“The essence of strategy is choosing what not to do.” – Michael Porter
Introduction: The Cost of Chasing Every Shiny Object
You’ve built something great – your clients are happy, your revenue is climbing, and new opportunities are knocking at your door. But here’s the catch: Not all growth is good growth. Without clear direction, the very opportunities that success brings could pull your business off course. Overstretching, losing focus, and diluting your market position are real risks that come with rapid growth.
The real challenge for CEOs isn’t finding opportunities, it’s choosing the right ones. It’s about strategic growth – focusing your efforts on the right path and saying “no” to the distractions that don’t align with your vision.
Ask yourself: are you scaling strategically – or just grabbing whatever looks good?
In this article, we’ll explore the difference between strategic growth and opportunistic expansion – and why deliberate focus is essential for scaling your business successfully. We’ll also touch on how to identify which growth paths will serve your business best, so you can scale with confidence and purpose.
This is the second article in the series Scaling Your Business for Growth, building on last week’s discussion, “How to Scale Your Business Successfully: A CEO’s Guide to Sustainable Growth and Profit”. If you missed that, feel free to catch up here.
Understanding the Temptation: Why Opportunity-Led Growth Happens
Success breeds opportunity. Clients ask for more, new markets beckon, and your business is suddenly presented with a wealth of growth options. As a business leader, it’s natural to see these as chances for progress. After all, the more opportunities you chase, the faster you’ll grow, right?
But here’s the catch: not every opportunity aligns with your core strengths. And saying “yes” to everything can dilute your focus, stretch your resources, and lead to a scattered, inefficient business model, weakening your competitive edge.
While opportunistic growth may seem appealing at first glance, it’s a slippery slope. Jason Goldberg, in his excellent book The Art of Scale, explains it perfectly: “Most are bad opportunities dressed up as good ones.”
This quote speaks volumes. While some opportunities may seem lucrative, being dressed up as the next big thing – new clients, more revenue, expanded products or services – they may not align with your core strengths. If you stretch yourself too thin, you risk compromising the excellence that made you successful in the first place.
Chasing every opportunity is a classic trap many scale-ups fall into. The result? A mixed business model that confuses your identity and muddles your value proposition. If this sounds familiar, it’s time to step back and assess whether you’re on the right growth path.
Scaling isn’t about chasing every opportunity – it’s about choosing the right ones.
Strategic Growth: Anchoring to Your Core
So, how do you scale sustainably? The key lies in strategic growth.
Unlike opportunistic growth, which is reactive and unplanned, strategic growth is focused, deliberate, and aligned with your core strengths. It’s about sticking to what you do best, focusing on your niche, and expanding deliberately in ways that allow you to scale without sacrificing quality, control, or focus.
Growth vs. Scaling:
Before diving deeper, let’s briefly clarify the difference between growth and scaling.
- Growth adds resources to increase output. For example, you may hire more staff or increase marketing spend to attract more clients.
- Scaling, on the other hand, is about increasing output without increasing costs at the same rate. You leverage systems, technology, and operational efficiencies to handle more business with minimal additional resources.
The Power of Being #1 in Your Niche
The most successful companies scale by focusing on their core – the products, services, and markets where they can become #1. They don’t chase every opportunity that comes their way; instead, they stay aligned with their strengths, mission, and vision.
Goldberg’s words are a guiding principle here: “The goal of strategy work is to define where and how you will be #1.”
When you dominate your core market, you create a virtuous cycle of market leadership that drives financial success. Being the best in your niche leads to higher margins, stronger customer loyalty, and increased market share – all of which provide the foundation for scalable growth.
For further insights on how to create a vision for sustainable growth, check out:
Scaling isn’t about being everywhere – it’s about being the best in your core market.
The Power of Strategic Focus: Why Being #1 in Your Core Market Matters
One of the most important factors in successful scaling is being #1 in your niche. As a leader, your goal should be to carve out a dominant position in your core market – this is the foundation upon which you’ll build a scalable business.
Why Market Dominance Drives Financial Success:
- Easier Customer Acquisition: Being #1 means clients come to you. You’re no longer chasing every lead; they’re coming to you because you’re known to be the best at what you do.
