A privately owned company in Stage III – Professionalization (transitioning from entrepreneurship to systematic management), (~ €35M revenue) has been experiencing slow growth for several years. After more than 15 years of successful development, the company management was trying to figure out why the company had been growing slower than the market. Although revenue was not decreasing, the consensus among the leadership team was that the business had lost traction and might be going into decline.
Review of historical data and several interviews with the leadership team revealed that the company was severely underbuilt for its stage of growth. At the Professionalization stage for almost seventeen years at that point, the company had begun solving some of the infrastructure tasks for this stage with more than ten years delay and was still underbuilt for some of the areas from previous growth stages.
Our Organizational Health Check™ validated these observations, showing severe delay in building the necessary company infrastructure with high level of Growing Pains and marginal level of overall organizational effectiveness. Further analysis with our diagnostic tools identified Strategy, Leadership development and Culture as being the most significantly underbuilt company layers.
A company-wide effort for strategic organizational development was undertaken, starting with strategic repositioning by implementing a structured process for strategic planning. Later systematic efforts were invested in building the Leadership layer through developing and implementing leadership development programs that focused on clearly defining roles and responsibilities and building the skills needed to effectively implement these roles. The Culture layer was built by developing clear definitions of company values, assessing the extent to which these values were reflected in employees’ actual behavior, and developing a plan to effectively manage culture as the company looked to the future.
Within two years the company doubled its growth rate, within five years it doubled in revenue and EBITDA. Building the company’s infrastructure allowed the company to successfully integrate further growth both in headcount and revenue, by acquiring the business of one of its major competitors. Over nine consecutive years after first applying the MS Playbook, the company has grown each year to reach almost tenfold growth in revenue and has doubled in the number of people employed.
The MS Playbook is now fully integrated into the strategic planning and yearly goal setting systems, in the culture management process, and in the leadership development company infrastructure layers. The Organizational Health Check™ and MS culture survey are used every couple of years to ensure no system layers are significantly underbuilt. All newly promoted or externally hired managers are onboarded using the MS Playbook methodology.