Wednesday, September 22, 2010

Growth

Back when I was doing my MBA, we used to go thru a lot of case studies. And one of the burning question of several such cases was: “a Growth Strategy”.

How can the company grow bigger ? How can sales be increased, which new markets can be entered ? how can profits be increased ?

I remember raising my hand in one such class and asking the professor: “But sir, why must this company grow ?”.

I still remember the answer (it was the finance professor Bashir “Bash”) who turned around and said: “if you are asking how much this company can grow, the formula for that is up on the board; if you are asking me a philosophical question, I don’t have an answer for you”.

He was right of course. We were training to become business people.MBAs ! And that is what MBAs do – they help companies grow. Doesn’t everyone want to grow ? They should !

But as I’ve gone thru professional life, I’ve often returned to this question in my mind. Why ? why is growth so important. What is the point at which you can say, “OK, this is big enough !” Do you ever get to such a point ? Should you ?

Vexing questions.

I was reminded of this question as I visited a shop this weekend after several years This shop is no bigger than 10 x 10 in a dark alley. Barely large enough for the proprietor and his wares. As far as I can tell he has not grown at all in the last 20 years – neither has he gone out of business clearly. How does he do it ? why doesn’t he grow ? how can he survive without growth ? doesn’t it drive him crazy that he is not growing ?

Now I don’t know enough about his situation. For all I know maybe he’s spent the better part of the last 20 years trying to grow but didn’t succeed. But maybe he hasn’t. Maybe he’s happy where he is. Maybe there is a philosophical answer to the growth question after all.

2 comments:

  1. Steve2:17 AM

    I always assumed it was all in service of the continually growing global population. But certainly, the infinite growth model is divorced from reality, unless we gain the ability to travel to other planets and ravage them also.

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  2. Steve: You're right on both counts :)

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