What to Do When Fast Growth Stalls

BY MIKE HOFMAN @MIKEHOFMAN

This past summer, Rob Acton was feeling stuck—and it worried him. The founder and CEO of Cause Strategy Partners has enjoyed steady success over the past decade. His New York City-based company works with clients such as Adobe and JPMorganChase to match their high-potential employees with nonprofit board work, helping give back to communities while developing emerging leaders. Since its inception, the business had been growing consistently and profitably, reaching 18 employees and $4 million in annual revenue.

But, all of a sudden, Cause Strategy Partners seemed to lose momentum. “I felt it in my bones,” Acton says. “I remember saying to our COO, ‘It feels like we have some malaise in the company that I’ve not felt before.’ “

Acton started digging into the company’s data and studying growth trends. He plotted the story of his company’s first 10 years on charts that included revenue, program outcomes, staff size, and other measures of success. “You could see the company scale rapidly, begin to hit stagnation, and then decline,” Acton recalls. “There was no denying it when faced with the cold, hard data. We had hit the top of our S-curve in terms of growth.”

What, then, is a leader to do when faced with a company in danger of stalling out?

Dan Heath, best-selling author with his brother Chip of the 2007 business classic Made to Stick (Random House, 2007), tackles this question in his new book, Reset: How to Change What’s Not Working, to be published by Avid Reader Press in January. “What I was intrigued by and wanted to understand better is how we get to these places where we’re bogged down or stuck or underachieving,” Heath says. “And then, how can you shake things up, shake off entrenched habits, and do something different?”

As Heath observes, entrepreneurs like Rob Acton face a specific challenge different from that of a leader who’s facing a crisis. In a true emergency, one feels permission to take tough or even drastic steps to make change. But often, in business as in life, problems aren’t immediate and dramatic. Instead, they are slow-moving, though no less grave.

Understanding that you’re in trouble is part of the challenge. Like Acton, Venus Quates had an unsettling epiphany recently. A military veteran, Quates is the founder and CEO of LaunchTech, an IT services provider based in Huntsville, Alabama. In her view, LaunchTech’s growing pains worsened even as the company added centralized staff. “Having a young company that’s moving at the speed of light, you already feel pressure,” Quates says. “But when I started growing my team, some of that pressure didn’t go away, and it’s not because I didn’t want to release it.”

LaunchTech’s P&L looked pretty great. The company grew to $10.7 million in 2024. But as Quates’s team expanded to about 50, she felt that functions like HR were not keeping pace. “I kept having to double back because tasks weren’t always getting done. Or maybe there was just a level of excellence that I wanted that others didn’t,” Quates says.

To shake up an unsatisfactory status quo, Heath argues in Reset, leaders should look for leverage points, which he defines as smaller, fixable problems that can have a disproportionate impact on the larger sense of drift within an organization. “If you’re trying to change things, usually you can’t change everything, but you can change something,” he says. “And so the question is, what’s the something?”

As a first step, Heath suggests that a leader get as close to day-to-day work as possible and hunt down inefficiency. He recounts a story passed on by MIT professor Nelson Repenning about a paper manufacturer that discovered it had higher paper waste because it shut down its main corrugator at lunchtime. Heath cites another example of deliveries within a large hospital being delayed because needless batching occurred at too many points in the system—a step meant to promote efficiency that had the opposite effect. In each case, a leverage point was discovered, a change was tested, and results improved.

Founders can identify other leverage points by seeking out success stories as well as problem areas. Heath shares the story of a Gartner executive named Ken Davis, who was assigned to figure out why the Stamford, Connecticut-based research company was experiencing a customer retention problem coming out of the Great Recession.

While many people within the company were trying to figure out why clients were bolting, Davis zeroed in on the work of 17 Gartner employees who were outliers in a good way, retaining a large number of accounts. What he discovered is that the small group of successful employees shared some common behaviors.

“The solutions were as simple as time management,” Heath recalls. “Virtually all of Gartner’s best client partners had a very disciplined way of carving out a few hours every morning to do proactive outreach to clients who weren’t actively using the service, learning what was important to them, and then showing them how Gartner could help. So Davis spread these practices among the whole team, and that began to get them out of that retention hole.”

How the re-energizing process will unfold at LaunchTech, Cause Strategy Partners, and other companies that are seeking to get unstuck today remains to be seen. Change management can itself stall out. One way Quates built momentum for operational excellence at LaunchTech was by bringing in an HR company to professionalize benefits administration. A recent open-enrollment initiative went much more smoothly, she says, affirming her instinct to push for yet more change.

Acton, meanwhile, gathered everyone in the company for a weeklong, in-person retreat where he shared the charts he had made that showed the cresting S-curve. As a group, his team developed a three-year plan focused on innovation and renewal. A big part of it centered on pursuing new sources of revenue. Acton says the team also spent a lot of time considering their core value proposition. “As we do this, we are committed to not making bad decisions on who we are,” Acton says. “But by naming the need for change, we rallied the team around finding new energy and new thinking.”

Acton and Quates may desire change, but it’s worth reiterating that they have accomplished a lot over the past decade, building businesses that help customers manage technology and talent. As a result, Cause Strategy Partners and LaunchTech are two of the 241 companies named to this year’s Best in Business list.

Inc.’s Best in Business coverage—which celebrates organizations and leaders for superior execution across all facets of business—continues here, where you’ll find profiles of a group we’re naming 2024’s New Icons & Innovators. Among them: MNTN’s Mark Douglas and Ryan Reynolds; tech leader Stacy Brown-Philpot; brash, young content king Tyler Denk; and Homecourt’s Courteney Cox, whose upstart brand is apt to put a smile on any Friends fan’s face.

These five business leaders, who grace our covers this month, as well as the many more we write about in this issue and on Inc.com, make up an inspiring group, offering hope that the economy in 2025 will be marked by renewal and prosperity. If you’re feeling stuck yourself, these stories should provide a fresh dose of motivation. And if you’re not stuck, then consider these pacesetters your peers, and set your sights in the year ahead on exemplifying the very best of what the business world has to offer.

Photography by Nathan Bajar.