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Profitable Growth- Founder’s prime responsibility:
Some time back, I met a founder who had grown his company from ₹20 crore to ₹85 crore in turnover after the COVID pandemic.
When I congratulated him, he smiled and said, “Yes, but our profit margin dropped from 14 percent to 3 percent. We’re growing, but it feels like we’re running harder to stay in the same place.”
That line stayed with me. This is because it captures what many founders experience but rarely talk about. Growth looks exciting on the outside, but sometimes, it quietly eats into the very strength of the business.
Every founder dreams of growth. It feels rewarding to see sales rise, customers multiply, and teams expand. But I often ask a simple question , is your growth making the business stronger or just bigger?
Many times, there’s a pause. Because in many small and mid-sized businesses, growth brings activity, not always prosperity. The energy is high, but profits start thinning quietly.
Why We Tend to Chase Only the Topline growth
Most founders don’t ignore profit intentionally. It just happens over time.
Revenue is visible and exciting. You can see new orders, bigger clients, busier teams. Profit is quieter. It hides in the details, a small discount here, a project taken up only to keep machines running, a delay in collection that blocks cash flow.
Once capacity expands or more people are hired, the pressure builds to keep them busy. So even low-margin business feels fine. Everyone is working harder, but not necessarily smarter.
In many companies, sales and operations proudly share growth updates, while finance quietly worries about margins. The CFO may raise concerns, but unless the founder makes profit part of the leadership conversation, no one feels responsible for profitable growth.
That was exactly what I noticed when I began working with an equipment manufacturing company. The company had built a good reputation and was scaling fast. The founder and team were ambitious, driven, and deeply involved in every order.
But when we studied their performance more closely, a clear pattern appeared.
The company had been growing at nearly 15 per cent every year for three years. Their revenue graph looked impressive. But behind those numbers, profitability had slipped from 11 per cent to below 7 per cent. They were still profitable, but each year, they were earning less on every rupee sold.
When I discussed this with the CEO, he said, “Ganesh, we are investing in growth, and profits will follow.”
I smiled and said, “Profit doesn’t follow automatically. It follows focus.”
When the Focus Shifted
When we began working with the company, our first step was not to change systems or targets, but to bring consciousness across the organisation about the importance of profitable growth.
We spoke with the leadership team about setting focus on both topline and bottom line. Together, we introduced the idea of having two annual goals ; one for sales growth and another for profit growth. For example, 10 percent sales growth and 10 percent profit growth. Both were reviewed every month with equal attention.
As this awareness grew, the company started seeing things differently. Sales began evaluating orders based on profitability, not just volume. Operations teams initiated small cost improvement projects. Procurement became more thoughtful about material usage and vendor terms. HR started linking manpower productivity to business performance.
These were not major structural changes yet they were subtle shifts in thinking. But they made a visible difference. By the end of the year, the company’s profit margin improved by 0.3 percent.
That number may look small, but what truly mattered was the new culture that started taking shape , a culture that valued both growth and profitability equally. The team began discussing profit in every review meeting, not just sales. That was the turning point.
Proven Habits for Profitable Growth
Over time, I have seen that sustainable profitability doesn’t come from one big decision. It comes from a few simple habits that, when practiced consistently, shape how a business thinks and grows.
Start the year with two numbers. One for revenue, one for profit. This keeps focus balanced right from the beginning.
Make profit part of every conversation. When every function like sales, operations, finance, HR understands how their work affects margins, alignment naturally improves.
Watch the small levers. Price discipline, product mix, productivity, and payment cycles may look routine, but they quietly decide your profit.
Keep reviews regular and calm. Monthly discussions build rhythm and accountability, without adding pressure.
Celebrate balance, not just size. A company that grows with profit builds stability, confidence, and long-term strength.
These habits are not financial techniques. They are leadership behaviours that help teams grow consciously with focus, balance, and purpose.
What Profitable Growth Really Means
Profitable growth isn’t about saying no to opportunities or cutting costs everywhere. It’s about growing with balance.
Every new customer, product, or order should make the company stronger, not heavier. It’s about expanding with clarity ,knowing where value is created and where it leaks away.
When founders balance their focus between sales and profit, they begin to make wiser, calmer decisions. That’s when growth turns sustainable.
Summary & Reflection
When you look at your business today, pause and ask yourself:
Is your growth making your business stronger or just busier?
Do your teams see profit as their responsibility, or finance’s concern?
If your sales grow 10 percent next year, will your profit grow too?
Growth is exciting. But profitable growth brings peace of mind.
One builds your size. The other builds your strength.
As you plan your next year, remember this simple truth :
The real victory is not topline growth. It is profitable growth. 🙂
That is founder’s prime responsibility.
