Search results

By using the internet search engine Google™ as the primary example, this article illustrates: (1) that some high‐growth expectations are unsustainable over the short and medium term; and (2) that dependency on single revenue streams may provide growth over the short term, but may not be sustainable over the medium and longer terms, and may be a high‐risk scenario. An approach is presented that companies can undertake to critically evaluate current and future positions and consider such options as acquisition and integration as a means of building future growth potential.

Secondary research based on the analysis of published data.

Dependency on one revenue stream within a volatile market can impact upon growth expectations. Hyper‐growth expectations may be unsustainable, indeed unrealistic, over the medium term. Such growth expectations may be detrimental to the company. Companies who can spread the risk through acquisition and integration through strategic fit may have greater longer‐term growth potential, notwithstanding market and environmental dynamics.

Future opportunities for research could include, among other areas, how Google™ and similar online companies could use currently free products to generate revenues.

Companies need to consider the volatility of the marketplace. Dependency on one revenue stream could be a high‐risk scenario, especially in relation to sustainable high growth expectations. Companies also need to consider various strategic options for sustainable longer‐term growth, and continually critically review both internal and external environments, as well as product ranges and revenue streams. Companies should take action to sustain growth, whether that is through new market development, acquisition or even divestment.

While being flexible companies need to consider a realistic strategic direction for the business. Companies also need to consider realistic growth rates as compared to hyper‐growth expectations that are unlikely to be sustainable over the medium and longer term.

Growth is the top priority on the CEO agenda, but the question they confront is “What factors constrain growth?” And, “How do successful companies drive growth?”

IBM Institute for Business Value conducted a global study that focused on three questions: Who are the successful growers and what patterns are associated with them? What do successful growers do differently? How can other companies apply what they do?

The major finding were: that limits to growth are often self‐imposed and, as such, can be overcome; firms with the will to be successful growers can break free of perceived constraints related to size, industry boundaries and geographic neighborhood; and despite the widely held belief that mergers and acquisitions inherently destroy value for the acquirer, companies that learn to become successful growers use M&A strategies effectively.

Looking at 1,238 Global S&P 1200 companies, the IBM team analyzed the patterns of revenue growth and shareholder value creation over the decade, segmenting results by four component geographies and 18 industry groups. It selected three industries (consumer products, telecom services and electronics) for detailed assessment, developing cases studies for about 20 companies in each industry, picked to represent a range of successful and unsuccessful results.

Winning the growth game requires companies to excel in three vital areas: course, capability and conviction. Successful growers set the right growth direction – the course – by forming a clear point of view on the future, evolving the product‐market portfolio without being limited by history, building a competitive model to win and pursuing reinforcing initiatives to sustain growth. They truly understand their capabilities – based on realistic assessments of their strengths and limitations – and evolve their operational model to support the growth strategy. Finally, while many companies develop excellent plans, truly successful growers build organization‐wide conviction that translates intent into action for everyone from top leaders to front line managers.

The message is clear: neighborhood is not destiny. Executives have more room to be ambitious than they tend to believe. Winning companies set ambitious growth plans regardless of industry or geographic “limits.” They aim for targets above and beyond what they and their peers typically expect.

THE purpose of this paper is to examine the ways in which managerial ages may affect a company's growth rate. A brief discussion of the possible links between age of management and company growth is followed by presentation of the results of an empirical investigation of four UK Industries and fifty large US corporations.

Gazelle companies are characterized by rapid growth in a short time. Identifying the determinants of this exponential expansion is important as these firms have a significant impact on the economy. They generate increased employment and investment by investors interested in new opportunities. Previous studies have failed to reach a consensus about what fosters high growth in gazelle companies as each firm’s geographical, political and economic context is different. The present research uses cognitive mapping and interpretive structural modeling (ISM) to overcome the limitations of prior investigations and identify factors that can potentially accelerate growth in gazelle companies.

Two sessions were held with an expert panel with knowledge about and experience with these firms. In the first session, data were collected to create a group cognitive map, while the second meeting comprised ISM-based analyses of the high-growth determinants identified and the causal relationships between them. A final consolidation session was held to discuss the results with two members of the Committee for Central Region Coordination and Development (i.e. Comissão de Coordenação e Desenvolvimento Regional do Centro – a public entity that grants gazelle awards in Portugal).

The analysis system created was tested, and the results demonstrate that the dual methodology used can increase our understanding of the dynamics of high-growth determinants and lead to more informed and potentially better evaluations of gazelle companies. Indeed, once high-growth determinants in gazelle companies are understood, this information can help other firms implement the same business model to achieve similarly rapid growth. The strengths and shortcomings of this new structured analysis model are also analyzed.

The authors know of no prior work reporting the integrated use of cognitive mapping and ISM in this study context.

I test empirically the hypothesis that the monitoring role of the board of directors depends on the severity of the agency problems and the amount of information needed to monitor. I show that in high growth firms, where the agency conflicts are low and managers are likely to reveal more information to get advice, boards are more independent but less likely to monitor, while in low growth firms, boards are less likely to be independent, but the relationship between firm value and board independence is strong. Overall, boards become more independent but monitor less as firms’ growth opportunities increase, suggesting that managers trade off the amount of information released to the board to get a better advice and to mitigate the monitoring role of the board.

