Growth Online > Knowledge Base > Business Growth > General Theory Business: General Theory   Potentials of Growth and Development | Five Growth Engines | Leadership   Potentials of Growth and Development (main) You Become that Which You Believe You Can Become An individual, a business, a government is limited only by its beliefs. A fast growing, out-of control business can become a model of organization and stability and still grow at an astounding rate. A giant lumbering company can double its revenues in a few years or less. We assume that small fast growing companies cannot easily gain control of its self, or that large companies with a long track record steady growth cannot all of a sudden be energized for spectacular growth. Could it be that this is only a mental belief? That if one were to change the belief, the reality could change? Could it be that you are what you believe in, and you become what you believe you can become? If this is true, and we think it is, any company can be energized to double its profits and/or revenues in two years or less, or become anything it wishes in the timeframe it wishes. Cause of Prosperity Prosperity is the result of intelligent industry which comes from education. (MSS) Business Growth vs. Development Business growth is an extension at the same level -- e.g. another hotel is added to a hotel chain. Business development is movement to a higher level -- e.g. a hotel chain that decides to cater specifically to the Internet traveler, or one that suddenly gives priority to the needs of its employees. Business growth is horizontal extension. Business development is vertical evolution. A salesperson who visits more of the same type of store is normally creating horizontal growth. If the salesperson went to a new type of store or begins to control his contacts with a computerized system, then that would be development. Sometimes development can seem like more of the same. E.g. if the motel chain was previously reluctant to expand into new markets because of some bias, then the overcoming of the bias and extending into these areas is vertical development. The overcoming of the attitude is the source of the development, not the added locations in itself. Factors that Determine a Company's Development CONSCIOUS, SUBCONSCIOUS SELF-CONCEPTION – Businesses develop as a result of a self-conception that is sometimes conscious, often subconscious.  A noted instance of conscious self-conception was Fred Smith’s idea for establishing Federal Express. ASPIRATION -- The development of a business is fueled by the aspiration of its people. The aspiration of the owners and leaders is a critical determinant of how far and how fast the business grows. REQUISITE ENERGY SURPLUS -- Surplus energy is an essential condition for business growth. Only in the presence of surplus capacity can new activities be supported. The same is true in business. Companies struggling for survival or to meet the minimum requirements of their customers lack the excess capacity needed to plan and initiate new activities or elevate their functioning to a higher level of organization. PIONEER INDIVIDUAL -- New modes of activity are introduced in a company by pioneering individual initiatives that are imitated and disseminated by others, diffuse through the company, and are eventually accepted and integrated with the normal functioning of the company. AUTHORITY -- Authority is a fundamental principle of organization that is essential to the survival and development of companies. Corporate authority is expressed more and more through the discipline of impersonal rules, systems, coordination of activities, policies, corporate culture and values that determine the effectiveness with which surplus energy is converted by a business into productive power, rather than by top down personal exercise of authority by a management hierarchy. TECHNOLOGY, KNOWLEDGE, & SKILLS -- Social know-how in the form of technology, practical knowledge and skills determines the conversion of productive power into material results in business. PRODUCTIVITY OF RESOURCES -- The productivity of a company’s resources is not subject to any inherent limits. It depends on the attitudes, information, knowledge, organization and skills creatively applied – i.e. on powers of mind. ATTUNING TO SOCIETY’S NEEDS -- Companies develop by attuning themselves to the direction, trends and changing needs of the wider society of which they are a part in each of these five major areas. This relationship is especially apparent in larger national and multinational corporations whose development is often closely tied to parallel developments in the societies in which they function. ORGANIZATION -- Companies depend for their development on three levels of organized infrastructure—a physical organization of production, transportation, communication, etc.; a social organization of legal, financial, commercial, and educational systems and institutions; and a mental organization of information, technology and knowledge. All three are needed for the achievement of progressively more complex forms of BUSINESS activity. VALUES -- Values represent that highest form of organization for directing human energies in constructive and productive activities. The quality and height of the values set the limits on the magnitude of developmental achievements. (MSS, somewhat modified) FULFILLING POTENTIAL -- The utilization of business development potential depends on the company’s level of awareness, aspiration, organization, values, knowledge and skills. Horizontal and Vertical Makeup of Company Horizontally a company is made up of its five components -- market, technology (products and services), organization, people, and finance. These are the engines of growth. The fuel and energy for growth is its vertical aspect which begins with top management's values, mission, values, and goals, which are communicated and executed down throughout the organization by knowledgeable and skilled