Growth(185 words)

Management needs to think through the minimum of growth that its company requires. What is the minimum of growth without which the company would actually lose strength, vigour & ability to perform, if not to survive? A company needs a viable market standing. Otherwise it soon becomes marginal. It soon becomes, in effect, the wrong size. (Read the link-Wrong size of a business.)

A business needs to distinguish between the wrong kind of growth & the right kind of growth, between muscle, fat & cancer.

The rules are simple: Any growth that, within a short period of time, results in an overall increase in the total productivities of the enterprise’s resources is healthy growth. It should be fed & supported.

But growth that results only in volume & does not, within a short period of time, produce higher productivities is fat. Any increase in volume that does not lead to higher overall productivity should be sweated off again.

Finally, any increase in volume that leads to reduced productivities should be eliminated by radical surgery-fast.

Determine the minimum growth rate for maintaining your organisation’s market standing.