The Growth DILEMMA

  4 min 19 sec to read
The Growth DILEMMA

Every new fiscal year brings with it enthusiasm, excitement and hope to everybody, be it a person or an organisation.

Organisations as well as other stakeholders can hope for betterment and employees can also look to become more prosperous. However, every new year, business planning brings a lot of anxiety and stress to all levels of employees, from the bottom to the top, due to the yearly growth requirement of a business.

Some organisations would have already have made up their minds about the minimum 15 percent CAGR (Compound Annual Growth Rate) for the next five years with no discussions whereas other organisations would project a growth rate as per their SWOT findings and many would project it as a better rate than the previous year. Regardless of the method used, the objective is to have growth at a decent rate, one that would sustain the business.

Many people may never understand the meaning or objective of a growth requirement year in and year out. Why is it really necessary to have growth every year at all? The answer is: if it’s a business, growth is one of the most important business acumens for prosperity amongst the many other parameters that need to be achieved. In business, growth is imperative for survival, capacity and competency development in order to remain relevant among customers. Furthermore, only with growth can a business offer better growth to its employees, dividend to its shareholders and more innovative and relevant products and services to its customers.

Rather than being ignorant about growth or not understanding it, we should focus more on capacity building. Growth is just an effect whereas capacity development is a cause of the growth, in the true sense.

If a student wants to scale up from a rating of B to A, the student first of all should build his/her capacity from B to A to achieve the target rating. Now that capacity building might require waking up one hour earlier, finishing home work on time, doing lots of class discussions and participating in the interaction session which he or she may not have done before. If the student changes his/her behaviour, instrumental for growth, he or she will then have done much to move from a rating of B to A. With this capacity development we now have a rating A student from a rating B student.

Likewise in sales, if we are targeting double digit growth, there is no reason for any panic and anxiety. We just need to build up our capacity that could deliver us that growth. It’s all about changing the water tank. A 1000 litre tank will hold 1000 litres of water and deliver 1000 litres. If you want to grow, we need to update or change the tank all together.

In FMCG sales we might have to make more new distributors, launch new products, focus on SKU of brands that offer more leverage in sales, make monthly communication amongst the team weekly for better alignment, while revenue collections should be as per the financial guidelines.

Likewise in the case of the service industry, we may need to find more clients, increase the repeat purchase, offer new service products, new talent recruitment, update system software for better processing. Also, one could locate the critical drivers of the system or department and update or change the effectiveness and efficiency that would direct one towards growth, including doing a task analysis of overall functions to find out the critical processes that have to be checked for better capacity development.
There is a saying in the corporate world in that it is the responsibility of a few corporate heroes to always take the initiative. Businesses might get the growth due to air in the tail or because of favourable winds, else it is soon heading for a dip at any point.

Capacity development is not a single person’s responsibility in an organisation. Capacity development is rather the responsibility of all stakeholders from the top, to the middle, to the floor. Everyone in the organisation is there to play a role and it is imperative to uplift the capacity of each role and each person involved in the organisation’s value creation so that collective capacity improvement will be the result of the growth.

As rightly put by Jack Stack in his popular management book, ‘The Great Game of Business’, “It’s not somebody’s business of running the business rather it is a collective effort from everyone involved in the company. It frees people from excess baggage.”

Organisational growth is mandatory when all have a prosperity mindset and capacity development is the only way to make growth happen.

(The author is the General Manager at Sujal Foods Pvt Ltd. and can be contacted at [email protected])

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