- Stronger Margins and Cash Flow: Market leaders command better pricing power, as clients value quality and are willing to pay more.
- Competitive Advantage: Once you’re #1, competitors find it difficult to dislodge you. You have the brand equity, operational excellence, and customer loyalty to fend off rivals.
Jason Goldberg succinctly sums this up: “To scale, don’t paddle harder; set your sails to catch the wind by being #1 in your core market.”
By being #1 in your niche, you not only lead the market but also unlock the power of strong customer loyalty and higher profitability, creating a foundation for sustainable scaling, and making it easier and cheaper, too.
Defining Your Sweet Spot:
The first step is to clearly define what your “sweet spot” is. Ask yourself:
- Who is your sweet-spot customer? – The clients who generate the most value.
- What product/service do you consistently deliver with excellence? – Your strongest offering.
- Where is the margin highest, and friction lowest? – The most profitable and scalable segment.
Then, expand this background to understand where you can achieve market leadership. Consider the following additional prompts to help define this:
- Market Segments: Where is there the highest demand that matches your capabilities?
- Ideal Customer Profile: Which customers are you best suited to serve with your unique offering?
- Core Products/Services: What can you deliver consistently better than anyone else?
Recognise, too, that rather than go broad to reach as many customers as possible, pick a smaller niche where you can dominate and then, from this position of strength, gradually expand into related and slightly broader markets.
To better understand your core market and position, I recommend looking into:
Scaling isn’t about doing more – it’s about doing the right things, better.
Identifying Your Growth Path: Where Should You Focus?
Once you’ve clearly defined your core market, it’s time to determine where you should focus your efforts to scale your business successfully. The most common pitfall for CEOs is the temptation to chase every opportunity that comes their way – whether it’s a new market, an adjacent product line, or a potential partnership.
The first step to successful scaling is ensuring that your growth path is aligned with your core market, strengths, and overall business goals, together with your company cuture. This is strategic growth at its heart: deliberately choosing the right opportunities and saying “no” to the ones that don’t fit your strategic focus and culture.
Understand Your Core Values, Vision, and Mission
As you scale, it’s crucial to stay grounded in your values, mission, and vision. Are these still relevant in your growth and scaling scenario? As you expand, make sure your values are clear to your teams and customers, and that they’re embedded into your operations. A strong, consistent set of values will help guide your decisions, ensuring they remain aligned with your company’s purpose.
If you’d like to explore any of these areas in more depth, the following articles will help:
- Finding Your Why
- Crafting Your Vision
- Defining Your Mission
- Establishing Your Values
- Embedding Culture into Your Business
- Defining Company Culture
- Does Your Business Strategy Match Your Company Culture?
Steps to Identify & Evaluate Growth Opportunities
This is where research, discipline, and strategy come into play. Here’s how to approach evaluating new growth opportunities:
1. Conduct a SWOT Analysis
Before considering any new opportunities, understand your current strengths and weaknesses, as well as the external opportunities and threats that could affect your growth. A SWOT analysis will help you evaluate which opportunities truly align with your capabilities and core market, and which ones may stretch you too thin. It also helps to evaluate the threats – such as potential competitors or market shifts – that could make a new opportunity less viable.
For more on SWOT, check out:
2. Market Research and Segmentation
Use data and customer insights to identify where your business can truly lead. Conduct in-depth market research to evaluate the demand for your offering in potential new markets. Use segmentation to target the right customer groups that align with your strengths and existing products. Expanding into markets that don’t fit your ideal customer profile could stretch your resources and ultimately lower your margins.
Market research tools, like customer surveys and competitor analysis, can help you assess which segments are worth pursuing.
For more on competitor analyses, see:
3. Scenario Planning
Every decision involves risks and rewards. As part of your growth strategy, make sure you’re using scenario planning to anticipate the potential challenges and benefits of different growth paths. For instance, if you’re considering a new market, think through potential risks – such as regulatory hurdles, customer acquisition challenges, or new competition – and create actionable plans for overcoming them.
