Graduation day: How new growth initiatives turn into sizable businesses

Abstract

Incumbent firms face the managerial challenge of turning new growth initiatives into the sizable businesses that ensure their future success. While many studies have investigated how large companies launch new growth initiatives, this article is among the first to focus on how they manage the transition to scale. Based on our analysis of new growth initiatives in companies such as BMW, Deutsche Bank, General Electric, and IBM, we found that managing the transition to scale properly may be as important as launching new initiatives in the first place. In this article, we reveal the triggers that drive the transition to scale and discuss four essential managerial activities for successfully managing transitions. © 2010 Gabler Verlag | GWV Fachverlage GmbH, Wiesbaden.