Be the CEO, not the person everyone likes. 4 rules for company growth during wartime

The Ukrainian IT sector was up-and-coming before the full-scale invasion of Russia. In 2021, 285,000 people worked there, bringing $6.9 billion in export revenue to the country's economy. The industry has seen a whopping 38% growth compared to 2020.

Many IT companies started the scaling process thanks to the good conditions that prevailed until February 24. However, the relocation of workers, shelling across the country, and uncontrollable blackouts have halted this process. That is why I decided to share my rules that I have formed during scaling process, which can help my colleagues in this situation.

Rule 1: For small companies, every crisis is an opportunity for growth

I run an IT outsourcing company. This is a standardized business in which there is no need to invent something new and build a unique model from scratch. Instead, you use a ready-made "scheme," which you just need to tweak and add a few things that will distinguish you from the competition.

We have two main departments - sales and recruiting. Each uses several ways to hire a specialist or conclude a deal. It can be LinkedIn, Clutch, Upwork, referral system. The job of the business model is to connect the people who work on your team with the customers who need your developers.

As long as you're a small company and don't have a huge staff, every crisis will be an opportunity for you. Analyze those who succeed in raking, see what exactly they do to do it and implement it for yourself. Something will take root and give results, something, on the contrary, will not work, but it is worth trying.

Rule 2. Learn to count correctly because financial accounting is the key to understanding the vector of business development

This is a standard way in Ukrainian business to work chaotically and impulsively. Because most people do not know how to conduct it correctly. I remember when I recruited 60 employees and could no longer hire people at a certain point.

I didn't understand what the problem was. Moreover, I could not analyze the financial indicators and find out how much we spend on salaries for developers and what needs to be changed so that they want to work for us.

Then I decided to hire a financier to systematize all reports and keep records. Business people I know even mocked a little, and asked why I was doing it. Why should anyone know how much we earn? Now I remember it with a smile because my decision did produce results.

To understand the profitability of a business, you need a Profit and Loss Report. This is the standard European form that all companies keep; it is the balance sheet of profit and loss. First, you evaluate the overall picture and compare it with market benchmarks. Next, use the P&L for specific projects and see what makes money and what is not worth spending time on.

When we tallied up all the reporting for the last six months, we saw that we outsource a lot of effort, although outstaffing brings more profit. It's also a great exercise to estimate your company is worth if you go out of business.

Rule 3: Be the CEO, not the person who helps everyone

I used to be proud of the fact that I lead every project. My working day consisted entirely of operational tasks: calls, meetings, something needs to be fixed, someone needs to be told. I thought of myself as a genius who managed everything and could handle any task. Maybe it was, but we began to skid in place.

To overcome the new crisis, I needed to become a director who dealt with strategy, not operational routine. I called a talented project manager on the team and told him, "Look, I'm dealing with nonsense that you can handle better." With this simple step, scaling began.

The organizational structure of Hubbard, the founder of the Church of Scientology, helped to ensure that each department worked efficiently and understood what and why it was doing. In one universal scheme, it depicts all the functions necessary company's successful operation.

At first Digis had only traditional departments: development, recruiting and sales. I didn't even think about the PR or training department. But when I started working on Hubbard's structure, I realized that they are very necessary. So we have not only these directions, but also the quality control department. He makes sure that the employee focuses not only on the amount of work done, but also on its quality.

How does it work? For example, the audit department creates standards for the sales manager, which indicate that this specialist must talk to the client in a white shirt against a plain background and make a two-minute presentation. Sales passes the test and gets a score of, say, 70 out of 100. Then the training department comes in and trains the salesperson to do his job even better.

Rule 4. Employees should clearly know their goals

Achieving results is only possible with people. You have to build the most flexible and self-motivated team that wants to survive in any conditions. How to do it?

• draw up a strategic plan for the company's work. It will help you clearly understand where you want to be in a year, two or five years;
• discuss the plan with the team. Each employee must understand where you are going, why and what role he plays in this;
• constantly think about risks and ways to minimize them. "What if…?" — this phrase should constantly be spinning in your head.

If the financial capabilities of the business do not allow expanding the staff and hiring new specialists, develop your own. To do this, clearly assign roles and define:

• who is responsible for what?
• how is it measured?
• what is the motivation

For example, sales sells four developers to client projects per month. Analyze the market benchmarks and find out if he can sell the services of not four, but six specialists in the next 30 days. Also, establish a clear motivation so that the employee understands what he will get for achieving the new KPI.

Digis had such a case: we cut wages by 30%, but put 45% in bonuses. Employees had to perform their work well and on time to get it. The team understood the motivation and moved towards the company's beneficial indicators.

Finally, an important tip: there will always be people among your employees who will not like any innovations. If you have doubts about a specialist and return to them repeatedly for several months, refuse to cooperate with him. Only those who are already motivated should be motivated.

Nick Nagatkin, the founder of the IT company "Digis", member of the 30 Under 30 – Europe – Technology 2022 list