If your business is in a hot sector, it may be all you can do just to keep up with growth. For the majority of businesses however, the search for growth involves persistent hard work, whether it's preparing to open another store or office, or simply energizing the sales force to find new customers.
But whether your growth is explosive or fought for dollar by dollar, it is almost inevitable that somewhere along the line growth will stall. Even the mighty come unstuck. McDonald’s has struggled to reignite growth after saturating the market with outlets and seeing customers turn their backs on the Big Mac in search of healthier alternatives. Digital photography has had a devastating impact on giants like Kodak as well as many small businesses involved in film processing.
In today’s rapidly changing business world, the odds that an upstart new competitor, a new technology or a shift in customer preferences will wreak havoc with your growth plans get shorter every day. When that happens, you’ll need a growth story. A growth story tells how your business will achieve growth not just by selling “more of the same” but instead by being able to identify and exploit new growth opportunities. A growth story engages investors, employees, customers and suppliers, inspiring them with the belief that you have a plan and the capabilities to reach the next level.
So what does a growth story comprise? At its heart a growth story needs the following four elements: a growth strategy, growth targets, growth culture and growth process.
A GROWTH STRATEGY
A growth strategy defines how you intend to achieve growth. A growth strategy should comprise two elements — core growth and new growth. Core growth is about achieving “more of the same” – selling more to the same customers or selling the same products or services to new customers. Core growth might involve adding new retail outlets, opening a new law office in another city, increasing telesales activity or offering discounts to encourage bulk purchases.
New growth is about identifying new revenue opportunities beyond your current market and product focus, recognizing that core growth will at some point experience gradual — or, in some cases, dramatic — decline. At its simplest, new growth involves enhancing or extending your product or service portfolio to meet unmet needs of existing customers, as well as new markets or customer segments.
For example, New York–based Intralinks Inc. (http://www.intralinks.com/) provides virtual workspace solutions that enable organizations to collaborate on projects or transactions. Intralinks was initially created just to serve the needs of the loan syndication market but subsequently recognized how it could adapt its offerings to address the needs of the alternative investments, life sciences and M&A sectors.
In another example, hotel developers Ira Drukier and Richard Born are targeting cost-conscious young backpackers and Europeans with their refurbishment of the East Side Pickwick Arms Hotel, which will feature bunk beds and shared bathrooms — quite a departure from the Mercer Hotel, one of their other New York properties.
There are numerous other ways of enhancing or extending your product or service portfoli
Adding or removing product features. Sony created a whole new product category when it removed the recording mechanism from tape recorders to create a lighter, portable cassette player, the Walkman.
Changing elements of your customer care or after-sales service. In many industries, such as banking and telecom, customers have shown a willingness and preference for self-service, Web-based customer care.
Using alternative delivery channels. If you provide published content, consider creating audio versions such as podcasts that customers can listen to while commuting or exercising.
Changing the pricing model. For example, you could switch from an annual license fee for software to a pay-as-you-go pricing scheme.
Repackaging your expertise. New York–based Forty Weeks started out as a retailer of maternity products but now provides trendwatching and consultancy services for maternity goods producers and gives insights and content to the media covering maternity matters.
Targeting new markets may be as simple as targeting different industry sectors from your current customer base or entering new geographic markets. But often it’s about better segmentation of your existing customer base, recognizing that “one size fits all” is a fallacy and adapting your offerings to different segments of your customer base. For example, if you are a retailer of high-fashion clothing, luxury goods or gourmet foods, have you considered personal shoppers, special events such as fashion shows or tastings, in-home sales visits, or “out-of-hours” private store openings?
The old adage that what gets measured gets done undoubtedly applies to your growth story.
Examples of growth targets:
• Generating 10% of annual revenues from new products or