There is a dramatic change that occurs when a business evolves from looking to its competitors for cues as to how to grow to looking to its customers and their needs. They suddenly change from being a follower chasing what everyone else is doing to being the one that is setting the next level of customer value and the one who is chased. It starts with the way you think about growth, which then becomes the catalyst of the capital value of your business.
Active Knowledge Question:
Where do you look for ideas and opportunities for business growth?
Stop Looking, Start Creating
There is no science behind achieving business success. There is no prewritten formula which if one follows, success will be guaranteed. If there was, then anyone and everyone could build great businesses.
But there is an art, and there are clear principles that provide succinct and unequivocal guidance to be studied and mastered. These principles not only highlight those areas where business leaders should focus in building a great business, but they also provide insights to solving any performance issues that a leader may face in growing their business.
These principles will provide the basis for:
- Developing undefeatable strategies.
- Achieving real sustainable growth.
- Creating decisive competitiveness.
- Becoming tactically alive
It is the second principle of achieving real sustainable growth that shifts a business from being a follower to being a leader.
Real sustainable growth compounds year after year and always builds upon what has gone before. No effort is wasted, and everything, failures and successes, are invested in stepping the business closer to its customers and further away from its competitors.
For there to be real growth, you need to possess a clear image of what it is you are building. Real growth is not simply represented by increased sales; it is represented by a growth in the capital value drivers that generate those sales.
If your growth strategy is based on watching your competitors and reacting to or imitating their actions, then you will always be playing catch up. You cannot build a great business on this basis, nor will you win any competitive game as you are being led by your competitors around the marketplace. Mind you, many businesses are happy to be the follower and led.
Real growth is an outcome of creation, not reaction nor imitation.
Intimacy Is The Standard
Real growth is founded in meeting future needs, that is, the future needs of your customers.
And that growth becomes sustainable when it builds on your experience, learnings and strengths. Your business is not continuously chasing random opportunities as it seeks to meet short-term profit targets.
Rather it builds on its founding as a business, its purpose as defined in the customer needs it seeks to meet, and the investment it makes in its capability so that it can always deliver a greater customer value than anyone else. This draws the benefit of compounding to its competitiveness and strengthens its capital value drivers.
But to be effective, your business needs to understand its customers and their needs; not their needs of yesterday, nor needs defined through the lens of the products/services your business produces. Rather needs seen through their eyes and value understood by standing in their shoes. And the word I would use to describe your business’s understanding, appreciation and empathy with your customers is, intimate. You know them better than you know yourself.
Imagination Is The Norm
There is a trait found in those individuals who have achieved enduring success in their lives. I call this the Achiever Trait, and one of the elements of this trait is play. And in a visual sense, I see this play happening in the clouds. Some would say it is imagination, which is the seed of creativity, if that is easier to grasp. Without imagination, you cannot truly create anything, and play is the field in which imagination is freed.
Here are a few words about the concept of the cloud in the Achiever Trait:
“The cloud represents your dreams, passions, imagination and the freedom you allow yourself to play with what is possible and what you would love to do in life. The concept of play is important as play is seldom frivolous and usually quite purpose-focused. And for adults, I believe, it is usually centred on role-playing. It allows the imagination to be released, for things to happen that we can only dream of, and it is our dreams that allow us to nurture the passions that make the impossible possible.
As adults, we rarely allow ourselves to play as we did as children. Life is far too serious to play as there is wealth to be built — or so we have allowed ourselves to believe. Play is our exploration, and it ignites possibilities. You should play all the time, and opportunity will be the reward.”
In your business, there must be a space for clouds so that imagination in seeing your customers’ future needs and creating products/services to meet them can freely occur. Imagination must become the norm in your business.
The narrower your business’s focus on customers, the stronger it becomes.
Some may recall the work of C.K. Prahalad and Gary Hamel in ‘The Core Competence of the Corporation’, in which they spoke to the need of corporations to organise themselves around one or more core competencies, each of which would then seed many commercial opportunities. And to invest in these core competencies so that they would become world-leading experts in these selected areas. Noting that it is not possible to become world leaders in everything, and therefore the selection of a one or may a few areas would be necessary.
Apply the same concept when you define who your customer is and the needs that you seek to meet.
Think of the purpose for which your business exists, how you define that and how that expresses itself as customer need. Purpose is the lens through which your business is able to imagine a new future.
Now customer need is not static, it is continuously evolving through the emergence of technology and simply all things that are changing in our world. So, as you define yourself around a customer need and begin to focus in on that need applying intimacy and imagination, your business does not shrink, in fact, it leverages that focus to see an entirely new world of opportunity.
Some may recall my story of the ballpoint pen and the two opposing businesses. One which saw itself as being in the business of manufacturing and selling quality pens. And the other, which also started off selling the same pens, saw itself as being in the business of ‘allowing people to communicate more effectively’. You can guess which business grew well beyond the simple ballpoint pen.
As your focus on your customers and their needs narrows, you become the leading market expert in those customers, and a world of opportunity opens to you. Your narrowing focus allows you to leverage that knowledge and grow your market share and capital value.
As your focus strengthens, you find your business moving from expansion to monitoring to creation as the principal source of growth.
The growth of your business should be founded in meeting a well-articulated customer need. And as your business narrows its focus on that need, it will find itself shifting from being a follower to being a leader, and discovers a new world of opportunity.
An entirely new level of performance.
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All the best in the success of your business,