The Secret to Exponential Business Growth
As overheard in a major retail department store, anywhere USA, 2024:
Store Patron: “Excuse me, Is this the Growth Department?”
Store Associate: “Yes it is, but I’m sorry sir, I don’t work in this department. Let me find you someone who does.”
<Associate disappears, never to be seen again>
Have you ever had an experience like this?
Have your customers?
SOME OTHER QUESTIONS TO ASK YOURSELF:
Has your company growth stalled? Do you know why?
Have you grown to a place where your departments exist in silos that don’t communicate directly with each other?
Are all of your departments united around a growth strategy?
Do all departments share certain KPIs?
Which departments are specifically tasked with company growth objectives?
WHY IS GROWTH SO COMPLICATED?
Most businesses have traditionally grown in a way where they organize themselves around departments. At a certain point growth inevitably stalls or hits a hurdle caused by a lack of transparency, communication, and shared company growth goals. Technology has evolved and made it easier for companies to break down silos in theory, but technology is the easy part as the more difficult task is aligning the people and processes around the shared goals.
Knowing what we know today, it feels like businesses have complicated the growth process with their structure and organization. How can we simplify it again?
SIMPLIFYING GROWTH
The mathematical equation for exponential growth is:
A=P(1+r)t
Where:
A is the final amount
P is the initial principal amount (also called present value)
r is the growth rate (as a decimal)
t is the time period
This formula is widely used to model exponential growth in various fields, including population biology, finance, and physics.
Despite the relative simplicity of the equation, there are millions of different growth tactics being promoted every day in the marketplace. The problem is that tactics in the absence of an overarching strategy don’t work.
They are the equivalent of trying to get your body in shape by “spot-training” a specific body part in the gym. Meanwhile, spot training doesn’t make your whole body healthy, but whole-body workouts coupled with a reasonable diet do!
Similarly, growth tactics are often quick-fix attempts to patch ebbs and flows in the company’s revenue. Marketers and salespeople make them sound like great solutions but you will not end up with six-pack abs as a result.
WHAT ARE THE DIFFERENT WAYS TO GROW?
Let’s review the traditional approaches that most business start with:
1. Sell More (Increase sales)
2. Pitch More (Increase sales activity)
3. Sell Less (Decreased and focused sales activity)
4. Charge More (Sell at Premium)
1. Sell More
Just like the formula says, If you find a way to sell more, at the same price over the same measured period, your business will grow. To accomplish this you will have had to increase your overall close rate. This is possible in many ways, such as revamping your sales process and team, providing sales enablement, and things you definitely should be considering however you first need to determine that sales is in fact, the root of your stalled growth.
For this reason, it makes sense to get a benchmark for your team’s close rate versus your industry or perhaps versus previous years in business. If your growth is stagnant, start by auditing both your sales process and team, thoroughly to understand if sales is the problem. You’ll inevitably find inefficiencies and areas of improvement in your sales process that need improvement, but you will likely uncover hurdles that your sales team faces as well as growth opportunities that exist outside of the sales department. Once you are on this track, you’ll realize there are much smarter ways to grow rather than
simply increasing quotas and focusing 100% on the sales team.
2. Pitch More
When growth stalls, businesses will inevitably turn to sales activity, as their answer for growth. This is where theoretically businesses believe that if the sales team simply makes more pitches, with more frequency, they will sell more. The problem here is that pitching more may benefit some individual underperforming sales reps in a company, but pitching for the sake of more quantity can lower the quality of sales engagements across the team, diluting the overall quality. A business also runs the risk of oversaturating prospects and clients with aggressive sales outreach and tactics that convey a very different message to audiences, actually turning business away. So the answer isn’t necessarily to pitch more, it could be to pitch less.
What if we add more sales reps?
Sometimes this can work but only if the business is ready for it. Otherwise, adding more sales reps rarely ends in sustainable, transformative growth. Especially when the rest of the business is not aligned with the new, additional sales team. For example, many newly funded startups fail as a result of scaling sales too quickly. A new influx of sales may arrive at a time when the rest of the company is not set up to support the customer experience for all the new clients. When unhappy clients show up, the whole system implodes.
Should we phase out sales reps to strictly sell online?
We all can probably envision certain products and services that will not require salespeople to make purchases in the future. Buyers will be able to avoid sales altogether by accessing information and the tools to complete the purchase online.
Especially with less complex purchases, this approach could result in more commoditization of what you sell. However, all salespeople shouldn’t start looking for new careers just yet. We need to remember that humans still make decisions about purchases that are heavily influenced by emotion. Good B2B salespeople can relate to a buyer's logic and emotion as they ‘help” the buyer decide what to purchase. This represents a big difference from selling something to someone. Instead, you are now helping someone buy. eCommerce Solutions with Sales Bots and AI, attempting to play the role of consultative salesperson, are still too slanted towards the logic side of the equation. Expect to see more businesses taking a hybrid approach, where they provide buyers with the information and capacity to buy online but expert consultants are available,
on-demand should they have questions, and want to talk to a person to make the purchase. Essentially providing the answers, and human experience that AI cannot.
