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The Double-Win: Six Factors For Achieving Sustained Growth in the Top-line and Profitability

Guest post by: Joe Evans

Article Overview: Achieving and then sustaining top-line growth requires sound strategy and a lot of hard work. Quarter-over-quarter revenue growth is strong evidence of an organization with a well-conceived strategy that has achieved operational excellence in areas like new customer acquisition, existing customer retention and innovation in product/service value creation. But what about achieving sustained profitability when growing the top line? That can be more challenging. This article explores six important factors needed for positioning your organization for the double-win of sustained growth and profitability.

The Double-Win: Six Factors For Achieving Sustained Growth in the Top-line and Profitability

Achieving and then sustaining top-line growth requires sound strategy and a lot of hard work. Quarter-over-quarter revenue growth is strong evidence of an organization with a well-conceived strategy that has achieved operational excellence in areas like new customer acquisition, existing customer retention and innovation in product / service value creation. But what about achieving sustained profitability when growing the top line? That can be more challenging. This article explores six important factors needed for positioning your organization for the double-win of sustained growth and profitability. It takes careful strategic positioning to strike the right balance of revenue growth and expense control. That is where operational excellence goes hand-in-hand with top-to-bottom business alignment to the strategic goals of the enterprise. Such strategic positioning requires careful planning with top-to-bottom synchronization involving all managers and employees of the organization.

Here are six important factors for positioning your organization for top-line growth and bottom-line results.

1. Align strategy with culture and organizational core values

Striking the right balance in the strategic mix of goals isn’t always as easy as it may sound. First, changes or “tweaks” to corporate strategy must be congruent with the organization’s culture and core values in order to be successfully accepted and enacted. That requires that the organizations culture be understood well enough to leverage it and bolster it with reinforcement through actions that are consistent with the core values of management and employees.

2. Align strategy and operational plans to organizational core competencies

Reviewing and understanding organizational core competencies is a second consideration related to strategy and the ultimate effectiveness of the strategic goals. Does the business possess the right skill mix at the leadership level? Are managers competent to execute crisply on goal-supporting initiatives? The answers to such questions may dictate the need for leadership development plans that position key managers to be successful and track developmentally to the long-term core competencies the organization requires of them.

3. Align strategy to operational initiatives

Aligning corporate strategy to operational execution is another huge factor in achieving profitable growth. A big cause of strategy misalignment is an underdeveloped strategic planning process which does not adequately define strategic plan goals to make them concise and measurable and possible to accomplish. An even bigger factor that still relates to the planning process and alignment is the failure to continue the planning effort beyond the corporate planning process - into the operational layers of the organization.

Operational planning is the conversion of strategic goals into managed execution. By doing a good job in this area, organizations will have the links from strategic goals to execution of the goal-supporting initiatives. Those links and the governance to manage overall progress at a plan-level are essential to achieving higher performance.

4. Inform and empower employees

Another major factor in achieving sustainable top and bottom-line growth begins with creating organizational structures that empower informed employees with the latitude to make broader line-level decisions. This recommendation goes hand-in-hand with leadership having already installed the management teams below them with the organizational core competencies that are needed for accomplishing enterprise strategic goals.

Stronger line-level managers and employees benefit the entire organization by improving upon the execution within the business operations while being a major part of the many strategic “goal-supporting” initiatives the business relies upon for fueling growth. Empowerment of managers and employees also gets executive management out of the minutia by trusting on well-informed and competent staff below them on the organization chart instead of trying to shoulder to much responsibility themselves. This is accomplished with well-constructed strategic plans that concisely relate to the operational budgets controlling the tactics of implementation. Organization performance indicators and metrics help provide the ability to control and manage, as they signal the need for evaluation and analysis early when corrections to implementation tactics can be made more easily and with less cost implications. With proper management controls in place, this approach allows those closest to the action to respond quickly and appropriately when it is needed – always operating within predefined spheres of control and in concert with the strategic goals. The goals are well known and understood by empowered employees, as their direct managers will have effectively communicated these goals to them, accompanied by the expectations for how they can directly contribute – allowing them to embrace the vision and fully participate in the tactical execution.

5. Communicate the message

As we have stated in previous articles, strategy is formulated at the top and the CEO is directly accountable for establishing the direction and the process for strategic and operational planning to unfold effectively. Communication of the plan goals is a very important part of that process and another huge factor in achieving sustained top-line growth and profitability. One approach to consider in the overall communication strategy is to translate plan goals into strategy statements that the organization can embrace and enact. The intent is to effectively disseminate the executive vision throughout the organizational ranks so that empowered employees will be energized and capable of helping their organization. As with the business strategy, the communication of the business goals must be carefully planned and well orchestrated to achieve the intended results. Communication must target the right messages to the right people in the organization at the time that they need to receive the message.

6. Reward performance

Once employees are empowered to act and understand the organization’s strategic goals as they relate to their roles, it is their turn to perform and help drive sustainable growth in revenue and profit. At this point, it is also management’s turn to oversee, facilitate, correct, and recognize as well as reward performance. Organizations that are equipped with measureable plan goals are well positioned to effectively manage performance, reward achievement and hold people accountable for performance.

Sustained Revenue and Profit Growth

Companies that have achieved operational excellence survive the economic downturns by out-performing their competitors. They follow a cycle of continuous innovation geared towards value creation, and product and / or service superiority, brand awareness and market domination. Achieving operational excellence is elusive, but possible. To produce sustained growth, businesses must improve in the areas outlined in this article, but this is not a one-time event. They must manage the planning and execution of strategy in an ongoing effort to evolve the business.

The executive leadership cannot do it all on their own. They need an organization beneath them that can carry out the mission. Corporate executives have always had responsibility for the development of business strategy, but the execution of the strategy should be entrusted to talented, well-informed and motivated employees. These informed and empowered employees posses the core competencies to allow them to follow thoughtfully defined plans that are engineered to hold everyone accountable for their part of strategy execution. Strategy and planning that empowers employees at the lowest possible level through aligned budget parameters and reward systems will build a stronger culture and a more successful company.

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Article Tags: business alignment, customer acquisition, customer retention, expense control, innovation, operational excellence, profitability, sound strategy, value creation
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