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How Small Consistent Improvements Can Lead to Exponential Growth

In business, it’s often a winner-take-all-scenario. Either you get the business or you don’t. But what if just a few small improvements, compounded over time, could lead to exponential growth and big profits?

The Japanese calls this Kaizen. It’s the idea that big results come from many small changes accumulated over time.

One of the best examples of how small differences can lead to exponential results comes from the world of professional golf.

In 2015, Phil Mickelson earned $51 million split between prize money on the tour and endorsements. His per-round stroke average was 70.5. By contrast, ever heard of Roger Sloan? Me either. Sloan won $133,000 on the tour. I couldn’t find anything he endorsed. His per round stroke average was 72.5.

You see where this is going?

Mickelson bested Sloan by an average of just two strokes per round yet Mickelson earned 383 times more money. In other words, Mickelson was just 2.8 percent better than Sloan, but that small margin added up to an extra $50 million in Lefty’s pocket.

Just think, one missed putt or one wayward tee shot every nine holes made the difference between being the world’s thirty-sixth highest paid celebrity and total obscurity. It’s the same in business. Small mistakes could cost you millions.

Exponential Growth

Make a point to identify areas of your business where consistent, 2.8 percent improvements compounded over time could generate exponential growth and Make Big Happen! Here are a few to get your started:

The key is you have to focus on making small improvements in multiple areas across your business. Remember basic math here. If we make 2.8 percent improvements in just three areas, that could be expressed as 2.8 to the third power, which equals about 22. However, if we improve in 7 areas, we’re looking at 1,349. Now that’s exponential growth!

At CEO Coaching, we focus like a laser on identifying these consistent improvements with our clients. For example, my client Don Schiavone, formerly the chief operating officer of Grasshopper and now an entrepreneur coach with the firm, said in the early days of Grasshopper, they would set a growth target but they had no reliable way to know which strategy or tactic would lead to hitting the number.

Today, they come up with multiple growth ideas, carefully test and measure the results of each one (fire bullets), then fully back those ideas that generate the best results. Without a rigorous testing mind-set like this, you’re simply stabbing in the dark.

By constantly testing, measuring, and adjusting, Grasshopper makes multiple small improvements over time. And this has led to stunning results including selling the company to a Fortune 500 firm for nine figures.

Make small improvements. Rinse, repeat. It’s a simple formula that works.

About Mark Moses

Mark Moses is the Founding Partner of CEO Coaching International and the Amazon Bestselling author of Make BIG Happen. Mark has won Ernst & Young’s Entrepreneur of the Year award and the Blue Chip Enterprise award for overcoming adversity. His last company ranked #1 Fastest-Growing Company in Los Angeles as well as #10 on the Inc. 500 of fastest-growing private companies in the U.S. He has completed 12 full distance Ironman Triathlons including the Hawaii Ironman World Championship 5 times.

Mark Moses

About CEO Coaching International

CEO Coaching International works with CEOs and their leadership teams to achieve extraordinary results quarter after quarter, year after year. Known globally for its success in coaching growth-focused entrepreneurs to meaningful exits, CEO Coaching International has coached more than 1,000 CEOs and entrepreneurs in more than 60 countries and 45 industries. The coaches at CEO Coaching International are former CEOs, presidents, or executives who have made BIG happen. The firm’s coaches have led double-digit sales and profit growth in businesses ranging in size from startups to over $10 billion, and many are founders that have led their companies through successful eight, nine, and ten-figure exits. Companies working with CEO Coaching International for two years or more have experienced an average EBITDA CAGR of 67.8% during their time as a client, nearly four times the U.S. average and a revenue CAGR of 25.5%, more than twice the U.S. average.

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