Momentum Matters

Margin leaders need to balance big potential payoffs with the strategic value of smaller, quick wins.

Margin initiatives begin as untested theories and grow into proven business models. Strategies that require long periods of time and significant resource investment are less likely to succeed in the margin than strategies which can build on short-term wins. While small, these successes build the trust of initiative partners, stakeholders, and investors by providing proof-of-concept evidence that the overall strategy can be successful on a larger scale.

Many margin managers make the mistake of putting all their resources into one large effort. The high payoff is tempting, but gambling on big wins rarely achieves long-term success. While a win may catapult the leader and the initiative to a new level, a loss can close the initiative down completely. In addition, the likelihood of a repeat performance is low while the expectations have been set high.

Small wins not only create a history of success, they build capabilities and experience through the application of lessons learned. This internal growth sets the stage for tackling larger projects and increases the likelihood of success. In addition, any failure is weighed against the longer history of successful value creation. Going after a big solo win should only be attempted when the conditions are highly favorable.