Building an Enduring Business by Managing
the Risks of Growth
Edward D. Hess
Business School Publishing, 2012)
Wall Street believes
that all public companies should grow smoothly and continuously,
as evidenced by ever-increasing quarterly earnings, and that all
companies either "grow or die." Introducing a research-based
growth model called "Smart Growth," Edward D. Hess challenges
this ethos and its dangerous mentality, which often deters real
growth and pressures businesses to create, manufacture, and purchase
noncore earnings just to appease Wall Street.
accounts for the complexity of growth from the perspective of
organization, process, change, leadership, cognition, risk management,
employee engagement, and human dynamics. Authentic growth is much
more than a strategy or a desired result. It is a process characterized
by complex change, entrepreneurial action, experimental learning,
and the management of risk. Hess draws on extensive public and
private company research, incorporating case studies of Best Buy,
Sysco, UPS, Costco, Starbucks, McDonalds, Coca Cola, Room &
Board, Home Depot, Tiffany & Company, P&G, and Jet Blue.
With conceptual innovations such as an Authentic Earnings and
a Growth System framework, a seven-step growth funnel pipeline,
a Growth Decision Template, and a Growth Risks Audit, Hess provides
a blueprint for building an enduring business that strives to
be better, rather than simply bigger.
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" Smart Growth
will bend your mind, challenge your assumptions, and set you on
a new growth trajectory. If you want to understand how following
advice from Wall Street can doom you to destruction, read this
-- Richard D'Aveni
Tuck School of Business at Dartmouth College, and author of Hypercompetition
and Beating the Commodity Trap: How to Maximize Your Competitive
Position and Increase Your Pricing Power
"Hess offers the reader a thoughtful critique of the assumptions
underlying the prevailing logic for the growth imperative that
is so widely accepted."
-- Robert K. Kazanjian
Goizueta Business School, Emory University, and coeditor of The
Search for Organic Growth
"Hess provides insight as well as prescriptions for how to
lead effectively and how to grow intelligently."
-- Kim Cameron
Ross School of Business and the School of Education, University
of Michigan, and author of Positive Leadership: Strategies for
"Hess takes dead
aim at one of the sacred shibboleths of business& mdash;the
notion that companies must 'grow or die'& mdash;and scores
a bull's-eye. He makes a devastating case and demonstrates how
destructive the blind pursuit of growth can be, and has been,
to businesses of all types, especially publicly-owned ones. Along
the way, Hess maps an alternative approach to managing business
growth that focuses on the long-term health of the enterprise.
It's a powerful argument and one that should be taken to heart
by corporate executives, entrepreneurs, and policymakers alike."
-- Bo Burlingham
editor-at-large of Inc. magazine and author of Small Giants: Companies
That Choose To Be Great Instead of Big
and research provide a navigational path that illuminates key
success factors and models that drive exponential growth."
-- Jeffrey S. Shuman
"In this masterful
work, Edward D. Hess shows us how companies can grow in a healthy
and organic manner, one that is sustainable and beneficial for
all stakeholders, including society as a whole."
-- Raj Sisodia
Bentley University, and coauthor of Firms of Endearment: How World
Class Companies Profit from Passion and Purpose
"This book will
challenge your basic assumptions about business and growth. It
needs to be read and talked about in both companies and business
-- R. Edward Freeman
Darden Business School, and coauthor of Managing for Stakeholders:
Survival, Reputation, and Success
"Warning against the creeping corruption of 'managed earnings'
and 'making the numbers,' Edward D. Hess wisely urges business manager-leaders
to keep their focus on the real growth of getting better, not bigger,
and creating true value, not short-term earnings per share."
-- Charles Ellis
author of Winning the Loser's Game: Timeless Strategies for Successful
Smart Growth is a provocative and useful evidence-based approach
to understanding the principles of corporate growth."
-- Mary Ann Glynn