Join Anil Gupta for an in-depth discussion in this video Leading for growth, part of Designing Growth Strategies.
- Given their authority and power, people who sit at the apex of the organization have an outsized impact on whether or not the company is able to grow. What types of leaders, in terms of their backgrounds and behaviors, are more likely to foster the company's ability to grow profitably on an ongoing basis? It is important that the leadership team include a mix of explorers as well as exploiters.
The term "explorer" refers to people who are inherently very curious and constantly look for new opportunities. In terms of their backgrounds, explorers are more likely to have demonstrated a track record of growing the businesses that they were managing, and for driving disruptive innovations. The late Steve Jobs symbolized exploration.
The same could be said for Tesla's Elon Musk. The term "exploiter" refers to people who tend to be somewhat conservative and less comfortable with risk taking and change. In terms of their backgrounds, exploiters are more likely to have demonstrated a preference for incremental innovations and for driving efficiencies within existing businesses.
Many people would say that in comparison with Steve Jobs, Tim Cook, Apple's current CEO, is relatively more of an exploiter. Leadership teams which include a balanced mix of explorers and exploiters are almost always better than those which are comprised mainly of either type. Too many explorers can make the company too much of a risk taker and too comfortable with growth per se, even if it is unprofitable growth.
At the other extreme, too many exploiters can make the company overly conservative and unwilling to experiment, lest it have a negative impact on profitability. Aside from composition of the top leadership team, in terms of driving profitable growth, it's almost important that senior leaders routinely spend time on the front lines with customers, sales and marketing people, and the R&D labs.
This is how they develop direct insights into problems that need to be resolved, and potential solutions to these problems. This direct exposure is key to keeping the organization innovative. Senior leaders also need to monitor not just mainstream competitors, but also upstart ones who are perhaps more willing to experiment with disruptive business models.
Think of Toyota versus Tesla . Such an approach is critical to accelerate the pace of innovation. From time to time, senior leaders also need to look at the company from the lens of outsiders. To borrow an idea from Andy Grove, Intel's former CEO, it can be eye-opening to ask the question, "Suppose we were newly hired to run this "company and today was the first day.
"What would we do?" This type of an outside-in approach can make it easier to discard old mindsets and embrace new ones. Last but not least, senior leaders ought to spend considerable time immersing themselves in markets that will account for bulk of the future growth. This is where the biggest unknowns, and the biggest uncertainties, lie.
This is also where the need for innovative thinking would be greatest. To sum up, those who sit at the apex of the organization have an outsized impact on whether or not the company is able to grow profitably on a sustained basis. They have the power to select key personnel, to establish incentive systems, and to allocate resources.
It matters who they are, how they spend their time, and the signals sent by their statements and behavior.
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- The growth imperative
- Identifying opportunities for growth
- Assessing and choosing among the growth options
- Implementing the chosen growth strategy
- Organizing and leading for growth