7 Keys to Profitable Growth

Planning for growth is something every business owner will say they do, but not all business owners will do this effectively and with a focus that will generate profitable growth.

Many businesses plan for growth, but not profitable growth.  Some businesses focus on growing sales without a focus on margins while others build infrastructures to support sales and growth that never materialize.

Michael Porter said, “If your goal is anything but profitability – if it’s to be big, or to grow fast, or to become a technology leader – you’ll hit problems.”

A business must focus on profitable, scalable and sustainable activities if it is to grow. Profit and the generation of cash to re-invest in your business must be made a priority, as it is an essential part of the financial strategy and structure of a successful business.  Profit and a clear business plan will create a focus and the alignment of the organization, as well as attract investors and other sources of funds to fuel growth – all of which impacts the underlying business value of the business.

The CFO Centre has identified 7 Keys to Profitable Growth:

1. Define your business goals & objectives
   Produce a formal plan from which you can articulate a vision
2. Critically review your business
   Identify competitive advantage, scalability & sustainability
3. Establish a financial plan
   Identify milestones, KPIs & dashboards
4. Create organizational alignment
   Nurture your culture, hire the right people & communicate the vision
5. Identify the financial resources required
6. Support the business with systems & processes to optimize performance
7. Measure, review, evaluate & course correct
   Be proactive & prepared to be reactive

If you follow these 7 Keys and plan for profitable growth, you will ultimately:

1. Improve and grow profits
2. Maximize the scalability of your business
3. Enhance management team and organizational structure
4. Attract investors and other sources of funds
5. Increase business value

To enhance the value of your business and grow successfully, follow the 7 Keys and Plan for Profitable Growth.