Growth Strategies
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Organizations must evaluate their market to determine if growth is necessary to continue to compete in their chosen industry. If an organization operates in market that has seen steady increases in product or service demand they must consider growth as an instrument to remain competitive. Within any growing market competition to enter the market and remain a relevant organization in the market is high. “Growth is a popular strategy because larger businesses tend to survive longer than smaller companies due to the greater availability of financial resources, organizational routines, and external ties.” (Wheelen, Hunger, Bamford, & Hoffman, (2015), p. 187.) Each organization must determine first if growth is necessary in their industry, and if it is how do they achieve this growth? Does growth stretch available resources too far? Will growth have the intended benefit of increasing sales and reducing production costs? Each question must be answered to identify if growth is the directional strategy should be growth. If growth is the best option an organization can expand their current business through internal growth, or expand externally through company acquisitions or organizational mergers. Although company growth can be achieved through many strategies, the primary strategies are concentration and diversification. Concentration focuses on expanding current production, while diversification aims to expand business by producing new products, crossing into different markets.
