Sustainable Business Practices for Tech Companies
Tech companies globally are growing at an amazing rate; in fact, some have become worth millions of dollars in less than two years. Growth sustainability strategies should be the next “headache for such companies”. Questions on subject areas of People Management, Process Optimization, Product Innovation and Reinvention are many times left unanswered.
In a research done by mckinsey.com, they analyzed the life cycles of over 3,000 software and online-services companies from around the globe between 1980 and 2012. They also surveyed executives representing more than 70 companies and developed detailed case studies of companies that grew quickly and others whose growth slowed down. According to their findings, just 28 percent of the software and Internet-services companies in their database reached $100 million in revenue, and 3 percent reached $1 billion. Also, approximately 85 percent of ‘supergrowers’ were unable to maintain their growth rates, and once lost, less than a quarter were able to recapture them.
In sustaining growth, every tech founder must come to terms with continuous improvement of market and monetization model but ought to first understand their growth path and determine whether their current products and strategy are sufficient to accomplish their targets.
Here are a few other basic best practices that promote business sustainability:
- Stakeholder engagement: Organisations can learn from customers, employees and their surrounding community.
- Providing the structures and processes that facilitate environmental efficiency into a firm’s culture and mitigate risks.
- Information, measuring reporting and disclosure is key in instituting sustainable practices.
- Life cycle analysis: organizations should systematically analyse the environmental and social impact of their innovative products periodically.
Tech firms that are sustainable have been shown to attract and retain employees more easily and experience less financial and reputation risk. These firms are also more innovative and adaptive to their environments.