A book written by two general management consultants from Mercer Management Consulting. In this book, they share their wealth of experience, having consulted for businesses that were considered not growing, profits being under pressure, and shareholders seen as being more demanding.
The book analyses different growth strategies corporate executives adopt during downtimes in business. Looking at American businesses as a case study, great corporations downsize, “rightsize”, restructure, and reengineer during low times in business. This is considered surgical tools for reshaping bloated and inefficient organisations. However, putting this surgical tool in the hands of a wrong business executive would lead to a significant reduction in morale and productivity.
The book goes on to shatter some myths of corporate growth during times when many large corporations felt compelled to downsize. These myths usually lead to ill-conceived business strategies that waste untold resources. An example is when business executives consider an industry to be dead (no growth). The authors considered this to be the number 1 excuse most executives use during business downtimes. However, blaming slow or negative growth on industry maturity or stagnation simply does not explain why even the most moribund industries have a few firms achieving double-digit growth.
The authors went on to name three strategies for achieving growth,
- The art of customer franchise management – Building a winning strategy around providing competitively superior value to a carefully defined group of customers.
- Superior new product development – It is important to recognise the winning strategy of using innovation and creativity to introduce new products and services.
- Channel management – The most overlooked approach to improving business performance. It is important to develop a strategy around exploiting new channels for reaching your customers.
Once growing, the need to sustain growth becomes imperative, spurring executives to turn to these permanent requirements for sustaining growth (or internal growth foundations). Without these strategies deeply engrained into an organisation, the likelihood of failure is unavoidable. They are;
- Competitively superior value as determined by customers – the perceived benefits offered at the right price.
- Comparatively superior economics across the value chain, ensuring that it is operating at a reasonable cost.
- Consistently superior strategy execution through organisational alignment – operational decisions, organisational design and practices must align.
The book concludes with summary examples of four companies in different industries that faced serious problems, yet found its way back to growth.