This article will provide more detail on scenario planning:
Key Questions to Define Your Growth Strategy
Use these key questions to assess whether a growth opportunity is strategic or just a distraction:
- What is your core market? – Identify the niche where you can be #1. If the opportunity doesn’t align with your core market, it’s time to say no.
- What are your core strengths? – Think about the products and services you excel at. If the opportunity doesn’t play to these strengths, question whether it’s worth pursuing.
- Who is your ideal customer? – Align growth opportunities with your ideal customer profile. Expanding into a new segment could make sense, but only if it fits your expertise and doesn’t detract from your core.
- What differentiation makes you unique? – Understand your competitive edge – your unique selling proposition and remarkable promise.
Strategic Growth Paths: Which Path Should You Take?
There are several potential growth paths you can explore, but not all are suitable for your business. Strategic growth involves choosing a path that is consistent with your core strengths and long-term vision. Let’s examine each:
|
Growth Path |
Description |
Pros |
Cons |
|
Market Penetration |
Strengthening your position in your existing market. |
Low risk, high reward if you’re already a market leader. |
Limited by market size and customer base. |
|
Market Expansion |
Entering new geographic or demographic markets. |
Diversifies revenue streams, reduces reliance on one market. |
High investment, risk of misunderstanding local markets. |
|
Product / Service Expansion |
Adding complementary products or services to your existing portfolio. |
Increases customer lifetime value, strengthens brand. |
Risk of diluting core offering, operational complexity. |
|
Strategic Partnerships / Joint Ventures |
Leveraging alliances for growth. |
Can open new markets quickly, access to partner resources. |
Risk of misaligned interests or culture, dependence on partners. |
|
Mergers & Acquisitions (M&A) |
Acquiring other businesses to accelerate scale. |
Quick market share growth, access to resources. |
High risk, integration challenges, cultural misalignment. |
Every business will face different choices when scaling. The key is to evaluate each growth path based on its alignment with your core market, capabilities, and long-term vision.
Building Your Growth Strategy: Deliberate Focus and Disciplined Execution
After evaluating these options, it’s essential to craft a clear and actionable growth strategy. Here’s how:
- Set Long-Term Goals: Identify what success looks like for you over the next 3-5 years.
- Define Your Core: Ensure you stay focused on your niche, ideal customers, and your competitive edge.
- Create Clear Steps to Get There: Break down long-term goals into short-term actions, ensuring that each opportunity you pursue aligns with your overall strategy.
The Importance of Saying “No”
One of the most important parts of strategic growth is discipline – knowing when to say “no” to opportunities that aren’t aligned with your core. It’s easy to get distracted by shiny new opportunities, but staying focused on your core and becoming #1 in your niche is what will make your business scalable and sustainable.
Remember, growth by opportunistic expansion often leads to strategic drift. Instead, by focusing on deliberate and strategic growth, you’ll set your business up for long-term success.
For more on how to stay focused and maintain a strategic growth plan, check out:
Scaling isn’t about chasing growth – it’s about executing a well-defined strategy.
The Dangers of Opportunity-Led Growth
As tempting as it may be to seize every opportunity that presents itself, opportunistic growth can have serious long-term consequences. Without a clear strategy, these opportunities can pull your business in multiple directions, diluting your focus and stretching your resources beyond their limits. Here are some of the key dangers of chasing growth without a strategic focus:
Dilution of Excellence
When you chase too many opportunities, your business risks becoming “a jack of all trades, master of none.” Your reputation for delivering excellence will weaken as you try to cater to too many different customer needs. Rather than being known for being the best in one area, your business becomes average across multiple areas, weakening your brand and your competitive edge.
Operational Chaos
Scaling without strategic focus leads to operational chaos. Trying to serve too many markets or too many customer segments results in an overcomplicated structure. Processes become inefficient, teams become fragmented, and communication breaks down. This can lead to demotivation, burnout, a lack of clarity on roles, and a failure to deliver the quality your customers expect.
Premature Expansion
The temptation to expand too quickly is another pitfall of opportunistic growth. You may feel pressure to enter new markets or add new product lines before achieving dominance in your current market. Scaling beyond your core before you have the team, resources, systems, or customer loyalty to sustain it can cause significant damage to your business.
