True Growth is About More Than "More"

You know what growth means. What innovation means.

But do your definitions, expectations and methods for achieving both, match up to the person next to you in the board room? And how do you create that alignment?

In this exclusive two-part series, professor and The Wall Street Journal best-selling author John Danner offers ideas for navigating through the thicket of possibilities and shaping your company's path forward.

The time to start is now. Enjoy.

By Elke Boogert, Mach49 Managing Editor

True Growth is About More Than "More"

By John Danner, Faculty Partner at Mach49

If you work (and perhaps more than you’d like to admit, live) in or near the executive suite of your company, you’ve probably heard two words more than almost any others: growth and innovation.

Chances are those two have made their way prominently into your annual reports and investor meetings. And why not? They’re central to the mythology of corporate capitalism, whether you’re an upstart startup or an entrenched incumbent in your industry. They focus on offense, not defense; on creativity, not complacency.

So how can you actually get either or both of these desired objectives? Starting with growth, I’ll offer two specific suggestions in this instalment, and two next week.

Suggestion One: From Heads to Paper

Each of us has our own working definition of growth and innovation, and our own ideas about how they are related. But we rarely share those mental models with one another candidly enough to turn those lofty-sounding terms into effective rallying cries for action.

So, start by asking every member of your team to personally reflect on what exactly they mean by those two terms. I’m not suggesting an exercise of dictionary drag racing or numerical target shooting. Ask your colleagues for something deeper:

What is true growth? Why is it important and what might it mean for your company, customers and colleagues? How would you know it if you saw it?

Then ask them to draw, on their own, their model of growth before they share their definitions with one another.

Why draw?

• First, because it levels the playing field – most people are not artists, and you are looking for the clarity of their ideas, not the beauty of their art.

• Second, drawing invites people to think and communicate a bit differently than the usual around-the-table verbal conversation.

• Third, it ensures that every individual on your team starts with her or his personal model uninformed by everyone else’s.

• And fourth, because it helps quickly identify overlapping and contradictory patterns of thought that can help focus your team’s composite understanding of what you are really trying to achieve together.

Here's some of what I’ve found conducting this kind of successful exercise with hundreds of executives over the years.

More sales, more profits, more customers, more market share . . . more, more, more. Executives relate because of the unceasing pressure they feel every day to do just that. One CEO of a major industrial products company said,

“I live in the Land of More. Not better, not healthier, not happier. Just More.”

But real growth has to be about more than just more. Every company in the Fortune 1000 Graveyard, from Blackberry and Toys ‘R Us to Blockbuster and Kodak, and the Global 1000 counterparts presumably wanted to grow. But they tried to do so at the expense of staying focused on far bigger changes in their markets and their own competitive positioning.

Growth by itself can be shorthand for simply doing more of the same. But your today and tomorrow customers may not be interested in more of your same; and your blatant and latent competitors are eager to offer them something different. So, if your team defaults to the “growth = more” shorthand, push them to think deeper.

You might ask them to put a one-word adjective in front of the “growth” they have in mind. Is it “profitable,” “sustainable,” “distinctive,” “commanding,” “targeted” or something else? That will begin to give your team a clearer sense of what kind of growth your company truly needs at this stage in your market’s evolution. Getting clarity on this point is critical to aligning your resources for the struggles ahead.

Suggestion Two: From Possibilities to a Portfolio of Priorities

Suggestion One is about answering the why question more precisely. Suggestion Two focuses on the where.

There is no easy answer to where exactly your company should focus its growth energy and resources. But there is an easy technique you can use with your team to help focus its attention and analysis in answering that question. Like the drawing exercise I described earlier, this one works.

Why? Because it’s simple and practical. It helps target different arenas in which growth is possible, while also setting the stage for prioritizing the portfolio of those possibilities that emerge.

As you know, consultants love 2x2 matrices; maybe not as much as Venn or Euler diagrams and waterfall charts, but they’re at least in the Top 5. I’ve just turned mine 45 degrees, to give it a sense of increased difficulty from bottom to top.

It asks you to first think about two fundamentals of your business: what you make/offer, and who you sell to. These are the two axes. Then it asks you to organize your ideas into two timezones: now vs. new, i.e., the future.

That can lead to a long laundry list of possible answers, and pretty soon you could end up with a 20x20 matrix if you don’t watch out. Beware: that defeats the purpose of this exercise. You want your team to error on the side of the strategic, not the comprehensive. So, think about your top 3-5 answers to those two questions as you move from quadrant to quadrant:

• Now:Now (what you offer today to your current customers)

• New:Now (what new solutions you might make for your existing customers)

• Now:New (what new customers might buy what you offer now)

• New:New (brand new things you might offer to brand new customer segments)

If yours is like most of the executive teams I’ve worked with, you should have the makings for a rich exchange about the reasoning behind each person’s candidates and the themes they may share. Make sure you don’t ignore the “wild cards,” those ideas that cause others to scratch their heads or roll their eyes. Sometimes, those items are exactly what you’ve been looking for.

What’s next? Translation. Now your team needs to shift focus – from possibilities to priorities. The best way to do that is to impose some constraints, whether it’s a fixed amount money, time or even imaginary points or tokens that have to be allocated among those four arenas. Make sure each voter considers each quadrant on its own before deciding what portion of get/his “budget” goes where.

Or maybe even their best questions that have to be answered before you make final decisions about this Growth Portfolio.

How much effort should go to your core, the Now:Now and Now:New where you can grow with what you know today vs. the adjacent and frontier New:Now and New:New domains that will test your ability to create new solutions for those you know today and/or open up entirely new markets.

But your job is not simply to be a synthesizer or facilitator. It is to be a leader – someone who probes, challenges and encourages your colleagues to tighten their thinking and question their assumptions without stifling those “wild card” possibilities. Make sure you push your team to consider all four domains; each has its own growth potential.

Welcome to the reality of translating that rhetoric of “growth” into a coherent, compelling action agenda to make it a reality.

Every company approaches the growth imperative in its own way, based on its own growth persona and culture. The choices are rarely easy or the risks comfortable. But these two suggestions can help you and your team navigate into and through the thicket of possibilities in shaping your path forward. Together, they can help you avoid the “Bog of Banalities” that too often equate growth with just more. We need less of that.

In the second instalment, we’ll shift our focus to the companion domain of innovation. I’ll suggest two ways your team might build and connect its insights on growth with its “more than more” thinking about innovation and how that might accelerate your success.

Faculty Partner JOHN DANNER is a Professor at the University of California, Berkeley and Princeton University, and a sought-after advisor to Fortune 500 enterprises, mid-market businesses, and emerging ventures worldwide.

A thought leader, trusted advisor, and respected teacher at the intersection of leadership, innovation, strategy, and entrepreneurship, John anchors executive education programs on 5 continents — including Aspen Institute leadership seminars, co-founded a national healthcare business newspaper, and is credited with the original idea for TED University.

He previously held senior-level positions in state and federal government — working for then-Governor Bill Clinton and the first US Secretary of Education — and represented major clients in telecommunications, real estate, energy, and investment banking at Morrison & Foerster.

John has been highlighted in the New York Times, the Economist, and the Los Angeles Times, and is a popular keynote speaker for audiences of industry leaders and executives. He holds a BA from Harvard as well as master’s degrees in public health and education from the University of California, Berkeley.