I recently provided my comments in James Careless’ article “When to Expand Your Firm, When to Outsource” in CBA Practicelink magazine. I said that “growth is only something to be looking at if it’s going to achieve particular strategic goals such as increasing profitability”. I have found that many firms set a growth goal for their firm without considering which practice or industry areas they should focus on growing in order to optimize the firm’s overall profitability.
The first step all firms should take before growing is to prioritize the strategic goals which will help them achieve their overall vision. Growth is just one of several strategic goals or strategies that firms might undertake in order to achieve their vision. If increasing profitability is a strategic goal, as an example, then growth might be one of the tactics your firm may take to achieve that goal. Then the question is where to grow and how to grow. Is the growth need permanent or temporary? In some cases, you can grow your firm’s capabilities and strength in certain practice areas such as personal injury by using outsourcing providers or freelancers. Often your costs can be significantly lower by using outsourcing providers and you risk less capital if the work is transitory but the opportunity is too good to pass up.
