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Extremely rapid growth for a
business might sound good, but it
can be a mixed blessing.
Certainly, high growth yields
greater returns, offering shareholders
five times more than medium-growth
companies, says Debora McLaugh-
lin, CEO of The Renegade Leader
Coaching and Consulting Group.
Growth predicts long-term suc-
cess, she says, and it matters more
than margin or cost structure.
But sustaining growth is ex-
tremely difficult.
For example, a business may
have tremendously high growth in the
start-up phase, as did the daily-deals
pioneer Groupon, which had a stellar
valuation of $6.4 billion in 2010.
“By 2012, Groupon had lost a
mind-boggling 80 percent of its
stock value since its initial public
offering,” McLaughlin says. “What
happened? The tech company nev-
er figured out customer retention.”
While Groupon is a prominent
example, it’s certainly not the only
one. Approximately 85 percent of
super-growers, defined by McKin-
sey as companies whose growth is
greater than 60 percent, are unable
to maintain their growth rates, and
once lost, less than a quarter were
able to recapture them.
McLaughlin, author of “The
Renegade Leader: 9 Success
Strategies Driven Leaders Use
to Ignite People, Performance &
Profits,” offers tips for maintaining
momentum for businesses that are
experiencing high growth.
• Define your Culture.
You can’t af-
ford not to invest the time to define
the culture needed to support your
strategic plan. What is the purpose
of your company, its guiding values,
and its top priorities? Defining the
culture allows you to align senior
leaders, stakeholders and investors,
make faster decisions, attract top
talent and engage employees.
• Do your best to retain the right
people.
Often, the problem faced
by fast-growing companies is that
they need to hire people fast so
they fill positions based on talent
versus fit and attitude. Hire people
who align with your culture and
its values. Have the right mix of
visionaries with executers.
• Maintain the quality of your
product.
Whatever it may be – an
online service or your town’s best
muffins – exponential growth can
have you running in 100 different
directions. Don’t forget what got
you to this point: quality. Continue
to wow the customers who trusted
in you at the beginning.
• Make sure you have the money
you think you have.
It’s easy to
confuse growth of accounts receiv-
able for tangible, cash-based growth.
If your company isn’t collecting the
cash it’s due, there’s a risk of run-
ning into a cash crisis during growth.
There’s nothing more valuable for an
expanding business than cash.
“You want to manage your growth
in a smart way,” McLaughlin says.
“You want growth that easily trans-
lates to profit, which means collecting
data, doing the research and chal-
lenging your business instincts. Don’t
be so focused on your product or ser-
vice that you fail to notice the shifting
sands of your consumer demands.”
Debora McLaughlin is a certified
executive coach and CEO of The Ren-
egade Leader Coaching and Consult-
ing Group. She helps business lead-
ers ignite their inner renegade leader
to unleash their full potential, drive
their visions and yield positive results,
both in business and in life.
By
Debora
McLaughlin
Is Your Business
Growing Too Fast?
How to maintain market-share mojo
In ThE
TREnchEs
71
July - August 2016
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