Growth Strata•Gems Magazine Growth Strata•Gems Magazine Spring 2018 - Page 8

GROW YOUR BUSINESS

How Do You Sustainably Grow Your Business ?

BY : RICK HOLBROOK , GROWTH STRATAGEMS

There ’ s a big difference between being able to grow your business when your market is expanding and customer demand is strong versus growing during more challenging times . Sustained business growth comes from optimising two systems in your business : your business operating system and your leadership development system . In my Coaches Corner article and my article on page 5 , I offer tips on leadership development , so my only additional comment is that the two systems are interdependent . You can only grow your business as fast as you grow the skills of your employees , and a scalable operating system is key to sustaining growth . Both were key findings by Bain & Company ’ s Chris Zook and James Allen in their research for their book , The Founders Mentality .

What do I mean by your business operating system ? I mean the operating practices you ’ ve implemented that align everyone ’ s focus onto your key strategies . Using a hockey analogy , I ’ ve found that most businesses operate like teams of shinny hockey players . They don ’ t play a consistent system that gets them playing as a team . Players aren ’ t held accountable . Team results are mostly achieved by strong individual efforts , each team has a few floaters , and often the players don ’ t pass the puck to each other . Sound familiar ? While playing shinny in business can be fun too , it rarely delivers winning results and certainly not sustainable growth .
Here are five essential elements of an effective business operating system , why they ’ re important , and suggestions on how to create them :
1 . CREATE AND MAINTAIN A PERFORMANCE-ENHANCING CULTURE
The famous business thought-leader Peter Drucker said that “ Culture eats Strategy for Breakfast ,” which succinctly ranks their relative importance . If you want to create sustainable growth , you must first create and sustain a great culture ; a culture that balances productivity , as measured by customers and shareholders , with being a great place to work , as measured by your employees .
Research by John Kotter and James Heskett , authors of the book Corporate Culture and Performance , revealed that the key is to place equal emphasis on all three stakeholders . Companies that did significantly outperformed those who favoured one over the other two . Last year ’ s sale to Amazon of the US-based Whole Foods Market is a good recent example of a company that was a great place to work but wasn ’ t equally focused on serving its customers or satisfying its investors . The result was Amazon bought Whole Foods at a surprisingly low valuation .
But it ’ s not enough to define your culture in theoretical and static terms . Your culture must be continually modelled by senior leaders and regularly reinforced at all levels of the company . Moreover , your culture must recognise and respond to changes in your market and operating environment . While certain elements of culture like Core Values shouldn ’ t change , other more flexible culture elements like attitudes and beliefs can and should change .
I ’ ve come to believe that a major sustainable competitive advantage is the work environment you create at your company . I believe people are intrinsically motivated by the opportunity to do great things and have fun doing it . Southwest Airlines is a great example of a company that has consistently grown over a long period of time in a tough , competitive industry . They ’ ve done it by creating a work environment that balances productivity with being a great place to work . As their former CEO Herb Kelleher noted , their competitors can copy everything they do , but they can ’ t copy their culture , their esprit de corps . Ordinary people , working in a great environment , can do extraordinary things .
2 . UNLOCK THE POWER OF YOUR CORE PURPOSE
To stay connected to your company , your stakeholders ( employees , customers , and investors ) need to find your work meaningful . Otherwise you ’ re just another employer , supplier , and investment option . You want a deeper connection with your stakeholders , and the way to forge that connection is to uncover your Core Purpose . Your Core Purpose answers the question , “ Why are we in business ( beyond making a profit )?” or “ If we disappeared , why would we be missed ?” As Simon Sinek says , “ People don ’ t buy what you do . They buy why you do it ”.