Despite a large and growing literature on the subject, little is understood about the phenomenon of small business growth. Specifically, the small business growth literature has often emphasized “why” opposed to “how” firms grow. This chapter sheds light on this black box of growth by investigating the phases of planning and implementation processes separately to explore the choice of strategic expansion modes. It examines a much under-researched firm category: declining small firms. Employing a three-year longitudinal study using a multi-case study method, we find that while growth approaches are typically contextually (industry) derived, formalized planning greatly affects implementation. Further, resources are the key mediating variable between formal planning and implementation – firms with slack resources will typically implement their contextually influenced planned growth course, and firms with inadequate resources will typically implement through interactive learning, which causes them to downscale the growth plans or exit the market (merger or sale).

To explore the challenges associated with organic growth, outline three requirements for growing faster than the competition and evaluate the recent trend toward the establishment of a new executive position: “chief growth officer.”

The article is based on an organic growth study examining the performance of 107 “non‐acquisitive” companies (those with no major acquisitions between 1996 and 2000). It then looked more closely at companies identified as “growth leaders” to isolate the best practices that set them apart from their peers.

Research into corporate performance over the long term indicates that organic growth is the most important driver of value in the capital markets. Yet sustained organic growth is difficult to achieve. The article identifies common organizational barriers to growth and reveals three best practices of companies that consistently achieve organic growth faster than competitors. These three practices are: a more disciplined approach to growth, better organizational capabilities for driving growth and a more supportive culture. Finally, the article reviews the performance of companies that have appointed chief growth officers as a means to kick‐start growth.

This paper addresses an issue at the top of nearly every corporate agenda – organic growth. It also delivers a key message to companies looking to achieve their growth objectives by creating a new CGO position: strong, value‐enhancing revenue increases require wholesale changes in behaviors, capabilities and culture, not just a new box on the organizational chart.

This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.

This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context.

This research paper concentrates on the relationship between company growth and digitalization, as measured in six growth companies in Finland. Growth was compartmentalized into three phases: pre-factors of growth, growth as a process, and growth as an outcome. Maintaining strategic flexibility powerfully facilitates digitalization. The companies generally integrated digitalization into the processes they built, creating a product and service platform from which they could reliably scale. Leaders in digital product-driven companies are encouraged by the study's authors to invest in and promote a culture of continual learning, so that their teams don't lose their instinct to keep innovating to achieve competitive advantages.

The briefing saves busy executives, strategists and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

The purpose of this paper is to determine if the relationship between growth and research and development (R&D) intensity is of a different nature in the context of low‐ and high‐tech Portuguese service small to medium‐sized enterprises (SMEs).

The System Analysis of Iberian Balance Sheets database is used. Based on the European Union's recommendation, L124/36 (2003/261/CE), the authors select 764 low‐tech and 139 high‐tech Portuguese service SMEs for the period 1999‐2006. As method of analysis, panel data are used.

A negative relationship between growth and R&D intensity for low‐tech Portuguese service SMEs is identified, whatever the level of R&D intensity. For high‐tech Portuguese service SMEs, a quadratic U‐shaped relationship between growth and R&D intensity is identified. Moreover, the authors find that relationships between growth and determinants are of a special nature in the context of high‐tech Portuguese service SMEs with high levels of R&D intensity.

It is recommended that as far as possible the managers/owners of low‐tech Portuguese service SMEs, and especially high‐tech ones with non‐high levels of R&D intensity, hire qualified human resources and make more continuous investment in R&D. The authors advise managers/owners of high‐tech Portuguese service SMEs with high levels of R&D intensity to establish stable relationships with creditors. Policy‐makers should increase financial support directed, above all, to innovative Portuguese service SMEs.

The paper is pioneering in presenting different relationships between growth and R&D intensity in the context of low‐ and high‐tech service SMEs.

The purpose of this paper is to investigate the joint influence of two factors (companies’ performance and growth) on the company’s capital structure and to determine the conditions for financially sustainable competitive strategies in the coordinates profitability and growth.

The study sample includes 1,996 companies from 6 high-tech industries in Russia (panel data: 7,984 observations). The authors use regression models with random effects and carry out a three-dimensional visualization of the resulting dependencies.

The study found that profitability improves the capital structure (reduces the share of borrowed capital) and, on the contrary, the growth of companies (assets growth or sales growth) increases the leverage ratio. In the case of assets growth, the combined influence of two factors reduces the negative effect of assets growth. The results have shown that the outstripping growth of most high-tech companies requires an increase in debt capital and deterioration in the capital structure and financial stability.

In general, based on the results of this study, the authors have identified groups of fast-growing companies that need financial support, and have defined the main areas of impact (reducing the loan burden and increasing profitability) that will allow these companies to maintain high growth rates and demonstrate advanced development.

The relationships (which the authors identified between the control variables, the studied variables and leverage) were obtained for the first time for a sample of companies in high-tech industries and services in bigger transition country (Russia).