For private companies, growth will always be an essential key to success. It can be challenging, however, for established middle-market companies to recapture the high-octane growth they experienced in the early stages of their business. To remain competitive and thrive, these private companies must protect their core business as they look for new avenues of growth.
Regardless of the company's size or industry, there are several ways private companies can increase growth at any stage of their business:
Inject innovation into the everyday. Innovation isn't just a requirement for early-stage technology companies. Leaders of mature private businesses need to bring discipline to their innovation process as well. Mature middle-market companies can jumpstart growth by staying agile and continuing to make innovation a strategic priority.
As businesses look to innovate, it's critical to consider the breadth that innovation covers within an organization. It's no longer enough to rely on product development or services, which can be copied by competitors. Companies should re-evaluate their entire business model to achieve sustainable growth in today's market. This requires encouragement from leadership, and a company culture that's supportive of trying new strategies, without fear of failure. Some of the most innovative ideas come from people or groups within a company who are given the time, tools and incentive to drive growth.
Focus on your customer. Competition is heating up, and new markets are evolving. This means private companies need to think like entrepreneurs and explore creative solutions and new ways of thinking now, more than ever. Understanding the customer is the top priority in generating profitable growth. Having an entrepreneurial mindset means that businesses must look beyond the quick fix, identifying and implementing long-term solutions to achieve a sustainable competitive advantage.
It's important for companies to never forget how they got to the level of success of where they are now. Focusing on customers allows businesses to re-connect with the key demographic that helped elevate the business initially. Understanding customers' wants and needs can help drive the strategy and business model to areas that matter most to the people supporting the business. Engaging in social media can help businesses use this understanding to achieve customer engagement, build customer feedback, and enhance research and development initiatives, so that customers are also driving the company's growth.
Re-evaluate your business model. In this new competitive environment, companies seeking to capitalize on opportunity need to move fast and achieve scale. Growth-oriented companies need to be more platform-oriented – continuously re-evaluating their business model – in order to keep pace with industry demands.
Evolving a successful business model demands an unwavering commitment at the leadership level. This helps align organizational investment with the strategic growth objectives of the business and allows for shifts in how the organization thinks and operates. It's important for mature companies to analyze their business model from the perspective of an early-stage business, as it can provide private organizations with a fresh perspective and competitive approach to growth.
The time is now. Middle-market organizations should approach growth in a manner similar to that of early-stage companies. Adopting a mindset that challenges owners to view their business from the lens of an early-stage business can provide valuable insights into new ways to capitalize on growth opportunities. Embedding a growth-oriented mindset into any private business isn't a strategy; it's a way of being that can lead to increased success.
Bill Hamilton is a partner with EY's private mid-market practice. Learn more about EY's Private Mid-Market Services at ey.com/ca/pmm and follow us on Twitter @EY_CAPrivateCo.