Chris Zook of Bain explains the predictable crises of growth and how to overcome them. His new book is "The Founder's Mentality," coauthored with James Allen.
In Repeatability, Chris Zook and James Allen - leaders of Bain & Company’s influential Strategy practice - warn that complexity is a silent killer of profitable growth. Successful companies endure by maintaining simplicity at their core. They don’t stray from, or regularly discard, their business model in pursuit of radical renovation. Instead, they build a “repeatable business model” that produces continuous improvement and allows them to rapidly adapt to change without succumbing to complexity.
"The Best Business Book I've Read...Ever!"
Chris Zook and James Allen, partners at the global consulting firm Bain & Company, report on how leveraging a simple formula allows companies to create new and more lasting differentiation.
At any given moment, about 5%–7% of companies either are in free fall or are about to be. Free fall is a crisis of obsolescence and decline that can happen at any point in a company’s life cycle, but most often it affects maturing incumbents whose business model has come under competitive attack from insurgents or is no longer viable in a changing market. And here’s a sobering fact: Only about 10%–15% of those companies will ever pull out of it.
When it comes to investments, here’s a general truth: the larger a company gets, the smaller it thinks. The process is insidious, and companies must always be on the lookout for signs that it is setting in. If you want your business to grow sustainably at scale, you need to figure out how to make big investments that will best differentiate you in your core.