Sustaining growth in a changing business world
Maintaining sustainable growth is arguably the ‘holy grail’ of most companies – achieving it can be an ongoing business lifecycle challenge, writes John Burbedge
Growth by nature brings change – operational, personal, cultural and often international, to name but four potential disruptions.
It might be the challenge of change produced by the growth of a family business beyond its successful family roots and abilities. Or the challenge of growth-change following a successful strategic acquisition or merger. Or the growth-change challenges on entering new markets or foreign territories. Or taking on new property leases, or even growth finance, or …
What are the secrets of achieving sustainable growth; the key ‘successful-growth’ pitfalls that can lead to business stagnation or failure; the best ways to avoid them?
It appears from the views of our five contributors from various sectors and business sizes that one key is to follow the Scout motto: Be Prepared.
Be fit and ready to grow – ready to overcome the challenges or grab the opportunities. Control what you can control; do well what you know best; create an accepted team culture; but overall be ready, willing and able to change, when necessary.
Or, use organisational change as a proactive business catalyst rather than simply preparing to be reactive, as several of our contributors note below.
Gerald Tombs, founder and CEO of Clearvision
For almost 14 years Tombs has been leading Southampton-based Clearvision (year-on-year growth of over 30% and now offices in USA, Ireland, India and South Africa) which helps support businesses with software development and staff collaboration – offering tools, solutions, services and resources to take business teams and technology to the cloud.
“Every journey starts with an initial step. It has taken me 20 years of business to realise that the best way to sustain growth with the least amount of challenges is to ensure every member of staff you hire matches the culture and views of the founders. This does not mean they cannot disagree with the founders – far from it – a good CEO will actively encourage staff voices and listen to other views, which then produce good, balanced decisions.
“The second key is to be constantly creative; moving with the times is essential. A company that invests time and energy to extend beyond its comfort zone will attract staff wanting to grow with it. Part of this creative aspect is to recognise failure fast and not be afraid to close down a project, regardless of the investment, but, ensure you learn from such lessons.
“An area I’ve had to work very hard on is to relax the rules within the company and to trust staff. If you get the culture right and you remind everyone that the minimum rule is to be professional in all aspects of business, then this plays well with all ages of staff.
“My last point is to communicate with staff and customers often and not to be afraid of using different mediums eg blogs, vlogs, town hall meetings, etc.”
Chris Way, Lloyds Bank, area director for SME & mid corporates division
Based in Hemel Hempstead, Way has been supporting and advising on SME and mid-corporate business growth in the Thames Valley and South East for over 18 years, helping clients achieve their business goals. His leadership of relationship-based commercial banking teams is built on integrity, honesty, hard work, and exceptional customer service.
“All businesses are unique, so extensive variables may impact upon a business’s short, medium and long-term success. That said, I see three principle areas that must be adhered to in enabling sustainable business growth.
Innovation: “The speed of change in society continues to accelerate. It’s unlikely to lessen and today may be the slowest pace of change ever experienced in your lifetime.
“Product consumption, manufacturing, access to services and products are all going through unprecedented change. This will affect different sectors at different times, in different ways. Ultimately, every business needs to stand ready to adapt and innovate.
“In order to innovate, businesses need to be able to take ‘time out’ to ‘step back’ from normal business operations and consider how their market is changing.
“What disruptive technologies might impact their model? What environmental issues (such as plastics usage) or disruptions in other sectors, might lead them to enforced change?
“Being aware of these changes – not panicking or constantly changing direction, but making small modifications to refine what you do; taking potential threats into account when planning capital projects – are critical business behaviours.
Cashflow: “Manage the cash available in your business; it is its lifeblood. Cash is king, not profitability. Many big and famous brands had significant periods of loss-making while becoming established.
“Care for your cash; plan its use with reasonable event horizons. Prepare sensible cash forecasts and monitor them well.”
Outstanding client service and compliance: Most businesses aim for the first, and HMRC plus our commercial world’s legal regulations demand the latter, but these two aspects remain core fundamentals for a sustainable business.
Alex Tatham, UK MD of Westcoast
Founded in Reading in 1984, the IT full-service distributor Westcoast is the epitome of a highly successful Thames Valley business. Now Theale-based and headed by Tatham, it has grown steadily and impressively, achieving £2.2 billion in revenue in 2017.
