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The Rise Of The Hyper-growth Organisation

(Guest Post)

The growing influence of so-called ‘hyper-growth’ organisations is having a significant impact on global industry. Here, we take a deeper look at what defines hyper-growth companies, and the role they’re playing in modern business.

What is a ‘hyper-growth’ organisation?

A hyper-growth organisation is a company that is growing, or has grown, at a phenomenal rate. Typically, a hyper-growth organisation is a business which achieves annual growth rates in turnover or number of employees of over 20% for three consecutive years.

In the US, hyper-growth companies are known as fast-growth tigers or threshold companies.

What’s fueled the concept of ‘hyper-growth’?

Changing attitudes towards business operations and a noticeable shift in our working culture have both had a part to play in the rise of the hyper-growth organisation, but it is access to new technologies that has really facilitated such rapid growth in these kinds of companies.

For example, traditionally it can take up to a year for an organisation to roll out a new IT infrastructure, but many businesses are now able to deploy new IT strategies within just a matter of weeks. This is largely due to advancements in cloud computing.

Developments in cloud technology have brought new possibilities to those who want to set up a company quickly and without significant upfront costs. Cloud-based hosting, security, storage and backup solutions eliminate the need to house expensive, space-hogging hardware in the office; cloud email, conferencing and VoIP platforms ensure seamless, round-the-clock communication between staff; cloud office suites and finance tools are a must for those who want to access vital files and information from anywhere, at any time. The majority of cloud-based services are available on a subscription model, too, allowing new companies to spread the cost of their new systems for better cash flow.

What advantages do hyper-growth companies have?

Sure, there are plenty of hyper-growth firms that have their 15 minutes of fame, then swiftly burn themselves into the ground, either because they were never set up for long term success or because they were only designed to service a fleeting market in the first place. But there are plenty of ‘baby shark’ companies that not only do well, but end up out-performing their bigger, more established competitors.

New entrepreneurs are arguably in a better position than those who have been running a company for some time. This is because they are not beholden to archaic policies, or stuck with age-old IT systems that have already been paid for. If an entrepreneur wants to set up a company from scratch in 2015, they can pick and choose from a huge variety of IT solutions that can be fully tailored to meet their needs. On top of this, all data, past and present, can be moved into the Cloud, which means they never need to worry about relocating – everything is accessible from external servers. The result? Hyper-growth companies can be more streamlined, more flexible and more reactive than many of their older rivals.

What challenges do they face?

In the words of Alexander V. Izosimov: hyper growth either kills a company or makes it much stronger. With quick expansion comes the need to hire new staff, implement new systems, and make big decisions in a short space of time. This creates a headache for veteran business owners and creates a make-or-break scenario for entrepreneurs with limited experience. Just ask those who have been there.

Sometimes, too, the market just doesn’t pan out as expected – those short-term selling opportunities dry up quickly, and are often not as profitable as hoped. 

Are hyper-growth organisations changing industry for the better?

More often than not, hyper-growth organisations are designed in such a way that they’re able to react quickly to developments in the market place and meet the changing demands of consumers. With the backing of the latest technologies, entrepreneurs can jump on trend bandwagons quickly and minimum fuss, putting them in a position to seriously monetize the latest ‘in’ thing. This in itself paves the way for fiercer competition in any marketplace and, off the back of this, faster and more aggressive innovation.

They have their flaws, but it’s clear that hyper-growth organisations have the potential to speed up evolution in almost any industry and bring new and exciting prospects to forward-thinking entrepreneurs.

Featured images:

Gary Gould is the Co-Founder of Compare Cloudware, one of the leading cloudware comparisons websites. Gary wants to help small business owners and start-ups to enter the world of cloud computing that will help them grow, including cloud-based financial tools, project management and CRM.

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