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What To Do When Growth Stalls

When Growth Stalls

growth stallsIT happens to every company. No one is exempt from the cycles of business. It’s not a question of competence or enthusiasm. It’s normal. “Generating consistent growth is just plain hard, no matter how smart, experienced, or talented you are. As one of the company leaders we interviewed told us, it’s like ‘trying to keep an ice cube from melting.’ It can be done, but only in the right environment.”

Steve McKee has written an insightful analysis of the problem. When Growth Stalls “is about generating growth for your company at a time when growth may be nothing but a glimmer of hope in your mind.”

There are external forces that we all fall victim to: economic upheavals, aggressive competition, and changing industry dynamics. But McKee’s research has identified four internal factors that work against recovery and often paralyze you:

Lack of Consensus. Consensus doesn’t mean management by committee. It means “agreement among an organization’s senior leadership about the nature and purpose of the company and where it’s intended to go.” McKee writes, “Consensus issues are hard to identify and unpleasant to face. But if you have a consensus problem, things can’t get better until you recognize it.” Only then can you work together to uncover the genuine issues you are facing. Everyone needs to be on the same page working from the same playbook.

Loss of Focus. “No matter how big the company, its management team has only a finite amount of resources—money, time, talent, energy—at its disposal. The less focused those resources become, the less muscle management can muster to move the company forward or, if necessary, pull it out of a ditch.”

Loss of Nerve. Probably the most insidious factor. When growth stalls, as McKee points out, it’s confusing. “Great leaders are supposed to be firm, decisive, and sure-footed. When things go wrong, you just fix them. That is until the problems spin beyond your control.” It’s discouraging. “When the road drops out from under the company, the CEO’s own discouragement can be difficult to hide.” It’s contagious. “It’s one thing to struggle privately…it’s quite another when the discouragement and disillusionment hit you so hard you can’t hide them. When the CEO is worried, everybody’s worried.” It's paralyzing. “You don’t have the luxury to think strategically when things are so desperate.” It’s wearying. As one CEO told him, “I wasn’t so much scared as ticked off and drained. I was tired of pushing the rock up the mountain like Sisyphus.”

redlightWhen you’re struggling to keep your head above water, taking risks is the last thing you want to do. Ironically, some risk-taking is just what is needed. Nobel Prize winner Myron Scholes “believes that companies should outsource as much ‘generalized risk’ as possible and focus on ‘idiosyncratic risk’; that is, risk related directly to a company’s core competency, where the company’s unique knowledge has a chance to produce better-than-expected results.”

Marketing Inconsistency. “The companies with the strongest track records do everything they can to maintain a consistent identity in the marketplace, even as the economy moves up and down, competitors come and go, and consumer tastes shift.”

These four factors can create a vicious cycle that can be crippling. The first step is to step back and understand that while it is common as a leader to feel guilt, “that attitude is not only unhealthy and unproductive, in most cases, it’s just plain incorrect….As long as denial, doubt, and fear—and in some cases, sniping, finger-pointing, and other destructive behaviors—are wreaking havoc with your internal dynamics, you’ll remain stuck in the vicious cycle.”

McKee shows you how to identify and deal productively with these factors. Writing from personal experience, he uses good examples and appropriate metaphors to explain what is happening when growth stalls. This adds to the book’s credibility and the friendly, thoughtful tone of his writing. If your growth has stalled, you need this book to help you get your company back on track.

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Posted by Michael McKinney at 12:00 AM
| Comments (0) | This post is about General Business , Problem Solving



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