CEOs are focused on growth this year and wish that their marketing and leadership teams would focus on it, as well. Over the past 18 months, CEOs have let external issues dominate their agendas but they know it’s now time to look at what needs to be done to keep their organizations growing and profitable.
All CEOs are concerned about is growth. No big surprise to hear, but how they achieve growth is still up in the air. About half my clients believe that they should begin acquiring businesses that align with their longer term growth strategies. These executives are looking for potential business acquisitions that can increase top line sales. Most of the CEOs have been sitting on cash, waiting for the election and health care issues to shake out. They see there might be some bargain to be had for the organization that is prudent in their new business acquisitions.
Many of my better known CEOs have publicly said they will be investing in new businesses this year. Merger and acquisition will highlight the first half of 2013. Several are good at growth strategy, but most are not. For people on these leadership teams, you should begin looking at your current product portfolio to see where there are gaps in your line up and begin identifying potential acquisition targets.
My second group of client CEOs is looking to expand their organic growth efforts. They want to leverage what they currently have, upgrade their team’s capabilities, and begin to look for new opportunities within their best clients and customers. They are going to spend this year creating stronger relationships with fewer, better clients. They plan to harvest clients in targeted niches that they see growing and will begin having their sales teams work to strengthen their position in key clients. They may also begin investing in account development managers who will oversee specific client education programs that strengthen their ties to the client organization.
The final group and by far the smallest group are the CEOs who look to partner with their best clients and suppliers. They will try to better understand the business environment in which both they and their clients are working. They will strive to help their best clients become more profitable by leveraging their products and services to help clients grow larger. During this time they will continue to look for opportunities to serve their clients better. This will include co-development of new markets so that their growth is tied to their client’s success. They will begin narrowing their focus to key target markets and then develop strategies to dominate these markets. Their organizations will become the centers of influence within their markets. They will be the thought leaders in their field while aligning their resources with future growth opportunities. Their clients will help them grow because they will be able to leverage knowledge to increase their influence. They will begin building stronger connections into the public sector because they see it as part of their growth infrastructure. For the next several years, the government will play a more activist role in your business and smart CEOs are going to learn how to navigate through these changing times.
Now, why did I share this with you? Well, first I’d like to ask you this simple question, what kind of organization are you? Most executives fail not because of lack of talent or intelligence but because they fail to see the writing on the wall. Most executives are so good at being good at what they do; they miss the subtle changes happening inside their organization. To remain in your role for the longer term you should seek to understand in which direction your business is evolving. Then decide how you can create value with the strategy your leadership team is embracing.
A simple exercise I use with clients is I ask them to describe how they plan to grow this year. I ask them to identify their three biggest challenges. We then brainstorm about these. We start large and then continue into the specific details. I ask them tough questions, I listen aggressively. We work to eliminate these challenges.
I then ask what are the three greatest opportunities for growth in their business. We talk about them in detail. We then look at their organization’s capabilities and culture. How change impacts them. What they can leverage and what they need to build out. The whole exercise lasts between ninety minutes and three hours. I continue challenging their thinking. I share new ideas and strategies others are using to get greater results. We build a stronger understanding what needs to be done. We chose three opportunities to begin working on.
We identify their growth goals. We help set firm revenue goals for their organization. We identify the needed resources and people to achieve these goals. Then we get to work. Next week we will discuss the concept of marketing innovation and how it applies to your business. Are you ready to get to work?