A limiting factor is any aspect of an operation that fundamentally limits its ability to sustainably grow.
For example, if you’re managing the progress of all of your projects in your head, your limiting factor is your memory which probably isn’t perfect if you’re like most people.
If you’re earning an active income whereby compensation is based off of the time you spend working, then your limiting factors are time & the market value of your skills.
If you’re trying to grow a business in a ripe market with one sales rep, then your limiting factor is the your ability to facilitate sales.
Trying to scale and produce more than what your limiting factors allow for is a threat to any individual or team’s sanity, which is why it’s important to invest time in identifying & upgrading limiting factors.
Instead of trying to track everything in your head, build a project management system that will remember things better than you.
Instead of doubling up your work hours, invest in skills with higher market values, build your first passive income stream, or strategically expand your team to distribute labor & increase earning potential.
Instead of overloading your sales rep with more leads than they can handle, invest in hiring and training additional sales reps or find creative ways to use software to effectively facilitate sales representation.
The hard part about upgrading limiting factors is that it requires hitting pause on you and your team’s routines & investing significant time and energy into rethinking and reimplementing how you work for the better.
It’s a hefty upfront cost with a return-on-investment that is only realized over time.
If you’re able to go through the exercise of upgrading your limiting factors though, the benefit is two-fold and well-worth it: you get more effective operations and, perhaps most important, room to breathe and a renewed sense of sanity to ensure that you and your team are able to continue doing the work you believe in.