No business can grow unless the people behind the organisation are focused on achieving growth. As new markets expand and globalisation becomes the norm, growth opportunities can become limited and even niche areas of business can become saturated. The ambiguity of the economic climate and differences of opinion among experts and forecasters is blurring many markets, and this is further compounded by increased competition and operational complexity.
There is no right or wrong answer when it comes to growing your business, so it is therefore important to focus on the variables that influence growth.
The Holy Grail of profit
Profit is often seen as the benchmark metric for measuring business growth and is ultimately the Holy Grail of business goals. There are many more ways of tracking growth, such as through measuring footprint, workforce and product offerings, and all have a real impact on a business’s overall development. These significant factors often need to grow before profits can be achieved and so businesses need to build strategies to pave the way for growth.
All businesses have their own growth journey and, until now, there has been little research tracking business growth and its related metrics on a global scale. Our latest study attempts to change this, bringing the state of global business growth to life and showing exactly how the business landscape is evolving.
Getting growth—trends across the globe
The research draws out some global trends despite the unique nature of each business’s journey. It shows that one-in-three (36%) businesses across the globe have failed to grow their profits in the last 12 months, leading us to question where these businesses are on their growth journeys. Do they ‘get’ growth? What goals are they chasing? Are profits on the horizon, or out of reach?
Not achieving profits may be down to strategic decisions. Companies may be investing elsewhere, for example, or growing in other ways, before they can see a growth in profits.
The companies that are coming out on top in the profit stakes are those with a ‘grow getter’ approach, taking opportunities when they are presented to them. As a result, these ‘grow getter’ companies have invested in technology to empower their workforces, drive efficiencies, and increase agility and profit margins. They use technology to adapt quickly to change and demand, allowing them to drive expansion into new markets and establish processes to adapt their product ranges to match consumer demand.
What is interesting to note is that these ‘grow getter’ businesses tend to be in emerging economies like China, India and Mexico. Around three quarters of Chinese and Indian firms (74% and 73% respectively) and 63% of Mexican firms cited IT investment as important, compared to a global figure of 54%.
Companies with this proactive ‘grow getter’ approach typically see speedier profits and returns on investment. An impressive 80% of businesses in India grew their profits in the last 12 months while businesses in other regions were left planning and preparing, perhaps growing in other areas, but falling further behind in terms of profit growth.
Are you a ‘grow getter’?
Where does your business sit on the ‘grow getter’ scale? Are you ready to compete against global businesses that are primed to implement the latest technologies and systems? Below are 10 characteristics of ‘grow getter’ businesses.
- Focus Outside the Business–Companies focused on growth are twice as likely to look for external opportunities to grow their business, compared to low-growth companies.
- Plan Strategically–High-growth companies are twice as likely than low-growth companies to see strategic planning for growth as important.
- Don’t Stress It–Business growth produces change. High-growth companies embrace it with a proactive, well-prepared strategy and are three times more likely to find growth rewarding, rather than stressful. Low-growth companies operate reactively, so growth can often seem challenging or stressful and they are twice as likely to find growth stressful rather than rewarding.
- Optimistic–High-growth companies have a strong plan in place for growth, based on insight and analysis, which allows them to be optimistic about the coming year.
- Believe in their capabilities–High-growth companies invest in technologies and efficient working practices that enable, connect and empower their workforce.
- Embrace change–High-growth companies learn to embrace change. They invest in ERP solutions that give them the visibility and agility they need to quickly respond to changing market demands and stay ahead of the competition.
- Invest where it counts–High-growth companies not only invest in technologies that provide agility and operational efficiencies, but also solutions that can help them better understand their customer and deliver a better service experience.
- Invest in new technology and innovation–High-growth companies understand that investing in technology that enables innovation is essential to grow the top line.
- Demand quick returns from IT spend–Grow-getters don’t just invest where it counts, they demand fast returns, usually within a year.
- Focus on the customer–Customer expectations are changing and businesses need to become customer-centric. Grow-getter businesses have a seamless and connected customer experience that evolves with change in customer needs in the digital space.
Many of the world’s businesses, particularly those in established economies, do not ‘get growth’ in the same way as their emerging market peers and risk falling behind ‘grow getter’ businesses in emerging markets. While macro-economic factors can often not be avoided, getting bogged down in legacy systems can. There is a resounding business case for investment in IT systems that support and enable business growth and help businesses navigate economic and political challenges as they arise. With intelligent, next-generation enterprise solutions in place, it becomes possible for businesses to be more confident in delivering their growth strategies.
Monzer Tohme is the Regional Vice President, Middle East & Africa, at Epicor Software.Click below to share this article