The “S” curve is a metaphor I often use with business clients when we talk about innovation.
The S is short for “Sigmoidal” (yes, I had to look it up too) which is a mathematical function that looks like the left-hand side of a bell curve, but one that flattens out when it reaches its maximum and then, in my drawings at least, starts to slowly slant back downwards.
The S curve represents how a new product takes a fair bit of time to initially gain traction, then it grows, then starts to plateau, before moving towards a long, slow decline. And it’s a pretty reliable predictor of how most businesses pan out.
You might think that flattening growth is only to be expected because they’ve saturated the market, they’ve reached every customer that could possibly want what they’re offering, they’ve satisfied the need in full. But while that might be the founder’s dream, it’s never the reality.
The reasons for the plateau can be many and various, but it’s never for lack of customer need: underinvestment, competition, changing customer tastes, loss of focus, leadership, key people, I could go on. But whatever the reason, the pattern can be seen in a million businesses that were once innovative, had early success, and now find themselves with the thankless task of scrapping for market share to keep the doors open.
If you’re a regular reader, you will already know where I’m going with this. You’ll have spotted the parallel with your own programmes, products or services, because the S curve metaphor is pretty universal, and the non-profit sector is replete with those exact same plateaus.
Most non-profit origin-stories are fascinating tales of passionate people who’ve seen or personally experienced a need and felt driven to meet it, often by pioneering an innovative service, a new intervention, a different way of raising funds, or of influencing their target audience.
They carved out the time, scrounged up the resources, took the risk, and made something new happen.
Their S curves for income and impact will almost certainly have followed a similar path. A slow start, then traction, and the growth of impact and income alike. But as time goes by, the growth of both starts to slow, they appear to find their natural limits not because they’ve met all the existing need, but because they’ve become trapped, scrapping it out for funding, for contracts, for resources, for the fuel to meet that need.
The answer is as obvious as you’d expect: to get off the plateau you need another breakthrough innovation, one that re-adjusts to meet changing or emerging needs, or finds a new approach that will by-pass those barriers and unlock the next phase of expansion.
The only problem is, by the time you’re on the plateau, the innovators have usually left the building, delivery has overtaken everyone’s day-job, and there’s no spare capacity to step back from the scrap, to think big, to pursue the next new idea or opportunity, to imagine a future off the plateau.
The best time to start innovating is always, always when you’re in the growth phase: as your first S starts flattening, you want the next one to be already taking off. But just like the best time to plant a tree was 20 years ago, the second-best time is now.
So, answer me this: which parts of your organisation are stuck on the plateau? Where has your growth gone flat, not because of lack of need, but because you don’t have the fuel or the people to push you onto the next stage of growth?
And within that list, where is the best opportunity for you to carve out the time, scrounge up the resources, take the risk, and kick-start your next big S curve?