Profitable growth is essential to the long-term sustainable health of a family business. Businesses that fail to grow or develop strategies to combat stagnant growth run the risk of being outflanked by new or existing competitors. This is true for all businesses, but especially for family businesses, because there is often a longer growth horizon. Agreeing on when and how to grow the business can often be a challenge for family businesses. Differing views within the family about how to grow the business can create a very disruptive environment. A growth plan that is supported and understood by family members can improve family harmony, and involving the next generation in the growth strategy can help foster innovation.
Like your family, your business doesn’t stand still – it continues to evolve. Family businesses are unique because at their core lies an important dynamic that connects the family and the business through family ownership, which presents both opportunities and challenges. Every decision you make is accompanied by strong family values and a purpose that will help you navigate the journey ahead. MARKEF‘s advisors understand the dynamics of a successful business and work with you to provide tailored advice – throughout the lifecycle of your business.
Family businesses may have competitive advantages over other businesses, but one thing is certain: for a family business to adapt and remain competitive, a growth strategy is required. How do you know if your business is ready to grow and what strategies are best?
Examine your capabilities in the following key areas:
Does your company periodically review the markets/
segments it serves for development potential, changes in customer preferences, quality positioning and costs?
Does your business have an inspiring and clear vision for the next 3 to 5 years that provides a basis for focus, direction, and goal setting?
Does your business have financial and management
reporting processes that provide reliable and timely
information for decision-making and reporting?
Does your compensation program fairly reward results and positively influence behaviors?
Does your business make investments in information technology that generate measurable value for the business?
Does your business have regular board or advisory committee meetings to provide input on direction and
Your growth strategy will depend on which combination is right for your business and how you will tailor your offering to succeed in the market place. Sitting down with a MARKEF‘s business adviser to conduct a thorough assessment can help point you in the right direction. When it comes to building and implementing your growth strategy, there are 9 Levers of Value to consider which represent the key elements of an organization’s financial, business and operating model that business owners think through to help achieve profitable growth.
Implementation is essential. Conducting a thorough assessment of your business and identifying opportunities for growth are critical when planning your strategy, but following through is the most important part. In many cases, this is where businesses fall short — they know how they can grow but do not take the action and necessary steps to fulfill their strategy. Fostering entrepreneurship within your family businesses will help to support your growth plans. Ensuring that your business executes its growth strategy can make the difference between a business that succeeds and a business that falls short.
MARKEF‘s business advisers understand that family dynamics can make it difficult to come to an agreement on the best strategy for growth. There is not a one-size-fits-all answer — our advisers can help you explore all of your options and find the approach that is right for your business and family. Once you have decided what route you want to take, we can work with you to implement your growth strategy