When you’re running a business, growth needs to be carefully planned. It’s vital for any business’ success, but unplanned, poorly structured growth can do tremendous damage to your brand, to your finances and ultimately to your future.
The next step in your business, whatever it is, needs strategic thought, well in advance of taking practical steps towards growth. For bigger players, growth strategy consultants may provide a useful insight, but before you commit, let’s take a look at a few of the basics.
Tactics or Strategy
It’s important to maintain a grip on the difference between tactics and strategy. Your strategy is a high level, long term plan – as much an encoded set of values as a specific course of action. A carefully planned growth strategy could be deployed over many different growth projects. Tactics are short term and individual to each specific challenge – though you may reuse tactics if they prove successful.
When you’re creating your growth strategy it’s important to think about the values that underpin your business and the norms for your industry and business model. If you’re a bricks and mortar retail concern, and you’re more interested in running a business that will sustain you and your needs for your working life than in building a global brand you might want to encode sustainable, cautious values into your growth.
If you’re running a tech startup, as reliant on buzz and pace as on the product you’re incubating, then growth has to be fast, and the strategy for achieving it has to include that speed, as well as the foresight to avoid potholes in the road.
The Risks of Going Without Strategy
If you try to manage your growth with the forethought of a strategy you’re putting your business at risk. For your brand to grow, your decisions need to be cohesive. If you’re making decisions without a governing strategy then it’s hard for them to add up to a brand that customers can recognise and feel loyal to. Building out an inventory based on what offers the best value in the moment rather than to target specific customer profiles, placing ads wherever you can get the most for the least money instead of where your ideal customers will see and value them, opening branches solely where you can get a good deal on property – all of these actions lack strategy and will create incoherent businesses that customers find it difficult to understand let alone shop at!
There are also financial risks. Growth needs to be integrated with your wider financial strategy or you’ll find yourself overcommitted and at risk of collapse if costs rise elsewhere. You also need to build growth into the funding model you pursue – startups rely on multiple rounds of cash injections from investment. Traditional retail businesses look to bank loans. Think about how your business model informs how you will find your growth, and what built in limitations and advantages it brings with it.