In the October edition of the HTG Way I introduced a three part blog series on Growth. In the first post we explored four different types of companies and the owner mindset of each in regard to growth and value.
Now that you have determined what mindset you have around growth and value and identified which type of company you would like to be, how do you plan for growth? (Make no mistake – it is a choice. We have to be very specific about what kind of growth we want to have as a business owner. We will fall short if we aren’t very clear in our own mind about that).
Growth can come in many shapes and forms. Here are some of the most common from my experience:
Types of growth:
- Organic growth – In the simplest terms, it is expanding what is already in place. Referrals are a key way this type of growth occurs. It can be slow but steady, and often yields long term stability because of the relational foundation that organic growth often comes from.
- Strategic growth – A strategic growth strategy may be to reach a previously untapped market through advertising or create additional products or services to take to market. Strategic business growth requires the money generated by organic growth because businesses won’t experience that same the watershed business acceleration. Instead, it will be a gradual increase in sales.
- New markets
- New products
- External growth – comes from an addition to the business from the outside
- Internal business growth – this type of growth happens through implementing an operational system like StratOp. While it may not impact top line revenue, it can drive bottom line profitability. This growth is often the hardest because rather than simply expanding into another market or trying to expand a product or service, businesses must change how they do things which can be concerning to employees and managers. Change always comes hard.
As you consider your business and strategic plan for the next year and beyond, begin with understanding your ‘why’ as a company. What kind of growth do you want to have? How will that growth happen? In order to be able to hit your annual and longer term targets, we need clarity around these key areas. In HTG, we spend our Q4 peer group meetings focusing on these types of conversations.
Along with knowing your numbers, members will come with their plan as to how you’ll work to achieve those targets. Remember that “vision without execution is hallucination”. It doesn’t do a lot of good to come up with targets if we don’t have a strategy and plan to get us there.
Put down some specifics and timelines that you’ll pursue. Look into your crystal ball and consider new products and services that you see for the future. The business plan should be based on what you know today.
But the longer term strategy to achieve your business valuation and personal wealth targets will need some outside the box thinking – things that may be a stretch or a but unknown – but would have the ability to get you to the end goal.
If we don’t dream and plan toward it, we’ll never achieve it.
Our final post in this series on growth will discuss some of the obstacles that will be in your path if you choose to grow your company.