I recently attended a YPO (Young Presidents’ Organization) session where Harvard professor, Boris Groysberg, shared a study on what contributes to sustained success in business. Boris called the case study, “contribution analysis,” and he reviewed data and findings on high performing companies over a ten year period – long-term results he called, “sustained success”.
In the contribution analysis case study, they observed how different variables contributed to the success of these companies. They attributed the following percentages to each variable:
Some of those variables are outside of our control. But almost 50% of what makes for sustained success, according to Boris, is within our control- leadership and company as owners or a Board. Further, the CEO contribution as 13.5% is an average among industries. The variance went from 40% contribution for highly competitive industries to 0% for zero competition industries. Most of us are in competitive industries, making leadership and company well over 50%.
I thought it interesting – if we as businesses focus in on culture and principled leadership – two things we have control of – we ramp up our chances of long-term, sustained success. At Smith Brothers, we are heavily invested in our culture and in our Emerging Leaders training on servant leadership and our business models getting our people ready to sustain our culture, our growth, and deliver on our purpose of Helping Others.