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Why do Some Companies Grow Consistently While Others Struggle Sustained growth, while boring, is very desirable by management, employees, and suppliers

By Rajeev Agarwal

Opinions expressed by Entrepreneur contributors are their own.

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The first lesson I learned as an entrepreneur is that growing a business is hard. Very hard! During the first few years of a start-up, most entrepreneurs are worried about keeping the lights on and meeting payroll. Growth can seem like an afterthought. The story was not very different for me during the early years of my entrepreneurial journey. 17 years down the line, however, we are doing just fine.

My sense is that a similar business dynamic plays out in every country, including India. Sustained growth, while boring, is very desirable by management, employees, and suppliers. We do not want a roller coaster ride of hiring heavily one year, only to lay off the same people the next year.

In such a volatile environment, delivering on any commitment to customers is impossible. All of us have experienced poor suppliers who fail to deliver on simple commitments, such as timely delivery of quality products and services. How can a company grow if customers are not getting what they were promised? Why do entrepreneurial teams fail to deliver on their commitments? In such a landscape of failure, how do some companies enjoy consistent growth?

Growth Hacks

You don't need to have a secret competitive advantage or a "killer app' for this. Sustained growth, I believe, can be achieved by being focused in daily operations. To create a great process, the management team of every company should be focused on three core areas:

1. Daily Execution:

The managers should be actively involved in the details of projects as well as the follow-through on an ongoing project. (Not all micromanagement or attention to detail is bad.)

2. Teaching:

Organisations should be focused on providing expertise on new software tools and architecture. The best managers make continuous learning a habit, so that they can educate their teams effectively.

3. Self-knowledge and Awareness:

With self-knowledge, managers should be better prepared to communicate with team members who have other social styles. These management practices may seem intuitive, but it's surprising how they are often ignored.

Senior management in many companies spends a disproportionate amount of time developing complex strategies for future growth. Strategy is important but studies indicate that prioritizing on improvement of daily operations leads to greater success. Some managers seem to pick up these habits intuitively.

Others are able to learn them with the right guidance. Hence, senior managers should help the junior members to learn what it takes to lead effectively daily and weekly huddles and one-on-one meetings.

These talented leaders energize fellow team members by modeling desirable behaviors, ultimately contributing to increased profitability and growth of the company. To make it easier for the managers to lead, it is essential to invest heavily in training.

This is crucial, to keep pace with advancing technology. During transitions to new technologies, engineers are sometimes reluctant to abandon their old expertise. For some, an easier option is to leave the former employer and join a company which is still focused on older technologies. What ultimately persuades most engineers to stay, however, is the highly efficient training system.

Admittedly, this makes the engineers more marketable and attractive to other employers. That is a risk one should be willing to take. Although I founded the company in 2000, having a well-trained team has driven 72 per cent growth in our revenue the past three years—a pace more common for start-ups than a company like ours. While some of our employees do get poached, our most capable team members tend to stay. They have no reason to look elsewhere.

By focusing on operational excellence and trusting our managers to execute, teach, and know their teams, we have created a culture of growth, both for our team members and for our company.

(This article was first published in the December issue of Entrepreneur Magazine. To subscribe, click here)

Rajeev Agarwal

Founder and CEO, MAQ Software

Rajeev Agarwal is the Founder and CEO of MAQ Software.
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