The One & Only Obstacle to Business Growth – Where the ‘buck’ stops

January 16, 2012

The older I get, the more I learn how much I don’t know – but also the more I recognise so-called “business experts” don’t know as well. I guess that’s fair, except at least I know how much I don’t know… others appear to “believe their own BS”.

The latest manifestation became glaringly apparent in the search for “Sticking Points in Business Growth” and “Barriers to Business Growth” where ‘money’ and ‘funding’ was patronisingly offered as a main reason. In reality, GROWTH should be easily funded, as trading history inspires lenders. (Launch, however, still is constrained by the 22nd Immutable Law of Marketing.)

Other reasons offered for growth constraints were ‘people’ and ‘market size’… Come on!!!! Surely, there are some strategic corporate thinkers out there that can distinguish between operational and strategic issues?

There is one, and one only, profound issue that hampers business growth, stifles unbridled expansion, and suffocates limitless potential… is the CEO the leadership and managerial talent that follows.

Many true veterans of business-consulting recognise this to be the core truth: When CEO’s reject a completely valid and rational business plan, when CEO’s horde decision-making, forcing operational middle management turnover rate to increases When decisions just aren’t made because the CEO won’t delegate and his in-try overflows… when money is NOT spent in growth generating areas, and, the most fatal of all… when not undertaking an idea is justified because “we’ve never needed to do this before”.

Nothing is more heart breaking for qualified practitioners of their specialised skills than when their CEO stops letting them do what they do best, and applies the brakes.

CEO’s who cant ‘let go’ inspire new appointees to keep their job search robots alive if a CEO interferes with new initiatives introducing higher sophistication levels than the firm is used to implementing: No one likes to dumb-down!

It is said that the only constant in the world is change. That business cannot stand still and must grow or wither. A CEO’s unwillingness to change with the business is frequently the key problem. Even CEO’s conscious of the need for change can fail to recognise their own inability to do so. (The most dangerous and destructive are those that SAY they move with change, but can’t.)

Hurdles that exist at key points in a business’s growth trail:
1. At $2M they must surrender their control over management decisions and accept that different decisions are not necessarily wrong ones.
2. At $5M they must recognise that future growth means complete market orientation and adoption of strategic initiatives rather than operational ones. complete autonomy of decision making delegated to the position holder responsible.
3. At $20M they must adopt corporate disciplines and formality of structure with complete detachment from all operational decision-making.
4. At $100M a CEO is the COO, and the CEO of the foundation years moves over the administrators to take Chairman and CEO mantles, mentored by major shareholders and appropriate performance incentives.

Summarily, if a CEO doesn’t change in order for the Organisation to grow, and the Organisation doesn’t change its CEO, then the Organisation cannot grow because it cannot change.

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