I recently had a talk with some friends about how life happens to us at a rate that is tremendous. And the older we get, the faster time flies. The factor that best shows this is the growth of our children. My oldest son is 22 years old. He feels like yesterday I could not tell my family by phone that mother and daughter were too. He had a tremendous lump in his throat.
Therefore, growth is a natural phenomenon for humans and even animals, all things being equal white. Somehow, HOWEVER, we make it a big deal for our companies. Investors require companies to grow so that they can increase their returns. They reward the companies that provide their returns with a higher share price, and the management of the company is rewarded with high pay and incentive packages.
Because of this, companies have a vested interest in ensuring that their revenues increase. At that point, Sami need to make sure they are also profitable. Often the goal of thesis 2 are mutually exclusive. According to recent research by IMD’s Peter Lorange, only about 40% of companies that are successful in growth and profitability are white.
Interestingly enough, from a perspective based on value, there are three drivers of financial value associated with growth:
- growth duration. This refers to the period during which you have a cumulative rate of annual growth as high as possible. It is management’s job to make sure that they adopt projects that produce this result. In the absence of this phenomenon, the best that the company can eventually hope for will be a growth rate maximum at the economic growth rate of the country in which the company is located. The directors of the companies find that in this position they run the risk of being fired when their company is absorbed by competitors.
- Billing growth. This factor seems to be quite simple. After all, sales are trying to increase the volume at a given price, gold grow both volume and price. However, it is far from simple as it requires many intangible factors to be in place. Here we mean segments best customers, with the proposed optimal value for customers, using distribution channels best with the message of optimal marketing and linking the client with you in a way that causes blocking competition and client lock.
- profit growth. The profit is the difference between price and cost. Both fixed and variable costs. And volume plays an important role in the case of fixed costs on a per capita basis. The larger the volume, the lower the cost per capita is fixed and greater profit per unit. The link between price and cost is due to the efficiency, by clear and direct its operating model is so productive and competent are their employees.
It is also that very interesting companies can grow too fast. Your investment needs may be outweighed by your cash flow needs due to a working capital requirement and a fixed asset investment requirement. Companies should do well to remember this in Pursuing the Growth Imperative!
That said, the common denominator of all the above types of growth is the people in the organization. You must have committed people who are committed to the vision, mission, purpose and strategy of the organization, who are productive and hard-working. You need people who are trained and developed, and who have an employee value proposition that is as attractive to the employee as the customer value proposition is to the customer. Without these people, there will be a period of high growth period, and revenue growth and earnings growth.
Aussi growth requires the growth of the leaders of the organization. Strong leadership and visionary is a prerequisite for the implementation of the strategy. And this requires the growth of the individual so Meaningful, making it grow emotionally and spiritually so significant.
I was recently lucky enough to accompany a group of MBA students from Stellenbosch University School of Business on a study trip to France and Belgium. As part of the tour, we visited the European Commission office in Brussels. There I saw the following emphasis on growth:
- Smart growth: investing in knowledge and innovation. This is the kind of growth the previous paragraphs. We need to be more informed and creative than we currently are. And this is a continuous truth. Never got to the point where we can rest in terms is all about! As companies and equipment they need, however, aussi be aware and concerned about the law Albrecht. Karl Albrecht stated that “intelligent people, when grouped together, tends towards collective stupidity!” To avoid this, we need emotional and spiritual people who are reliable to create synergy, where the whole is more than the sum of the parts.
- Sustainable growth: promoting a greener economy. We need to be aware that we can not grow at the expense of our planet. Sustainability, HOWEVER, aussi That requires our business models and strategies are good enough to ensure the survival of the company in a competitive environment. Of course, all too often emphasize the “sustainable” growth of our business models and strategies and ignore the needs and requirements of the planet. We do this at our own peril, therefore, the EC approach was a greener economy!
- Inclusive growth: fostering a high-employment economy. HAS Technology Become advantage and curse, DEPENDING look. We use technology to solve a lot of problems, our goal is to create more problems in the process. Increase productivity by using technology is excellent. This, however, often creates jobless growth, in developing companies can have a devastating effect. So to be socially responsible, we must grow our businesses and economies taking into account the warning promote high employment economy.
So far we have talked about the company. This does not mean that people can sit back and expect others to take care of them. he or she also: has the responsibility to ensure that they grow as people grow in their skills, and are employable and remain as such, regardless of managing the economy. Again, they need to understand that this journey of personal growth is an endless journey. they should not, growth will happen to them, and not necessarily for them and often (especially?) not for profit!
The reality is the lack of growth that stasis is not – it Eventually regression and death. In relation to others who do grow, you don’t stay still if you don’t grow. you fall behind This is the case whether you are an individual or a company.
So grow seems to be essential. The aim seems like thinking – qui Henry Ford said the difficulty is that so few people actually engaged in it. People struggling to grow, maybe why companies grow FEW optimally and appropriately!