3. Sell Less
This is where it shows how critical it is to have a clearly defined ideal customer profile that the entire company agrees with. Your ideal customer isn’t necessarily the client who buys most frequently from you. You may find that your ideal customer is your more profitable clients who extract the most value from your product or services. They are likely to be repeat, longer-term clients, and they are the most likely to publicly share their positive experiences about working with you.
Although terms like “Ideal Customer Profile” and “Personas” might appear to be novel, and popular today, businesses have been making decisions to shift focus on a specific customer type for decades. When The Pareto Principle (The 80/20 rule) became popular in the 1940’s, many businesses began applying the principle to their businesses. For example, a business learns that 80% of its profits come from only 20% of its customers. Meanwhile, the other 80% of their clients are a bigger draw on company resources and harder to keep satisfied. This is an early example of a “feedback loop” that many high-growth companies use today. The insights telling the company to focus on finding more of the 20% and less on the other 80% could only come from sharing data across departments. This is not a bad strategy, but the keyword here is strategy, as this is not a tactical decision that a single department, like sales, can make on its own. A decision to sell to only certain types of companies and not to others represents an entire shift for the business. By cutting out the revenue stream, the decision could very well involve discontinuing a specific product or service, as well as all of the people responsible for building, servicing, or maintaining these clients.
4. Charge More:
While every fiscally responsible buyer should be cost-conscious and price-sensitive, there are always going to be certain buyers who are willing to pay a premium for a superior product or service. They are happy to pay a premium when they know the product will work and will deliver superior results and client satisfaction.
A lot of start-ups fail because they attempt to make and sell a product that is valuable and affordable for everyone. Growing this way is much more difficult than starting with a niche market to sell to, perhaps at a premium. Apple has grown more than any company in the last 40 years and appears to have mastered the art of selling premium products, at a premium price, into well-established, already competitive, product categories. Look at mobile phones, as an example: When Apple introduced the iPhone, in 2008, it cost $500 more than any of the other phones in the market. But instead
of entering a highly competitive, price-sensitive marketplace, Apple created a product, called a Smartphone, that didn’t fit into the previous category. Premium design, features, and user experience, coupled with world-class branding, allowed them to create and own an entirely new category that was not anchored to the previous price points. The result was they also took over the entire existing category for mobile phones while dominating market share in the new category for the last 26 years. They then proceeded to do the same thing with tablets, watches, and headphones. Case in point, Apple is not only the #1 smartwatch seller in the world, but they now sell more watches than any other company in the world, disrupting the Swiss Watch Market. The point here is that you can charge more, but to be successful your company needs to be aligned around a premium growth strategy.
“I’d much rather create than compete” -Seth Godin
So What Does A Shared Company Growth Strategy Look Like?
How Do You Manage it?
When you examine Apple's growth over the years, it is clear that they have always been aligned around a shared company growth strategy. They had a top-down strategy, that was closely monitored across all departments who were working together towards transformative growth. The evidence can be seen early on when Apple chose to take a different path than Microsoft by deciding to marry their hardware technology with their own software, not third parties, thus being able to
deliver a much smoother and more secure experience because the tech and software where were fully aligned and built-in sync.
This aligned approach to hardware and software development was complemented by a brand strategy and approach to sales and marketing that was consistent with the premium design and performance. All of these variables were interconnected by a cohesive company-level growth strategy that came from Steve Jobs at the very top.
We are not Apple, there was only one Steve Jobs, so how does this apply to us?
The objective of this article was to point out some of the common ways that businesses go about growing, but when successful they are often short and unsustainable periods of growth, that are hard to repeat and usually hinder or cannibalize from another area of the business. The common denominator between companies that achieve transformative and sustainable growth is that they are aware of the role that every department plays in winning, supporting, and delighting customers to grow.
Unlocking transformative growth at your business.
Every department plays an equal role in the company’s growth as a whole. But the lynchpin, critical to making it all work is client satisfaction. None of your other attempts at growth will be truly transformative or sustainable for the long term, if you do not become obsessed about client satisfaction. Client satisfaction starts in the sales process and extends to the client onboarding process, and the more seamlessness the transition, the better. Training, customer service, troubleshooting, and the reliability of the product, itself all contribute collectively to satisfying that client, as together the company spins the flywheel that gains momentum in growing the business.
To summarize there are many different tactics to grow your business but on their own, they are not growth strategies. These “patches” are short-term solutions to try to bolster sales to hit quarterly revenue forecasts, or to offset the ebbs and flows in a particular business.
Wait, is this RevOps?
If this all sounds familiar, the popular term being used is Revenue Operations (RevOps),
Which is in most basic terms aligning sales, marketing, and operations departments around agreed upon strategies and shared goals. To be successful it needs to start at the top, and it will rely heavily upon technology and sharing of data to provide transparency across departments and by removing any of the remaining silos that have prevented this collaboration in the past.
