Startup Lessons: Thinking About Growth

Growth is King. At any venture, big or small, growth drives the agenda. Failing to grow implies a loss in market opportunity and competitiveness, along with an inevitable end to profitability. 

A recent friend of mine gave me some perspective about the challenge of growth. In chatting, he identified the differences between how companies pursue growth, and the fundamental changes they have on the organization and its people.

There are mainly 2 approaches to growth that separate the winners from the losers. 

First, let’s talk about “mean-based growth“. In this approach you and your team look at the company’s capabilities and assess market demand in a strategic meeting. After a couple meetings, you define a target, let’s say 10% growth. Then this target is agreed upon and communicated to the entire company. Everyone in the company organizes their work and their priorities around hitting this 10% goal.

Here’s where the problem happens. This target becomes the new gold standard.  As a team you begin to think in the following way: “Well, our corporate goal is 10%. We’re on target to meet that growth rate, so we must be doing a good job.”  Your team’s output gets calibrated around a static goal. Your team becomes complacent about growth. Your team thinking gets ‘capped’ by this ‘justified ceiling’. Your organization may do well in the short run, but sooner or later your organization will have handicapped itself to deal with the aggressive of market uncertainty and competitive realities. When the going gets tough, steady growth will dry out and your team will not have trained itself for the rigorous and radical innovation that is necessary to sustain growth.

Then there’s the second approach. The “bottleneck” method. This one is less of way to organize work and more of a cultural mindset. In this approach, the team sets a ridiculously high bar, one that is almost impossible to achieve. Now your team ask themselves the simple question, “What is getting in our way from achieving X growth?”. You identify the biggest barriers to growth and tackle them, one at a time. You measure the results. And once a higher growth rate has been achieved, you ask yourselves the same question, setting a higher bar in the process. 

This approach represents a simple, yet radically different approach to growth. In this approach, you and your team relentlessly pursue continuous growth. You push yourselves to think about the most effective actions to be taken. In this approach, you and your team calibrate yourselves against a moving target, continuously raising the bar in the process. This keeps your team motivated. This keeps them productive. This keeps you and your team from becoming complacent about growth and settle for market standards of “satisfactory growth”.

Thinking about growth from a “what’s achievable based on where we are now?” leads to incremental growth tactics, such as product expansions or productivity gains. Tackling growth from a “removing barriers” approach, leads to innovative and forward thinking strategies; uncovering unsatisfied market needs and significantly lucrative commercial opportunities.

The differences in these mindsets come down to aspirations and tolerance for risk; and the ambitions of the leadership team. These values fuel the cultural DNA of the organization, defining the legacy to come. 


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