Operational Scalability: Bob Marshall of Wells Fargo On How To Set Up Systems, Procedures, And…

Posted on

Operational Scalability: Bob Marshall of Wells Fargo On How To Set Up Systems, Procedures, And People To Prepare A Business To Scale

Build a strong network: Running a small business is no small feat, and having a strong support system in place can make the difference between thriving and failing. Take time to establish relationships and build a network of other professionals who can help you. In addition to a business banker, you should also establish a relationship with a lawyer, a CPA and any other professionals pertinent to your industry. It’s also a great idea to network with other small businesses by joining your local Chamber, or other business and industry organizations.

In today’s fast-paced business environment, scalability is not just a buzzword; it’s a necessity. Entrepreneurs often get trapped in the daily grind of running their businesses, neglecting to put in place the systems, procedures, and people needed for sustainable growth. Without this foundation, companies hit bottlenecks, suffer inefficiencies, and face the risk of stalling or failing. This series aims to delve deep into the intricacies of operational scalability. How do you set up a framework that can adapt to growing customer demands? What are the crucial procedures that can streamline business operations? How do you build a team that can take on increasing responsibilities while maintaining a high standard of performance?

In this interview series, we are talking to CEOs, Founders, Operations Managers Consultants, Academics, Tech leaders & HR professionals, who share lessons from their experience about “How To Set Up Systems, Procedures, And People To Prepare A Business To Scale”. As part of this series, we had the pleasure of interviewing Bob Marshall, head of Business Growth & Strategy, Wells Fargo.

Bob Marshall is the Business Growth Strategy Executive with Wells Fargo Bank for the Small Business Development Group. He is responsible for leading a team of Business Development and Healthcare Leaders across the footprint that is charged with acquiring new customers with sales ranging from $1 — $10 million. Prior to his current role, Mr. Marshall has held several banking management positions including Area Business Banking Manager (for Northern Virginia, Washington, D.C. and Maryland), Community Bank Executive for the Wholesale Banking Group (Wachovia Bank, NA), Corporate Retail Sales & Service Strategy Team Leader, and Corporate Retail Bank Sales Strategy Leader.

Prior to joining Wachovia Bank, he held various roles within financial services and commercial finance. Mr. Marshall began his banking career in the Management Development Program at Nat West Bank, NA.

Thank you so much for your time! I know that you are a very busy person. Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?

Absolutely, I began my career in financial services as an external auditor with a commercial finance company. We provided accounts receivable financing to small and medium-sized businesses. I learned pretty quickly the importance of building relationships with business owners, bookkeepers/CFOs, accounts receivable specialist, stock managers, and inventory specialists. Looking back, the most important relationships were those developed with employees within the firms in my portfolio. Those employees who were closest to their goods, the customers, and our assets. After two very productive years as a commercial auditor, I joined Nat West Bank as a management trainee. That experience provided me an opportunity to get to know how financial institutions operate and set me on a path to continue my support for small and medium-sized businesses throughout my career.

It has been said that our mistakes can be our greatest teachers. Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?

That is a great question. During my management training program, we were afforded the opportunity to attend a session hosted by a very senior leader within Human Resources. Her session was engaging, thought-provoking, and packed with valuable information. Typically, in sessions like this I take copious notes. When I am concentrating and focused, I have a very intense look. As the cohort had been together for a few months, the facilitators in the class learned each of our habits, so they read my actions as me being thoroughly engaged. The next day, the facilitators pulled me aside to tell me that the executive thought that I was angry at something she said and that I was focused on something else. I shared my pages of notes and comments with the facilitators. They assured me that they had straightened the situation out and we even laughed about it. It was probably more ironic than funny, but I learned two valuable lessons. The first is that I will meet people that don’t know me and that my actions leave an impression (whether correct or not). The second lesson was that as a leader, I would assume positive intent when engaging with my team or others. I won’t know their stories and having context before making a lasting impression would be critical.

