What enables some companies to achieve high growth, while others struggle? We asked ourselves the same question, and following research with hundreds of high growth companies here is an extract from our recently published ebook on the topic.
In a nutshell what we discovered is that high-growth firms take the uncharted path, acknowledge mistakes, create an agile culture, and focus on their core strengths.
Taking the uncharted path
It’s more challenging to break new ground than to follow an established template. True entrepreneurs have a passion to identify an unmet need in the marketplace and then serve it, as opposed to their more complacent counterparts, who either miss the need altogether or see a need and conclude that someone else could or should serve it.
While established companies have the ability to innovate, they often avoid radical innovation that might disrupt their existing revenue streams in the short term. High growth companies seek radical innovation and use agile methods to develop it.
Successful entrepreneurs know that innovation is the lifeblood of company survival and economic growth. Their agility and propensity to innovate not only drives growth, but makes them an attractive target for investment, acquisition, or partnership.
Taking the uncharted path also reflects an approach to strategic planning that involves not just setting long-term goals and then working towards them, but ensuring that the goals themselves are always relevant and attainable. There is no sense in working toward a goal that is no longer relevant to the marketplace.
Acknowledge mistakes and move ahead
If you boldly take the uncharted path, you’re going to make mistakes. While all businesses make bad decisions from time to time, the best entrepreneurs and their teams are highly resilient. Encountering obstacles, they openly acknowledge the challenge, set a new course, and rapidly recover. They exhibit greater agility than their large, corporate counterparts and learn from mistakes to avoid making them again.
The staff and management of the high-growth company will be in an almost continuous state of learning and development, which can result in mistakes. In order to learn and develop, the culture must promote a team approach and not condemn trusted people for getting things wrong. Mistakes in high-growth companies are regarded as the inevitable price of progress.
One key to managing mistakes is to catch them as early as possible. With a networked dashboard providing key performance indicators in real time to those who need to know, mistakes don’t have time to snowball into an unmanageable crisis.
Create an agile company culture
A healthy culture is fundamental to the success of a high-growth firm. High-growth companies overwhelmingly cite people as their leading priority, and have a strong concern for the contributions of the individual employee. These companies show an ability to communicate their vision to and instil their passion in every employee.
Communication-stifling silos are not allowed to develop. Information is freely exchanged so that the company can quickly respond to changing customer demands or environmental threats. The focus is not on the tactics used to fulfil the mission, but the mission itself. How the agile company satisfies its customers may be different tomorrow than it is today.
Focus on core strengths
Entrepreneurs at high-growth companies focus on the things they do best. They recognize and preserve those qualities that made them a market leader. When necessary they partner with other entities to fulfil infrastructure and technology needs, meet administrative functions, develop sales channels, carry out manufacturing and distribution, or achieve regulatory compliance. This enables more rapid, flexible, and cost-effective scaling as the business grows.
Outsourcing non-core tasks frees up staff to focus on what they do best. By dedicating their time to their strengths, the company derives the maximum benefit from their talents. Allowing specialists to utilize their unique skills increases the company’s overall performance.
(article by C.Wells)