Often a company ’ s purpose is linked to the founder ’ s purpose . John Aldred , the founder of Enerflex Systems , had as his Core Purpose to elevate the status of tradespeople . He believed welders , millwrights , mechanics , etc ., made valuable and important contributions to society , and that the trades were desirable career paths . Through the manifestation of his Core Purpose , Enerflex was a great place to work , a great company to buy from , and a great company to invest in .
8 | SPRING 2018
GROW YOUR BUSINESS T How Do You Sustainably Grow Your Business? BY: RICK HOLBROOK, GROWTH STRATAGEMS here’s a big difference between being able to grow your business when your market is expanding and customer demand is strong versus growing during more challenging times. Sustained business growth comes from optimising two systems in your business: your business operating system and your leadership development system. In my Coaches Corner article and my article on page 5, I offer tips on leadership development, so my only additional comment is that the two systems are interdependent. You can only grow your business as fast as you grow the skills of your employees, and a scalable operating system is key to sustaining growth. Both were key findings by Bain & Company’s Chris Zook and James Allen in their research for their book, The Founders Mentality. What do I mean by your business operating system? I mean the operating practices you’ve implemented that align everyone’s focus onto your key strategies. Using a hockey analogy, I’ve found that most businesses operate like teams of shinny hockey players. They don’t play a consistent system that gets them playing as a team. Players aren’t held accountable. Team results are mostly achieved by strong individual efforts, each team has a few floaters, and often the players don’t pass the puck to each other. Sound familiar? While playing shinny in business can be fun too, it rarely delivers winning results and certainly not sustainable growth. Here are five essential elements of an effective business operating system, why they’re important, and suggestions on how to create them: 8 | SPRING 2018 1. CREATE AND MAINTAIN A PERFORMANCE-ENHANCING CULTURE The famous business thought-leader Peter Drucker said that “Culture eats Strategy for Breakfast,” which succinctly ranks their relative importance. If you want to create sustainable growth, you must first create and sustain a great culture; a culture that balances productivity, as measured by customers and shareholders, with being a great place to work, as measured by your employees. Research by John Kotter and James Heskett, authors of the book Corporate Culture and Performance, revealed that the key is to place equal emphasis on all three stakeholders. Companies that did significantly outperformed those who favoured one over the other two. Last year’s sale to Amazon of the US-based Whole Foods Market is a good recent example of a company that was a great place to work but wasn’t equally focused on serving it 27W7FW'2"6F6gpG2fW7F'2FR&W7VBv2&VvBvRfG2B7W'&6vǒpfVF'WBN( 2BVVvFFVfRW"7VGW&PFV&WF6B7FF2FW&2W 7VGW&RW7B&R6FVǒFVVB'6V"VFW'2B&VwV&ǒ&Vf&6V@BWfV2bFR6&VfW"W"7VGW&RW7B&V6v6RB&W7@F6vW2W"&WBBW&FpVf&VBvR6W'FVVVG2`7VGW&RƖR6&RfVW26VF( B6vRFW"&RfW&R7VGW&RVVVG2ƖPGFGVFW2B&VƖVg26B6V@6vRञ( fR6RF&VƖWfRFB 7W7F&R6WFFfRGfFvR0FRv&Vf&VBR7&VFRBW 6&VƖWfRVR&RG&66ǐFfFVB'FR'GVGFFw&V@Fw2BfRgVFrB6WFvW7@&ƖW22w&VBWRb6琧FB2667FVFǒw&vfW"pW&BbFRFVv6WFFfPGW7G'FW( fRFRB'7&VFrv&Vf&VBFB&6W2&GV7FfGvF&Vrw&VB6RFv&0FV"f&W"4TW&"VVW"FVBFV"6WFF'266WfW'FpFWF'WBFW6( B6FV"7VGW&RFV"W7&BFR6'2&F'VRv&rw&VBVf&VB6FWG&&F'Fw2"T4DRtU"bU 4$RU%4PF7F6V7FVBFW"6W 7FVFW'2VVW27W7FW'2BfW7F'2VVBFfBW"v&VvgVFW'v6R^( &RW7BFW VW"7WƖW"BfW7FVBFॖRvBFVWW"6V7FvFW"7FVFW'2BFRvFf&vPFB6V7F2FV6fW"W"6&PW'6RW"6&RW'6R7vW'0FRVW7F( v&RvR'W6W70&WBr&fB( "( ĖbvPF6V&VBvvVBvR&R֗76VC( Ф266V62( VRF( B'WvBRFFW'WvRFN( gFV6( 2W'6R2ƖV@FFRfVFW.( 2W'6RG&VBFRfVFW"bVW&fW77FV2B026&RW'6RFVWfFRFR7FGW0bG&FW7VRR&VƖWfVBvVFW'2֖w&vG2V672WF2FPfV&RB'FB6G&'WF2F66WGBFBFRG&FW2vW&RFW6&&P6&VW"F2F&VvFRfW7FFb26&RW'6RVW&fWv2w&V@6RFv&w&VB6F'Wg&Bw&VB6FfW7B