"Over the past quarter century we have studied the process of
corporate growth and formulated a comprehensive theory to explain how and why some
companies are able to grow rapidly and keep growing. We have presented detailed
illustrations of that process in two management books entitled The Vital Difference and
The Vital Corporation. There we have identified five internal combustion engines
that can drive the growth of any business and outlined strategies to energize each of
them. The five engines include: the relationship the company forges with the external market,
which is potentially as wide as the needs of society itself; the technology or
know-how it applies to produce and deliver products and services; its capacity to attract
and retain talented people, releasing their energies and tapping their capacities;
the creativity and efficiency with which the company manages capital; and the
capabilities of its organization¸ the structures and systems it employs to
harness all these resources to meet social needs.
Each of these engines represents an unlimited reservoir of potential energy
and creativity accessible to every business. Each releases maximum productive power only
when it develops in a balanced manner with the other four. The power of any of these five
can combine to generate epoch-making success or, if managed poorly, epoch-making failure.
Microsoft has used all these levers in its rise to eminence in the global software
industry.
But the greatest growth occurs at moments when companies align the
development of these internal engines with the explosive emergence of new forces in
society. Society constantly throws up new waves of energy that generate
opportunities in different fields. At times of dramatic social change, these fresh
energies forge fundamental shifts in the five external engines of society from which the
internal engines of each business derive. New markets emerge, as the overnight delivery
business did in the 1970s. New technologies spread like wildfire, as the automobile did
after 1910 and the computer after 1980. New ways of managing people release far greater
energy and creativity than before, as the Silicon Valley style of management has elevated
productivity of an entire industry and infiltrated revolutionary ideas into traditional
industries. New systems for generating and managing capital accelerate business
development, as the growth of venture capital has over the past quarter century. New forms
of organization proliferate, as mail order did at the turn of the century, franchising did
from the mid-1950s and Internet has during the last decade.
Companies that can attune their strategies to reflect the
evolutionary changes in several or all of these engines catch the growing swell of the
wave of social advancement. By synchronizing multiple waves of this energy, they are
catapulted forward and upward to levels ten times or more their previous position. Companies
that adapt to one major shift, such as advancing technology or an expansive market, rise
rapidly for some time and then level off, fall back or even disappear, as countless
personal computer startups did in the early 1980s. Companies that jump a little too soon
or too far get caught and crushed under by the advancing momentum, while those that are
slow to adapt may miss the opportunity altogether.
It is no coincidence that AT&T, Ford and Sears went on to rank among
the largest corporations in the world. That is a natural consequence of the way they tuned
their internal engines to the surging tide of social progress.
During periods of radical change, a product that symbolizes
people’s social aspiration or a company that aligns its purpose with society’s
growth or an individual who envisions the evolutionary need of the hour can rise
phoenix-like out of nowhere to become the focal point for releasing enormous social energy
and projecting it in a new direction. Usually this process is unconscious and
therefore partial. But it can also be done consciously and comprehensively. In this case,
the results can be nothing short of miraculous. Doing it consciously requires a
theoretical knowledge of the process of social evolution as well as a practical knowledge
of how to formulate appropriate strategies that synchronize with the live movement of that
evolution."
For additional
thoughts about a company's commitment to the emerging aspirations of
society, click
here.
Additional Info:
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To review an article
about business opportunities in the marketplace, click
here.
-
To review strategies for
energizing the market for you company, click
here.
-
To review an article of the role of the pioneering individual to foster growth in
the society click here -- click
here.
-
For
more on the five growth engines of a business, click
here.
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