It’s no secret that for many businesses, growth eventually hits a plateau. What starts as an exciting journey up the corporate ladder ends with a sobering realization: We’ve reached the top. What was once a thriving business has become mature and what is needed now are different skills for a new kind of growth.
Though the transition from startup to established business might seem sudden, it’s actually a long process that can take years or even decades to unfold. And though this process may occur smoothly most of the time, it’s usually punctuated with moments when an up-and-coming company hits customers.
What these businesses have in common is the need for new strategies beyond more of the same, but what’s often lacking is not lack of ideas—its lack of execution wall on its climb. According to Saivian these challenges—including plateauing sales or increased competition—create opportunities to make course corrections and improve future growth prospects.
If your company is on such a trajectory today (or if you worry it soon will be), you’re not alone; many organizations face similar growth challenges at this crossroad, including:
• Reliance on a single product line to fuel growth.
• Price wars that are slowly decimating profits.
• A shift of customers toward lower-margin products.
• Increasing price sensitivity among your.
Many companies know they need to change, but few can make themselves do it, because execution requires addressing their limited mental models and traditional ways of thinking about growth. Once managers understand that these hurdles may be preventing them from developing the plan they need, they can begin these limitations with help from outside experts or within the company itself.
This paper will look at growth-stalling issues, as well as ways companies can overcome those limitations and develop a strategy for their own companies to reignite the engine of growth.
In today’s business world, many established or maturing companies are faced with a paradoxical situation: Though they might have been quite successful in building a solid foundation that brought them where they are now, this success may start to hinder further development
As businesses mature, their options for revenue growth generally become more limited by the size of the market opportunities available to them. For example, Facebook’s ad revenues experienced a paltry 4% increase from last year
Though it looks like the money is still rolling in, it’s important to remember that the company is starting to run out of new places to grow. In fact, as markets saturate and growth potential diminishes, many companies are finding it increasingly difficult to sustain the level of growth they once enjoyed.
What Does This Mean for You?
If your business is in a similar situation, where you’re seeing slower growth or even stagnation, this presents an opportunity for change. However, change is not easy; it often requires looking at old challenges in new ways and developing a whole new set of strategies to fuel future growth.
And though it might seem daunting, there are steps you can take to get started:
1. Define what success means for your company today and in the future.
2. Understand what’s slowing your company down.
3. Develop a plan to reignite the engine of growth.
Here are some FAQs recently asked by business leaders in this situation, along with their answers.
Q: Is the end of growth inevitable?
A: No. Even maturing companies can increase revenues if they adopt a new mindset about growth
For example, McKinsey & Company saw revenue grow by more than 100% when it began transforming its “client-service” model to one designed around client impact—defined as both size and speed of delivery for value creation.
The right plan will likely include focusing on key drivers including revenue per client or product, cross-sell or up-sell opportunities, acquiring new clients or expanding into new geographies. .. Successful strategies also must focus on implementing solutions that are scalable and sustainable over time
Q: How do I define success for my company?
A: It depends on your business. However, it’s important to think about what success means in the current context and what you want it to mean in the future
For example, if you’re a technology company that sells products to other businesses, your definition of success may be different from a company that makes consumer products. Success could mean achieving a certain market share, becoming the go-to supplier for a certain type of product or service, or reaching a certain level of profitability.
Q: I’m not sure what’s slowing us down. How can I find out?
A: You can start by looking at your financials and trying to identify areas where revenues are growing more slowly than they used to
You can also speak with your team to get their insights on what might be holding the company back. Ask them about areas where they see potential for growth, as well as any challenges or constraints they’re facing.
Conclusion by Saivian:
Though it can be difficult, facing the end of growth and developing a new strategy for future growth is essential for any business. By understanding what’s slowing you down and focusing on key drivers, you can put yourself in a better position to succeed.