Strategic Drift
When your focus is scattered, you risk losing your “why.” Growth becomes a reaction to market noise rather than a deliberate decision based on a clearly defined strategy. This leads to strategic drift, where the business becomes disconnected from its core mission and vision. As a result, you lose your market leadership, and the competitive advantage you once had starts to erode.
While chasing every opportunity might seem tempting, these dangers highlight why it’s essential to stay focused on your strategic path rather than getting pulled in multiple directions.
Jason Goldberg sums it up well: “You’ve traded riding the wind for manning the oars.”
This powerful quote speaks to the importance of staying focused on the strategic wind that drives your business forward, rather than paddling aimlessly through a sea of opportunities.
When is Opportunistic Growth Appropriate?
While opportunistic growth can often be detrimental, there are times when it can be appropriate – if it aligns with your strategic goals and capabilities. Here are the key conditions under which opportunistic growth may be worth pursuing:
- It aligns with your core market: If the opportunity is closely related to your current market position and strengthens your overall offering, it can be a good move.
- You have the capacity to deliver without distraction: If you already have the infrastructure, team, and systems in place to handle additional demands, then pursuing new opportunities can be feasible.
- You’ve already built dominance in your current market: Once you’ve established a strong foothold in your core market, exploring adjacent opportunities may be appropriate to expand your influence.
Checklist to Evaluate Opportunistic Growth:
Ask yourself these questions before committing to an opportunity:
- Does this help you get closer to being #1 in your niche?
- Is it in line with your long-term strategic goals?
- Do you have the resources, systems, and people in place to handle it without losing focus?
If the answer to any of these questions is “no”, then the opportunity may not be right for your business or, at least, not right at the present time. Strategic growth should always remain your priority.
Opportunistic growth should be a strategic decision – not a reaction to external pressure.
The Role of Leadership in Scaling Smart
At the heart of smart scaling lies strong leadership. CEO leadership is the single most critical factor in determining whether your business will scale successfully or fall into the trap of opportunistic growth. As your business grows, your role shifts from day-to-day operator to strategic architect.
The CEO’s Role: From Operator to Architect
- Strategic Thinking: Focus on the big picture and how each decision aligns with long-term goals. Steer the company toward its vision.
- Delegation: Trust your team with execution. One of the toughest tasks of a founder/leader is to let go of operational tasks that are best left to experts. Empower others to take responsibility.
- Building the Team: Ensure your leadership team is capable of handling increased complexity as the business scales.
Building a Leadership Team for Scale
- Strategic Thinkers: Hire leaders who are capable of long-term strategic planning.
- Execution Specialists: Ensure your team includes individuals who are experts at getting things done, translating strategy into action.
- Culture Champions: As you scale, maintaining a strong company culture becomes even more critical. Ensure your leadership team champions your company’s values and ensures consistency across the business.
For more on building the right leadership team, check out:
- Essential Skills of a Top Team as Your Business Grows
- Building Your Dream ‘A-Team’ – Hiring A+ Talent
- Building Resilient Teams: Leadership Strategies for Tough Times
- Mastering Decisive Leadership
- Delegating for Success: The Leader’s Path to Effective Execution
Financial Readiness:
- Cash Flow: Ensure that your working capital and cash flow are strong enough to support the growth you envisage.
- Forecasting: Regularly stress-test your financial forecasts to make sure you’re prepared for any uncertainties that come with scaling.
- Funding: Know where to find funding if needed, and ensure that you have access to capital when required for expansion. Ideally, you should have at least six months of operating expenses as a reserve in any case.
For greater detail on financial readiness and management, see:
Scaling isn’t just about business readiness – it’s about leadership readiness.
How to Stay Strategic in a Noisy World
As you scale, external distractions will become more frequent. You’ll be presented with numerous opportunities to grow, pivot, or diversify – but the trick is staying aligned with your core strategy.
Keep Your Strategic Plan Front and Centre
Your strategic plan is your roadmap for growth. It’s vital to revisit it regularly and adjust as needed, but never lose sight of your core. Create a feedback loop that allows you to stay on track without chasing distractions.