What do you think makes your company stand out? Can you share a story?

Two things make our company stand out. The first is undoubtedly our people. It is refreshing to work beside so many colleagues who care about our customers. We all understand that the customer is our “raison detre” (reason for being). The second is our commitment to the community. Evidenced by our work on ecosystems critical to enable our citizens to have fruitful and productive lives. I am fortunate to serve as a board member of the DC Jazz Festival. Like with many other industries, the pandemic proved to hit jazz musicians (and others) hard. Due to various circumstances, many did not know that they too had resources available to them to assist in those difficult times. The CEO of DC Jazz Festival along with two other board members met with me to discuss the situation. After months of planning and support from Wells Fargo, we kicked of a series of workshops entitled “musicians are business owner too”. This program brings musicians together to improve their personal and business financial acumen. This past Labor Day, during the festival, I had the opportunity to observe a session in progress. The discussion was raw, real, and impactful. I walked away knowing that this idea came to fruition because we believe that in order for all to succeed, we must provide the technical and financial assistance needed.

You are a successful business leader. Which three-character traits do you think were most instrumental to your success? Can you please share a story or example for each?

The three Character traits that are critical to any leader’s success are authenticity, integrity, and adaptability. Authenticity is critical because you must have the ability to embrace others, build trust, and work horizontally and vertically within an organization. Our business is a people business. Employees don’t follow people they can’t connect with or relate to. Integrity is critical because they must know that you are forthright and that you are a person of your word. People will view your leadership as a sum total of their interactions with you and the decisions you made. If you appear uncertain or wishy-washy, people will feel it. Lastly, adaptability is important because we live in an ever-changing environment. The ability to adapt, embrace change, and assist others in navigating in your environment plays an integral role in your success as a leader.

One of the assignments during my tenure here involved rebuilding and re-energizing a team. As I assessed what it would take to begin my mission, I met with everyone who worked within the organization. I learned about them as individuals, their families, their stories, and what was top of mind for them as individuals. This provided each person to get to know me, ask me questions, provide me insight, and set the foundation for building trust. As we came together as a team, we were deliberate about communicating by various means and creating a mission and purpose. We kept things simple from a priority perspective (3 things). Everyone can remember and embrace “3 things”. As we moved through building a dynamic team, people believed in our mission and purpose. They trusted my word and were willing to go above and beyond. As we built the team, change was inevitable. We were deliberate and transparent. This created the space necessary to lead through change while continuing to progress towards our goal.

A leader cannot be successful without followers. A leader cannot be successful without being able to listen or follow others. These characteristics provide the necessary platform for a leader to be human and humble.

Leadership often entails making difficult decisions or hard choices between two apparently good paths. Can you share a story with us about a hard decision or choice you had to make as a leader? I’m curious to understand how these challenges have shaped your leadership.

This question brings back fond memories of a leadership role I was fortunate to have during my senior year in college. Towards the end of the second semester, I had to recommend my eligible staff members for positions or promotions for the upcoming fall semester. The process afforded me the opportunity to assess the team, provide commentary on their performance, and recommend next opportunities. Unfortunately, I had to recommend that we not offer the position to one member of my team in the fall. As a young leader, this was incredibly impactful to me. I believed that I was making the right decision, that the decision was not a surprise to that individual, and that I had a number of conversations with the person and my boss throughout the year. This taught me the importance of feedback, communication, and follow up. This taught me the importance of making decisions based on data and fact, not feelings. This taught me that leadership decisions were complex and did impact people.

Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?

My favorite life lesson quote comes from an excerpt from a speech of Dr. Martin Luther King:

If a man is called to be a street sweeper, he should sweep streets even as a Michelangelo painted, or Beethoven composed music or Shakespeare wrote poetry. He should sweep streets so well that all the hosts of heaven and earth will pause to say, ‘Here lived a great street sweeper who did his job well. — Martin Luther King Jr.

