Contents
Are there universal and proven success factors that bring together the most dynamic players in the market, which show explosive growth every year? Trends understand the reasons for the outstanding growth of such companies
About the expert:
Igor Kalganov, CEO of T1 Group.
Despite global challenges and uncertainty, some companies manage to show annual growth above the market. We see them in the ratings of fast-growing companies -, Inc. 5000, Spark Interfax, TechUp, CNews and others. The lists include transnational corporations, high-tech start-ups, and companies of various sizes and industries. Let’s try to answer the question of what unites these companies in the context of their success.
Industry identity
The growth leaders in the global market were the technology and media sectors, retail and pharmaceuticals. In January 2022, TikTok was recognized as the fastest growing brand in the world (growth of 500%) in the Brand Finance Global 215 and truly revolutionized media consumption. The pandemic predictably brought pharmaceutical brands to the fore – their value increased by 94%. Retail also saw a growth spurt, with a 46% increase in brand value, outperforming the tech (42%) and media (33%) sectors.
In the Russian market, among the leaders in terms of revenue growth are IT, agriculture, and pharmaceuticals. The dynamics was 30%, 24% and 22% respectively.
Strategic and Digital Leadership
Fast-growing companies themselves consider strategic planning based on access to accurate and up-to-date information to be one of the main factors of their growth. Digital technologies and data analytics allow you to see new opportunities and react faster. Leading companies are 1,3 times more likely to collect their own data, 1,8 times more likely to make analytical decisions in real time.
In addition to technology, “digital champions” focus on qualified personnel with digital skills. Leading and laggard companies alike agree on the importance of attracting talent, but leaders are 2,6 times more likely than laggards to seek to retain that talent by offering a unique value proposition. To do this, they are 1,7 times more likely to implement talent management processes to encourage diversity.
Business model and product portfolio
A business model links a company’s strategic intent to its ability to deliver. A transparent business model increases the company’s attractiveness for product monetization and external investment. Therefore, 49% of companies plan to innovate business models as one of their top priorities in the future.
For example, to diversify a business, a company creates new products that go beyond the industry. Turkish mobile operator Turkcell’s ecosystem includes Paycell payment platform and BiP messaging super app, which generated 2021% additional revenue for the operator in 8. And the average income per active user of services increased by 5-10%.
On the same wavelength with clients
A focus on customer needs immediately distinguishes leaders in the industry: customer satisfaction with a product or service quality directly affects business growth. Leading companies are 2,5 times more likely than laggards to consider personalization a core part of the customer experience, constantly real-time real-time marketing spend reallocation.
For e-commerce, the cost of retaining a customer is five times cheaper than acquiring a new one. At the same time, if you increase the retention rate by only 5%, then profit can increase by 25-95%. And big brands are investing in improving the quality of the customer experience, for example, by engaging specialized companies to deliver products accurately and on time.
Transformations in the IT landscape
Leading companies approach digitalization strategically — to implement a digital strategy, they consistently get rid of technical debt and outdated IT infrastructure elements, invest in a flexible architecture. The right foundation can unlock the value of big data and drive technological innovation. Leaders are much more advanced in their cyber, digital and cloud journeys than the rest of the companies.
The need for enterprise technologies that are dynamic and adaptable to new business needs will only grow. Globally, companies with a high level of digital maturity are the most likely to report migrating to the cloud. In our country, the process of introducing cloud technologies has accelerated with the departure of Western vendors and the emergence of a shortage of hardware. This experience should spur the demand for SaaS services, which are useful for accelerating the deployment of technologies and bringing digital products to market.
September 27 will be conference “Russian software: a leap of faith or growth based on expertise”organized by T1 Group of Companies. As part of the discussion, leading experts will give an up-to-date assessment of the situation in the Russian IT industry, as well as talk about implemented projects in the framework of import substitution. You can register for the event using this link.
Corporate venture investments
According to BCG, 65% of companies today work with startups. Cooperation is developed through corporate venture funds, accelerators, incubators or open innovation centers. Fast growing companies invest 2,6 times more than their slow growing competitors. It helps to realize the full potential of these assets by understanding how to create synergies and expand opportunities. We are back to analytics and strategic leadership again. Leading companies are twice as likely to have processes in place to measure the impact of R&D and design, and three times as likely to make holistic investment decisions on a systematic and regular basis.
Business scaling
When a company has achieved product-to-market fit, orders, and a growing customer base, it enters a new stage. Processes, teams, and systems can no longer keep up with growing demand, and operations need to be kept up and running at scale. There is a need to minimize the human factor in business-critical operations and processes, as well as to focus on automating routine processes that directly affect the scalability of operations. The tools for this are flexible Low Code platforms and RPA technologies (technology that replaces manual processes with robots. — Trends).
For fast-growing companies, the market becomes a playground with its own rules. They segment the market, trying to conquer it. Leaders are much more likely to think about how to scale disruptive new business models.
Showing rapid growth from scratch is important, it gives access to internal and external investments, opportunities for development. Sustaining growth over the long term will require much more than a breakthrough idea or innovative product. Although there are no universal recipes for business development, the experience of leading companies, focus on similar approaches and growth points can help to reach new heights. Today, breakthrough business models, information and digital technologies have become the main drivers of development in almost any industry.