Use OKRs and KPIs to Keep Teams Aligned
OKRs (Objectives and Key Results) and KPIs (Key Performance Indicators) are essential tools for tracking progress and ensuring that your teams are working toward the same strategic goals.
Check out:
Involve Your Board or Advisory Group
If you have a board or advisory group, make sure you’re regularly involving them in strategic decisions – oversight of strategy is, after all, a key board responsibility. External perspectives can help you avoid falling into the trap of chasing every opportunity, and keep you focused.
A strong board provides strategic oversight, accountability, and expertise. If your business lacks a proper board, scaling will be riskier.
For more on the role of your board in scaling, read:
- How a Board Enables Faster and More Sustainable Growth For Businesses of All Sizes
- Boards Shape Strategy
- Building a High-Performing Board of Directors
- Leveraging a Business Coach
- Why a Peer Advisory Group
Scaling requires discipline – and in a world full of distractions, staying focused is harder than ever.
Case Study Example
A great way to illustrate the difference between strategic and opportunistic growth is through a case study (anonymised for obvious reasons).
Company 1: The Jack of All Trades
A software company with a great product initially focused on a specific customer segment. As they gained traction, they began chasing every opportunity – expanding into new verticals, offering too many features, and entering international markets prematurely. The result? Operations became chaotic, and they lost their edge in the market, losing their position as a leader in the space and eventually having to downsize the business to survive.
Company 2: The Market Leader
Another software company, much smaller, focused solely on their niche market for the first 5 years. They became the go-to provider for a specific type of customer, with a clearly defined product that solved a well-defined problem. They scaled deliberately, built their team around their core strengths, and entered new markets only when they were fully prepared. They’ve since become the dominant player in their niche.
You might find this a useful read, too:
Scaling isn’t about speed – it’s about sustainability.
Tools to Help You Stay on the Strategic Path
There are a number of tools that can help you maintain focus as you scale. Here’s a quick guide:
- SWOT Analysis: Regularly revisit your strengths, weaknesses, opportunities, and threats. This tool helps you stay aligned with your core.
- Competitor Analysis: Understand what your competitors are doing, so you can differentiate yourself and stay focused.
- Strategic Growth Filters: Develop a set of criteria, perhaps as a matrix or checklist, for evaluating new opportunities and assessing whether they align with your core market.
- Scenario Planning: Anticipate future risks and rewards by running different scenarios, ensuring you’re prepared for the unknown.
- OKRs and KPIs: Keep track of your objectives and key results to measure progress and stay on target.
In addition to the tools mentioned earlier, check out the tools and frameworks in:
Conclusion: Set Your Sails, Don’t Grab at Oars
In conclusion, the key to scaling successfully is choosing your growth path strategically. Rather than chasing every opportunity, focus on becoming #1 in your core market. Ensure financial, operational and team readiness. Use strategic focus and the tools to stay on track and be adamant about saying “no” to the distractions that threaten to derail your success.
Before you go after the next big opportunity, take a moment to reflect: Does it align with your core market, strengths, and long-term vision? If it doesn’t, it might be time to say no. Start saying ‘no’ to distractions so you can say a powerful ‘yes’ to what truly matters.
Remember Michael Porter’s great insight, “The essence of strategy is choosing what not to do.”
It’s your turn now:
We’ve seen that scaling isn’t just about ambition – it’s about focus.
Have you ever had to turn down a tempting growth opportunity to stay on track? How did you make that decision?
Let’s talk about it in the comments!
In the next article, we’ll explore the importance of building the right team for scale – the next essential step in achieving strategic growth. Stay tuned!
FAQs from this Article:
1. What is the difference between strategic growth and opportunistic growth?
Strategic growth is focused and deliberate. It aligns with your business’s core strengths, mission, and vision, and is backed by research and a clear market focus. In contrast, opportunistic growth is reactive, where a business chases every new opportunity that arises, often without a clear plan or alignment with the company’s core. Opportunistic growth can lead to a scattered focus, diluting your competitive edge.
2. How do I define my core market for successful scaling?
To define your core market, start by identifying the niche where you can be #1. It’s about recognising the ideal customers who benefit most from your offering. Understand your sweet spot: this is the intersection of what you do best, the market’s needs, and where you have the least friction and highest margins. Focusing on this core will allow you to scale successfully and sustainably.
