The awesome pressure for EBITDA and short term focus on quarterly results has come at the expense of long term growth and a sustained of culture of innovation at many companies. Executives faced with the challenge of jump starting growth and transforming their organizations often fail amidst their digital transformation efforts. Given the proven track record and “safe bet” nature of focusing on financial management, boards often find a crutch in pushing the immediate strategy of extreme EBITDA.
Now in the midst of an effort to grow and innovate, management teams lack the ability to think beyond the financial levers as they embark on digital transformation efforts. In fact, many CEOs and boards often fail to understand that the right approach heavily depends on where the organization is in the continuum of growth and innovation. Purpose, team, offering, market, and financials must be reexamined in the quest to jump start sustainable growth. Great boards and leaders must understand that form follows function. The right strategy must be applied to the right the phase of continuum in order to succeed.