Unlocking Growth in Mid-Sized Firms: Simple Lessons for Business Owners

Many business owners focus on exciting startups or global giants, but most companies fall in between as mid-sized firms. These companies often face the challenge of sustaining steady growth without hitting a plateau.

In an article in Harvard Business Review entitled “What Drives Growth in Midsize Firms?” Gary Wolbers and Arun Pillutla have explored how mid-sized manufacturers overcome these challenges. Their study, based on interviews with the CEOs of these businesses, shows that success comes from balancing strong personal relationships with ongoing improvements in company skills.

So what can be learnt from this important research study?

When a company is small- typically with revenues between £1.5 million and £15 million, the CEO usually acts as the main point of contact for customers. In this early stage, success depends on building personal relationships. CEOs get directly involved, earning trust by listening to customer needs and quickly solving problems. This hands-on approach creates a strong foundation because the company focuses on what it does best, delivering high-quality products and services that meet specific customer demands.

As companies grow and reach revenues between £15 million and £40 million, the strategy needs to evolve. At this point, relying only on personal connections is not enough. Firms begin to build more formal systems to manage their expanding customer base. CEOs describe this stage as turning into a “well-oiled machine.” The business invests in new technology and modernizes production processes—like adopting lean manufacturing—to speed up production and reduce delays. These improvements boost efficiency and help build a solid reputation for reliability. A better reputation means more customers and larger contracts, paving the way for further expansion.