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Saturday, January 25, 2020

C-Suite Advisory

Nine Principles For Mature Companies To Thrive

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The startup phase of a business is an invigorating time — fresh with promise and innovative ideas, along with an energized desire to achieve lofty goals. If all goes well with the launch, a rapid growth spurt occurs and the founder’s dreams become reality. At the end of a business cycle, we experience decline and sometimes, sadly, an eventual death. Smack-dab in the middle of these opposing phases sits maturity. This can be a long phase, and for many, not a particularly exciting time.

I am one of a rare breed who actually appreciates the challenges, and associated excitement, of participating in the maturity phase of a company. I have the experience to understand this phase as I have spent my entire adult career at one firm — Elliott Davis. I started my career upon graduation from Clemson University, an accounting degree in hand. Fast forward to the present, and I am proud to say I have served as CEO for more than ten years. The firm, almost a century old, has been through more than one turnaround phase. In business years, that translates to a mature, older firm. Though that may have a boring tone to it, it is quite the contrary.

Like a fine wine, a more mature company has the potential to improve with age. Learning from experience, incorporating innovation, and building upon success all add up to “getting better,” one of our core values. I like to compare the journey to that of an aging athlete whose quest for continued greatness and improvement is enough motivation to keep them persevering. Pressure from the fresh competition and emerging talent could be stumbling blocks for some athletes. But a great athlete takes the years of competition, and the desire to stay on top, and turns those challenges into new goals for achievement.

So how does an aging athlete defy the forces of nature, like the inevitable breakdown of the body? The same way a mature company avoids the phases of decline and death.

  1. Accept and value the strengths of maturity.
    “I’m not 23 anymore. But the defensive ends and linebackers chasing me are. If I had to choose between youth and experience, I’d take experience every time.” (Peyton Manning, former NFL quarterback). Seasoned maturity can serve as a huge advantage in business. With it comes best practices and problem-solving tactics. It also comes with a cache of mistakes and pitfalls experienced from the past, but the key is that maturity now knows how to avoid them.
  2. Get comfortable with being uncomfortable; be willing to pursue change.
    When you commit to change as a mature company, there is a little more resistance than at a startup. It is harder to turn around an older ship and a mature company can withstand some inertia, fear, and stagnation. I have learned to accept the reality that everyone will be uncomfortable, including me. During my years of leadership at Elliott Davis, I have probably been outside my comfort zone more than during the full span of my work life.
    “Struggling and suffering are the essence of a life worth living. If you’re not pushing yourself beyond the comfort zone, if you’re not demanding more from yourself — expanding and learning as you go — you’re choosing a numb existence. You’re denying yourself an extraordinary trip.” (Dean Karnazes, ultramarathon runner)
  3. Understand that what you did before isn’t good enough now.
    Competition gets tougher. Athletes get better as training becomes more technical. Science offers more insights and coaches become craftier. The “greatness” that you had ten years ago isn’t good enough to beat today’s standards of “great.” You cannot depend on the tactic of “keep doing what you have always done, just do it harder.” Every year, the mature company has to ask the questions “Where can we improve this year?” and “How will we be better five years from now?”
    As new changes and variables continue to enter the realms of industry, the economic environment, the competitive landscape, and technology, you need to realign both yourself and the company with those new realities.
  4. Stick to basics and focus on strengths.
    At age 38, Roger Federer has recommitted to doing what he does well: quick-strike tennis. He works to win points in fewer exchanges. Earlier in his career, he often “constructed a point,” enjoying 12-14 stroke rallies from the back of the court. But today he steps inside the baseline, volleys more, and doesn’t give his opponent time. Instead, he relies on his quick reflexes, sheer talent, and superior firepower to take a win.
    In analyzing your mature business, you need to ask what got you to where you are today. What sustained your business to bring it to its current levels of strength and stability? It is those strengths you want to highlight and intensify.
  5. Compensate for losses.
    At 42, Tom Brady is in some of the best shape of his life. Through his body is enduring the same aging process as any athlete, he chooses lifestyle factors to counteract it. Sleep and rest for recovery, meditation for better self-awareness, and a diet heavy on plants and low on inflammatory foods may not slow down the aging process, but by enhancing his inherent strengths, there is a counterbalance.
    Every company, regardless of phase, has weaknesses that are practically built into its DNA from its founding. Mature companies can experience a decline in nimbleness, flexibility, and even some creativity. But so long as they highlight their strengths, most can compensate for those weaknesses. They learn to play smart.
  6. Never stop learning; bring new ideas and variety to your game.
    Fitness experts have long debated the virtues of endurance runs versus interval runs [or HIIT as it’s popularly called now]. The reality is that runners, as they age, continue to need both types of work — aerobic and anaerobic. Steady-state work is important, but so is intensity. Throw in some new, varied workouts, and now you have a winning combination for improvement and growth.
    Businesses can use the same model to achieve growth and improvement. Don’t depend on the same process to work forever. It may not be sustainable and it can lead to a stale environment for employees. Entertain variety, introduce new concepts, tweak the old ones, and don’t shy away from innovation. If you want to run with the big dogs, keep teaching the old ones new tricks.
  7. Focus on improvement of the little things.
    Nearly every competition is a “game of inches.” Every sport is an athletic endeavor of improvement in small things. The steeplechaser improves his footwork between hurdles. A sprinter achieves a slightly improved start from the blocks. The basketball team picks up defense a little sooner and is just a little more focused. Each of these things can make the difference between placing or winning a race, winning a few more games, or even making the playoffs. The same is true for businesses. Slight improvements in corporate culture can lead to happier employees which lead to better client service. A focus on communicating your brand’s values and sculpting a more powerful message leads to more successful recruitment and retention of talent, giving you an edge on the competition. Better segmentation and capture of client data lead to superior client recommendations and clearer communication.
    Create a list of small tweaks and focus on those improvements. This can be much more potent than attempting a remake of corporate culture, replacing mid-level managers, or rolling out numerous new product lines. Over decades of time, it will be the small shifts that lead to lasting quality and endurance.
  8. Vary your goals.
    Many aging athletes have chosen to shift sports and discover their second wind in something new. Runners who competed in the mile or the marathon may choose to focus on ultra-marathons or endurance races in later years. Cyclists may switch to triathlons.
    A mature business may think it has reached its peak when in reality, it may be poised to attain a higher peak. If your business has been successful in capturing a market, it may be time to add some new lines, markets, or services. The shot of zest may even improve the standing products and markets.
  9. Love what you do.
    Athletes who enjoy the longest careers are those who not only basked in the competition and the win, but who also found fulfillment in the preparation and the process. They loved the day-to-day and the week-to-week long before the fame, recognition, and financial rewards came along.

I have worked for more than 30 years for a company getting ready to celebrate its 100th birthday. I would not have lasted that long without the personal enjoyment I gain from the people, the challenges, the efforts, and even the frustrations of working for a mature company. Longevity, whether in sports or business, is a result of loving what you do. Therein lies the motivation to keep moving forward every day.

 

As Peyton Manning summed it up, “Everybody is going to be excited to play in a Super Bowl. When you can still enjoy the preparation and the work part of it, I think you ought to be still doing that.”



Rick Davis
Rick Davis is the CEO of Elliott Davis, a top 30 US accounting firm and one of the largest accounting, tax, and consulting firms in the Southeast. Over the years of serving clients in a wide array of industries, Rick developed special interest and expertise in five areas of business growth and success: corporate culture, change management, the discovery and development of talent, strategic planning, and leadership. For further conversation, contact Rick at Linkedin.
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