Optimizing Core Business for Short-Term Growth PPT
This PPT slide, part of the 31-slide McKinsey 3 Horizons of Growth PowerPoint presentation, outlines the first horizon of growth, emphasizing the importance of maintaining and enhancing core business operations. This horizon focuses on short-term growth, typically within a 1-3 year timeframe, and is centered around sustaining existing value propositions that generate cash flow. The key message is about optimizing margins and profits through improved business processes and performance enhancements.
Leadership plays a critical role in this phase. It's essential for executives to assess the organization’s strengths and weaknesses. This evaluation will help identify which value propositions are effective and which may need to be retired or abandoned. The slide suggests that activities in this horizon are often routine, involving sales, marketing, and customer acquisition efforts. These tasks are fundamental to ensuring the ongoing success and growth of core businesses.
The measurement metric highlighted is the Return on Invested Capital (RoIC), which serves as a crucial indicator of financial performance in this horizon. The responsible individuals for these initiatives are referred to as business maintainers, indicating a focus on those who manage and optimize existing operations. Furthermore, the slide notes that a fully-assembled capability platform is necessary to support these activities effectively.
Overall, this slide serves as a strategic reminder of the foundational work required to defend and extend core business operations. It stresses the need for a disciplined approach to managing existing resources while also being vigilant about potential areas for improvement. This perspective is vital for any organization looking to secure its immediate future while laying the groundwork for longer-term growth.
This slide is part of the McKinsey 3 Horizons of Growth PowerPoint presentation.
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