people. Untitled Commerce has brought science to the masses through technology. (MSS)  Factors of Potential in Business In the 60s, [the Indian concern] Pondicherry Milk Society was losing money. The government was willing to close shop. Someone suggested that the Cooperative Bank Secretary was a dynamic man and he could turn it into a profit-making concern. That officer rose to the expectation of his admirer and made the Milk Society a great success. What was the secret? Inside the various sections of the Milk Society there was plenty of potential - money, human resources, opportunities, advantages of the market, organisational strength, etc. - which when drawn upon, a losing concern becomes a profitable one. (MSS) Tending To All Areas of a Company's Strength Simultaneously In every company there are about a hundred areas of strength - reputation, loyalty, credibility, thoughtfulness, resourcefulness, dynamism, etc. - each of which was prominent at one time. At any given time, any company focuses ONLY on one resource. In practice, it is one project. All the others recede to the background and are gradually forgotten. It is true of any family or any individual. Anyone who realises such potentials and exercises his mind to DRAW upon them will let his life or his company’s life grow exponentially. The strength is within. (MSS) Success is for Those Who Dare and Act in An Aggressive (Seemingly Oppressive) Market Work goes to China from USA in pursuit of low cost. Jobs are lost in the USA. The small US manufacturer goes out of business. The nation faces this crisis. The national association of tool manufacturers is called NTMA, National Tool Manufacturing Association. They are of all sizes, from $2 million to $20 million. A few of the companies are worth between 70 and 100 million dollars. In the view of the NTMA members, this crisis is a disaster and a misfortune. We see it as the greatest opportunity for the members. How can that be told to them? Even if we manage to speak it out to them, of what use is this sterile philosophy? Can we make them see that this is an opportunity and inspire them to act on that basis? The facts are on our side. We addressed their conference five years ago and earlier seventeen years ago. Out of the 2000 members, we have interviewed 40 or 50 of them. Several of them who were doing 2 or 3 million five years ago are now at 7 or 10 million dollars. That is a fact. But there is another side to that fact. Several others have closed shop. Many others are frightened of the prospect of closing. The interviews clearly show that the MARKET is aggressive, but expanding. Those who rise to the occasion of aggressiveness are caught by the wave of expansion and move from two million to ten or twenty. Those who are timid, and cling to their old ways are wiped out by the aggressively changing market. Success is for those who dare and act. (MSS, edited) Five Growth Engines (main) Five Growth Engines of Business There are five components to a business that are its engines of growth.  They are market, technology (products and services), organization, people, and finance. Most fast growing companies are weakest in the organization component. A company is only as strong as its weakest component. Horizontally a company is made up of its five components -- market, technology (products and services), organization, people, and finance. These are the engines of growth. The fuel and energy for growth is its vertical aspect which begins with top management's values, mission, values, and goals, which are communicated and executed down throughout the organization by knowledgeable and skilled people. Five Growth Engines Every business consists of five components essential for its existence, survival and growth -- market, products and services (technology), organization, people, and finance. Take away any one of these components and the company ceases to function. Each of these five possesses unlimited potentials that can be tapped to transform the component into an engine to drive the growth of the company. The maximum achievement results when all five components are energized and developed in a balanced and harmonious manner. Where the accumulated energy of the company is the fuel for growth, the five engines utilize the fuel and drive it to growth and profitability.  Just as more energy in the company provides more fuel for combustion, so to the well-being of each of the engines determine the final outcome. Together the fuel and the power of the five engines drive the company to growth and prosperity.  The stronger the combustion the more powerful the results. Five Growth Engines Detailed The five engines of growth for a company are: MARKET: This component includes the company's relationship with existing and potential clients/customers, its knowledge of changing needs and opportunities in the market, the way it identifies and reaches its clients/customers, the quality and speed of service it provides, marketing, advertising, and the selling and management skills its possesses. PRODUCT AND SERVICES (Technology): This component refers to the capacity of the company to deliver products and services. It includes the range and quality of products/services it markets, the technical knowledge and skill of sales and service staff, and the level of technology incorporated in its products/services and utilized to carry on business. ORGANIZATION: This is the component that holds everything together and forms it into a living whole. Organization consists of the structures, systems, policies, procedures and activities of a business, the manner in which it exercises authority, takes decisions, communicates, coordinates and integrates its activities. PEOPLE: This component covers the energies, abilities, skills, and attitudes of employees that can be harnessed for growth. People and companies grow together. Those companies that provide maximum opportunities for their people to grow, find maximum opportunities for their own growth. FINANCE: This component defines the way in which the company manages, monitors and utilizes capital resources for its growth. It includes the quality of systems and skills for accounting, budgeting and financial management, cash and credit management, control over purchasing and inventory, access to capital. Balancing The Five Engines The performance of a company is determined by the extent to which it utilizes its potentials.  