“When does growth stop? When you want it to.” Commitment to growth must come from the owners and senior management and it has to be at the heart of a business strategy. “Hope’ is not a strategy,” said Tatham.
“At Westcoast, we set out our stall to grow fast – without losing our flexibility and speed of execution. Having made that decision, we needed the fuel to make it happen – access to finance to fund investments and working capital; appropriately incentivised people actioning our plan; access to credit both for Westcoast suppliers and to offer to customers; and finally a ruthless focus on the one thing that you can control – costs. It is the latter that makes growth sustainable.
“With increased pressure on gross margins, growth provides an opportunity to spread fixed costs ever more thinly, but ensuring that you are super competitive is critical to long-term sustainable growth. Growth attracts more customers, new recruits and suppliers. It’s an upward spiral which makes us so much more attractive to deal with, and fun to work within.”
Tatham admits being within the fast-changing IT industry has helped Westcoast enormously. “As companies digitally transform, automate and move to the cloud – there are an ever-increasing number of opportunities for Westcoast to get involved in”
Staying adaptable helps manage the inevitable market changes. “Rather than running away, Westcoast runs towards such potential opportunities; making the investments required and sticking with them for a longer term – the joy of being privately owned.”
For instance, cloud had every potential to be disruptive, but Westcoast invested in a dedicated team and systems and has become one of the largest cloud partners for Microsoft in the UK and Ireland. “Cloud is now part of our growth story.”
Claire Edmunds, founder and CEO of Clarify
A Theale-based professional services consultancy specialising in strategic business development for enterprise and high-growth start-up clients operating in the technology space. Clarify helps create a systematic way to grow sales pipelines and revenues while delivering long-term and transformational change.
“There are so many factors outside of our control that can affect a business. With the present rate of change and level of disruption it’s possible that analysing and anticipating the big opportunities and threats has never been more critical.
“However, in my personal experience it is more often factors that are inside my direct control that have the power to accelerate growth or cause it to stall.
“I’ve learnt that when you are running a company nothing ever stands still and in truth the behaviours, processes and knowledge which got us to where we are today will likely not get us through the next phase of growth.
“Looking hard in the mirror to consider what I personally need to change, how I need to grow as a leader and committing to making this happen, is perhaps the most important ongoing area of focus.
“Being vulnerable, seeking feedback and being willing to learn are powerful behaviours. I have found that when I model these, they spread throughout the leadership team and filter into the whole organisation; building trust, improving alignment and accountability.
“I truly believe that our competitive advantage is our culture. Prioritising and investing in our business culture and selecting people who share and live our core values has helped us to unlock potential and growth.”
Jason Pyke, managing partner, Vale & West
A Reading-based accountancy and business advisory practice that in 2019 will be celebrating 125 years of successfully operating with varying sector clients throughout the Thames Valley.
“Sustained growth enables the confident creation of commercial plans.
“Businesses today need to be responsive to change at all levels – market, legislative, technological, social and even international.
“Businesses need to be forward-thinking, covering current risks while always thinking about how to drive the business forward – progressing not stagnating. “If a business stands still it effectively moves backwards in 21st century markets.
“Businesses also need to invest in their infrastructure and people – for example, having the right modern working environment to attract and retain staff.”
To underpin sustained business growth, access to capital and good cashflow are essential. “Business owners who do not invest or retain sufficient cash to fuel growth can often see their business curtailed or miss out on the potential for creating and realising valuable business asset.”
Regulatory requirements, taxation, payroll etc are all key business facets that need to be under control, whether internally or through outsourced professional assistance.
“The greater complexity of the regulatory compliance and red tape burden today can stifle businesses in controlling their preparedness for growth.
“In today’s Internet era you also have to be more aware and savvy. The magnitude and availability of information means you cannot ignore the potential worldwide influences on a business.
“With service-providing businesses, attitude is especially important. At Vale & West we aim to develop mutual respect for each other’s respective professional skills and views – that’s with all our staff, associates, suppliers and clients.
“We are open-minded, remain ready to be flexible, but we aim to be client-focused and doing things well to sustain our long-term business performance and reputation.
Competency should build confidence, not dogmatism. “We are employed for our compliance, strategic and management services but we provide our professional advice with natural empathy for a client’s business operations, aims and objectives.
“In some scenarios, there are no right or wrong answers. You can only truly find the right advisory pathway for clients by examining all available and practical options with an understanding of a client’s needs to find the best fit.”
