Growth strategies: What successful companies do and don’t do.
All companies have a growth strategy in one form or another however, the most successful companies have a clear set of dos and don’ts when achieving long term sustainable growth.
In this article we explore what the businesses that defy the odds, do to achieve growth during the ups and downs over 5, 10, 20 years.
Everyone knows the goal and shares the goal
One of the most important factors regardless of the growth strategy (organic, through diversification, efficiency drives, or M&A and partnerships).
Successful executive teams are aligned, with key functions in the business including sales, marketing, product, and customer experience sharing a common and focussed set of goals.
Planning how it will be delivered
Planning for how a growth initiative will be delivered is as important as the outcome itself. Most initiatives fail not because they lack merit but because of poor planning – not securing buy-in from stakeholders, poor communication and expectation setting, lack of resourcing and prioritisation inhibit positive outcomes.
Spotting rising costs
Rising costs will dampen the outcome of any growth initiative. The most effective growth strategies have warning triggers in place to detect when costs are about to rise. Accurate forecasting and contingency planning and a clear understanding of uncertainties and potential outcomes, will offset the risks of rising, unplanned costs. Companies with strong governance for evaluating initiatives periodically to keep a check on costs and are robust in shutting down non-performing initiatives, are far more likely to deliver growth.
Not being afraid to re-prioritise
Striking the balance between shutting down a poor performing growth initiative, and making sure promising projects aren’t killed prematurely can be challenging. However, with good planning, assumptions and criteria can be set to qualify whether the growth strategy is a good idea in the first place and if approved, clear indicators set to determine whether a project should continue, or resources be re-allocated to a higher preforming initiative.
Betting the house
Risk aversion by the leadership team can stifle growth. Especially when there is fear that micro and macro environmental factors will raise costs, and if there is a perception in the business that growth comes at the expense of hard-won efficiency gains. The companies most successful at sustaining growth categorise their growth initiatives and ensure that transformational projects are fully tested, funded and managed differently. Understanding the numbers from the investment required and predicted payback period and growth goal means that strategic decision can be made with confidence.
Clarity on the ideal customer
Having absolute clarity on customer acquisition is a common trait in successful growth initiatives. Being clear on the size, location, sector, demographic of your ideal customer steers the business towards the most suitable growth strategy and potential investment required and likely outcomes.
Not following the crowd
With the pressures on sales and marketing teams, following what the competition is doing in the pursuit of sales can result in vanilla tactics that fail to differentiate and have impact. Leveraging the company’s core strengths around innovation, service, knowledge and really understanding potential customers’ aspirations, often results in an effective growth strategy.
Some of the most successful companies we see, are the ones that study how their rivals operate and improve on this with more differentiated compelling marketing, better products and services and a more desirable customer experience.
Creating a frictionless experience
Customer journeys that are mapped from the outset across the functions of the business to create a frictionless, engaging experience are proven to increase satisfaction, revenue, and loyalty. Tech savvy customers increasingly expect a frictionless joined up experience as they move through the organisation. Companies investing in technology and data management to smooth transitions between marketing, sales and service, are the ones that are recording strong growth and retention against a backdrop of clunky, siloed experiences.
Superior data management
Businesses with internal growth strategies that promote excellence in data management, service customers better. Investing in technology that empowers sales and marketing teams with real time insights on customer behaviour, means you can be responsive and position a more compelling business case during the sales cycle. Once the customer is onboarded, collecting data on customer preferences helps service teams understand what they need and service them better.
These are just some of the considerations made by successful leadership teams when determining the path for growth and engaging their people and supply chains to deliver positive outcomes for their customers and the business.
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