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Large companies can implement several strategies to build an alternative growth engine while their core business is still growing. Firstly, they can allocate a portion of their capital and executive resources to new ventures, even when the core business is thriving. This allows for the development of new growth engines in parallel with the core business. Secondly, they can adopt a patient approach, understanding that it takes years for a new venture to become a growth engine. Lastly, they should avoid the temptation to rapidly invest in new ventures with the expectation of them becoming huge very fast, as this often leads to disaster.
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Management theories not only can be applied to our careers, but also personal lives. Think of them as a resource allocation problem. You have limited...
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The best time to build an alternative growth engine is when the core business is growing. Unfortunately, large companies allocate almost all capital and executive resources to the growing business. When the core business begins to slow, there is no new growth engine ready. It rapidly invests in new ventures and expects them to become huge very fast. Inevitably, as the theory predicts, this ends in a disaster. If a company has ignored investing in new businesses until the time it needs new sources of revenue and profits, it's already too late. It takes years of patient nurturing for a new venture to become a growth engine.
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