I have mixed emotions about the phrase “grow or die” in business. On the one hand, it’s great advice and I agree with it 100 percent.
But the problem I have with it is not so much the literal words. It’s the way people usually apply it, which typically doesn’t lead to the kind of growth companies need to thrive – or to avoid dying.
In fact, “grow or die” is one of the most abused terms in business. And a lot of that has to do with the nature of entrepreneurs, who are often more inclined to go-go-go than they are to really think about where they’re going.
So when you tell a go-go-go entrepreneur to grow or die, it begs the question: What does it mean to grow? And too often that entrepreneur will simply assume growth refers to one thing and one thing only – and that’s top-line revenue.
Now I’m all about bringing in more revenue. But it’s a mistake to think that’s the only form of growth your company needs. And it’s a big mistake to think you can become more successful by focusing only on revenue growth and not on the things that typically lead to it.
Growth done right means becoming better in a lot of ways. It means improving in employee engagement. It means enhancing the value you offer your customers. It means conceiving and perfecting products that truly serve a need in the market. It means building a company culture that emphasizes excellence in every aspect of operations.
Absent these things, revenue can become little more than vanity for the owner. Your top line may look good, but if you haven’t grown in these other areas, you’re not in the strongest position to parlay that higher revenue into real, sustained success.
And you can usually tell what this is going to look like. The entrepreneur who’s chasing only after higher revenues will tend to put outsized emphasis on sales. He or she is sure the product or service is great, and that he has exactly the right people, and that all the company needs is more people buying.
This is the entrepreneur who doesn’t think there’s any definition to growth apart from simply taking in more money. Everything else? He’s sure he’s got that mastered.
In fact, the great companies have often had seasons of growth in which they elevated themselves in different areas. This was true of Apple, where they spent time focusing on employee engagement, then more time focusing on client value, and all along the way they kept zeroing in on what they needed to accomplish to become a truly great company.
Many entrepreneurs are relatively young. They’re full of energy and they have great ideas, but they’re lacking in experience and education, so they may not understand everything that’s required to achieve what you can really call a growing company. They may not really understand what it will take to grow.
That’s clearly a lot of things, but there are three especially that make a huge difference:
- Better products
- Better people to deliver the products
- Better sales and marketing.
Beyond that, you can add better financial management, better deployment of resources, better improvement processes . . . these are all the things that lead to more revenue, so they’re all part of growth.
If I had to name one thing that would define your priority in growth, it wouldn’t be revenue. It would be the value you represent to your customers. Grow in that area, and just about everything else will take care of itself.
But of course, to achieve that, you have to grow in all the areas mentioned above – and that will likely require various stages of growth to get you to the goal.
Skipping all this and just focusing on sales gets it exactly backward. When you’re truly excellent in all the areas I’ve described here, the company’s offering practically sells itself. I’m not saying you don’t need to get out there and market it, but it’s not hard to make the sale when the value is that clear. People will always buy what gives them more value and helps them to achieve.
If this is what you mean by growth, then I agree with grow or die. Failing to grow in all these ways will leave you in your competitors’ dust, because they will surpass you. Grow or die is a great term as long as you understand there are stages to business growth, and as long as you’re committed to what those stages will require of you.
When grow or die just means, “bring in more revenue,” someone needs to sit down and have a serious talk with the entrepreneur who’s pushing that thinking. That’s really not growth at all. It’s an ill-fated attempt to get more people to throw money at you when you haven’t done the things that would allow you to say you’ve really earned it.
By the way, the ultimate prize for all this isn’t more revenue. It’s more profit. If you really want a monetary measure of your business’s success, that’s it. Lots of companies bring in revenue but don’t make much profit, because they haven’t grown in the areas we’ve discussed here. Do the hard work, and accomplish the real growth, and then your profit reward will prove to be a much more satisfying one.
Written by: Wade Wyant
Red Wagon Advisors