A business achieves maximum performance when each of its five engines is fully developed, and when all five are developed in a balanced and harmonious manner.   When the development of the components is uneven, the weaker components prevent full utilization of the capacities of the stronger ones. For example, a company with a good reputation in the market or excellent products will not be able to fully leverage these strengths if its people lack critical skills or its organization cannot respond quickly to growing market demand. The company is as strong as its weakest engine. ARTICLE on the Five Growth Engines of Business Success Leadership (main)   Executives Follow the Inner Requirements of the Employer Executives in a private establishment do not go by the rules laid down, the speeches given, by the tone of those speeches and what the top actually desires. Very readily they tune themselves to the real inner requirements of the employer. When Khrushchev announced liberalisation in the USSR, he still behaved like Stalin and the rank and file treated him as Stalin. (MSS) Managers vs. Leaders -The distinction between managers and leaders is of paramount importance in the modern business environment. Simply defined, managers direct, leaders inspire. Managers demand respect and exercise authority. Leaders respect others and enhance their freedom for individual initiative. Managers promote efficient execution of routine activities. Leaders release and direct the energy of the organization to propel it into higher levels and wider circles of accomplishment. Effective managers promote horizontal expansion of the activities over which they exercise control. Inspiring leaders promote vertical development and creative initiative, even in areas over which they have no organizational power. Efficient managers insist on strict adherence to policy and procedure. Dynamic leaders strive to maximize energy, commitment, effort and resourcefulness. Managers often mistake the submissive behavior of subordinates as an accurate reflection of their own worth. Perceptive leaders know their own weaknesses and know that others know them too. Almost anyone can exercise authority when the power to enforce obedience is placed in his hands by virtue of his position within an organization. Great leaders are those who generate the power for accomplishment by the strength of their own personalities in circumstances where organizational authority does not exist and obedience cannot be enforced. Strong managers enjoy the use of power and feel energized by exercising their authority. Insightful leaders understand that the only one who feels energized by the exercise of authority is the one who exercises it. -Can one man and a handful of followers make such a difference to the life of an organization or a nation? They can and they do. Every great accomplishment is the result of one or a few people who rise above the ordinary to perform extraordinary deeds. What makes them extraordinary? It is not their talent or strength. It is their attitude and determination. What can motivate men to such an attitude and determination? Neither the power of authority, nor the force of compulsion, nor the threat of punishment. It can only be accomplished by acts that are self chosen in an atmosphere of freedom in pursuit of a challenging and inspiring goal that unites and benefits all rather than divides and deprives. The true essence of leadership is to create that atmosphere of freedom, project that inspiring goal and motivate people by determination and example to the highest conceivable levels of accomplishment. For such a leader and followers, anything is possible. (MSS) Great Leadership & Emotional Intelligence -What makes a leader great? A commanding presence? Technical brilliance? The drive to work 80 hours a week? Or spending thirty minutes each day in self-reflection? The answer is self-reflection. Follow that up with highly trained listening skills, persistent optimism and a bit of empathy and you have a leader who's not only great, but superb. -A steady stream of research over the past decade has consistently identified emotional intelligence as a much more powerful predictor of professional success than intelligence or expertise. Highly emotionally intelligent managers retain workers and encourage the productivity and innovation that make a company shine. Instead of trying to micromanage, effective leaders bring people together and inspire them. -You must create an environment where people feel valued to be creative. -Individuals' self-interest diminishes empathy and limits ability to see the big picture. -The most capable leaders demonstrate modesty and even shyness, giving credit to the organization and their co-workers before themselves. -The self-management aspect of emotional intelligence includes acting with honesty and integrity, especially in difficult situations. Executives must be flexible, and know when to walk away. -An executive who surrounds himself with 'yes' men, creates a morally neutered environment. The emotionally intelligent leader, in contrast, is aware of others' feelings and is willing to admit mistakes. -Emotionally intelligent executives maintain accountability and are committed to ethical business practices while they increase a company's profits. (East Bay Business Times, extracted)   Also See Thoughts on Leadership in General Also See Thoughts on Growth of Highest Management         New Insights into Infinite Business Success A Growth Online Portal Visit Now     Contact Us  | Growth Online Home