MARKETING CLINIC: No company outperforms its aspirations

I want you to undertake this experiment. Ask 25 people in your organisation this question: "What would be a reasonable expectation for top-line growth this year?". Calculate the average answer. Is it 20 per cent, 30 per cent, or something substantially less ambitious?

No company outperforms its aspirations. If most of your colleagues believe you are in a 5 or 10 per cent growth business - you are.

In the June issue of Fortune magazine, Gary Hamel writes a fascinating article about 10 fundamental rules that can help companies reach new heights of growth and success.

1) Set unreasonable expectations

2) Stretch your business definition

3) Create a cause, not a business

4) Listen to new voices

5) Design an open market for ideas

6) Offer an open market for capital

7) Open up the market for talent

8) Lower the risks of experimentation

9) Make like a cell - divide and divide

10) Pay your innovators well - really wellSetting unreasonable expectationsRule number one, setting unreasonable expectations, is somewhat challenging but exciting as the company tries to stretch the "do-able" of its employees.

"We will grow our earnings 20 per cent per year or more." Objectives that are outlandish force you to think very differently about your opportunities.

If one account manager has a 10 per cent target and the other has a 20 per cent target, the second rep is going to do different things. This is not to say that a bold aspiration will suddenly produce a multitude of nonconformist strategies. But without doubt, its absence will always yield bland, me-too strategies. Whether the objective is growth in revenues, earnings, or efficiency, "nonlinear innovation begins with unreasonable goals" (Hamel).

Only nonlinear innovation will drive long-term wealth creation. Beware, as some clever employees will take shortcuts such as deep price cuts or rebates.

Convincing people in an organisation that it is reasonable to strive for unreasonable goals is tricky and lends itself to demonstrating with real stories, otherwise the aspiration has no credibility.

Hamel gives the example of Steve Taylor, the founder of Fresh Express. Who can possibly grow a lettuce business, you ask? Yet, the market for prewashed, precut, prepackaged lettuce (a salad in a bag) grew from nothing in the late 80s to $1.4 billion a year by 1999.

If someone can do this with a vegetable, what the hell is our excuse?, the inspirational manager will ask. Never, ever believe you are in a mature industry. "There are no mature industries, only mature managers who unthinkingly accept someone else's definition of what's possible," Hamel tells us.

Creating a cause, not a business

According to brokerage firm Charles Schwab, "Around here, we think we're curing cancer."

The courage to move out of the comfort zone and leave some of oneself behind to strike off for parts unknown will come not from a simplistic assurance that change is good, but from a devotion to a wholly worthwhile cause.

Hamel explores the situation that the retail giant Schwab found itself in and wonders where Schwab got the courage to migrate its business to the Web, knowing that the move would force it to slash prices by 60 per cent. Think about how your company would react if faced with this kind of decision.

David Pottruck, president and co-CEO of Charles Schwab, says, "We are the guardians of our customers' financial dreams". When was the last time your bank manager (if you could find him or her) looked like the guardian of your financial dreams?

Every employee should feel that he or she is contributing to something that will make a genuine difference in the lives of customers and colleagues. Viktor Frankl, the great Austrian psychiatrist, sums it up well: "Success, like happiness, cannot be pursued; it must ensue . . . as the unintended side effect of one's personal dedication to a cause greater than oneself".

While you may not be able to employ all 10 rules in your business, recognising one of them may be what you need to move to greatness.

I hope that by now every reader knows my cause - leveraging reputation. I am dedicated to creating, maintaining and building on a company's reputation in the market and workplace.

Dolores Diez is managing director at Rivers of Communication. Reach her at rivers@hotkey.net.au

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