You’ve been working hard on winning that dream contract all year, you know, that business tipping point, the one that will catapult you into the public eye, that brings the steady reliable income, that makes all those sleepless nights worthwhile. It’s success and on Friday, you’re all out celebrating, and rightly so!
Monday is the tipping point. Not the contract win the week before.
On Monday morning, everybody is back to it, doing exactly what they were doing the week before. Only more of it. And it’s the point at which that well known phrase, What got you here, won’t get you there applies in a business setting.
A tipping point is more than a busy patch
Every business goes through a busy patch when the way you work is under pressure. There’s too much coming in, not enough hands on deck, and everyone working flat out until the wave passes. You get through it with effort, goodwill and more than a little caffeine, and then afterwards things settle back down.
A tipping point is different. It is the moment the way you work stops being the right way to work. The wave doesn’t pass, because it isn’t a wave, it’s the new normal.
The distinction matters because the two require completely different responses.
A busy patch responds to effort. A tipping point responds only to redesign. And if you apply effort to a tipping point – which is what most business owners do, because effort is what got them here and effort has always worked before – you buy yourself a few months and burn everyone out in the process.
What a tipping point looks like
Of course, not all tipping points are positive. Sometimes it’s losing a big contract, discovering a new competitor or realising that the market conditions have changed around you.
The negative tipping points are easier to spot, because they hurt.
- You lose a major contract. The client is bought, or restructures, or simply goes elsewhere, and suddenly you’re waving goodbye to a third of your revenue.
- A new challenger appears. Someone arrives in your market doing a version of what you do cheaper, faster, or simply newer, and the conversations you used to win are now ones you have to fight for.
- A technological or regulatory disruption changes the terms. What you sell is no longer scarce, or no longer compliant, or no longer the way clients want to buy it.
They’re painful, but that pain has one huge advantage: it generates urgency. It gets people talking, creates an agenda item, a board discussion, sometimes a strategy day. You know something has happened, and you’re primed to do something about it.
Why good news is often the most dangerous
The success tipping points can be far more dangerous, precisely because they feel like a reward rather than a warning.
- You win a big new contract. Bigger than anything you’ve delivered before, with capacity demands, reporting requirements and compliance expectations to match.
- You cross a growth threshold. Somewhere between eight and twelve people, informal coordination quietly stops working. You can no longer run the business by everyone overhearing everything. Somewhere between twenty-five and thirty, you need a layer of management you have never had, made up of people you have never developed.
- You launch a new service offering, and discover it needs a different delivery model, a different sales conversation and a different kind of person from what you’re used to – and from how everything else is geared up to work.
- You change your target market – usually because you’ve finally admitted that the clients you started with either can’t afford what you’re now worth, or want work you no longer want to do. The trouble is, all that marketing, your website and probably your systems are still tied to your old ways and don’t fit with where you want to go now.
Nobody calls an away-day after good news. When a big contract lands, the instinct is to savour the moment, not interrogate it.
The challenge that rarely gets explored in the midst or the aftermath of the celebration is what does this mean for how we’re used to working – what do we need to do differently, and what do we have to stop doing altogether?
The silent tipping points
As well as those external tipping points, there are the internal ones too, even harder to spot but all too predictable from an outside perspective.
- The founder becomes a constraint on the business rather than its engine. Unwilling or unable to let go, progress is slowly stifled and important decisions get stuck or are left unmade.
- Unplanned departure. That key employee who quietly held everything together leaves. All the organisational knowledge and memory leaves with them and the team are left wondering why what used to work doesn’t anymore.
- Loyalty before reality. The senior team you built for a smaller business are stretched well beyond their capacity and often their comfort zones too. They’re no longer able to be brilliant at what you hired them to do, and loyalty means nobody will say it out loud.
The hard truth is that change arrives, whether or not you plan for it. These are tipping points every bit as significant as wins and losses – and almost never treated as such.
What it looks like from the inside
Picture the scene. A professional services consultancy has spent six years building a reputation with mid-sized clients and then wins a contract with a national organisation worth roughly twice their previous largest.
Their response is entirely sensible. They recruit four people, take on more space, put a reliable project tracker in place and everyone knuckles down and works hard. The client is happy – for a while. Not an uncommon scenario and one that I’ve seen play out more than once.
Then gradually things start shifting. Margins drift from healthy to marginal without anyone noticing. Two of their long-standing mid-sized clients leave quietly, because the responsiveness they had always valued has gone. And there are mutterings from their new customer as well, questions about whether the team are really up to it.
Two of the four new recruits have already moved on and another two of the existing team are restless, because ‘it’s just not as much fun as it used to be’. The founder goes back to working weekends in a delivery role they had supposedly stepped out of three years before, and is still involved in every decision of any consequence, because that’s how decisions have always been made and nobody’s changed it yet.
Nothing here is a failure of effort. Everyone is working extremely hard. What’s letting them down is the operating model: the informal decision-making that works beautifully at nine people and collapses at nineteen, the pricing built for a different scale of work, the founder sitting in the middle of every significant conversation. The new contract itself didn’t break the business. It just crystalised the problems of a way of working that had already been outgrown, and would have been exposed by the next thing if not this one.
From the business owner’s perspective, they had done everything right and it still went wrong. It’s just that “right” had changed definition and nobody spotted it.
Four questions worth asking
If you suspect you’re at one of these moments, four simple questions can surface issues quickly:
- What has changed about our business in the last twelve months that we have not changed our way of working to match?
- Are there decisions that still come to one person – a single point of failure – that shouldn’t?
- If our largest client left tomorrow, how long would it take us to notice in the bank account, and what would we do on day one?
- What are we still doing purely because we have always done it?
Don’t be surprised if the answers come slowly, or generate an uncomfortable silence. The important thing is to start the conversation and not let it catch you out at a time when you’re least able to cope with it.
What actually has to change
Once you accept that you are at a tipping point rather than in a busy patch, the work is more specific than ‘let’s review strategy’, and a bit more personal.
Where decisions get made. The single most common failure at a tipping point is that authority never moves. The business gets bigger, more complex and more demanding, and every judgement call still lands on the same desk. Growth without delegated decision-making doesn’t produce a bigger business; it produces a bottleneck that burns people out and dents results.
What you now say no to. Every tipping point makes something obsolete. A new market means old clients you stop chasing. A new service means an old one you might have to retire. Entrepreneurs are generally good at starting and terrible at stopping, and stopping is where the capacity most easily comes from.
Who owns what. Roles that grew organically around individuals need to be redrawn around the work. This is usually the conversation people most want to avoid, because it involves telling capable, loyal people that their job is changing. Sometimes, however, it comes as a pleasant surprise that what Joe always did for you, they’re quite happy to delegate to someone else and tackle a new challenge, you just never asked them!
What you charge. Pricing set for an old scale, market or version of your business is one of the quickest ways to grow revenue and lose money simultaneously. Understand how your costs and revenues are changing in the new world order and price accordingly.
The choice
The uncomfortable truth about tipping points is that you don’t get to decide whether your business changes. That happens anyway. The only thing squarely in your control is whether you rebuild deliberately, at a moment of your choosing, with the people you want to keep, or whether you carry on applying effort until something (or someone!) breaks and you rebuild in a crisis, with whoever is left.
What got you here really won’t get you there. That’s what the phrase really means. Not because you did anything wrong, but because “here” is a different place than it was, and it needs a different business.
At Perception Insights, we love working with businesses at (or ideally, just before!) their tipping points. If your business feels like it’s facing a choice, change or challenge, get in touch for a chat about how our strategy & leadership expertise might be able to help.
