Business Growth Strategies- What are Business Growth Strategies?
Business growth strategies are the single most important set of strategies to develop and maintain growth in your company. This post is part of a series that links competitive advantage to developing and executing business growth strategies and company development strategies.
In my first post, I introduced the link between creating competitive advantage, business growth strategies, and company development strategies and gave a general overview of the goals for the series.
In my second post, I addressed the question “What is Competitive Advantage?”
This post answers the question “What are business growth strategies?”
Business growth strategies are strategies you can use to increase the size of your business. The best business growth strategies for your business will grow your business top line and bottom line over the long-term and can also help you in creating competitive advantage over your competitors.
Defining your business growth strategy:
The 3 core “what’s” of your business growth strategy:
Business growth strategies can be described in various ways. I find the best way to describe a business growth strategy is along three dimensions:
1. Target customer segment- What is the segment you are targeting? Your target segment can be described in various ways, such as demographic or psychographic characteristics for consumer segments or industry vertical company size, or department for business segments (note that there are many, many different dimensions for describing customer segments and these are just examples).
2. Whole product- What is the whole product you will deliver to your target segment? Our definition of whole product, as described on the OpenView Labs Website, is “Whole product development is the comprehensive set of activities and interactions intended to design, create and deliver valuable and unique whole product experiences for your users. Whole product is your core product plus all of the ancillary touch points that your product users experience, including pre-sales experiences, professional services, and ongoing user support.”
3. Customer Development Channels- What are the customer development channels you will use to find, acquire, and grow your customers? Our definition of customer development, as described on the OpenView Labs Website, is “Customer development is the design, creation, and delivery of all of the touch points that your product buyers experience to help them find, perceive, try, and purchase your products and services and renew and grow their relationships with your products and company over time. It is the comprehensive set of content, activities, and interactions with your market participants intended to design, create, and deliver valuable and unique experiences to help you realize your buyer oriented goals.”
The 3 core “whats” of a business growth strategy define the target customer segment, the product that will be delivered, and the customer development channels that will be used. If you have multiple business growth strategies, you should describe these three dimensions for each strategy.
The additional “whats” of the strategy:
- What are your goals for the strategy?
- What are the anticipated results from your strategy (e.g., economic results)?
- What are the expected competitive advantages that will be created in the target customer segment?
- What are the resources needed to support the business growth strategy?
- What company development strategies are necessary to support the business growth strategy?
- What are the anticipated risks?
- What are the anticipated obstacles that need to be overcome?
Now, better describe your strategy with the “Hows” of your strategy
- How will you develop and deliver the whole product? For example, build the product internally, hire a company to build the product, buy a company that already has the basics of the product?
- How are you going to design and develop your customer development channels? For example, build organically, partner with others, buy a company that already has these customer development channels?
- How are you going to support the product development and customer development with company development strategies? For example, people, organization approaches, operational processes, legal and financial support?
Now, better support the “whats” and “hows” and the “whys” of your business growth strategy:
Why is this strategy the best business growth strategy?
- Why will this strategy best help the company align with its aspirations?
- Why will this strategy best help the company meet its goals?
- Why are other customer segments less attractive?
- Why is this whole product the best one for the chosen customer segment?
- Why is your whole product better that the alternatives for your chosen customer segment?
- Why are these customer development channels the best ones for this customer segment and this whole product?
- Why will this strategy create competitive advantage?
- Why are your answers to the “How” questions the best options for your company?
These are the broad brush strokes for a complete business growth strategy. Defining the target customer segment, the target product, the target customer development channels and addressing the rest of the “whats,” “hows” and “whys” will set you up really well with the best business growth strategies and make it easier to drive your strategy into your operating rhythm.
If you can clearly articulate, execute, and iterate on your business growth strategy, you should also evolve to achieve a really high market clarity score.
Can you clearly articulate your business growth strategies? If not, why not?
In my next post in this series, I will address the question “what are company development strategies?”
Note 1: Business growth strategies align with company aspirations (mission, vision, values). Some companies develop aspirations at an early stage of their development and should consider their aspirations when developing their business growth strategies (and consider adjusting their aspirations and/or their business growth strategies to make sure they align). As a company reaches a stage of development where the company has one or more solid business growth strategies in place, the management team should be at the point where they develop their company aspirations (if they have not already done so) and ensure their aspirations and business growth strategies align with each other (again, adjusting either or both so they align).
Note 2: I am only describing what a business growth strategy looks like in this post and I am purposely silent regarding the best approach for driving the strategy through operations and making adjustments to it over time. I am a huge fan of Steven Blank’s ideas on iterating and adjusting as you move from strategy design through execution (which I believe fits into the “agile” development concepts) and I believe that at every iteration you are essentially trying to more clearly and accurately describe your business growth strategy while you are adjusting the strategy based upon the results from the prior iteration. Net net, at each iteration, the framework is the same, but the best business growth strategy evolves and becomes clearer over time.
Note 3: I also purposely did not explain the graphic in this post. The three dimensions of the cube should be obvious from the explanation, but I will fill in the detail in future posts.