AIM Archives - Tag: growth capabilities

Why you shouldn’t hope for great financial results this quarter.

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A large, unexpected revenue upturn this quarter feels good, right? But the satisfaction is fleeting. What you need is growth that is unrelenting, earned and reliable. If your growth is serendipitous—not the result of superior growth capabilities—you’re just setting yourself up for problems in 12 months. That’s when you’ll be held accountable for year-over-year results. Then you’ll be expected to repeat last year’s revenue windfall and then some.

More in article, B2B Organic Growth: Moving to earned growth

Business Leaders: Are you building your growth capabilities?

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It may seem counterintuitive, but many business leaders focus too much on business results. Wise leaders balance the pursuit of results with capabilities. Can you name any endeavor—rock-climbing, martial arts, chess—where champions didn’t first build their capabilities? Their victories (results) came later. When you see a leader fixated on quarterly results, picture an amateur climber at the base of El Capitan. He has the wrong shoes, no climbing skills and flabby abs… in other words, no capabilities. But boy oh boy, is he ever eager to climb. Yes, he wants results.

More in video, Leader’s Guide to B2B Organic Growth series, Video Lesson #9

 

Today’s financial results are the future someone else created years ago

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Let’s say you’ve led a business for three years. If this year’s financial performance looks great, it’s likely this is mainly because a) the last business leader put strong growth capabilities in place, or b) you’ve cut costs and taken other short-term measures that will ultimately degrade this business. It takes a long time to build a growth juggernaut, and very little time to “raid” it for short-term gain. Companies should recognize this and reward the “builders” among us.

More in e-book, Leader’s Guide to B2B Organic Growth (Lesson 7)

Are your “P” and “PC” out of balance?

p pc balance

“What is P PC Balance?

Decades ago, Stephen Covey explained we need to balance “P” (production) against “PC” (production capability). Today many companies just focus on this year’s results (P), without building the capabilities needed for future growth (PC).

Production Capabilities are the PC

There is a natural law of harvesting: sowing and reaping. And the sowing must come before the reaping. When we don’t understand this, the “P PC Balance” will make that profitable future difficult to achieve. Jeff Bezos has taught that this year’s profits have to do with the work done years ago. Further, we know that we need our PC to contain the core components of tools, processes, and  people.

Tools are Production Capabilities

“P PC balance” must consider the tools required. Tools increase efficiencies. They reduce errors. The modern B2B firm must understand how to leverage tools to its advantage. From voice of the customer software to web conference services, this is not a place to pinch pennies. Let’s also get more sophisticated about the language of finance, which is how success is measured.

Processes are Production Capabilities

“P PC balance” must consider the processes. For example, we must know  how to allocate resources. That is, we must optimize the risk between risk and reward with our portfolio management system.  We need our stage-and-gate system to keep development marching along. And we need processes for pursuing riskier investments, or, we’ll look at our new initiatives – and find that they are all incremental in nature.

People are Production Capabilities

And last, but certainly not least, “P PC balance” must consider people.  They are the most important assets a firm has.  And yet, how often, during tough times, do we see massive layoffs? How often to we watch knowledge and experience literally walk out the door.  Fail to maintain the talent level and bigger failures are sure to follow. And don’t just keep them, but invest in their learning and careers. There should be a high degree of alignment.

There is no doubt that there’s tremendous pressure on executives to perform. But don’t just hit the reset button and start over again every year.  Sell the vision, sell the process!  Build the future that you (and your firm’s investors) want.

 

More in article, B2B Leadership: Time for Greatness

It’s easy to be distracted. Building real growth capabilities? Now that’s hard.

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Some firms exhibit “Brownian motion,” with initiatives flying in all directions. In others, ideas are vigorously debated… in action-free zones. In other cases, action begins but quickly fades, leaving employees wondering what next year’s program will be. In the saddest situations, long-term initiatives live only in the investor relations department’s PowerPoint® slides.

More in article, Build Growth Muscles at Your Company