3. When is opportunistic growth appropriate for my business?
Opportunistic growth is appropriate when it aligns with your core market and plays to your strengths. If the opportunity complements what you already do well and you have the resources and infrastructure to handle it without distraction, then it may be worth pursuing. However, be sure to evaluate whether it will dilute your market position or disrupt your existing operations.
4. What is the role of leadership in scaling smart?
As a CEO, your role shifts from operator to strategic architect. You need to focus on the big picture, empowering your team to execute while building a leadership team capable of handling the complexity that scaling brings. Strong leadership ensures that your company stays aligned with its strategic goals and maintains focus as the business grows.
5. How can I say “no” to distractions and stay focused on my core?
The key to saying no is having a clear strategic focus and discipline. Create a growth plan that outlines where you want to be and what opportunities align with your long-term vision. When new opportunities arise, ask yourself: does this move us closer to our core goals? If it doesn’t, then it’s time to say no and stay focused on what matters most.
If you’ve found these answers helpful and want to dive deeper into the subject of scaling your business, you can explore the full article and more resources in the previous sections. And as always, feel free to share your thoughts in the comments below or reach out for further insights.
Want more tailored advice on how to scale your business? Book a free 30-minute strategy session today and get personalised advice.
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This month, we’re exploring the topic of Scaling Your Business for Growth, with this being the second article in the series. Last week’s one, in case you’d like to review it, can be found here:
> How to Scale Your Business Successfully: A CEO’s Guide to Sustainable Growth and Profit
Stay tuned for further articles to help you take your business to the next level – or better yet, subscribe to my blog and receive the latest insights straight to your inbox. Click here to sign up or send me a note here and I’ll add you to the list.
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Related Posts
If you’d like to learn more about business strategy, risk, leadership and the areas we’ve covered here, the following articles and posts might also be of interest:
- Vision 2030: Crafting a Long-Term Strategy for Unstoppable Business Growth
- Crafting a Three-Year Strategic Plan: The Roadmap to Success
- The Power of a SWOT Analysis
- Maximising Your Business Value
- Mastering Scenario Planning: Navigating the Future for Your Business in a VUCA World
- Finding Your Why
- Crafting Your Vision
- Defining Your Mission
- Establishing Your Values
- Embedding Culture into Your Business: Transforming Values into Action
- Defining Company Culture: Building a Foundation for Business Success
- Does Your Business Strategy Match Your Company Culture?
- Performing a Competitor Analysis
- Crafting a Three-Year Strategic Plan
- 20-Mile March: A Proven Framework for Sustainable Growth
- Essential Skills of a Top Team as Your Business Grows
- Building Your Dream ‘A-Team’ – Hiring A+ Talent
- Building Resilient Teams: Leadership Strategies for Tough Times
- Mastering Decisive Leadership: The Keystone of Effective Execution
- Delegating for Success: The Leader’s Path to Effective Execution
- Mastering Financial Management: Essential Strategies for Long-Term Business Success
- Harnessing the Power of KPIs and OKRs for Effective Execution
- OKR – Measuring What Matters
- How a Board Enables Faster and More Sustainable Growth For Businesses of All Sizes
- Boards Shape Strategy – The Critical Role of Governance in Business Success
- Building a High-Performing Board of Directors
- Leveraging a Business Coach
- Why a Peer Advisory Group
- Scaling for Success: Unleashing Growth and Profits in Your Business
- Book: The Art of Scale and Website
Backgrounders
HBR – Is It Better to Be Strategic or Opportunistic?
Fast Company – 12 cash flow strategies to grow or scale any small business
Forbes – Scaling A Business: Best Strategies To Use And Mistakes
McKinsey – Business growth: The leader’s blueprint
Inc. – How to Scale Your Business
Entrepreneur – This Strategy is the Key to Scaling Your Business
#BusinessFitness #ArtOfScale #BusinessGrowth #BusinessModels #BusinessStrategy #CompetitiveAdvantage #Growth #Opportunity #Planning #Scale #ScalingYourBusiness #Strategy #QOTW
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