What’s the most critical element for a successful business? Without a doubt, it’s growth. Growth is the primary requirement for good business health.
Look no further than GM. Because GM didn’t maintain growth, the company now has 1 retiree for every 3 employees. The "legacy costs" now killing GM are a result of insufficient growth – which has created more out-of-work union members and pensioners than they ever anticipated. Without growth, they’ve created a huge number of people relying upon the productivity of a relatively small group. Had GM maintained it’s market share, and grown, it wouldn’t have nearly as difficult problem today.
Or look at our U.S. consumer sentiment. While some politicians tell us we’re in a "good economy" the fact is that we are going to end this year with 5 consecutive years of over 1 million layoffs from large firms (source – Challenger and Gray.) This doesn’t count all the small and medium-sized firm layoffs, which the government tallied at 1.77million in September alone. It’s hard for consumers to feel good when the government brags about creating 215,000 new jobs in a month where that is less than one-fifth the layoffs. So, lack of growth in jobs and you have trouble believing there will be a pension, social security, medicare/medicaid — or even a decent future income.
The key to success is growth. Growth can hide a multitude of mistakes undertaken in the pursuit of growth. But without growth, every hiccup is a potential disaster.
