Understand three roadblocks that impede business growth

Companies can come with excellent value proposition by way of innovative products. Still they will face roadblocks from areas other than in production and operations. These obstructions can derail business growth prospects because creating value need to be properly balanced with delivering and capturing value for the firm. Here are the three roadblocks:

Marketing warfare: In formulating and executing business strategy a key factor that is factored in is how marketing will play out. Firm faces what we call “time limitation” that works in favour of it when introducing ground making new product in equally with ground shaking marketing strategy. It continues basking in glory but not for long.  By and by its competitors would also introduce similar product and strategy bringing the score to even. 

Sticking to a single marketing strategy for promoting products is therefore not feasible in the long-run. Look at the Cola war that is going on between giants Coca Cola and Pepsi Cola. Both are engaged in novel ways of manufacturing and in aggressive manner of conducting marketing via promotional campaigns indirectly targeted upon each other. These heightened marketing strategies are adopted to secure advantages but most of the time these are transient. The one who blinks first will be eliminated. So the war continues forever.

Financial risk: This affects every business small, medium and large. Small business has much more vulnerability to be destroyed by finance related risks than its stronger counterparts with large scale operations. Finance risk arises due to many weak points including lower equity base and creation of financial instruments such as debt notes.  Businesses that borrowed large quantum of money by issuing exotic instruments are in for trouble now.  They have brought down along with them the lenders, creditors and even governments. Look at what is happened in the Euro Zone.

Key Persons: Insurance companies are smart; they brought the key person insurance pretty long time ago. Business faces this strategic risk when a prominent leader or manager leaves office. High profiled companies assign head-hunters to get their choice of key persons from upcoming firms poaching them resulting in major setbacks for the victim firms. Although this risk affects companies across the industry, the worst mauled are technology, food, travel and tourism firms. Business strategist must be tasked to apply measures to neutralize if not eliminate this vital risk.

 

Cheers!

 

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail:   cosmicgems@gmail.com

Blog:   Business Strategist