Whether by improving and adjusting existing products, bringing products into new markets, or buying new customer segments or technology, finance chiefs are testing a variety of growth strategies to determine what will work in an environment marked by caution. It’s challenging, to be sure, but many say they welcome the chance to focus on expansion. In fact, with uncharacteristic optimism, many insist that their businesses will find a way to grow despite lingering macroeconomic malaise.
“The world has got more opportunities than issues right now. We need to make sure our organization looks at the opportunities and doesn’t complain about the issues,” says Siemens’s Kaeser. “If global GDP is down by 2%, that means that 98% of GDP is intact. Unless you have 100% market share, why complain about GDP being down by 2% or 3%?”
Kate O’Sullivan is senior editor for strategy at CFO.
The business landscape has changed markedly over the past two years, so dusting off a previously concocted growth strategy may not be a viable way forward for many companies. Competitors, for example, may be in far different positions today — some may have disappeared, others may have retooled or refocused, and still others emerged from nowhere.
Janice DiPietro, national managing partner at executive services firm Tatum, urges finance executives and their fellow managers to survey the competition as a first step to identifying growth opportunities. She suggests some critical questions to consider:
• Which company is gaining market share?
• Which company has pricing power?
• Which is bundling products and services in new ways?
• Which is creating buzz?
• Which is the marginal player? Is it you?
• Are you increasing your R&D budget?
• What innovative new products and services have you brought to market?
Armed with that analysis, you can begin to chart your next moves. — K.O’S.