Growing “smarter”

One fundamental of successful strategic planning is the ability to craft growth strategies that capitalize on your organization’s capabilities. Over my years as a strategy consultant, I have found the Growth Strategy Matrix (below) to be an excellent means for exploring alternative growth avenues. This simple yet effective tool is used to define business opportunities, leverage strengths, and minimize risk over the long term. It helps focus resources on growth initiatives with a high probability of success, given the skills and capabilities of employees, and strengths of your business processes and assets.

First and foremost, don’t pursue complex growth initiatives unless you have secured a strong foundation within your core businesses. Companies that try to expand from a weak core rarely succeed. Be sure your core business can support growth initiatives.

Second, avoid pursuing initiatives that fit in the lower right hand box (New Product requiring New Infrastructure). Growth initiatives in this box are generally expensive and risky, with a low probability of success because the organization lacks experience and expertise. 

Growth initiatives that should be considered include those in the upper right hand box (current products that can be leveraged into new infrastructure). As an example, a company might decide to pursue the expansion of its current retail food products into the foodservice channel. A joint venture with an existing foodservice operator might be considered a means of entering this market.