As a nation, we are searching earnestly for new opportunities of growth in products and services. We are diving in more deeply, searching for new opportunities with a strategic process. The differentiation companies are fighting to achieve has turned to a point of survival, not just another growth plan initiative. The critical component to success and sustaining growth while managing competition falls on understanding that “the grass isn’t greener.”
An article written in Harvard Business Review on the topic promotes the understanding that moving into a hot new industry probably won’t revive growth; instead, the focus for every industry should be to dive deeper into our own industry for the win.
To explain, the author’s cited an excellent example. Here’s a summary: The CEO of a company we know convened his top executives and asked them to look for new strategic growth opportunities, because revenue had stalled and the existing customer base was shrinking. He encouraged them to be not bound to the company’s history, or the assets it had in place. Instead he wanted them to identify new markets. He stated that the company needed to find some other way to extend their business.
The authors argue that the senior executive’s problems are not simply a function of a decline in their core markets or an “underlying belief that leaders should find the ‘best’ industries and put their companies in a position to compete in them-thinking the grass is greener.” The truth, according to the authors, is that, in almost every case, there is “a bigger opportunity in improving your performance in the industry you’re in, by fixing your strategy and strengthening the capabilities that create value for customers and separate you from your competitors.”
I personally believe this is the underlying struggle on the supplier side of corporate real estate and within our client’s overall business strategy objectives. As the supplier, we are in constant motion to dive more deeply in the processes of strategic development and transactional management to meet and exceed our customer’s needs and expectations. The more we are able to strengthen our capabilities and create value for our clients without adding in new strategic growth opportunities outside of our industry norm, this will enable us to further separate us from our competitors and create a sustainable value proposition to our clients that only improves the current climate in which we do business.
The strategic processes of change management, portfolio optimization, collaboration, and consolidation/cost cutting, to just name a few, deserve more detailed attention from a c-suite perspective. This allows us to partner with our client in order to continually build upon what we know and uncover what we don’t know in order to create value, increase separation from the competition, strengthen capabilities, and improve performance. The findings and processes we use in order to understand our clients business strategy versus corporate real estate strategy should only help redirect, strengthen and support them to dive even more deeply in improving their performance in their current industry and give them a voice/seat at the c-suite table.
The authors write that, in order for our clients to win in their own industry, it is imperative for them to first rethink their definition of growth, by realizing there should be a singular focus on market-share gains, which leads to superior performance. Second, they should funnel resources to the few capabilities that are really critical to the company’s success, and minimize all other costs. Finally, they should change the focus of the business units and teams by balancing out the focus between numerical targets for revenue, growth, profitability and expenses to focusing on market share; a more independent variable.
If as corporate real estate professionals we walk in with the same focus, on market share gains and aligning resources with critical factors to the company’s success, our conversation immediately turns to a strategic look at the portfolio based on understanding their future growth as it pertains to their brand, marketing, services, products, and financial strategic platforms. We walk in ready to discuss business strategy not just corporate real estate strategy.