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Growth Strategies

5 Lessons in Growth From Former Dimension Data CEO, Brett Dawson

Brett Dawson took Dimension Data from a $2 billion to $8 billion business over the course of 12 years. He's now focusing on making an impact in the business landscape through investments. These are his five lessons on building a high-growth business.
5 Lessons in Growth From Former Dimension Data CEO, Brett Dawson
Image credit: Devin Lester
Entrepreneur Staff
Editor-in-Chief: Entrepreneur.com South Africa
11 min read

You're reading Entrepreneur South Africa, an international franchise of Entrepreneur Media.

PLAYER: Brett Dawson

COMPANY: Campan, a personal investment platform focused on investing in and nurturing businesses aligned to the fourth industrial revolution

INVESTMENTS: Gather Online, BrandHubb, Fourex, Free2cycle, Ubusha Technologies, Wrapistry

PREVIOUS EXPERIENCE: CEO of Dimension Data from 2004 to 2016, and took the business from $2 billion revenue to $8 billion during that time.

 

1.    Success begins and ends with your people

In any business, your entire leadership team needs to believe it can go out and do extraordinary things. My goal is always to achieve a rate of growth that’s three times the growth of the market.

You can only achieve that with people who buy into the dream that we are going to outgrow the market, who believe that a good performance is three times the rate of growth of the market and who want to go out there and do it.

It’s all about mindset.  Some people wake up and think ten minutes of exercise is hard. Others wake up and think three hours is hard. It’s all relative. 

You need to find the people who suit your vision, dream and culture, and then support and nurture them. As a leader, you have to build the compelling vision and belief that we can do this, but you also don’t want to attract the wrong people who just believe and don’t critically analyse what you’re trying to achieve.

It’s a delicate balance.  You want people who take it in and think, ‘that sounds aggressive; it’s a big, hairy, audacious goal — how do we get there?’ They need to be able to formulate a real, achievable plan.

 

2.    Find your market opportunities

I’ve always had one simple mantra: We want our fair share of the market, and as long as you believe our fair share is 100%, then that’s all we want. And then we didn’t stop until we got our fair share. 

You can’t ignore the fact that there are competitors — there are always competitors — but there are always market opportunities as well. As long as you don’t have 100% of market share, there’s an opportunity.

To achieve this, you have to have a culture that says we always want to win and grow and beat our competition. We want to expand our market share. Very few businesses have run out of market share.

In every business I’ve been in there’s always been a bit of market share available. At Dimension Data, we were able to successfully go up to 90% in some of our segments. 

 

3.    Extend from your core

One of the biggest mistakes I see businesses making, large and small, is diversifying. I would say, don’t diversify, rather extend from your core. Diversifying typically means you go and do something different.

If you diversify into different markets, for example from pools to grass chemicals, you’re entering a completely different market.  Too many business owners make the mistake of thinking that the grass is greener somewhere else.

If you don’t have the people, the operating model, the business rationale and experience of the business you’re moving into, there’s a high likelihood that you’re going to fail. Instead, embrace a mindset that the world is competitive.

If your space is hard, that doesn’t mean that because something else looks good it’s going to be easy. There will be competitive pressures there as well. Before you make radical changes, decide on what your core business is and what you’re good at.

Then get better at that — focus on growing it and becoming the leader in that space. Find the logical extensions of your business. We took Dimension Data from $2 billion to $8 billion while I was there.

We never ran out of opportunities to expand from our core, leveraging what our people were best at.  If you’re in a business that employs a certain type of engineer, what else could that type of engineer be good at — what could they easily expand their thinking to? Do that.

Don’t take that Internet networking engineer and decide to build rockets. What’s in their culture?  Ultimately, you need the courage to say ‘my organisation comes from this base — what drives my people, excites them and motivates them?’ And then stay in businesses that really excite your people.

At the end of the day, if your people go home and they’re proud of what they’ve achieved that day, they feel good, and they come in the next day and do even more, pushing their boundaries even further.  

 

4.    Build it in your home market first

The best growth strategy is to do it in your home market. Do it where you have the people, the leadership, culture, network, systems and capabilities. Too many companies look to expand into other geographic areas too fast.

They look for the biggest markets. They think, ‘I’m successful in South Africa, where should I go next?’ and then they look at the size of the US and go there.  Why would a fast food business win in the US?

Do you think there’s no competition? And unless you achieve massive market share in your area — in whatever you do — you will lose money. Instead of just looking for the biggest market, find another market that is culturally close to your own and where the competitive dynamics are such that you can go and win.

