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Profitable Growth Is Everyone's Business: 10 Tools You Can Use Monday Morning. Ram Charan. Crown Publishing Group. 206 pages, $22 (Also available as an audio cassette, audio CD and a downloadable audiobook.) (Click here or on the cover image to purchase this book.)

Buy Profitable Growth.

BY RICHARD PACHTER

rpachter@wordsonwords.com

Originally published on Monday, March 1, 2004 in The Miami Herald.

Former Orioles manager (and former Miamian) Earl Weaver said that his strategy for winning baseball games was hoping for a three-run home run. A base-clearing blast is a wonderful thing, but hope, as they say, is not a plan. What you can do, if you want to win, declares author and consultant Ram Charan, is try to hit a lot of singles and doubles. You will consistently score runs that way, and be in prime position to benefit from any shots that are, indeed, hit out of the park.

Baseball metaphors aside, Charan thinks too many executives are fixated on only achieving major, multimillion-dollar successes. Yet smaller wins are often easier to achieve and may ultimately result in greater gains with fewer risks. And sometimes, they can result in blockbuster breakthroughs, but the important thing is to consistently strive for growth in a variety of ways.

Charan is also a strong advocate of dedicated growth budgets, wherein financial resources are identified and allocated specifically for projects that promote profitable growth. These could be new products, sales support, marketing or, in some cases, acquisitions, but what's always required is a near-obsessive focus on strategies and behaviors that promote and sustain new revenue.

The author is wary of firms that focus on cost-cutting as a means of reaching revenue goals while assuming increased productivity as a given in the equation. He writes: ``Improving productivity and increasing revenues are seen as two separate issues when they are, in fact, inseparable. Sporadic, deep cost-cutting -- downsizing, closing plants, across-the-board budget cuts -- are one-shot reductions (often without attention to the consequences for revenue growth) that do not result in doing things in a better way.

``Cost-reduction campaigns are largely a result of the lack of discipline of productivity improvement on a long-term consistent basis. When employees experience these cost-reduction campaigns every year and sometimes two or three times a year, and revenues are flat or declining, they know they are in a business going nowhere. It becomes a personal-survival issue and saps their emotional energy.''

The holistic approach favored by Charan employs all of the company's resources as fuel for the firm's engine of growth. To be sure, urgency and focus are required at all levels, but most organizations -- like organisms -- would rather grow than die.

As with most books of this type, the author conjures up a number of examples to illustrate key points, including one threading through the text that involves the manager of a presumably fictitious Miami-based furniture store recently gobbled up by a conglomerate.

But mostly, Charan conveys his lessons in an upbeat, amiable and earnest manner. His ability to communicate serious and often complex concepts would be highly useful to any executive astute enough to implement the philosophy of striving to do lots of small and medium things successfully. It could give such organizations a decided advantage over bigger, better-funded teams. Play ball -- and go Marlins!
(I alternately read this book and listened to the audio version, by the way, and recommend either, depending on your personal preference and the duration of your commute or exercise routine.)

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