Pain Points for Mid market companies.
The top challenges faced by mid-market companies in the United States are hiring employees, growing revenue, adhering to government regulation, issuing employee healthcare plans, increasing profit, disciplined financial planning and execution, managing and sustaining the “right growth”, attracting and retaining talent, budget constraints, and mobility security.
After an extensive search through industry reports, government databases, market studies, and other trusted media sites, we were able to compile a list of the top challenges faced by mid-market companies with employee strength between 100 to 1000. The key challenges were identified from pre-compiled lists that determined the pain points of mid-sized businesses, based on interview and survey responses from business owners, executives and senior managers. The “top” challenges were identified according to the ranking of each pain point.
1. Hiring Employees
According to a survey conducted by Wasp Barcode Technologies, 56% of business owners believe that hiring employees to maintain the rate of business expansion is a major concern. Mid-sized businesses (100+ employees) need a specialized workforce and skilled labor force to progress. It is also found that mid-sized companies are less flexible, leading to poor communication between different departments. This leads to the biggest business challenge of hiring the right employees to fill in the gaps of each business process.
2. Growing Revenue
The challenge of growing revenue is a key pain point for businesses of all sizes since the size of the business correlates with revenue strains. For mid-sized businesses with more than 100 employees, the focus is mainly laid on increasing the customer base, acquiring talent, and developing comprehensive solutions for loss management, rather than focusing primarily on increasing revenue. According to the Wasp Barcode Technologies survey, 43% of respondents believe that growing revenue is a major pain point.
3. Government Regulation
Government regulations are updated from time to time and businesses are expected to adhere to them. Most businesses feel the pressures of government regulations as they grow larger. According to the Wasp Barcode Technologies survey, 36% of respondents believe that fulfilling regulatory requirements can be daunting. Many business owners state that government regulations can be unfair to small and medium-sized companies since most regulations allow the larger organizations to “destabilize local markets”, causing further problems for smaller companies.
4. Employee Healthcare
In the United States, it is a basic requirement for companies to provide their employees with a healthcare plan. For mid-sized businesses, issuing and managing the right healthcare plan is a pain point that 32% of respondents from the Wasp Barcode Technology survey believe. For companies with many employees (100 to 1000), it can become a strenuous and challenging task to keep tabs on compliance. Companies will also have to take the rising healthcare costs into consideration, which pose more problems in extending the existing budget that has been allocated to employee healthcare plans.
5. Increasing Profit
31% of business owners, executives, and senior managers (Wasp Barcode Technology survey) state that increasing the profit of their business is another important pain point. Mid-sized organizations tend to focus on achieving stability and increasing their customer base in order to drive profits at a more steady pace. Many organizations are “sales-oriented”, where employees focus on promotion and are rewarded based on the sales goals instead of focusing on profit goals.
6. Disciplined Financial Planning and Execution
According to the insights from Oliver Wight principals, disciplined financial planning and execution is a key challenge that is faced by mid-sized businesses across the country. Most organizations develop forecasts and operating plans based on marketing, research and development, sales, supply chain, and various other functional areas. This results in the finance department of the business to develop and include their own forecast into the plans, which ultimately produces unreliable outcomes. In order for organizations to overcome this challenge, they would need to develop an “Integrated Business Planning process” that will take every aspect into consideration and allow for a smooth financial planning and execution approach.
7. Managing and Sustaining the “Right Growth”
Many mid-sized companies face problems when they do not have the right ratio of ‘projects to the number of employees’ and when they do not prioritize their projects. This, in turn, leads to resources being shifted and re-shifted, causing further delay in the completion of their projects. Thus, managing and sustaining the right growth of the company is a major concern. The problem can be controlled by providing visibility for a fixed period (example — 24 months) that will enable the business to predict and prevent problems in advance.
8. Attracting and Retaining Talent
When unemployment rates are low, attracting and retaining talent force can be quite a challenge. Business owners of mid-sized companies, and startups, are so focused on increasing their customer base and driving innovation that most times they neglect the development of a “structured business management plan”. In order for businesses to ensure its growth in attracting and retaining talent, professional management processes such as IBP (Integrated Business Planning) should be adopted.
9. Budget Constraints
Budget constraints is another key challenge faced by medium-sized businesses. For mid-sized companies, investing slightly more in a specific area can mean cutting back in another. This increases the importance of prioritizing their need for spending, for example — prioritizing tech spend can include aspects like investing in financial software, productivity software, CRM systems, and security systems.
10. Mobility Security
Business owners have admitted that mobility security is another major concern for mid-sized companies. Technology services and security systems are found to be the top priority for mid-sized IT businesses. According to Bright Ideas, a survey revealed that 83% of SMEs (Small and Medium Enterprises) do not have a proper security plan.
To wrap up, we have identified ten key challenges that mid-market companies face in the United States. The pain points are hiring employees, growing revenue, government regulation, employee healthcare, increasing profit, disciplined financial planning and execution, managing and sustaining the right growth, attracting and retaining talent, budget constraints, and mobility security.