10 Tips For Leaders To Improve Growth Results
By Kelly Lawrence, Founder & CEO, Lawrence Innovation
Introduction
Today's business leaders face an immense challenge – the relentless demand for growth while managing the existing business. Leaders are accountable to their companies, boards of directors, employees, and customers, all interconnected within the broader economy. The average tenure of C-suite leaders in Fortune 500 companies is just 4.6 years, adding urgency to making a significant impact in a short time. Compounding this pressure, Forbes reports that 8 out of every 10 businesses fail, while Booz & Company notes that 66% of new products fail within the first two years. In this environment, understanding and leveraging innovation is critical for sustainable growth. Below are 10 tips to help leaders improve growth results without sacrificing the existing business.
1. Focus on Organic Growth
Organic growth should be the foundation of your strategy. This involves expanding your business by increasing output, customer base, and sales without relying on mergers and acquisitions. Every product has a life cycle. If you’re running a successful business, chances are you have at least one offer that has hit mainstream market adoption. Things are good so it man be difficult to establish a sense of urgency to invest in new initiatives. However, this is the best time to invest a portion of cash into new organic growth initiatives that can progress from new market to mainstream.
Investing in your people, refining your processes, and enhancing your products or services are essential for sustainable, internal growth. You may need to explore adjacent markets, build or integrate new technologies, and/or develop new product or service solutions.
2. Define What Success Looks Like
Setting clear, measurable goals is crucial for tracking progress and ensuring organizational alignment. Success should be defined not only in financial terms but also through metrics reflecting customer satisfaction, market share, and employee engagement. When everyone understands what success looks like, it’s easier to rally the team and focus efforts on achieving those targets. You’re likely doing this to manage the existing business.
Now, you’re asking people managing a business with very defined processes to look outside the box and do new things. Organizations need a process to decide what new things are truly attractive to the organization and which opportunities should be passed by. For new opportunities, leadership needs to define what success looks like so areas of potential opportunity can be assessed and narrowed for execution focus. These are just a few of the questions you as a business leader will want to answer in order to more effectively guide growth teams.
· What size of revenue opportunity is big enough to matter to your organization?
· What are the minimum margin expectations required to invest in something new?
· What is the time horizon the organization will allow to achieve a return on investment?
· Does the organization prefer to cater to tight markets with a few significant players or does the organization prefer to sell to markets with thousands of customers?
3. Identify Level of Risk Tolerance
Understanding and defining your organization’s risk tolerance is crucial. Some initiatives carry more risk than others, and it’s important to balance your company’s appetite for risk. Encourage calculated risk-taking and innovation while ensuring there are safeguards to mitigate potential downsides. Keep in mind that new markets come with many unknowns. The unknown is not an indication of risk. Rather, it’s an indication that learning is needed in order to assess the level of risk. Encourage your growth team to learn what they don’t know they don’t know. This will inform the decision making process and enable the organization to place small bets. More on this in tip #9.
4. Define the Process for Establishing Priority
Not all growth opportunities are equal. Establish a clear process for prioritizing initiatives based on potential impact, alignment with strategic goals, and resource availability. This ensures the most promising opportunities receive the attention and investment they deserve. Also consider the organization’s appetite for risk. This will inform the ideal make-up of the project portfolio. Typically, organizations invest in a mix of projects ranging from easy hits to new markets and new technology that are typically both higher risk and higher reward. A balanced portfolio is a way to manage risk. Defining priority of what goes in and what is out of the portfolio is as critical as establishing the order of priority within the portfolio.
5. Validate Market Assumptions
Regularly validate your market assumptions through research, customer feedback, and competitive analysis. This ensures your strategies are based on accurate, up-to-date information and allows you to pivot quickly if market dynamics change. Death, taxes and change are constants in our world. Markets will change. Your organization needs to know the drivers of that change as well as the cost and benefits of change. Economic viability is critical to new solution success. This is one criteria that can be referenced within #2 Define What Success Looks Like.
6. Understand Customer Needs
Customer needs are at the heart of any successful growth strategy. Invest in understanding your customers’ pain points, preferences, and behaviors. Use this insight to tailor your offerings and create value propositions that resonate with your target audience. Validate customer needs regularly. Like market dynamics, customer needs change over time. You want your organization to be ready with the next solution when those needs change to ensure customer retention over time. Happy customers are loyal customers, and loyalty drives growth. It can put you in the desirable position of earning the right to say no. In this situation, customers call you with their problems before they call anyone else. This puts you in an advantageous competitive position to decide if it is strategically important and within your goals of #2 What Success Looks Like to solve the posed customer problem.
7. Understand Current Capabilities
Knowing your organization’s current capabilities is as important as envisioning future goals. Conduct a thorough assessment of your people, processes, and technologies. This helps identify gaps and opportunities for improvement, ensuring your growth initiatives are grounded in reality. Keep in mind the criteria for these assessments is often different for the growth business versus the established existing business. The existing business has progressed to a point where you’re optimizing internal processes, taking costs out and ensuring steps are repeatable. New business requires ongoing learning and adjusting. This is needed to define the right offer for the right market segment and to define the right process for delivering the value proposition. These goals often require different employee skill sets such as dealing with ambiguity, questioning assumptions, analyzing changing market dynamics and adjusting to deliver the goals.
8. Learn. Test. Adjust. Repeat.
Adopt a mindset of continuous improvement. Implement a cyclical process of learning, testing, adjusting, and repeating. This agile approach allows you to experiment with new ideas, measure their effectiveness, and refine your strategies based on real-world feedback. This experimentation is a powerful way to drive innovation and stay ahead of the curve.
9. Place Small Bets Before Complete Commitment
Before committing significant resources to a new initiative, place small bets to test its viability. See tip 8 Learn. Test. Adjust. Repeat. This could involve interviewing market experts to generate a list of assumptions to be later validated with actual customers, prototype products pilot programs, limited market releases, or MVP (Minimum Viable Product) launches. These small-scale tests provide valuable insights and reduce the risk of large-scale failures, allowing you to make more informed decisions. When the indicators of success are there, see Tip 2 Defining What Success Looks Like, the decision to go all in should be obvious. When it’s time to go all in, make sure you do so. Leadership championship for new business growth is critical to success.
10. Tell the World How Your New Solution Helps
Just because you built it, doesn't mean they will come. The world needs to know you have the answer to it’s problems.
Once you have a proven solution, it’s time to spread the word. Effective communication is critical to driving growth. Highlight how your new solution addresses customer needs and adds value. Use a mix of marketing channels to reach your audience, and leverage customer testimonials and case studies to build credibility and trust. Ensure you’ve budgeted this communication in the project upfront so there are no surprises on impact to ROI.
Conclusion
By focusing on these ten strategies, senior leaders can create a robust framework for driving growth. The journey may be challenging, but with a clear vision, strategic planning, on-going learning and relentless execution, the rewards can be significant. Embrace innovation, stay connected with your customers, and continuously refine your approach to ensure your business thrives in a rapidly changing market. Here's to accelerating your growth and building a sustainable future for your organization.
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