My initial growth strategy was to drive Dimension Data into emerging markets. We achieved most of our expansion throughout Asia, Africa, Latin America, and into Australia and New Zealand, all with a slightly lower competitive intensity than the US. 

Only when we had good growth in those emerging  markets with reasonable market shares and good profits did we look to an aggressive growth strategy in the US.  The US is incredibly competitive and whilst we did have a US footprint it was primarily there to enable us to win business in the US for our emerging market footprint.

That’s why we had a US footprint, not for growth in the US, but for US businesses that had a footprint in emerging markets and needed a partner who could execute in those areas.  Our competitive differentiator was the fact that we had the emerging market footprint. We could deliver in difficult spaces.

Once we had established a significant presence in emerging markets, then our strategy turned to seeking growth in the US.  Many companies go straight to the US once they’ve achieved some local growth.

Rather go there last. Find markets where you think you can dominate; where the competitive space is slightly less robust. You’ll also make more money dominating a small market than being a blip in the ocean of a big market.

 

5.    Know why your customers will buy from you

This sounds so straightforward, and yet in my experience it’s one of the most difficult questions for business owners to answer.  First, start with why a customer would come to you. That’s always my first question, and nobody can really answer it.

Many of the biggest businesses in the world can’t answer this question. Too often we have a perception of what our customers want, and we end up building features into products that nobody cares about, because we don’t have a deep enough understanding of our customers, or why they buy from us.

You need to have the brutal conversation right upfront — why would your customer buy from you?  That ‘why’ is so critical to your pricing and the value you bring to market.

What is so compelling about what you’re providing that it will make your customer want to come to you and only buy from you?

It’s a competitive world. In everything I’ve done I’ve found competitors. Assume you have competitors and be better than them in some meaningful way.  If you’re not better, you don’t deserve to be around. It’s a harsh but simple truth.

It’s always a red flag for me when a business tells me they have no competitors. It’s a competitive world. Can you really come up with something in this day and age that’s so unique no one else is doing it? And if you can, it will be copied in a week anyway.

So, what can businesses not copy? It’s your people, not your products. Products can be copied, and often quicker and cheaper than the originals. You have to have differentiation — people need to be prepared to come to you and pay your price.

And more often than not, that differentiation lies with customer service, and something you offer from an experiential perspective.  From a strategic perspective, you also need to be clear on what you do, and more importantly, what you don’t do. What you say no to is as important — if not more so — than what you say yes to. 

 

INVESTING IN GROWTH

Since leaving Dimension Data, Brett has focused on investing in businesses. He has made investments through Anuva Investments and personally, and is now collating his investment portfolio under Campan.

“Campan is an umbrella I’ve created to give my investments and commercial interests a home,” he says.  From an investment perspective, this is what Brett looks for in a business.

I believe the next big growth area will come through the fourth industrial revolution. I’m therefore interested in companies that use tech — not manufacturers, but businesses that leverage existing tech to impact their markets.

Airbnb and Uber are great examples of businesses using tech to disrupt existing markets. Through technology it’s possible to do things ten times faster and cheaper, and massively impact existing business models. 

Has the entrepreneur begun to turn their dreams into a reality? Lots of people have dreams. Very few have the chutzpah to turn their dreams into a reality. I need to be convinced a person is beyond the dream stage. Are they committed?

Are they giving up? Are they putting everything into this? To be a success you need to commit 110%. Perspiration is everything. It’s blood, sweat and tears on an extraordinary level to build a business. Nothing just happens.

To understand if a person is capable of all of that, you need to see some form of track record. An idea isn’t enough.  Is their money where their mouth is? Do you have the willingness to go out and really put your back into it?

Even early stage angel investors want to see something up and running and a proof of concept. There are too many opportunities that have moved beyond dreams out there — that’s what you’re competing with.

Why would an investor choose an idea over a business that’s up and running, has some traction, some customers and an entrepreneur who has personally invested time and money in the business? Think about who else an investor might be speaking to, and view your business through that lens.

I’m looking to nurture greatness. I want to build great companies. Not operationally, but through strategic input. All companies struggle with go-to-market strategies, and I believe I can really add value there.

Failure is okay. I’ve competed my whole life. I would rather invest in people who have lost a few of their own battles; people who have never failed haven’t learnt the lessons they need, or developed the resilience and perseverance that will help them reach their goals.
 

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