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Profitable_Growth_Is_Everyones_Business_ _A_Book_Summary
| Profitable Growth Is Everyones Business - A Book Summary
This article is based on the following book: Profitable Growth
Is Everyone's Business "10 Tools You Can Use Monday Morning" By
Ram Charan Published by Crown Publishing Group, 2004 ISBN
1-4000-5152-5 198 pages
The days of ruthless downsizing and drastic cost cutting are
long gone. Nowadays, companies have realized that the best way
to earn profit is only through growth – profitable growth. In
this book, author Ram Charan provides 10 tools anyone can use to
hurdle obstacles and achieve profitable growth.
These tools are:
1. Revenue growth is everyone’s business, so make it part of
everyone’s daily work routine.
2. Hit many singles and doubles, not just home runs.
3. Seek good growth and avoid bad growth.
4. Dispel the myths that inhibit both people and organizations
from growing.
5. Turn the idea of productivity on its head by increasing
revenue productivity.
6. Develop and implement a growth budget.
7. Beef up upstream marketing.
8. Understand how to do effective cross-selling (or
value/solutions selling).
9. Create a social engine to accelerate revenue growth.
10. Operationalize innovation by converting ideas into revenue
growth. One of the most critical points discussed is the need
for re-orientation of thinking. Most businessmen and executives
think about growth as “home-runs” and more often than not
disregard the “singles and doubles”. Managers often look forward
to the big breakthrough or the grand new product without
realizing that home runs don’t happen everywhere – sometimes,
they don’t even happen in a decade.
Instead of aiming for that one grand home run, aim for singles
and doubles. This is a surer and more consistent path. Of
course, it is important to note that while aiming for singles
and doubles, one should not exclude home runs. These singles and
doubles come from an in-depth analysis of ALL the fundamentals
of a business.
Another factor to be considered is the difference between good
growth and bad growth. Managers should dispel the myth that
growth in whatever form is a victory. Although growth (both good
and bad) builds revenue, only good growth increases not only
revenues but also improves profits and is sustainable over time.
Bad growth, on the other hand, lowers shareholder value. Unwise
mergers and acquisitions are examples of bad growth. Price
cutting to gain market share without cutting costs can also be
detrimental to your company’s health.
Here are some questions that can help you diagnose whether or
not you are part of a growth business:
1. What percentage of time and emotional energy does the
management team routinely devote to revenue growth?
2. Are there just exhortations and talk about growth or is there
actually follow through?
3. Do managers talk about growth only in terms of home runs? Do
they understand the importance of singles and doubles for
long-term, sustained organic growth?
4. How much of each management team member’s time is devoted to
making effective visits with customers? Do they do more than
listen and probe for information and then try to “connect the
dots”?
5. Does the management team come into contact with the final
user of your product?
6. Are people in the business clear about what the specific
future sources of revenue growth will be? Do they know who is
accountable?
7. Would you characterize your company or business unit’s
culture as cost cutting or growth oriented? If the answer is one
or another you need to start doing both. Do people in leadership
positions have the skill, orientation, and determination to grow
revenues?
8. Does the company practice revenue productivity? Does it think
through whether there are ways to more effectively use current
resources to generate higher revenues?
9. How well does your sales force extract intelligence from
customers and other players in the marketplace? How well is this
information communicated and acted on by other parts of your
organization, such as product development?
10. How good are the upstream marketing skills- that is, the
ability to segment markets and identify consumer attributes- in
your business?
About the Author:
Ram Charan is coauthor of the landmark Fortune article "Why CEOs
Fail" and an adviser on corporate governance, CEO succession,
and strategy implementation. He was named as Best Teacher by
Northwestern's Kellogg School and as a top-rated executive
educator by Business Week. He is author of Boards at Work,
coauthor of Every Business Is a Growth Business, and a frequent
contributor to Harvard Business Review. (6/2000)
By: Regine P. Azurin
Regine Azurin is the President of BusinessSummaries.com, a
company that provides business book summaries of the latest
bestsellers for busy executives and entrepreneurs.
http://www.bizsum.com "A Lot Of Great Books....Too Little Time
To Read" Free Book Summaries Of Latest Bestsellers for Busy
Executives and Entrepreneurs
Mailto: mailto:freearticle@bizsum.com BusinessSummaries is a
BusinessSummaries.com service. (c) Copyright 2001- 2005
,BusinessSummaries.com - Wisdom In A Nutshell
About the author:
Regine Azurin is the President of BusinessSummaries.com, a
company that provides business book summaries of the latest
bestsellers for busy executives and entrepreneurs.
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