Increases in revenue growth rates drive twice as much market-capitalisation gain as margin improvements for companies with less than $4 billion in revenues

Mckinsey
Growth Strategy🕑 Reading Time: 0 Minutes

So, growth is essential to value creation. But is it more important than other factors, such as cost control and operating excellence? We analyzed the relationship of cost structure to growth and found little or no correlation. In every major cost category—cost of goods sold, R&D, marketing and sales, and overhead—there is little or no correlation between the level of expense or investment and growth rate. Fast-growing companies can spend a lot or a little on these categories; it doesn’t seem to matter.