As a rule, companies find that sustaining and accelerating growth boils down to three basic choices.
The first choice is to develop a breakthrough product or service that no one else has. There are plenty of examples - Apple's iPad, for a short time at least, was the only product of its kind and has sold in the millions in just a few months.
The second choice is to stand head and shoulders above the rest. It's not necessarily about providing better products than delivering more value for the customer's dollar. The best example of that would be the Dyson vacuum cleaner which took advantage of the weaknesses of other vacuum cleaners that kept losing suction and leaving dust behind.
The final choice for resellers is to target a particular niche, like for example, small to medium sized businesses, the education sector, hospitals and clinics. It doesn't have to be big, it just has to provide lots of return. You become the best provider of a specific offering for a particular market that's willing to pay.
One of the key things entrepreneurs focused on growth need to do is be clear about what growth will mean for them.
They need to understand what growth means for the company in terms of its operations, staffing, facilities and production.
And for many entrepreneurs, it's a case of working out what it means for them personally. How hard are they prepared to work? Will you be working five days a week or six? Accelerating and sustaining growth is not like picking low-hanging fruit.
Another point to focus on is staff. It is important to have the kind of staff and skills in place that will take you where you want to go, not where you are now. It is important to have the right people doing the right jobs, which in turn means being highly strategic in hiring.
Recruiting the best sales and technical teams is important as is having good account managers who know how to work with clients. The reality is that with every service company you need people and skills. Service companies are labour intensive and there are no short cuts here. You need to have people who are prepared to work in the size of company you want to be. They will get you there.
This also means taking good care of staff. Your employees keep you on track and the best companies recognise and reward that. This does not necessarily mean financial rewards either. It can mean more flexible working hours, training opportunities and special projects.
It is important to remember that working in a high-growth organisation can be stressful and challenging. The best employers take note of their employees' work and they respond appropriately. If they fail to do that, they risk losing the talent that turned them into a high-growth company. It is important to create an environment where people are willing to work through the stresses. Some of the best companies have systems in place that ensure their employees are constantly informed and kept in the loop. It is about creating a real partnership with staff.
‘The best high-growth companies say their most important priority is the customer. The great management thinker Peter Drucker said the purpose of every business is to create a customer. No company can do without them and if you don't stay close to them you lose them. It is important to know what they want and then give it to them. This is why high-growth resellers have account managers in there, working with customers and understanding their needs so that they can deliver. It is about creating a long-term partnership.
This raises another strategic question. High-growth companies cull their customers, getting rid of the ones who will not buy that much and who will not provide long term value. It is not uncommon to have the top companies working to the Pareto principle where they get 80 percent of their revenue from the top
20 percent of their customers. It's a model that creates focus and drive.
This leads to the question of not getting distracted. The best high-growth companies draw lines in the sand, knowing they cannot do everything and cannot be all things to all customers. They focus on their core strengths, on what
they are good at.
Diversification has to make business sense. If it has nothing to do with your core business, getting into it because it seems like a good opportunity can siphon away energy and badly needed resources.
Smart companies when faced with this choice will outsource it to another party or they will create an alliance with another which is in that space. It will also confuse customers and employees. Spreading yourself too wide reduces quality and profitability.
High-growth companies also have very close relationships with financiers. But more often than not, resellers grow using their own money. It's high risk and that means watching every cent and managing finances carefully. The upside is total independence.
Next: Focus, the key to success
For reseller CRN Fast50 No. 12 Reseau, becoming high growth came down to making some key strategic decisions. Reseau managing director Alfa Aminudin said the company last year decided on embedding itself in the space between enterprise and small to medium businesses. He concedes it had to draw many lines.
"We were very selective about the clients we took on last year. The clients we took on were interested in having a long term relationship,'' Aminudin says. "They were happy to pay for quality because the solutions we deliver are very high calibre. And from that we were able to increase our revenue because we were getting clients that were happy to pay a bit more because of the service that we provide."
The result: Reseau grew 41 percent in the 2008-2009 financial year and 65 percent in the 2009-2010 financial year.
Much of that, says Aminudin, comes down to that selective approach to clients. "I openly say to any client that comes in front of us that as much as you are evaluating us to be your service provider, we are evaluating you as a client because we only take on clients who are looking at working with us over a long period of time. The relationship factor is key,'' he says.
Aminudin says the team at Reseau is critical. It's about having the right people doing the right job. "The guys in here have an inherent passion for technology and that allows us to keep at the forefront because they are actively testing things out because of their interests and passions.
"We have transparent management, so that the team members regardless of their role understand what's going on in the business and where we are headed. That means idea generation is quite fluid. It becomes a great place to work in, which results in growth because everyone is involved."
He says the firm has also developed and refined its internal processes including sales, accounting and technical matters.
The important part, he says, is to focus on the clients' business processes and understand exactly what they need. It's all part of getting close to the client.
At No. 19 Advent One, the focus was on building the sales team. As a result, Advent One grew 19 percent in the 2008-2009 financial year and 53 percent last financial year.
Advent One managing director Graeme Clark says the company had acquired a number of new customers and took good care of the ones it already had.
He estimates that Advent One has had 30 to 40 new clients every year over the past two years.
"About 18 months ago, we grew our sales team so that made an important contribution because they brought new clients into our business,'' Clark says. "The skills we have and the relationship our teams have with our clients have enabled us, along with our partnership with IBM, to be a safe pair of hands with opportunity.
"There was no magic formula. It was just doing a good job of servicing our customers and the foundation of what we do lies with the skills of our consultants." He says the sales consultants also operate as client managers, looking after the clients and making sure everything is going well.
"Each representative is responsible for their own territory which they have built up in many cases over many years and with others, over a few years. In a sense, they are running their own small business within Advent One,''
he says.
"Their success is driven by their ability to bring in revenue and margin through the doors of the business. Their clients and their success is directly linked to how well they do that."
Much of it, he says, comes down to old fashioned sales prospecting. "We run activities where we put something in front of new prospects and put diffe-rent products areas in front of existing clients that we have not talked to them about before."
Based on the present rate of return, Clark estimates the company will grow 20 percent this year.
Geoff Olds, managing director of Techflare, says there is no secret - it's hard work. "You burn the candle at both ends,'' Olds says.
Techflare grew 30 percent in the 2008-09 financial year and 55 percent last year. Part of that growth came from an acquisition the company made in Canberra. The company plans to expand from 23 employees to about 90 in the next four years.
Olds says acquisitions need to be handled with care. "You need to have an open mind and take a very conservative approach about how much time you will stick with the company,'' Old says. This means Techflare is highly strategic when it recruits for its acquisitions. It recruited people who could take the company where it wanted to go.
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