Why Do Large Companies Struggle for Growth?
Nice comment in the Harvard Business Review blog section about the Innovator's Paradox by Scott Anthony. He defines the Innovator's Paradox as this:
"When you don't need the growth, you act in ways that lead to you not getting the growth you will need. And when you do need the growth, you can't act in ways that deliver it."
I encourage you to read the article but the gist is this:
- When companies are in a period of high growth and resources are ample they should be looking for the next growth opportunities but they don't do it effectively. Their activities lack discipline; wasteful spending and overpriced acquisitions occur.
- When a companies business matures and growth slows done, there are little resources available for growth initiatives. The acute need for growth pulls them to large established markets that rarely pay off how they thought they would. They often ignore disruptive technologies because their current markets are small; if they view the disruption as a threat they will respond, but the response will be rigid. If they view the disruption as an opportunity, they will be more flexible in the response, but starve it of funding (because they don't see it threatening their business).
I love one of Anthony's recommendations - That for every growth business, companies must recognize that the business size has a limit. Thus, they should plan accordingly in the early stages.
Article: The Innovator's Paradox by Scott Anthony

Comments 0 Comments