Why the Race for Growth is a Fallacy

| July 14, 2017

By Curt Fowler | Fowler & Company

According to The Conference Board CEO Report, the primary challenge facing CEOs is growth. Not profit, not customer retention or expansion, not innovation, but growth! This doesn’t make any sense.

Growth is what is known as a lagging indicator. In other words, lots of things cause growth to happen or not to happen, but you can’t just make growth happen! An innovative new product, new customers or more purchases from current customers could all drive growth, but you can’t do anything about growth without these other things happening. Growth is the consequence of getting lots of other things right! You must work on the leading indicators to cause the lagging indicator to move.

It’s like trying to lose weight. You want to lose pounds and you know you can’t “manage what you don’t measure” so you do the right thing and go buy a scale. Every morning you measure your weight diligently with hopes of moving the needle just a bit, but nothing happens! Why?

I’m measuring therefore, I think I’m managing. Why am I not losing weight? You are not losing weight because you are measuring the wrong thing. What you must measure to lose weight is how many calories you burn in a day at rest (called your basal metabolic rate) plus the calories you burn doing any additional exercise minus the number of calories consumed. Make your caloric intake 3,500 calories less than what you burn and, congratulations, you lose one pound! Measure your weight all you want. It will be difficult to lose any pounds until you start measuring and managing the right things.

Just like trying to lose weight, the reason we are caught off guard by our lack of growth is because we are measuring the wrong things. It is understandable that we do. Growth or increase in top line revenue is very easy to measure. It’s staring at you each month right there on the top of your financials! Measuring the things that lead to the growth you desire is much more difficult, but it must be done.

So, if growth is one of your goals like it is for so many other leaders, take the time to determine what factors drive your growth. Measure them and manage them and you are much more likely to get the growth you are after. I heard it said one time by a very wise CEO, “Don’t focus on getting bigger, focus on getting better. If you get better, you clients will force you to get bigger!”

Pretty good advice.

Are you ready to measure the right things and grow your business? If you are, head over to our Resource Page and check out our free tools to help you get started or give us a call at 229-375-5613.

Have a business growth topic you’d like me to cover? Send suggestions to cfowler [at] valuesdrivenresults.com or use our contact form by clicking here.

Curt Fowler is an organizational growth expert and President of Fowler & Company, a business advisory firm dedicated to helping leaders create and achieve a compelling vision for their organization. He has an MBA in Strategy and Entrepreneurship from the Kellogg School, is a CPA, and a pretty good guy as defined by his wife and four children.

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