Every business should have a specific growth strategy in order to survive, move forward, and generate income. Companies without growth strategies can be hit by unexpected adversity. A growth strategy can be organic or inorganic in nature. While acquisition strategies are usually pursued by more mature companies, investors typically look to organic growth numbers to review and evaluate the overall performance of a new company.
Organic growth for a company is a balanced and gradual method that is created through the use of own resources and leads to a sustainable increase in sales and earnings. It is also very important for a company to maintain the symmetry between the values created for customers and what employees contribute to a company.
The first and foremost priority of an organization implementing an organic growth model is making a profit. By focusing on organic growth, investors can analyze how a company is achieving its goals by leveraging internal assets. Organic growth also shows a company’s performance in its ability to leverage the skills and know-how of internal resources to create opportunities for future returns on investment.
Regardless of the strategy pursued, companies should plan and document every action and create risk reduction steps to protect themselves against failure. A well-defined business plan is the foundation for defining a growth strategy and helps companies identify realistic and actionable options.
At Burasa, we’ve identified steps that drive organic growth. These include:
a) An organization should implement a growth model and set SMART goals that are understandable to its employees.
b) Documentation of all activities to monitor and control progress made is essential.
c) An organized and uniform service provision of high quality is one of the essential characteristics of a successful organic growth model.
d) Employee loyalty and high employee loyalty are particularly important in the growth phase.
e) The level of quality control and customer service are factors that can make or break a business. These should be carefully analyzed.
f) Corporate advertising to communicate effectively and create a positive brand image to successfully promote the business should be implemented even if the marketing investment is modest.
g) Experimentation and taking measured risks are very important to generate growth. Organizations should implement a reward mechanism for new ideas that come through internally.
On the other hand, unlike acquisitions and mergers, where the main focus is on increasing market share through capital injections, organic growth can be a sensible strategy for companies to grow slowly without causing large capital outflows. Startups can certainly focus on organic growth as an alternative strategy for raising capital.