Whether you're overseeing a multi-billion dollar business with global operations, leading a start-up, or responsible for a global product or service line, you know that leading growth is hard work.
The challenges to successfully building and nurturing teams to deliver and sustain profitable business growth are great. Leading growth requires you to manage many situations without clear answers. For example, you have to leverage your current products and capabilities while at the same time exploring new growth opportunities. Likewise, you have to ensure that your team is delivering on today's commitments while concurrently building capabilities for the future.
When business growth is relatively slow and steady, people and processes can evolve and keep pace. When growth exceeds 10, 20, or even 30 percent year after year, the rate of growth typically exceeds the ability of both people and organisational structures to keep up. So while growth can provide greater rewards and recognition, it also can result in burnout, mistakes, and a painfully inadequate pipeline for skilled leaders and professionals.
When growth comes from outside a company's home market, growth leaders face even tougher challenges. Markets vary hugely in terms of consumer preferences, ease of distribution, government controls, tax rates, and competition levels, just to name a few factors. For leaders in this situation, almost every interaction is a cross-cultural one. There is no guidebook for this.
As an example, consider a business leader, Jane Chen, heading the China business for a global medical devices company. Jane's business has grown more than 30 percent annually for the past five years and has tripled in size from 20 million USD in annual sales to over 60 million. The market opportunity is huge, but governmental regulations are getting tougher, the number of competitors in the market has tripled and the local competitors play by different rules. They are faster, cheaper and not necessarily of lower quality.
Attracting and retaining experienced, skilled people to grow the business in China is harder for Jane than it is for her senior colleagues in markets where their brand is stronger and enjoys a longer history. The globalisation of HR in her company also negatively impacts her. Standardised structures and positions make it harder for her team to compete against local companies who are faster and more flexible in terms of pay structures and packages. These local competitors also offer better career opportunities to Chinese leaders who value upward promotion within China.
Jane is driving a growth strategy that includes expansion to more than 100 cities in China. She has to find people who can sell to and influence more people than in the past — not just doctors, but nurses, medical technicians, hospital administrators, even regulators. Finding sales people who can sell in this more complex environment and want to live in these cities is very tough. Selling in tier 4 cities or rural areas in China is so different to selling in Shanghai that it might as well be in another country.
Over the past few years, increased growth in emerging markets has raised corporate interest. Jane benefits and suffers from this. Due to her business's growth, senior leaders in the home office scrutinize her revenues more, as well as the normal ups and downs she experiences. She spends increasing time reporting and communicating upwards to keep everyone aligned. And while corporate functions are keen to support the China operations, their lack of familiarity with local norms often makes their solutions non-implementable.
Due to the pace of growth she's led, Jane finds that it's hard to slow down and create conversations to improve alignment and execution. This creates even greater urgency in her organisation, which makes it nearly impossible to implement much needed development programmes. The pace of growth creates a pattern that can quickly become a barrier to future growth. She's aware of this, but is so busy that it is hard for her to change.
Like other growth leaders, Jane operates in an evolving, complex market comprised of numerous provinces and cities, each with its unique character. All are evolving slightly differently. With all this change, she needs to create focus and a shared direction for various parts of a matrix getting pulled in different directions.
As she drives her growth strategy, she has to make sure her people are growing fast enough so that as their jobs grow, they can continue to deliver. She also has to ensure that the structures and processes she's developed can scale for the growth underway so that in two or three years' time the organization can continue to deliver growth.
This case describes typical challenges of a growth leader working outside of his or her multinational company's home office. In a smaller company, the challenges are even greater. There is no single issue, nor single solution to creating and sustaining profitable growth—particularly outside of the home market. If you are a growth leader or supporting one or more of them, you will have many stories to share. Please join me in this Growth Leader Series to explore the many challenges and solutions for growth leaders around the world.