Good Strategy - Good Growth

Max McKeown, in his 2011 publication The Strategy Book, states "strategy is about shaping the future" and is the human attempt to get to "desirable ends with available means".

It would be tough to argue that growth is not a "desirable end" for most any organization. Seems pretty simple - use the available means to create growth. Maybe the challenge comes in the first portion of the quote from McKeown, that "strategy is about shaping the future". So how does one discern what means are available in the future to create growth?


I will offer up a place to start. When I am looking for growth, I often like to explore the intersection of three key dimensions: 

•          core competencies, 

•          technology dynamics, and 

•          demographic/psychographic dynamics.

Apple’s growth break out, the iPod, is a great example. Apple understood one of their key core competencies – an intuitive user experience, saw how broadband adoption would greatly reduce download times, and recognized the demographic interest in an easily available portfolio of my favorite music went way beyond the early millennials accessing Napster. A number of other success factors were critical (scooping SoundJam's “exchange platform” built to connect disparate music sources with millions of fans was brilliant), but the opportunity is revealed by the three dimensions of core competencies, technology dynamics, and demographic/psychographic dynamics.

AT&T developed a new growth vector by leveraging their core competencies in moving vast amounts of data, the “new” benefits of cloud storage, and the burgeoning healthcare needs of our aging population. They created a highly secure vendor neutral cloud based medical imaging solution. Looking back from today’s armchair this seems all very logical. Years ago, when the concept was being developed, I am sure there were a variety of opinions on it’s merit.

Clearly, this strategic approach is not the only way to find growth opportunities. The point is that good solid strategy can create good growth, and we can all use a good dose of that.

My next blog will focus on a simple approach to move from a long list of early growth concepts, to the few that deserve your attention and resources.

In the meantime, drop me a comment and let me know your thoughts on how good strategy creates good growth.

Let's create some growth!

John

Growth Is Freedom: 5 Reasons Why

This is my inaugural blog, and it should set the stage for where this vehicle will take us together. Regardless of the roads we travel, our destination is growth. See, I'm a growth guy. Creating growth is what I love to do, and I believe it is essential in today's business world.

 In fact, I think Growth Is Freedom, and here's five reasons why:

1. Growth Creates Smiles: almost everywhere you look. Get growth going and look at the faces of your employees - they're happy, and happy employees are productive employees. Check out your customers as well. They are smiling because growth funds new value you can deliver to them. Your partners are happy because they're enjoying additional pull through activity. Investors are happy because all of their "ratios" are better. Growth is fun!
2. Growth Is Like A Flywheel: that puts positive momentum on revenue. Growth is great fodder for marketing...press releases on new deals, testimonials from new customers, articles on new value you deliver, constructive comments on social media, new references. And, there is nothing like growth to get the sales organization grinding out every deal. So spin it up!
3. Growth Lowers The Cost Structure: through-out the P&L. Growth delivers way more than the top line. It has positive impacts on supply chain, lowering variable costs and cost of goods sold. It can increase resource utilization, dropping cost of service. It spreads fixed costs out across more revenue, improving gross margins and the R&D and SG&A percentages. All of this improves the bottom line. Sure, sales comp goes up - but's thats a "good cost!"
4. Growth Opens Doors: and generates new opportunities. Some growth requires re-positioning existing offers, creating new value props, or accessing new segments. These moves increase your addressable market, provide virgin market to go after, and present great cross sell opportunity. So open some doors and grow!
5. Growth Puts You On Offense: and that's way better than being on defense. Growth in the base strengthens your foundation and increases switching costs. Conquest gets the competition looking in the rearview mirror, wondering where you're going to strike next. Protecting their base saps their resources and reduces the energy they can invest in growth. Conquest is great growth!

Growth Is Freedom. It covers for the business anomalies that come out of the blue. It opens up those requisitions that have been on hold. It provides you the funds to invest in improved customer sat and generates the cash needed to make that next acquisition. It lifts employee morale and productivity. It scares your competition and increases your valuation. Get going...get growing!

Looking forward, we'll focus in on how to create growth under different business scenarios. Perhaps the challenge is to re-invent within a stalled market, or it may be to create totally new growth. These are very different challenges that require different approaches. Growth Is Freedom regardless of the business scenario.

Drop me a comment and let me know how growth provides your organization freedom.

Let's create some growth!

John