The Second Curve - Extending your business life-cycle

The average life span of a Fortune-500 size company is 40-50 years and business lifecycles are growing shorter than ever with the increasing impact of technological innovation. It is becoming more and more important to innovate in order to survive.


The traditional way that the life-cycle of a business is depicted is through an S-curve showing start-up, growth, maturity and, finally, decline. Nowadays, businesses are following this cycle more and more rapidly.


However, Peter Handy invented the idea of the second curve. The second curve overlaps the first and starts its journey to growth before the first begins to level off. This visualises the need for change and innovation within a business to ensure survival.


It is important to remember, though, that wherever you consider your business to be along the first curve, the reality is that you are much further along. It’s never too early to innovate, whether that’s through your business model or through innovating your products or services.


For example, Netflix has done this several times: changing from a postal DVD service to a streaming service, then again when they began creating their own content in addition to licencing existing content. In contrast, Blockbuster failed to recognise their need to update their offering when they were on their way to decline.


To explore more opportunities for business growth, reach out to the team at the SME Centre of Excellence for a 30 minute consultation.

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