Growth Stage – the company is broadening production lines, focusing on the main product; management style transition from informal to formal

Organization: Centralized Management:  Hybrid formal/informal Technology: Developed, focused Funding Stage: Second

Manage the Five Risks: growth risk technology & production risk marketability & competing risk financial risk team & management risk

 

Problem	Solution	Action
Growth Risk Your capabilities in maintaining perspective (reality vs. euphoria), balancing today's and tomorrow's needs, and coordinating resources are being tested The original route to success works for some time, but then it stops working so well and hits diminishing returns. It is nor easy to keep a great new venture to grow at its original rate for more than 3 to 5 years. If you continue doing the same things that made you successful during the start-up stage you are almost certain to fail. → Growth Strategies → 6Ws of Corporate Growth	Thinking about your second stage of growth before the first has happened. Reinventing your business model, experimenting extensively to find a successful new model and get to the second stage of growth Besides creating a viable model, a critical factor in the ultimate success is how well and fast your company integrates Development of a flexible and responsive company structure adaptable to changing internal and external conditions Development of an effective and flexible production systems responsive to change Building strategic alliances and synergistic partnerships	Embrace 10 characteristics of an emerging growth business Take a helicopter view and work on your business Understand what changes as company grow and most important tasks Learn 9 secrets to boost your small business performance and follow the ten commandments for building a growing company Develop sustainable growth strategies; use → balanced business system approach Reinvent your → competitive and → differentiation strategies; play entrepreneurial games, such as Innovation Football and Innovation Chess; use Kore 10 Innovative Thinking Tools Master company integration and build a new organization that works Maintain a purposeful and organized search for  → new opportunities Inject the relentless growth attitude into your company Build a coaching organization Keep flexible – spot what goes wrong and turn error to → advantage Identify people (values, skills, expertise) and resources needed Develop a business plan for your company growth stage Build  synergistic partnerships, strategic alliances and joint ventures Create roadmaps (market opportunities; positioning; sales, distribution, operations; continuous innovation; people) Develop innovative → value chain management system Develop effective reward system – people are reinventing the wheel
Problem	Solution	Action
Technology & Production Risk Early success with a single application or product line does not translate into long-term viability in the face of well-capitalized, entrenched competitors with strong customer relationships New technology and products development draws significant resources from the fast growing business operations	Identification of strategic market intervention areas Development of the business and technology strategy to achieve this goal Top management participation Development of strategic technology development partnerships	Reinvent your intellectual property management system and develop IP strategy Develop licensing strategy, protect your trade secrets Identify competitive factors and critical technologies and formulate your technology strategy Set strategic priorities and actions and develop your business strategy Develop a synergistic diversification strategy and launch differentiated produce Harness the power of innovation –  practice → systemic approach to innovation; build an innovation portfolio; establish an → effective innovation process Establish a technology intelligence system Search continuously for → new opportunities Develop flexible → lean production systems responsive to change; establish → continuous improvement mindset Explore opportunities for a joint venture or a merger with a strategic partner to best exploit your short-term technologic advantage and realize the full potential of the company's entrepreneurial vision. Transfer technology and establish strategic alliances to stay technologically competitive. Winning is not necessary achieved without partners and parents.
Problem	Solution	Action
Marketability & Competing Risk Poor market feedback Poor strategic marketing plan Growing backorders Competitors "knockoffs" → Customer complaints; product returns or write-offs	While managing growing complexity, it essential to remain focused on how the business provides value to its customers Fight fires Research into the market and its trends Reinvent market development strategy → Surprise To Win → 5 Strategic Questions → Benefit from Your Competitors	Develop your competitive strategy - defend your markets from competitors, explore new markets to penetrate; create a new market niche Reinvent your → value innovation strategies Revisit continuously the laws of marketing and → virtuoso marketing approaches; reinvent your marketing strategy Revise critically your marketing approach Develop realistic marketing concept and → customer value proposition Reinvent your competitive strategy Reinvent your marketing, advertising and → selling strategy Develop strategic marketing plan Gain more loyal customers and repeated customers; retain customers ‒ unleash the power of your service-profit chain and engage customer Partner with your customers to create a future for both parties that is better than either could have developed alone Develop innovative product selling and customer relationship chain Develop marketing partnerships
Problem	Solution	Action
Financial Risk High leverage Short-term financing Inventory shortages or imbalances Poor financial & tax strategy for generating cash Excessive increases in overhead and personnel	Operating costs reduction through optimization of production systems  Raising of working capital (second round) to support strategic growth plans → 7 Routes To High Profits → Internet Revenue Models	Invent new → revenue models → Creating Sustainable Profits: 9 Questions To Answer Look at several measures of capital employment ‒ not just one Work back to costs from what customers are prepared to pay Select type of finance you require to implement your growth strategy and develop your fund raising strategy Study investment opportunity selection criteria of different types of investors Enhance shareholder value by adopting a leading-edge reporting model Use a combination of long and short term loans
Problem	Solution	Action
Team & Management Risk → 9 Signs of a Losing Organization Start-up spirit starts to fade Organizational boundaries are mounting; employee gradually lose perspective on each other's jobs People lose the big picture: they can no longer see how the various tasks, activities and functions fit together to achieve the organization's overall purpose Employees start to identify more with their own unit or work group than with the company as a whole As boundaries become more rigid, the company loses its elasticity - it's ability to change in response to (or anticipation of) changes in the external environment No strategic and contingency planning Shifting priorities in response to → opportunities Resisting development of structure, processes and controls Hiring people who are no smarter than you are Key people leaving Others don't share your urgency Poor decision support systems Overridden and inadequate internal systems, non-responsive to customers & employees  >>> Conflict between formal and informal Emergence of the "Peter Principle" Difficult decisions about roles, authority & responsibility	Keeping pace with an increasingly complex business environment requires proper delegation, better communication, and cross-pollination of → perspectives from outside advisers and peers → Managing a team Addressing the problem of "good people" who can't keep up → Solving people problems Establishment of management systems enabling better control, transparency, and customer relationships Development of → employee empowerment mechanisms Development of formal professional management structures → Overcome Resistance to Change	Create the mindset of growth and establish the relentless growth attitude in your organization Learn to do less and manage more; practice → leadership-management synergy and the art of effective → leadership, → management, and → coaching Practice effective self-management → Lead the team; practice → Results-based Leadership Start with yourself, know your own values, strengths, weaknesses and use them effectively To be a successful manager, learn how to innovate Build an → innovation-friendly organization If you cannot afford top management, build your management team from within and develop their management skills Change from reactive to proactive style Do the → feedback analysis as a matter of course to build on your strengths Gain really effective control a comprehensive business audit Develop plans for the future Don't over-respond to opportunities to avoid fragmentation and burn-out (see → 80/20 Principle) Micro management de-motivates people - concentrate on the activities that bring the most value to the organization and delegate other responsibilities and tasks Make sure you → communicate clearly and often with colleagues, superiors, and subordinates; talk less and → listen more and actively to associates, advisors, customers, suppliers, and vendors; cross-pollinate solutions and ideas with peers and advisers outside the business Don't assume that everyone in the company thinks like you do; that you have all the answers; that things won't get done without you; and that your direct reports will automatically function as a team. Lead! Play the role of the team builder, coach, strategic planner and communicator; communicate critical and actionable information Require top managers to operate as a → "team" Help team manage the plan by group discussion of progress; measuring results with key metrics; communicating progress and results; and adjusting plans to market shifts Manage organizational misfits, malcontents, and non-performers