I’ve got nothing against saving money. I believe in saving money. Controlling expenses is important. And I also believe in growth. I believe in innovation. In business today, it’s “innovate or die.” Any of you once own a Palm Pilot? How about a Blackberry? Whew.
Success in business requires a growth mindset; not a scarcity mindset. We must move business forward. Success is vastly different from survival. Often, we see businesses that are in survival mode. Part of survival mode is cutting costs – or at a minimum, rigorously scrutinizing costs. Again, that’s good business and good fiscal management. But as one of my CFO friends says, “It’s easy to control expense. Having a team that supports growth thinking is more challenging…to be able to deliver into the growth as it happens.”
I don’t think you can save your business into massive success. It’s easy (albeit not pleasant) to whack and squeeze and cram down. Is that innovating? Sometimes. Sometimes scarcity leads to really creative, efficient and cost-effective solutions. But if we’re celebrating a win for using one square of toilet paper instead of two, there’s a problem.
Another C-suite friend talks about “The Pile”. The Pile is cash. A close cousin of EBITDA. The challenge (and the fun) is growing The Pile. The Pile can grow from cost cutting, but it’s much more fun to grow The Pile by addition vs. subtraction. New products, new customers, new programs, new niches.
How about you and your business? How do you grow your Pile? Is it only by scrimping and saving? Or do you keep a keen eye on expenses while pushing hard for growth? It’s like walking and chewing gum at the same time. You gotta do both to achieve massive success.