A few weeks ago, an article I was reading referenced a book called The Physics of Business Growth by Ed Hess and Jeanne Liedtka. The idea of exploring the forces and laws that create business growth intrigued me, so I got a copy and have been reading and re-reading it since.
Given the innovative, often unpredictable, nature of new natural products, and the challenging conditions that many local natural retailers grow and thrive in, I wondered what “laws” were at work. And how about the companies and stores that don't make it, but appear to have all they need to succeed? What laws did they violate?
Why are some brands so successful when they have ugly, dated packaging, high prices and retailer-unfriendly practices? Why are others, their polar opposites, crashing and burning?
What makes a company successful?
The authors began their research with an impressive list of successful companies to dissect, and had a logical list of expectations for the companies' success:
- The companies had unique products and/or services.
- They had the best talent.
- They had visionary leaders.
- They had superior innovation capabilities.
We link all of these to success. Certainly, none of these are linked to failure!
However, consider the rarity of several of these things or, at least, the challenge in obtaining them. If these are requirements for success, many companies are not going to make it—period—so why bother trying?
However, as the authors researched these top companies, they found that the high-growth companies:
- Did not necessarily sell unique products or services
- Did not always have the best talent
- Rarely had visionary, charismatic leaders
- Were not the most innovative in their industries
What high-growth companies did have:
- Highly engaged, loyal, productive workforces who knew their customers very well
- Humble and passionate leaders
- They were master learners and imitators
- Simple, focused strategies that all employees could understand
- A “be better” DNA where they always strove for improvement
That list is much more encouraging. A retailer or manufacturer won't get those things without concerted effort over time, but they are attainable. With a “be better” mindset, you can start where you are today and build on that next week, next month and next year.
What does this mean for your company?
In an industry full of innovators, don't fret if you aren't the most unique company in your market. Hire good people, focus on your customers, learn from and copy the best, keep it simple and never stop improving. These basic, simple practices driving the best companies in the marketplace today—and these practices can help your company, too.
What simple practices have made a big difference in your success? Please share them in the comments.