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As the allure of rapid growth captivates entrepreneurs, the reality of scaling a business can come with significant hidden costs—most notably, employee burnout. A recent study from the International Business School in Jönköping has brought to light a concerning trend: 6 out of 10 employees in Swedish scaleup companies are experiencing burnout.
Key Insights from the Study
The research, spearheaded by Mohamed Genedy (Docotral Candidate) and based on data from 11.000 "newly registered companies" (see definition further down in this article), highlights several critical points:
- Prevalence of Burnout: 60% of employees in scaleups report burnout, characterized by persistent physical and mental fatigue.
- Symptoms and Impact: Burnout doesn't always lead to long-term sick leave but often manifests as chronic exhaustion, both physical and mental, which hampers personal and social life.
- Root Causes: A significant factor is the unforeseen increase in workload due to inadequate scaling plans. Entrepreneurs often fail to predict the real growth and its implications on their teams.
- Growth vs. Capacity: The discrepancy between actual and projected growth can lead to a workload that far exceeds the planned capacity, overwhelming employees.
- Training and Onboarding Issues: Rapid hiring to manage increased workload often results in inadequate training and onboarding, further straining existing employees who have to support new hires in addition to their increased responsibilities.
More about the study:
The data on which the study is based includes employees at newly registered companies in Sweden who participated in the “Swedish Work Environment Survey” (SWES), conducted by Statistics Sweden (SCB) in collaboration with the Swedish Work Environment Authority. The data was collected from 2005 to 2017.
In this context, "newly registered companies" refers to companies that were established less than 10 years before the data was collected. The study is based on data from private sector companies with at least five employees. The survey encompasses a total of 10,908 employees and 6,324 companies.
Five Strategies for Entrepreneurs to Prevent Burnout
To mitigate these challenges and foster a healthier work environment, us at The Scaling School recommend entrepreneurs to adopt the below strategies. We do understand that not all companies have the resources and possibilities to implement all, however selecting a few is still better than selecting none.
- Develop Comprehensive Scaling Plans:some text
- Conduct thorough analyses of potential growth scenarios.
- Create flexible plans that can accommodate unexpected increases in workload.
- Regularly review and adjust plans based on actual performance data.
- Implement Effective Onboarding Processes:some text
- Allocate time and resources for proper training of new hires.
- Ensure new employees are well-integrated into the team to minimize disruptions.
- Prioritize Employee Well-Being:some text
- Encourage a culture of open communication where employees feel comfortable discussing workload and stress.
- Offer mental health resources and support programs.
- Promote work-life balance through flexible working hours and regular breaks.
- Monitor Workload and Adjust Accordingly:some text
- Use tools to track employee workload and productivity.
- Adjust task assignments to prevent overload.
- Recognize signs of burnout early and take proactive measures.
- Invest in Scalable Infrastructure:some text
- Adopt technology solutions that can handle increased demand without overburdening staff.
- Ensure that business processes are efficient and scalable.
- Regularly assess and upgrade infrastructure to support growth.
How The Scaling School can help you work smarter – not harder
At The Scaling School, we provide a digital toolkit designed to help entrepreneurs work smarter to both scale their companies, but also to avoid severe problems such as burnouts. Our resources focus mainly on customer segmentation, organizational development, and roadmap planning to ensure sustainable growth. By prioritizing comprehensive planning and employee well-being, entrepreneurs can achieve success without sacrificing the health of their teams.