Latest Vistage Research Provides Important New Insight to Growth
If you’re like most companies we’re working with, you’re experiencing growth this year. After all, the economic and business climate is quite conducive to growth – low cost of capital and a stable labor market are certainly contributing. But what about the companies that are getting more than their fair share of growth? What are they doing?
Vistage Worldwide just published insightful research that explores the decisions high-growth company leaders are making that set them apart from their peers. This study of over 1,300 CEOs and business owners identifies key factors that clearly distinguish between higher (double-digit growth) and lower growth companies. Ready to see the specifics?
Multiple Growth Initiatives
Vistage found that companies deploy their growth strategies in this order:
- Expansion/retention of existing customers
- Serving new markets and customers
- Operational efficiencies to scale for growth
- Introducing new products and capabilities
- Growing salesforce (or expanding sales channels)
High growth companies deploy each of these tactics more often. In addition, high growth companies tend to initiate all of these strategies more often (30% of the time). What’s interesting here, is that companies believe they can grow without adding sales capacity. They can grow their base, expand into new markets, introduce new offerings, all before adding additional sales people or channels. That’s good news, and points to the power of an effective growth strategy. In the Chief Outsiders Growth Gears framework, one of our most fundamental tools for clarifying growth strategy is using this 2x2 growth matrix, which maps directly to 1. Gain Share and retain customers, 2., Expand into New Markets, and 4., Introduce New Offerings.
Investing in Talent, Training & Technology
These “3 T’s” – Talent, Training and Technology – appear to be the crux of what’s embedded in high growth company performance strategy. It makes sense; businesses need an array of strategic initiatives, plus the resources and readiness to get them done. As it turns out, investing in “marketing” programs, while more common in high-growth companies, was not a differentiator in driving growth. What? Well consider this: It’s not “spending” on marketing programs that makes the difference in growth. It’s spending on the right marketing programs that makes the difference. The implications are that high-growth companies invest “upstream” from marketing program spending and execution, getting more strategically aligned programs with the proper level of leadership to oversee execution. Which leads us directly into the final key finding from the study:
Dedicated Leadership – Sales, Marketing, Customer Service
High-growth companies place a greater emphasis on leadership. High-growth businesses are up to 30% more likely than no-growth businesses to have dedicated marketing, sales or service leadership in place. Additionally, high-growth businesses are almost twice as likely to have leadership in place across all three functions compared to no-growth companies. So, leadership matters. It brings hyper-focused expertise into the organization and relieves (even releases) other executive resources – often the CEO – to focus on other priorities.
Summary – Growth Requires Strategic Investment, Including Key People
This latest Vistage study brings light to the challenge of growth: What are the specific decisions CEOs need to make to put them on the high-growth path? Every company makes bets and investments. Some CEOs base these decisions on their own experience, their “gut.” Others bring in experts to assist, to sharpen the decision-making process, increase the likelihood of success and minimize the risk. For sustained growth, these experts need to be permanent fixtures on the executive team. To get started, many choose fractional executives. Our firm, Chief Outsiders, lives in this realm and has assisted over 500 mid-sized companies with achieving higher growth. We do this by joining the management team as a fractional or outsourced Chief Marketing Officer, to help crystalize the growth strategy, and then oversee execution. With over 50 CMOs with client experience across 60+ industries, we can help with most any business and situation.
If you’re interested in learning more about how an outsourced Chief Marketing Officer can help your company realize its growth potential, let’s start a conversation. Or check out this Growth Matrix flyer that describes how a fractional CMO relationship might work for you.