This excerpt has always spoke volumes to me. From an early age it inspired me to ensure that I did everything to the best of my ability and to strive for excellence. Whether I was pursuing academic pursuits, working in my first job as a store clerk at Sam Krasdales in my community, or serving on boards today. We must strive for greatness in whatever we do.

Thank you for all that. Let’s now turn to the main focus of our discussion about Operational Scalability.

Throughout my 25 year tenure at Wells Fargo, I’ve worked with many small business owners, and one of my strongest takeaways is how small l businesses are the heartbeat of our communities. They pump life into our neighborhoods, creating vibrant places to live, work, and raise families — and they are crucial to sustaining millions of local jobs. So when I think about operational scalability, for me, it really hits home as being the right opportunity — for the right kinds of businesses — to expand their footprint and impact within the communities in which they operate.

Operational scalability means that a business is growing and profitable with increased demand for products and services. It can also mean the business is growing by adding new customers or based on average revenue from current customers. Sometimes, scaling can mean narrowing in on what works and expanding part of the company. There isn’t a one size fits all definition for operational scalability nor one common path on how a company scales. It is very dependent on the business journey.

Which types of businesses can most benefit from investing in Operational Scalability?

As an entrepreneur there are two routes you can take: either create a service-based business where you trade your skill or knowledge for money or create a product-based business where you sell products to people. Those businesses that offer a service typically take less money to start and have a smaller upside in regard to scale. The businesses where products are sold typically take more money to start but have more upside with respect to scale and repeatability — you can design one product and sell it thousands of times.

Both types of business can be very profitable, and there are millions of product-based and service-based companies around the world. However, the money you can make selling a product may outweigh the amount you can make selling a service because of scalability and the intent to eventually sell that business.

A tell-tale sign that a business can benefit from operational scalability is when it is meeting and exceeding sales targets.

Why is it so important for a business to invest time, energy, and resources into Operational Scalability?

Scaling is critical because sustainable growth can mitigate things that can go wrong when you’ve started a business. If you have people who have invested in your business, those investors ultimately want to know that if they are committing time and/or capital to it, it has a reasonable probability of growing very quickly over a very long period of time. Whether a small business can achieve sustained growth is really the difference between failure, modest success, and lasting profitable development. When companies scale, it means they are adding revenue faster than they’re accruing new costs, which is why it’s so important.

Can you please share a story from your experience about how a business grew dramatically when they worked on their Operational Scalability?

I am inspired by so many of the small business owners I’ve worked with over the years who’ve successfully scaled their business. Each one has taught me something different about what it means not just to dream, but to follow through on the courage of their convictions, to be resilient and to be optimistic.

One business that jumps to mind is Pioneer Linens, a 4th generation family-owned business that been in operation for over 100 years. It opened in Florida in 1912 as a hardware store — Pioneer Hardware — selling just what pioneers would need, s like dynamite to blow-up tree stumps, kerosene lanterns for light, and hammers and nails to build houses. In 1920, it scaled up, expanded its product offerings and evolved to become Pioneer Hardware and Furniture, selling goods like furniture, dishes and stoves. That store was destroyed during a hurricane in 1928; it reopened in 1930 in the more busting town of West Palm Beach as a general home goods store. Over the decades, the store continued to adapt and scale. Today, Pioneer Linens has earned the “Specialty Store of the Year” status by the National Bed and Bath Association representing 2400 stores.

Here is the primary question of our discussion. Based on your experience and success, what are the “Five Most Important Things A Business Leader Should Do To Set Up Systems, Procedures, And People To Prepare A Business To Scale”? If you can, please share a story or an example for each.

1 . Start with a business plan to assess its scalability: Not every business is scalable. The first and sometimes most challenging step is to objectively determine the scalability of your business. Creating a solid business plan will help set your business up for success, and in the process, offer a viable assessment of its scalability. Big picture, the business plan establishes the company’s mission, goals and objectives, and competitive analysis, and it serves as an important communication tool for potential investors and lenders. It will allow you to articulate your current financial status, any sources of revenue, and how you plan to meet revenue projections. Your business plan should explain what your product or service is and why people and businesses will want to purchase it. Be sure to highlight areas where your product or service has a clear advantage over the competition.

