Business Growth — Stage 7 — Creating a Vision for the Future
Visionary is Stage 7 in The Stages of Growth methodology and follows on from the Strategic stage. Companies are in this stage as they grow from 161–350 employees.
At Stage 7, the greatest challenge for the organization lies in addressing the enormous shift in complexity, as the number of employees can double from the previous stage. Viewing the business from an ideal business model perspective, which provides an integrated yet holistic template of how the enterprise could perform, the business leader can begin to think about and apply solutions from a more informed viewpoint. This is definitely not an easy transformation for the leader, but a critical one to think about.
The key objectives in Stage 7 are:
- The Leadership team must have a clear vision and communicate that to the organization.
- Setting in place a strong corporate culture that unites the team.
- The company must always be selling to keep profitability sustainable.
- Review and refine the business model for this largest Stage of Growth.
- Focus first on People, then Process, and finally Profit.
Disequilibrium and Innovation: Great Tools for Larger Companies
In Stage 7, layers of bureaucracy begin to form in the company which quickly impede performance and growth. Once a company gets to this size, there is a natural tendency for it to gravitate toward equilibrium and safety. The organization begins to feel and act like a large company. Decision making is slower, product innovation takes longer and bureaucracy becomes formidable. The business leader needs to recapture the entrepreneurial spirit, which in short can be achieved by systematically ‘breaking’ parts of the company.
Along with sustaining and propagating the vision of the company, the job of the leader is to create a degree of chaos or disequilibrium within the organization. Their mission must to be to stimulate higher levels of innovation and employee authorship to improve company performance. At this Stage of Growth, the leader must make an internal entrepreneurial “call to arms.”
This transformation can be accomplished by creating a corporate culture that expects, supports and rewards entrepreneurial endeavors. The leader must encourage and promote a company-wide environment that enables staff to identify new opportunities, foster exploration, develop action plans and assign resources to manifest those plans.
In a Stage 7 company, typical challenges include products not being differentiated in the marketplace, products getting to market too slowly, not keeping up with marketplaces that change quickly, inadequate profits, and again, a weak business model.
A strong business model is really important at this stage, because it creates the profit architecture of the company. By not having a proper understanding of what the revenue groups are, what is driving the profit and how the company makes and keeps money, the company is at risk of floundering or potentially dying.
The mistake many companies make when they reach Stage 7, is that they think they’ve got it all figured out. “We got this far, right?” However, the key to sustainable growth is to review and critically look at the business model to evaluate profitability.
The Rules
Some of the Non-Negotiable Leadership Rules for Stage 7 are:
- Revitalize workplace community by innovating the company core values program and infusing the culture with a specific citizenship recognition and reward program.
- Leadership Team practices “management by walking around” daily and interacts at personal level with employees.
- Ensure employees know how company makes and keeps money.
- Revamp the company’s Business Model to optimize company margins, rethink 3 Revenue Groups, innovate new Offers, and set future strategic direction of the company.
- Generate, track, and preserve cash.
Visionary Leadership Is Vital
At Stage 7, the leader must ignite the spirit of innovation, listen to their people and grow future leaders. The leader really needs to hone their skills to navigate the company through this stage and be able to act as steward of the company culture and vision.
As the leader ignites the spirit of inspiration and innovation, they must be relentless in allowing and accepting mistakes in the pursuit of these new ideas.
In Stage 7, the primary leadership style is Visionary blended with Coaching and Democratic as secondary and tertiary styles. The business requires a leader who can communicate well with their employees and coach them to be their best.
The harsh reality of understanding the Stages of Growth, is that the complexity of the organization will always demand its due. There is unfortunately always a price to pay for growth, so one must not be fooled. If the environment is not right as the organization grows, so not having the infrastructure in place and the workplace community aligned, the pain of inefficient performance and lower profitability will be felt and will send the company backwards.
Proprietary research, spanning 30+ years and covering 1,300 companies in dozens of industries, shows that every company goes through the Stages of Growth. Some business leaders are aware of it, and some are not. Those that choose to be aware, and who to take proactive steps to understand it, will find it easier to mitigate the challenges of complexity and be more effective in managing change with in their organizations.
Here are links to the articles published on the other Stages: