All growth is good. Bigger is better. All businesses must either “grow or die.”
Small business owners have heard these mantras for years. But, “at best those beliefs are half-truths and at worst they’re pure fiction,” argues Ed Hess, a business professor and author of 10 books, including Grow to Greatness: Smart Growth for Entrepreneurial Businesses.
“‘Grow or die’ is a belief that has no basis in scientific research or in business reality,” he adds. “When not approached carefully, growth can destroy value as it outstrips a company’s managerial capacity, processes, quality, and financial controls or substantially dilutes customer value propositions.”
His recent study of 54 high-growth private companies found that several successful entrepreneurs had imploded their first businesses by taking on too much growth too quickly. This kind of “gas pedal growth” overwhelmed them.
“Let up on the growth gas pedal as neede...(register to read more)