2. Manage your cash flow: Unexpected expenses will occur even for established businesses. Keeping a rainy day fund with three to six months of basic operating expenses in a reserve can prepare you for slow periods and emergencies. One important tool for planning ahead is a cash flow forecast — usually a one-year prediction of how cash will move in and out of the business. This helps business owners evaluate how profitable future sales will be and provides an overview of what needs to be done to reach their goals.

3. Invest in growth and don’t be afraid of loans: While most small businesses are initially financed by personal savings or credit, your business will likely face a need for additional financing at some point, especially if you’re looking to scale and grow your business. As a first step, I’d recommend meeting with a Business Banker who can help review financing needs, and options, and work with you to strategize ways to build your credit profile.

4. Determine your hiring needs: Many businesses start out as sole proprietorships, while others require support staff and employees from the get-go. If you intend to hire full- or part-time employees right away, make sure you’re comfortable with and can afford the costs associated with hiring staff. Take time to understand what type of employee is right for your business. For example, contractors can be a great alternative to full-time employees for newly established businesses.

5. Build a strong network: Running a small business is no small feat, and having a strong support system in place can make the difference between thriving and failing. Take time to establish relationships and build a network of other professionals who can help you. In addition to a business banker, you should also establish a relationship with a lawyer, a CPA and any other professionals pertinent to your industry. It’s also a great idea to network with other small businesses by joining your local Chamber, or other business and industry organizations.

What are some common misconceptions businesses have about scaling? Can you please explain?

Scaling a business and experiencing rapid financial growth is a great thing, right? Yes, but….

A common misconception I’ve observed is a failure to appreciate how rapid financial growth is a double-edged sword. When a business is smaller, it’s easier to monitor cash flow and expenses and how they’re measuring up to sales. Ironically, as a business scales, it can be easy to get to a place where your monthly expenses exceed your operating capital. Fortunately, spending less than an hour each month on a cash flow projection can help you identify potential cash shortfalls in the months ahead.

How do you keep your team motivated during periods of rapid growth or change?

Scaling a business can mean a shift in responsibilities for employees, new co-workers, and some degree of uncertainty about how roles will change. As the manager/leader of the business, there will be more on your plate, added stressors, and less time for the day-to-day interactions with your employees.

While scaling a business is critical to its growth and long-term sustainability, it can also be an alienating process for employees. Be intentional about staying engaged with your team and communicate the ways in which everyone can benefit from a business expansion so they feel part of the process. Even if you can’t have the more casual, frequent interactions with you employees, schedule regular 1:1 catch-ups. Arrange a quarterly “retreat,” or outing, even something as simple as a group dinner can help your team feel engaged.

You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger.

This is truly such a profound question because all of us have tremendous influence within our personal ecosystems. For me, I attempt to serve the community by engaging with non-profits that feed my passions (education, the arts, social services). As a board member of the DC Jazz Festival, we are collaborating with musicians to help them gain the small business literacy they need to be successful entrepreneurs because musicians are small business owners too. As a board member of Building Hope, we support the organization’s efforts to provide financial and technical support to Charter School boards and administrators, so they can have the resources they need to provide school choices to communities that need it most. The movement I would start would undoubtedly be linked to personal and business financial literacy. Personal financial literacy helps create a sense of wholeness and wellness for a person. Small business financial literacy is critical because businesses are the lifeblood of our communities. They collectively are our country’s largest employer and are literally the heartbeat of our economy.

This was great, thank you so much for sharing your story and doing this with us. We wish you continued success!

Operational Scalability: Bob Marshall of Wells Fargo On How To Set Up Systems, Procedures, And… was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.