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Rita McGrath cited in Business2Community blog

Recent research from the Columbia Business School concludes that fewer than 1% of large, publicly-traded companies deliver consistent growth over time. In fact, only 8% of nearly 5,000 companies studied achieved five percent growth or better two years running, and only 4% of companies managed the feat for five consecutive years. Sadly, a paltry ten (10) companies achieved growth of 5% or better for a decade.

How do the “growth outliers” do it? “On the one hand, they’re built for innovation,” says Rita Gunther McGrath, a Columbia professor and one of the study’s authors. “On the other hand, they’re extremely stable. Chief executives have come up through the company; strategy and organizational structure stay consistent for long stretches; client retention is unusually high; and the corporate culture is strong and unchanging.”

This new research aligns with our findings that the internal issues of alignment, focus, courage and consistency are critical to corporate success. Of course, if these things were easy to maintain every company would do so. Still, both this study and our own demonstrate that ignorance of the true drivers of corporate growth is still widespread. Steady gains come not merely as a result of brilliant strategy or amazing innovation, but a steady hand at the wheel and a strong culture behind it.

How does your company measure up on these critical metrics?

If you’d like a quick analysis, take a simple, confidential self-diagnosis here. If things aren’t firing on all cylinders at the moment, it may give you a sense as to why.

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