To understand this, we start by pointing out some common myths or misconceptions about what causes high growth; myths such as how much risk CEO’s are willing to take or how much access to capital they have.
The Gazelle Index surveys found that owners of high-growth and low growth companies work just as hard, have the same level of education, and are moderate risk takers primarily.
However, where they differ is that CEOs of high-growth companies, in comparison to those of low-growth companies, plan! That is, CEO’s of high growth companies do the following:
- They create and execute business growth plans,
- They set much higher annual growth targets,
- They pay much attention to improving their company’s management efficiency,
- They worry less about their competitors than their competitors worry about them, and
- They more likely to be operated by younger entrepreneurs.
In short, CEO’s of high-growth and low-growth companies are similar in the following ways:
- Both groups of CEOs are moderate risk takers, not high risk takers
- They work equally hard
- They are committed to innovation
- They have the same access to capital
- They have similar levels of education
- They are equally optimistic about the future
- They spend the same time growing their business vs. managing it.
What makes the difference when it came to achieving high-growth is planning for it.
Planning is a factor that every CEO can control. To grow one must set a high growth target, develop and implement a plan to reach it, constantly improve your company’s operational efficiency, and stop worrying about your competitors but instead work on achieving a distinctive products or service.