Shrink to Grow: how do we make it happen?
Why Shrinking Might Be the Smartest Growth Strategy You Have
The instinct to grow, whether faster, broader or louder, is hardwired into most business strategies. Yet in reality, consistent growth often hides inefficiencies, legacy drag or overstretched portfolios. Markets evolve, consumer behaviour shifts, and what once worked may now dilute capital, attention or profit.
In this environment, companies are increasingly confronted with a sharper question: not just where to grow, but what to let go. And this is particularly true during bear markets. This is where Shrink to Grow comes in. It is not a cost-cutting mindset, but a disciplined approach to reallocating resources to where you genuinely have the right to win.
The concept is not new. Portfolio optimisation and strategic focus have long been staples of corporate strategy. What has changed is the need for more data-driven precision and a stronger internal resolve to act. Boards are less forgiving of complexity when there is no profit. Investors are asking more complex questions about capital deployment. And category leaders are realising that success increasingly lies in doing fewer things, better.
This article introduces a practical framework to support those decisions: the Attractiveness versus Right to Win matrix. It helps management teams evaluate where to invest, where to hold, and where to shrink to grow stronger elsewhere actively. We will cover the core mechanics of building the matrix, interpreting its outputs, and applying it to real business units, geographies, or brands.
Alongside the core model, we will also explore a set of complementary tools, such as profitability analysis, customer investment mapping, and innovation efficiency, to help refine and monitor your strategic choices over time.
Every framework in this piece is illustrated with visuals from the Shrink to Growth Era masterclass. These can be used directly or adapted to your internal processes.
What follows is not a theoretical exercise. It is a step-by-step method for moving from strategic ambiguity to clarity, so your business can focus on what it does best, achieve stronger outcomes, and experience fewer distractions.