Driving radical growth through business-building: Creativity, analytics, and purpose
The pandemic shattered the concept of “normal” and permanently reshaped consumer behavior by fast-forwarding us 10 years into the digital future. Now, as some parts of the world begin to emerge from the crisis and business leaders contemplate what’s next, one thing is clear: Companies are ready to focus on growth again.
But how do you reignite the growth engine to achieve above-market results? As leaders look to reset and recharge, they’re focusing on a new growth muscle—building new businesses. And their ability to do so is enabled by three key elements of the growth triple play: creativity, analytics, and purpose.
Business building is a top strategic priority
Despite unprecedented disruptions brought on by COVID-19, new business building has rapidly moved to the top of the corporate agenda as a growth driver. Some forward-thinking leaders acted decisively early on in the pandemic, moving with startup agility as they combined their core scale and assets to build new businesses in the pursuit of organic growth. For instance, the New York–based real estate owner and manager RXR Realty quickly extended its capabilities and developed a new platform to help facilitate safety and wellness for occupants of its buildings, and thereby opened a path to future new business-building opportunity.
This is no passing fad: Incumbents are launching new businesses with greater frequency and speed than ever before. Startups, venture capital, and private equity firms are making substantial investments into new markets and creating more ecosystem-oriented institutions. Also, more companies are partnering to pursue new and bigger opportunities, creating a faster and more furious world.
Although most companies encountered difficulties during the pandemic, our survey of 800 executives across industries showed that 52% of them still ranked business building among their top three priorities, despite the setbacks they have faced. That’s a 20-point jump from the pre-COVID-19 era. They are justified in their focus—74% of companies that chose business building as their main strategy grew at above-average rates.
These companies not only tend to outgrow the market but can also respond with greater resilience to volatility and economic shocks, rapidly executing on the idea that change can be a catalyst of value creation. One great example of this is banking titan Goldman Sachs. It launched its first digital consumer business in 2016, Marcus by Goldman Sachs, which allows customers to bank from their phones. In just four years, this digital-first business attracted millions of customers, accumulating deposits of $92 billion and making loans of $7 billion via a combination of organic growth, acquisitions, and partnerships with Apple and Amazon.
The growth triple play
In a changed world, driving outsize growth through business building will require all three elements of the growth triple play: creativity and analytics, all underpinned by a distinct, unwavering purpose. Companies that use all three to fuel business building are able to drive average revenue growth at 2.3 times the rate of their peers, and up to 2.7 times during the pandemic. However, pulling it off is not easy. Our survey of approximately 900 global chief experience officers shows that only 7% of companies are currently getting it right. Several tactics can help ensure success.
Infuse creativity with analytics. This means being even more open to new ideas and approaches to delighting customers and having a 360-degree understanding of their needs and wants. The addition of granular data and analytics on their behavior and preferences can unleash creativity more effectively, by allowing deeply personalized customer interactions and faster decision making. For example, marketing sensors can help show how your customers are changing and allow you to align investment decisions more effectively.
Deploy analytics with purpose. CEOs need to build organizations that are focused on experience-led customer interactions, creating meaningful moments across every touchpoint. This requires analytical horsepower and precision to uncover customer intentions, interests, and unmet needs. The key here is to anchor analytics in purpose, allowing leaders to zero in on insights that matter most to their customers, without getting distracted by the sea of data being generated.
Companies that successfully deploy analytics with purpose outperform their peers, according to our new research. They’re also 3.7 times more likely to make data and insights easily and quickly available to all teams across their organization to drive rapid decision making and speed innovation. And these outperformers are 1.4 times more likely to have a 360-degree view of customers.
According to Brian Solis, global innovation evangelist at Salesforce, meeting the expectation of the new consumer isn’t possible without analytics and an unwavering focus on the customer. “The goal is to create connected, intuitive, and personal ‘ignite moments,’ when you have someone’s attention, know their intention, and can deliver the best, most personalized, ‘wow’ experience possible.”
Make purpose your North Star. As the world faces more disruption and crisis, whether it’s social challenges or climate change, purpose has become even more important to building a great company. But purpose must be more than just a warm, fuzzy mission statement and can spell the difference between success and failure. Our research shows the companies best positioned to grow are those that know how to combine purpose with their commercial activities in a way the consumer finds authentic and genuine. It’s not easy, but it’s the only path forward.
Jane Wakely, lead CMO of Mars Inc., shared how the Sheba Hope Reef project—which helps restore coral reefs to underscore the company’s commitment to using sustainably sourced fish in its cat food— builds on Mars’ purpose while embracing science and creativity. “It’s a magical way to open people’s minds, but also their hearts and get them on board to drive a movement that makes a meaningful and measurable difference.”
Companies that unify creativity, analytics, and purpose to build their businesses are logging double the growth of their industry peers, a margin that only increased once the COVID-19 crisis hit. All three elements of this triple play are available to most companies, though few use them successfully in combination. This is a big moment for CEOs to evolve from the hardwired lessons of the past and embrace business building to create long-term sustainable growth.
Brian Gregg is a senior partner of McKinsey & Company and a leader in the marketing & sales practice in North America. Ari Libarikian is a senior partner of McKinsey & Company and is the global leader of the business-building practice Leap by McKinsey.
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