Want To Grow? Look At Your Business Model
Economic booms are times to harvest revenue; recessions are times to conserve profits. It's a sign of how forward-thinking the business community has become that we're turning our attention to growth this fall, not waiting through the winter to see if this great, paralyzing blizzard of a recession is really melting away.
But as we dig out and survey the intellectual landscape for guidance in planting the next growth crop, we find a paradox. Management literature suggests diametrically opposed solutions for companies seeking to grow: "Stick close to your core" and "look for opportunities far from any competitors, where no one has gone before."
Both camps are backed by excellent research. There's fairly indisputable empirical evidence showing that the closer to the core a company's growth strategy is, the lower its chance of failure. But there's also prime evidence to show that truly transformative growth opportunities lie in totally uncharted territory, far from your core way of doing things.
Blend both schools of research and you seemingly reach an uncomfortable truth: Companies seeking transformative growth need to venture far from their core. Yet the chances of success there are bleak—a thought not lost on the markets.