Is growth always the best strategy?

Essay by tbt April 2004

download word file, 9 pages 4.6

Is growth always the best strategy? Critically discuss.

In an era of increased environmental complexity and turbulence, the emphasis on strategic planning and its focus on the future are essential for survival and are essential. As the world becomes a global marketplace with national borders becoming meaningless, the potential for organizations to grow and expand is unlimited. Likewise, business challenges today are becoming more numerous, more threatening and more urgent and it is imperative that firms respond to adopt new strategic methods of gaining power to survive in the increasingly competitive industry. But is bigger really better? A corporate level organisation can choose to grow, stay put or divest. The strategy an organisation adopts depends on several aspects: the size and internal resources of your business, the industry/s in which it operates, where the business is currently positioned in the market, the organisational structure and culture of the business, and the environmental status.

In consideration of these factors will help determine the criticality of organisation strategic position in the market, and whether to proceed with the spur to adopt a growth perspective or postpone to later suitable times. To answer the question, bigger, of course, is thought to be better.

Growth defined

The Australian Concise Oxford Dictionary defines growth as growing, development, increase in size or value, developing faster than most other industries. By defining growth as developing naturally, increasing and be produced, it is therefore a question of why would businesses not want to grow? How else will you fight an opponent that is bigger and better than you? Often times there is no clear rationale for why growth should be a strategy pursued by the organisation, it is just in essence to have a long term strategy directed towards growing the business (Anonymous, 2000).

There exist three main...