Tigers, Zombies and Business Success

Andrew Scott, CEO of the Ascot Group, talks about business, wealth creation and sustainable growth

It seems investors and the business community are obsessed with hi-tech start-ups and the fortunes they might make. Yet many of the UK’s fastest growing and most successful SMEs and corporates are established companies across a diverse range of sectors, from manufacturing and retail to construction and business services. The most dynamic of these are Tigers.

A Tiger Economy is described as “the economy of a country that undergoes rapid economic growth usually associated with an increase in the standard of living”. A Tiger business is similar, a company that has sustainable rapid growth, creating value for its customers, wealth for the stakeholders and a better standard of living for its people.

We’ve all seen a Tiger business – most sectors have one. While their competitors complain about the state of the market, too much competition, rising costs and demanding customers, Tiger companies create their own path, defying convention and consistently producing results others can only admire.

Tigers often operate in growth sectors, but even in the most established markets with high competition and low margins Tigers can rise up and acquire significant market share, consistently achieving above average growth and profits.

In stark contrast, a zombie business lumbers along year after year covering its costs and repaying debt interest, but is generating insufficient profits or cash to clear debts or invest in growth. It barely survives. The Institute for Turnaround estimates there are well over 100,000 zombie companies in the UK.

What makes a Tiger business?

I’ve been fortunate enough to have worked with several Tiger firms, including one that grew from £1m to £12m annual sales in 4 years with extraordinary profits, before being acquired by a U.S. Fortune 500 company.

Tigers are characterised by rapid year-on-year growth, strong profits and positive cashflow. They can emerge at any stage in a business lifecycle and operate in any sector; products or services, offline or online, premium or budget brands. They can be market leaders that suddenly edge away from the rest of the pack, or a small start-up that comes from nowhere, re-writing the rule book and snatching market share from unsuspecting rivals.

Tigers have a compelling proposition; they introduce products, services or technologies that are better, faster, more desirable or more convenient with customers and markets that offer scalability, and they communicate this brilliantly with their audience.

But they aren’t always disruptive or revolutionary – sometimes it’s as simple as better customer service, more choice or a lower cost alternative.

Can any business become a Tiger?

Few Tigers start off that way. Sometimes they have the benefit of venture capital or other funding, but most gain traction over time. First and foremost, they have a management team with a clear vision of where they want to be, unshakeable belief they will get there and the energy and hard work to make it happen.

Powerful, strategic marketing plays a vital role in building a Tiger business and accelerating the growth and profit curves. Marketing decisions from Zombie businesses are based on short-term gain, whereas Tigers invest for today and tomorrow. They become marketing machines, using every possible marketing opportunity to drive sales today, and build their brand, reputation and customer loyalty tomorrow.

Sadly, some business owners and directors get stuck in a rut and lack the confidence or passion to build a Tiger business. It doesn’t have to be that way. With ambitious leadership, an innovative business proposition and relentless marketing, most companies have the potential to create the impressive growth and profits that define a Tiger business.

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