Every leader, in any organisation, faces the same fundamental
challenge. You are given a set of human, technological, and
financial assets to manage, with the task of making those assets
more valuable in tomorrow's world.

In short, if you are a leader, your job is to ass value. There
are two ways to do that. You can use those assets more
productivity - deliver more and better goods or services - and
you can grow your assets - increase their reach and capability.

Growth usually is seen in financial terms - for good reason in
the case of most businesses. If you're competing for capital in
the financial markets, you probably have to grow profitably at
12% a year and have an operating return on assets of 16% a year.

According to research by Columbia University, that is what it
takes to match the performance of the top quartile of companies
in Standard & Poor's Stock Index.

Investment capital is necessary to fund new product and
services, and to provide the financial incentives that top
technical and management talent demands.

But even in the overheated world of Internet start-ups,
companies in the long run need growth and profitability. Without
growth, the imagination, energy and investment that companies
need will dissipate; without profitability, growth is
unsustainable.

Beyond the financial realities, however, growth is important for
strategic and psychological reasons. The way you create a
vibrant organisation is to engage the creativity, energy, and
the commitment of every member of the enterprise.

People need ongoing opportunities to use their skills, try new
things, and stretch their limits. Those opportunities are
necessary for people to be their best - and are available in
sufficient number only when your organisation is growing.

A growth strategy is also the best path toward continual
innovation. In education, for instance, there has been an
explosion of new models and markets for learning, but most of
that activity is happening outside of traditional universities -
in companies, in communities, on the Internet - where the growth
impulse is strongest. If universities don't grow and adapt, they
will soon become marginal contributors.

Growth forces you to look at your organisation from the outside
in - focusing on what your customers and the environment demand
of you. Too many organisations, unfortunately, are managed from
the inside out, putting their own practices, policies, or
priorities ahead of the needs of customers.

Limits of Growth

As any business leader knows - or soon finds out - you cannot
set high growth targets and then simply wish for the best. You
can achieve fast growth only with competent people, capable
systems, and disciplined leadership.

Leaders have to be prepared to say they will not push growth
beyond the capacity of people to deliver the quality that
customers demand.

It is possible to buy growth through mergers and acquisitions,
as we have seen in recent years. But that strategy, too, has its
limits. Ford's acquisition of Volvo, for instance, adds several
billion dollars to corporate revenues, but that by itself does
little to help the people running the F-150 truck or Taurus
businesses. They still have to grow their own organisations.
Therefore Jacques Nasser, Ford's former CEO, was driving for a
behavioural shift that permeates the organisation.

A one-dimensional obsession with growth also takes a toll on the
quality of life for workers, their families, and communities.

To sustain any institution into the 21st century, leaders must
balance many competing interests, and expand their view of the
organisation's role in society.

For example, Ford's Business Leadership Implementation, a
three-day workshop for 55,000 employees taught by 1,500
managers, includes a half-day of community service. Nasser
supports that investment because he sees the business benefits
of an engaged workforce, and because he sees growth - financial,
professional, and social - as essential to the company's future.

Role of Leadership

To add value to your assets, you need a vision of where you're
taking the institution and a strategy for getting there. You
have to paint a clear picture of your destination and the route.

That may require a total transformation of the organisation,
especially when past practices and assumptions forestall growth.

Successful leaders of such journeys are invariably creative
thinkers.

They know how to look from the outside in, to challenge the
status quo, to move proactively, and spot and cultivate talent.
They translate their vision of the future into what Dr Tichy
calls a teachable point of view.

This has four elements:

· Ideas - the products, services, markets, distribution
channels, or customer segments that are going to be most
important

· Values - the behaviours and ideals that support those business
ideas

· Emotional energy - the drive, communicated to others, to
create positive outcomes

· Edge - an engagement in the business that allows leaders to
make tough, yes-or-no decisions.

All of these are essential to asking the right questions about
the future and to formulating and implementing a growth
strategy. A teachable point of view, grounded in an
understanding of your mission, also helps you know when to say
no to people, practices, and opportunities that no longer add
value to the work of the organisation.

When an organisation is growing, its people are too. For these
organisations, growth is always a tool for accomplishing more,
never an end in itself.

Their leaders know that growth entails risk, but that growing is
less risky than not growing. It is part of the genetic code of
all living systems, and must become so for all organisations.
Like all living systems, organisations that are not growing
cannot survive.
 
Dr Noel Tichy will be in Malaysia for the first time to speak on
"The Leadership Engine: Building Leaders at Every Level" on Aug
3 at the Palace of the Golden Horses, Selangor. For details,
call MIM Customer Service at 03-21654611, e-mail:
enquiries@mim.edu or visit www.mim.edu