This is the fourth article in our series of Managing a Mature Business. If you haven’t caught up, the other articles in the series, published so far, are:-
- Managing a Mature Business – Managing Cash Flow
- Managing a Mature Business – How to Keep Innovating
- Managing a Mature Business – Marketing for Continued Growth
In this article, we will deal with identifying, prioritising, and mitigating risk – Risk Management Planning in a mature business.
But first, to recap what a “mature business” is. The business cycle of a business, starts with a new business, then rapidly moves into a growing business, and then eventually morphs into a “mature Business” and ultimately – unless you do something at maturity – goes into decline. Each stage of this business cycle has different challenges.
In a “new” business, those challenges are all about establishing the business – proving the product, finding customers, poor cash flow. In a growth business, the issues are around retiring debt, satisfying demand, larger customer bases and proportionately larger debt-collection problems, control over organisation and business systems.
In maturity, it is about fading demand, older products, reducing customer bases, reduced cash flow. If this is recognised, businesses can “kick-off” a new growth phase by innovating and finding new products and markets through expansion or change. In this way, they can stave off the ultimate slide into decline.
Risk Management Planning is important at every stage of the business, but why is it especially important in maturity?