Do we have a misguided obsession with growth?

Have you seen the recent advertisements encouraging people to volunteer to be mentors helping businesses to grow for the Help to Grow campaign? This scheme is essentially part of a government initiative designed to stimulate more business growth – apparently in the belief that, to improve the economy (and raise more taxes from it), we need bigger businesses making more profit and employing more people. Is this, however, an example of fixing on a target without really asking why? Is economic growth a desirable end in itself or is it being sought because it is assumed that it will help the people on whose behalf the government is supposed to be acting? asks Prof Simon Bridge.

Because of thinking like this it would seem that business ‘growth’ has become the accepted aim and therefore others are presumed to share this aspiration.

For example there appears to be an assumption that the owners of most, if not all, businesses must want their businesses to grow in order to raise their turnover (and consequently increase their employment) because that way they will achieve their owners’ aims which are supposed to be to make more profit. But is a pervasive promotion of business growth in reality good for the owners and their businesses?

Actually growth is not what many (and probably most) business owners want. They are not averse to making more money but that is not why they have a business – and, if they are getting out of it what they want, why would they want to take on the extra effort involved in growing and running a bigger business?

Most businesses are small and research has shown that many people running small businesses would make more money if they were instead employed by a bigger business and that they run their own businesses, not to maximise their profit, but to provide sufficient income while also giving them the reward of meaning and purpose missing in many bigger businesses; a sense of independence, of following an idea or of practicing a skill; or the satisfaction of fitting in with and giving to a community.

Also growth can be harmful for businesses. As West has shown, growth can limit business life and a common feature of really long-lasting businesses is that they have found a rewarding niche and not pursued growth beyond it. It has also been suggested that fast and/or early growth (as sought out and encouraged by business agencies) can be particularly counter-productive and lead instead to early failure.

Further Kay has pointed out that growth is often achieved obliquely – for instance businesses tying to produce a good product often make more money than those which focus primarily on the bottom line. And we also need to ask if constant growth is sustainable for a planet with limited resources.

So why not instead have programmes aimed at business success? An explanation of the search for ‘growth’ mentors is that, in looking at growth, they will be helping business owners to grow their knowledge and skills and thus addressing the things needed for success.

But declaring the initiative to be targeted on ‘growth’, although in line with policy thinking, helps to perpetuate the myth that growth should be the aim – which, in can be argued, is potentially dangerous. Aiming for ‘success’, however, would prompt consideration of what that would actually mean for the people and businesses concerned.

So, if you are in business, what would realistic long-term success mean for you? If you are seeking growth is that really your aim – or what you have been encouraged to think is what businesses should do? Growth is not inherently wrong but is it being encouraged because of policy assumptions rather than considerations of what will actually benefit the people concerned?


References:

  • John Kay, Obliquity (London: Profile Books, 2010)
  • Geoffrey West, Scale, (London: Wiedenfield & Nicholson, 2017)

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