Growth evolves in enterprises towards the one, determining key figure. All efforts serve only to increase profit, revenue, market shares, and productivity. The system is part of an environment, has defined borders and exchanges energy with other systems. Within the system, the subsystems also exchange energy.
Where does the energy for growth actually come from?
Examples of systems are:
- Living organisms that need food;
- Machines that require fuel;
- River systems that swell with tributary rivers and rains;
- Families that become larger through offspring;
- Enterprises that expand.
In principle, any growth is created by adding energy from the outside. Creatures have their energy through wining and dining. If food is missing for a long time, the organism dies. The car that is not refueled stops. As soon as creeks and other rivers dry up and the rain is absent, a river drains. Families without descendants become extinct. Enterprises enlarge by opening up new markets, by pushing competitors out of the market or by purchasing enterprises. Within the system, the energy likewise shifts, i.e. gets rearranged. Thereby individual subsystems grow. However, the total energy of the system does not increase. The reallocation even leads to a loss of energy that results from the efforts for the change.
In the enterprise, this shift of energy appears in many places.
- With the takeover of enterprises the revenue, the profits, the market penetration, the procurement volume and the number of employees grow at the expense of the related investments and the employees that do not ‘survive’ the fusion.
- The reorganization of processes costs the energy of the change efforts and the employees, who are loosing their tasks.
- New technologies come from the outside and produce drain of energy in the form of cash flow. Beyond that, the employees again pay part of the bill with the loss of their tasks, either if they are transferred or dismissed.
Bottom line: For growth, you need energy form outside. Any growth happens at the expense of others. Internal growth yield no results to the overall system, because energy moves only from the right into the left pocket or gets simply lost through the efforts.