Does growth really matter?

Does growth really matter?

Growth for the sake of growth is not good. You need to have a purpose. You must be able to answer: “Why?” And of course an answer to “What?” is equally important. In spite of this I have come across many CEOs who have boldly stated to both shareholders and employees that the company needs a growth strategy. A growth strategy? I was of the opinion that all strategies included an element of growth so please answer ”Why?” and ”What?” before you make too bold statements.


Don’t get me wrong. In my company we have a ”growth strategy” as well (we work hard to triple our turnover in five years and quadruple our profits in the same period). But this didn’t start out as a ”growth strategy”. As a matter of fact we hadn’t grown for quite a few years and the financial crisis wasn’t the only reason. No, the real reason was that I didn’t see a need for growth so I had no answer to “Why?”. Of course there are some generic reasons to grow:


  1. You will be more profitable by spreading your overheads
  2. You will minimize your risk by having more customers
  3. You will attract larger (and more profitable) customers
  4. You will be able to hire better and more experienced people
  5. You will have greater purchasing power with your suppliers


But are these reasons sufficient? I don’t think so. I fully understand that they – if properly implemented – will lead to increased profits and to maximize their profits is the ultimate goal for most companies. But to me increased profits (or shareholder value) can never be the answer to “Why?”. Of course profits are important but they are the results of something else. And it’s this “something else” we work hard with and for our clients to figure out.


It starts with the mission and vision of the company (not seldom we need to have these rewritten so that they are more than high-flying platitudes) and a close look at the market. Or to put it short and simple: By understanding the real reason why the company exists we look at the market (including competitors) to identify our client’s strengths and weaknesses and the opportunities and threats they are facing (yes, a good ol’ SWOT analysis). This leads to an answer to “Why?” that goes way beyond the generic reasons mentioned above. And the good news is that we actually also find one or more answers to “What?” and even better: In most cases we can also answer the subsequent “How?”.


So if you are serious about growth (as opposed to wanting growth for the sake of growth) then you might want to take advantage of our GrowHowTM. In any case consider carefully the “Why?” and the “What?”. If you have clear answers to these questions then I suggest that you go for it because striving for growth changes the whole attitude of a business. It becomes much more outward looking and for that reason alone it is more likely to succeed.

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