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 1. Home
 2. A Guide to Growth: A global analysis of the defining characteristics of
    leading midsize companies


A GUIDE TO GROWTH: A GLOBAL ANALYSIS OF THE DEFINING CHARACTERISTICS OF LEADING
MIDSIZE COMPANIES

Discover the eight growth strategies practiced by leading companies and learn
how they can help you to achieve your business goals. These recommendations are
based an IDC research study sponsored by SAP, which identified how some midsize
companies have thrived even in times of disruption. Download the Document

15

190%


January 2023 | IDC Doc. #US49859322An InfoDoc, sponsored by SAP
RESEARCH BY:
Katie Evans
Research Director
Worldwide Small and Medium Business Research Program, IDC
A Guide to Growth
A global analysis of the defining
characteristics of leading
midsize companies



22An InfoDoc, sponsored by SAP
J
anuary 2023 | Doc. # US49859322
A Guide to Growth: A global analysis of the defining characteristics of leading
midsize companies
Identifying the Practices and Strategies of High-Growth Companies 3
Setting the Stage: Challenges and Priorities 4
Growth Strategy: Evolve Business Models 5
Growth Strategy: Diversify the Supply Chain 6
Growth Strategy: Dedicate Resources to Digital Transformation 7
Growth Strategy: Invest in Sustainability 8
Growth Strategy: Focus on Employee Efficiency 9
Growth Strategy: Prioritize Employee Happiness 10
Growth Strategy: Constantly Refine the Customer Experience 11
Growth Strategy: Track ROI 12
About the Analyst and Research Study 13
Message from the Sponsor 14
Navigating this InfoDoc
Click on titles or page numbers to navigate to each section.



33Table of ContentsAn InfoDoc, sponsored by SAP
January 2023 | Doc. #US49859322
A Guide to Growth: A global analysis of the defining characteristics of leading
midsize companies
We categorized each responding midsize organization into one of four levels
of maturity (Leaders, Progressing, Evolving, and Aspiring) based on:
4 Expected greater revenue and market share increases than the overall market in
2022
4 Status of digital transformation
4 Effectiveness of response to disruptions
4 Evolve business models
4 Diversify supply chain
4 Dedicate resources to digital transformation
4 Invest in sustainability
4 Focus on employee efficiency
4 Prioritize employee happiness
4 Constantly refine the customer experience
4 Track ROI
We then investigated the defining actions and characteristics of Leaders. Based
on this information, we’ve
developed A Guide to Growth, a set of eight clear and actionable recommendations
that can serve as a blueprint
to help other midsize players weather challenges, achieve priorities, and chart
a long-term path to growth.
10.5% -0.6%
Average expected
increase in revenue
Leaders Aspiring
-0.8%10.7%
Leaders Aspiring
Average expected
increase in market share
Effective response to disruption over last two years
81% 36%
Leaders Aspiring
Digital transformation completed
or in advanced stages
91%Leaders
40%Aspiring
Identifying the Practices and Strategies of
High-Growth Companies
Today’s rocky business terrain is littered with challenges: supply chain
pressures, inflation, and skills gaps, to
name a few, and it takes strategic investments and careful planning to navigate.
Yet many midsize companies
are surviving — and thriving — despite the challenges.
SAP commissioned survey-based research with IDC to understand the key
differentiators of leading midsize
companies and the lessons other companies can learn from them.
Source: IDC’s SAP A Guide to Growth Survey, September 2022; n = 1,850



44Table of ContentsAn InfoDoc, sponsored by SAP
January 2023 | Doc. #US49859322
A Guide to Growth: A global analysis of the defining characteristics of leading
midsize companies
Attract new customers
Grow revenue
Increase employee productivity/efficiency
Expand into new markets
Improve sustainability
Innovate with new products, services, and business models
Improve margins/profitability
Attract and retain top talent
Cost savings/spend management
Improve customer experience/retain existing customers
Increase organizational resiliency
Enable digital transformation initiatives
Increase market share
Improve the employee experience
Increase organizational agility
Minimize business/compliance risk
Acquire/merge with other organizations 14.0%
25.7%
28.2%
31.2%
34.0%
34.9%
22.2%
26.4%
29.6%
32.7%
34.4%
36.3%
22.3%
27.8%
30.6%
33.9%
34.8%
Setting the Stage: Challenges and Priorities
Top Challenges
In 2022, we talked about the winds of change as we emerged from the pandemic.
The underlying theme then
was uncertainty with a healthy dose of optimism. Now those winds of change have
become storms of disruption.
They are increasingly interwoven: international tensions, rising energy costs
driving inflation, supply chain
disruptions, and increased fees for skilled labor.
Top Priorities
Across a myriad of strategic goals, respondents reported that attracting new
customers, growing revenue, increasing
employee productivity, expanding into new markets, and improving sustainability
were the top 5 business objectives
to drive growth in 2023. These priorities are generally consistent with past IDC
analysis of the midsize market, with
the addition of a rising focus on sustainability.
Top Macroeconomic Challenges
Top Business Objectives in 2023
Global pandemics (e.g., health concerns, COVID-19 restrictions)
Inflation/interest rates
Supply chain disruptions
Talent acquisition and retention
Inability to find raw materials and necessary inputs
Climate change
Geopolitical unrest and/or uncertainty
Other natural disasters
(Percentage of respondents)
(Percentage of respondents)
62%
56%
51%
44%
38%
33%
28%
8%
Source: IDC’s SAP A Guide to Growth Survey, September 2022; n = 1,521 for chart
1, n = 1,549 for chart 2



55Table of ContentsAn InfoDoc, sponsored by SAP
January 2023 | Doc. #US49859322
A Guide to Growth: A global analysis of the defining characteristics of leading
midsize companies
Growth Strategy: Evolve Business Models
Midsize companies that want to continue to grow must evolve. They must adapt to
swiftly changing market
conditions and consumer preferences — and fast.
This could mean delivering services to consumers in new ways, such as employing
augmented reality to show
shoppers just how a piece of furniture would fit in their room, to scale, so
that they are not leery of buying it
online. It could mean employing machine learning that will automate and improve
marketing campaigns to save
on employee costs, or using robotics in warehouses to reduce manual processes.
Leaders are constantly exploring ways to evolve their business models. Most
Leaders (91%) said they plan to
expand into new business models and services to address evolving consumer
expectations compared with
26% of Aspiring companies. Leaders also rank higher in several other facets of
evolution, including venturing
into new customer channels such as mobile apps or launching new product lines.
Value-Added Services to Address Evolving Customer Expectations
54%
26% 91%
42%
18% 73%
37%
29% 67%
51%
20% 84%
39%
11% 74%
32%
13% 60%
47%
19% 71%
37%
15% 68%
New business models/services (e.g., subscriptions, direct to consumer,
marketplace, everything as a service)
New channels/touchpoints (e.g., mobile app, social commerce, conversational AI)
Eco-friendly shipping
New delivery options (e.g., same-day delivery, curbside pickup)
New product lines
Personalized offers
Virtual appointments
New return options
(Percentage of respondents)
My strategy for growth?
“Innovate to produce new
products to attract wider market
interest, with the hope for
continuous development.”
– Director, high-tech company, Spain
“Enter new markets
and invest heavily in
technological innovation”
– CIO, professional services, USA
“Expanding into the ‘new’
– markets, categories,
customer segments...”
– IT director, consumer
packaged goods, China
Source: IDC’s SAP A Guide to Growth Survey, September 2022; n = 1,850
n Leaders
n Aspiring
n Total




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