Debunking four myths of organic growth

While organic growth is crucial to a company’s survival, many executives underestimate its value. In past research, we found that fewer than 30 percent of businesses systematically scan for and evaluate new growth opportunities.1 The reasons for this vary from reliance on cost-cutting efforts to difficulty overcoming short-term pressures.

Companies can Invest, or identify pockets of growth and reallocate resources to them; they can Create, or innovate products, services, and business models; and they can Perform, or excel at commercial functions and operations.3 The results from our top-growth companies—that is, the companies where respondents report revenue growth four or more percentage points higher than the industry growth rate—appear to debunk some commonly held myths about organic growth and what it takes to do it well.

Myth 1: Creating new products, services, and businesses is the best way to grow

Myth 2: What worked before will work going forward

Myth 3: Innovation capabilities can’t be developed

Myth 4: Superior growth is not possible in my industry

It’s important for companies reviewing their growth agenda and strategizing for improvement to take a hard look at their explicit or implicit assumptions on how growth is achieved. Deliberate identification and targeting of capabilities is a tried-and-true method that distinguishes firms with consistent growth records from those without them.

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