Since the financial crisis, many companies have been shutting down locations and cutting back. They no longer want a growth at all costs approach that sacrifices profits for greater size or market share.
Does this mean that companies are less ambitious? And, what is an ambitious growth strategy and when is it likely to succeed?
A look at dictionary definitions of the word ambitious can help. There are various definitions of ambitious. They involve attributes such as going after goals by being highly driven, or having intense desire, or pursuing something challenging. So, by definition, ambitious entails intense desire, drive or determination to reach goals–often goals that are not easy to attain. Taken literally, these definitions might suggest that ambitious means intense pursuit of the nearly impossible. Furthermore, to some people, this might even mean intense pursuit of goals so lofty that the process starts resembling the fictional Don Quixote chasing elusive windmills.
But, accountable results have value in business. So, rather than chasing unattainable windmills, many ambitious businesspeople would like their intense drive and desire put to use with the intent of producing accountable results. Too often, however, when business is ambitious, the emphasis upon challenging growth objectives overshadows any emphasis upon outcomes.
Yet, for ambitious growth strategies to succeed, companies must go beyond merely applying desire, drive, and determination in pursuit of challenging goals, and also concentrate upon achieving outcomes. This means companies must strategically harness their ambitions. To do so, they must be strategic about determining which ambitious goals fit their strengths and warrant pursuit. Sometimes, this entails cutting back in areas of lower potential, thus cutbacks do not necessarily mean a company is less ambitious. By pursuing goals that are appropriate for their strengths, companies can strategically harness their ambitions and achieve far more successful outcomes.
For example, both Apple and Avon are companies that exhibited ambition. But, Apple strategically harnessed those ambitions, while Avon did not. Steve Jobs and Apple were driven, and had great desire and determination to pursue challenging goals. They did it in ways that built upon their strengths, and thus, produced highly successful outcomes. In contrast, a recent article in Fortune (Avon: the Rise and Fall of a Beauty Icon, April 30 2012) describes Andrea Jung, Avon head now being replaced with a CEO hired from the outside, as having ambitious growth strategies for the company she led. But, unlike Apple’s, Avon’s ambitions did not come to fruition.
Pointing out that Andrea Jung lacked an operations background, the Fortune article attributes Avon’s lack of success to difficulty executing its ambitious strategies. But, Fortune also tells how Avon’s problems were due to Jung trying to take the company too far from its core. Based upon my 25+ years researching business success and failure patterns, Avon fits the pattern of pursuing a strategy that doesn’t fit its strengths, and as a result, cannot succeed. Avon also fits the pattern where the CEO’s strengths differ from the company’s strengths. Such a conflict of strengths often leads companies to stray from their strengths and falter. Straying from its strengths made Avon’s strategy tough to execute and kept Avon from strategically harnessing its ambitions into successful outcomes.
This should not be forgotten as Avon brings in an outsider as its new CEO. The new CEO is at a disadvantage in that she lacks direct sales experience, an area where Avon has been strong. Some outsiders can be blinded by their own past experiences and may easily find themselves ignoring their new employer’s strengths. Yet, Avon’s new CEO does have an advantage in that the press has called attention to her lack of direct sales experience, and that Avon has already been through a misplaced emphasis upon retail that ignored its strength in direct sales. As a result, Avon’s new CEO may be more attuned to paying attention to Avon’s strengths, possibly putting her in a better position than many outsiders to avoid, or at least mitigate, the conflict of strengths. Only if she keeps Avon’s growth strategies in line with and building on its strengths is success likely.
After all, building on strengths is how ambitious growth strategies succeed.
