Business Growth

  • W. Stewart Howe


In Part I of this text we examined the sequence in which firms make strategic decisions. In Part II we shall examine a range of individual business strategies that are used to achieve corporate objectives. The first of these individual strategies to be examined is growth. This has been chosen because growth embraces most of the major directions of strategic decision-making. Indeed, only divestment as a business strategy falls out with the ambit of growth, and even in that case individual divestments by a firm may simply be a prelude to a new phase of growth.


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  1. 1.
    See, for example, G. Meeks and G. Whittington, ‘Directors’ Pay, Growth and Profitability’, Journal of Industrial Economics, September 1975, Vol. XXIV, pp. 1–14.CrossRefGoogle Scholar
  2. 2.
    R. Marris, The Economic Theory of ‘Managerial’ Capitalism (London: Macmillan, 1964) p. 58.Google Scholar
  3. 3.
    See G. Johnson and K. Scholes, Exploring Corporate Strategy (New Jersey: Prentice-Hall International, 1984) p. 151.Google Scholar
  4. 4.
    See Interim Report of the (Wilson) Committee to Review the Functioning of Financial Institutions (London: HMSO, 1979, Cmnd 7503) Ch. 9.Google Scholar
  5. 5.
    See Financial Times, 9 February 1984.Google Scholar
  6. 6.
    See J. Thackray, ‘The Year of W. R. Grace’, Management Today, January 1975, p. 72.Google Scholar
  7. 7.
    See, for example, London Brick Company’s approach to valuing its reserves of Oxford clay in Financial Times, 10 February 1984.Google Scholar
  8. 8.
    See E. T. Penrose, The Theory of the Growth of the Firm (Oxford: Blackwell, 1980 edn) Ch. 4.Google Scholar
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    Ibid., p. 47.Google Scholar
  10. 10.
    See the evidence on this quoted in W. S. Howe, Industrial Economics (London: Macmillan, 1978) pp. 87–8.Google Scholar
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    R. L. Marris, ‘Incomes Policy and the Rate of Profit in Industry’, Manchester Statistical Society, December 1964, pp. 23–8.Google Scholar
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    See Marris, The Economic Theory of ‘Managerial’ Capitalism, pp. 250–3.Google Scholar
  13. 13.
    See T. J. Peters and R. H. Waterman, In Search of Excellence (New York: Harper & Row, 1982) pp. 296–7.Google Scholar
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    See Penrose, The Theory of the Growth of the Firm, Ch. 7.Google Scholar
  15. 15.
    See S. Caulkin, ‘The Unlimited Explosion’, Management Today, February 1984, pp. 42–4.Google Scholar
  16. 16.
    See R. G. Hamermesh and S. B. Silk, ‘How to Compete in Stagnant Industries’, Harvard Business Review, September–October 1979, pp. 161–8.Google Scholar
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    See W. S. Howe, ‘Competition and Performance in Food Manufacturing’, in J. Burns et al. (eds), The Food Industry (London: Heinemann, 1983) pp. 101–26.Google Scholar
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    See Sunday Times, 19 February 1984.Google Scholar
  19. 19.
    See W. K. Hall, ‘Survival Strategies in a Hostile Environment’, Harvard Business Review, September–October 1980, pp. 75–85.Google Scholar
  20. 20.
    See R. Biggadike, ‘The Risky Business of Diversification’, Harvard Business Review, May–June 1979, pp. 103–11; and for some rather more optimistic UK evidence C. W. L. Hill, ‘Conglomerate Performance Over the Economic Cycle’, Journal of Industrial Economics, December 1983, Vol. XXXII, pp. 197–211.Google Scholar
  21. 21.
    See Monopolies Commission, British Match Corporation Ltd and Wilkinson Sword Ltd (London: HMSO, 1973, Cmnd 5442); and S. Caulkin, Wilkinson’s Second Safety Match’, Management Today, September 1983, pp. 50ff.Google Scholar

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© W. Stewart Howe 1986

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  • W. Stewart Howe

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