DOUBLE-DIGIT GROWTH How Great Companies Achieve It ­ No Matter What By Michael Treacy Publisher: Portfolio Publication date: September 2, 2003 Price: $27.95/hardcover // ISBN: 1-59184-005-8 "DOUBLE-DIGIT GROWTH is exactly what CEOs and business unit leaders must be thinking about today. We cannot cost reduce our way to prosperity; we must grow out of the global economic slump. This book prescribes the way forward." -- Rick Roscitt, Chairman & CEO, ADC, The Broadband Company GROW OR DIE BUSINESSES THAT DON'T EXPAND ARE BOUND FOR EXTINCTION, SAYS BESTSELLING AUTHOR MICHAEL TREACY In His New Book, Treacy Reveals Visionary Strategy For Achieving Double-Digit Growth "Growth is the oxygen of business, the key to business life or death," contends bestselling author, entrepreneur, and consultant Michael Treacy. "But the way most businesses think about and pursue growth is fundamentally flawed." In his new book, DOUBLE-DIGIT GROWTH: How Great Companies Achieve It - No Matter What (Portfolio, September 2, 2003), Treacy reveals why slow-growth companies are doomed to die, and offers a visionary new strategy for attaining long-term, double-digit growth. Co-author of the bestseller The Discipline of Market Leaders and former professor at the Sloan School of Management at M.I.T., Treacy contends that - despite many business leaders' excuses to the contrary - growth is a choice that lies entirely within a company's power. Blaming the economy, or competitors, or unforeseen circumstances for stagnant growth, or even decline, is "a little like listening to an addict in denial," he asserts. DOUBLE-DIGIT GROWTH is built on Treacy's careful analysis of the Fortune 1000 and the Forbes International 500, and his study of some eighty firms that have demonstrated steady double-digit growth over the past five years. These include such well-known stars as Wal-Mart, Harley Davidson, and Starbucks, as well as up-and-comers like H&R Block, Lowes, and Medtronics, and a number of smaller and less familiar firms like Oshkosh Truck, Biomet, and Paychex. For comparison, Treacy also studied fifty high-profile but non-growing firms. Based on his research, he has determined that there's no single method which will allow a company to achieve consistent double-digit growth. Instead, like investors who hedge their bets, smart companies build a sophisticated portfolio of different growth initiatives. Treacy has uncovered five distinct growth disciplines that can be combined to make up a growth portfolio: Retain Your Customer Base. One of the easiest ways to improve growth is to slow the rate at which a company loses existing customers. Treacy explains that this requires much more than the simple loyalty programs employed by many organizations today. He reveals the latest, cutting-edge base-retention tactics. Gain Market Share. No company gives up market share without a struggle. Treacy explores strategies for building market share, both organically and through acquisitions. Exploit Market Position. Companies must learn to anticipate which segments of their markets are going to grow the fastest, and position themselves to get the biggest boost from this growth. DOUBLE-DIGIT GROWTH lays out how to spot growth opportunities early and get established in those growing market segments. Penetrate Adjacent Markets. Illusionary opportunities abound. Managers must carefully assess whether their key operating capabilities can truly give them an advantage in an ancillary market, and whether the organization can build or acquire the new capabilities needed to meet competitive standards in that market. Invest In New Lines of Business. This final discipline focuses on achieving growth by invading new sectors which are unrelated to the primary business. Proceed with great caution, advises Treacy, and enter only if an outstanding acquisition, fairly priced, is available. "Investment judgment must supercede managerial ambition," he asserts. Treacy explains how treating growth like an investment portfolio - that is, by spreading risks - enables companies to improve the quality and predictability of their results. Consider a modest company like Paychex, which provides payroll services to small businesses. For the last five years, Paychex has averaged 19% revenue growth, 20.9% gross profit growth, and 29.6% net income growth, by combining four of the five growth disciplines. It practices base retention by relentlessly training its staff to respond to the needs of existing customers, as well as by adopting the best new technology. It pursues share gain by selling new customers on the no-hassle value of its services, and by the occasional small acquisition. It benefited from market positioning by expanding into new geographic markets and into a major new customer segment (firms with 50 - 500 employees, not just fewer than 50). And it's working on adjacent-market penetration by offering new services to its existing customers, such as 401(k) reporting, insurance, and other human resources functions. Illustrated by dozens of such case studies, DOUBLE-DIGIT GROWTH demonstrates that sustainable, double-digit growth is NOT a fantasy. With Michael Treacy's book as a guide, any company can make the choice to grow - and flourish. # # # ABOUT THE AUTHOR MICHAEL TREACY has been helping companies achieve market leadership for more than twenty-five years. The co-author of The New York Times bestseller, The Discipline of Market Leaders, he is currently the Chief Strategist and Co-Founder of GEN3 Partners, a firm based in Boston and St. Petersburg, Russia dedicated to creating science-based product breakthroughs for a wide range of clients. Formerly a Professor of Management at the Sloan School of Management at the Massachusetts Institute of Technology, Treacy resides in Needham, Massachusetts. For more information, visit www.michaeltreacy.com
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