Growth Strategy Evaluation and Selection
Following the identification and profiling of potential growth strategies and an objective analysis of the client’s core competencies, the next phase in the growth strategy development process is the evaluation and selection of the growth strategies. The evaluation of growth strategies is usually based upon two sets of metrics: (1) a fundamental attractiveness of the specific target market segment, and (2) its “fit” with the client’s business. Taken together, these two sets of metrics answer the questions How attractive is the market in each area? and How well does this growth platform fit with our company? By evaluating growth strategies against a common set of metrics, inherent biases are reduced and objectivity is maintained.
Once the criteria have been identified, weight factors must be applied. Here, a combination of external perspective (often provided by the consultant) and internal perspective (provided by the company’s business leaders) is critical to developing a balanced view on the relative importance of each criteria.
At the end of the day, however, the selection of a growth strategy is not a mechanical exercise of choosing the strategy with the highest combined market attractiveness and company fit score. Typically the chosen strategy assumes a portfolio approach to growth which results in the adoption of several strategies that synergistically complement each other.
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