For all of our collaborative technologies and connectivity, businesses today remain worlds apart when it comes to the topic of growth and how to deal with the challenges growth brings.
Some company leaders choose to measure growth in terms of profit, while board members at other businesses see geographic expansion, growth in capacity or even growth in capability of the organisation and its employees as the priority.
Needless to say, for such a simple word, “growth” is a more complex topic than first meets the eye.
To name just a few options, growth can reflect net revenue, operational income, tangible assets and customer base figures. Perhaps surprisingly, it doesn’t have to depend on profit.
Amazon is one company that famously avoided profit until 2015, yet its global growth has taken the retail world by storm in the last 20 years. Its cloud computing arm, Amazon Web Services, has also seen a 90 per cent usage increase, giving the company reason to celebrate even if its successes weren’t based on earnings.
For many, profit remains key, but however you choose to measure growth, it’s vital that business leaders agree on a common definition.
Read more on business growth:
- The travel business born out of a recession and now backed by Google
- Stripe Atlas to help UK entrepreneurs scale online companies into the US
- Aston Martin to create 4,000 British jobs with new manufacturing centre in Wales
Businesses may face difficulties if they are not aligned on a definition of growth at boardroom level. It’s easy to understand why a CFO might be more interested in measuring the bottom line, whereas a COO may be more excited by customer numbers.
C-level executives also, naturally, have a different outlook on the knock-on effects of growth when it happens.
For some, business growth can pose the challenge of rapidly recruiting more skilled workers to meet customer demand. For others, growth could result in less day-to-day contact with customers, which negatively impacts the customer experience.
Some may need to deploy new applications to give them a bird’s eye view of operations – because they simply can’t know it all anymore.
Importantly, coming to a joint decision on the definition of “growth”, will also help business leaders to identify challenges and put the resources or technology necessary in place to prepare for the road ahead.
We’re by no means saying that the journey will be an easy one, but preparation is the vital ingredient to make sure a business doesn’t just run into growth, before it can walk.
Sabby Gill is executive VP at business software provider Epicor International
Share this story