Perhaps the most important type of growth that a business can encounter would be that of organic growth. Organic growth by a business is that type of growth where a business develops new products, expands their customer base, and grows “naturally”.
When a company acquires another company this is the exact opposite of organic growth: inorganic growth. We see both examples in our day-to-day lives in both large and small companies. For example, in Facebook we have seen a number of reports where they have purchased a smaller company as an example of inorganic growth but we have also seen them develop new products in order to keep up with the times. When they roll out new options such as giving users the ability to advertise on Facebook in a new manner or giving them the means to open a store on their platform (called shopify) they are giving us a classic example of organic growth.
So organic business growth is definitely an important factor to consider and for many people it is the preferred way to grow a business.
Also called “bootstrapping”, it is slow, determined growth that results in a strong company foundation. But organic business growth in business means that you will always be in sync with your employees, your company, and your customers. In the early years, you may have to take other jobs in order to help support the company. There are a number of pillars to organic growth in business that you should be aware of. And there are a number of reasons why you should prefer organic growth to the “bang-bang” approach that some new companies attempt to utilize. Consider the following problems that the “bang-bang” model will encounter:
What if revenue grows faster than you can hire?
This can easily occur within a company that is started in the “bang-bang” model. When this happens, poor customer service will result. You may have a great deal of revenue and believe that everything is going gangbusters, and you may be right. However, your employees will be overworked attempting to keep up the questions and concerns that customers may have. If your employees take too long to cater to your customers, they just might decide to go to a competitor instead of waiting for you to get your act together. Remember in business that the customer is always right, and if you have a new product they have not developed enough brand loyalty in order to be patient. You will lose them to a competitor just like that.
What if you hire employees faster than your product improves?
When this occurs, the new employees do not have the opportunity to learn the culture of the company and the quality of their work will be inferior. One example of this can be found in Ben and Jerry’s Ice Cream. If they had employed the “bang-bang” model instead of the model that promotes organic growth in business, they would have had employees lacked understanding in the goals and strategies of the company. The quality of the ice cream would have suffered as a result.
What if you get a large amount of PR before you have fully developed your product?
The result of this symptom of the “bang-bang” approach to business growth will be that your customers will become “tire-kickers” rather than those that pay for the product or service. Even if you improve the product drastically, it will already be too late to improve your product’s damaged reputation. Moreover, too much publicity too soon will result in low fanfare when your product actually comes out.
SnapMunk
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