Working as a growth strategist, I have the good fortune of helping companies address their most pressing growth strategy and innovation challenges. Regardless of industry or geographic location, my clients are relentless in their pursuit of strategies that will produce consistent, profitable growth. However, I also see how top management can struggle as they go about identifying, articulating and prioritizing growth opportunities.
Multiple trends that have emerged and accelerated in the last 20 years are continually forcing top management to re-think the way they make growth decisions. Improved technology, faster communications, heightened competitive intensity, increased market complexity and accelerated change keep pushing the boundaries of processes that may have worked yesterday but that are not delivering expected results today.
At a basic level, executives are working to create economic value and strengthen their company’s competitive position. At the same time, allocation of limited resources (time, people, money) and associated opportunity costs also push companies to work in ways that achieve the best “bang for the buck” to maximize returns.
The pressure created by these dynamics tend to coalesce into five typical challenges top management have trouble surmounting when they work to identify, articulate and prioritize new growth opportunities. While they take on different disguises in every organization, I find myself constantly working to help clients overcome:
1. Lack of alignment around long-term strategy and strategic priorities.
It may sound surprising, but more often than not there is no consensus around high-level strategic company direction, market scenario evolution, or key segment/market focus, particularly at a functional level. In other cases, there is no clear linkage — and sometimes even conflict — between overarching corporate goals and specific functional goals. When even the simplest concepts of “attractiveness” or “execution complexity” vary widely depending function or geography, it makes it hard to prioritize initiatives and deliver growth.
2. Weaker growth-decision processes.
Most companies have some sort of “stage-gate” process to move initiatives across their innovation pipeline from opportunity identification through execution. However, in many cases, such processes are so complex that executives find ways around them to gain visibility for their initiatives and achieve faster execution. Commonly, these processes also do not allow functional teams to connect their performance with impact on key corporate business initiatives. This can translate into low morale, wasted resources and slower time-to-market. Brilliant initiatives may become obsolete before they are even out of the gate.
3. Inadequate ability to capture, manage and prioritize initiatives.
Typically, great initiatives (new and old) and their associated information stores are scattered across a company with no top-management or cross-functional visibility. Functional teams may spend a great deal of time shaping growth initiatives that end up in obscurity just because a company lacks the proper systems to capture, articulate and manage such efforts. (The good news is that there are many low-cost, simple systems that address opportunity fragmentation.)
4. Deficient cross-functional collaboration and teamwork.
Despite appearances to the contrary, companies still often work in silos, either because they want to retain or even restrict access to key information/resources or due to company culture. Cross-functional teams in these organizations face challenges similar to the organization as a whole. These include team-member misalignment and a lack of necessary knowledge and skills to move growth initiatives forward. Global or multicultural teams face additional challenges, as geography, language and culture make the cultivation of trust among team members difficult.
5. Poor communication or engagement among functional teams.
Initiatives with the biggest growth potential often come directly from the field, as field personnel have the best view to market desire and direction. Top management may underestimate the importance of sound communication and engagement mechanisms. Executives across the organization need to be able to trust that their suggestions will be properly captured and evaluated. This becomes especially important in multicultural firms that have functional teams with different cultural backgrounds, particularly when business practices and dynamics differ from those in the home office.
Fortunately, while these challenges may be difficult to see (and even more difficult to solve) from the inside, a systematic assessment from a firm that specializes in growth decision-making can help bring opportunity areas into focus. Once an assessment of both internal and external growth drivers has been made, opportunities can be analyzed and prioritized for maximum short- and long-term bottom-line impact.