Stall Points Research Questions

Introductory Research and Book Questions

Where can I order a copy of the Harvard Business Review article or the Stall Points book?

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What is a stall point?

A stall point is the moment in time that best represents a turning point, or significant downturn, in corporate revenue growth.  For a more detailed answer, see our Methodology Questions section.

How frequent are stall points?

Corporate Executive Board research suggests that 87% of the Fortune 100 firms have encountered a revenue growth stall.

Can I predict my company’s growth stall before it happens?

Growth stalls are abrupt and seem to happen without warning.  In fact, many companies’ growth rates accelerate into a stall.

Yet there are often warning signs, and approximately 87% of growth stalls occur due to preventable stall factors.  You can assess your organization’s vulnerability to preventable organizational and strategic risk factors through use of our Red Flags Diagnostic.

Are some risk factors more dangerous than others? 

To a certain extent, this answer depends on your company’s size, industry, location, and competitive positioning.

With that said, the Corporate Executive Board has looked at the relative frequency of stall causes.  Premium Position Captivity, Innovation Management Breakdown, Premature Core Abandonment, and Talent Bench Shortfall appeared most often in the examined set of growth stall cases.

If my company stalls, can it recover?

Yes, but recovery is by no means certain and seems somewhat time sensitive.  While almost half of companies recover, almost two-thirds of those do so within ten years of their stalls.

I want to expose the rest of my executive team to the research.  What’s the best way to do that?

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If your question is not covered here, please feel free to submit a question to the authors here.

Deeper Research Methodology Questions

What is a stall point?

A stall point is the moment in time that best represents a turning point, or significant downturn, in corporate revenue growth.

More specifically, a stall point is based on a 10-year pre-stall to 10-year post-stall CAGR.  The CAGR for the 10 years prior to the stall must be at least 2%, the stall delta between pre- and post-stall must be at least 4%, and post-stall growth rate must fall below 6% in real dollars.

Why judge a company’s health based on revenue growth rather than other measures of corporate performance?

Revenue growth is the primary driver of long-term corporate performance.  This is not to say that revenue growth without profits is desirable, but to suggest that high growth through margin management alone is not sustainable. 

It is also more difficult to “engineer” or manipulate the top line over time.  By contrast, market value and profit measures are much more variable.  Deflating market capitalization by an underlying index can eliminate some, but not all, of this variability; and as for profit, the combined effect of one-time charges, changes in accounting rules, and the inevitable short-term manipulations make for numerous peaks and valleys.

Does each stall case get assigned a single root cause of the stall?  How are percentages on the root cause tree calculated?

Multiple challenges may present simultaneously to a management team; therefore, each company still has been assigned from two to four stall factors.  The root cause tree has been inductively created based on observations from interviews, company histories and annual reports, analyst reports, and relevant business literature.  It does not artificially assume that stall factors are mutually exclusive from one another.

Why did the root cause tree change between your 2006 Overcoming Stall Points worksand the 2008 “When Growth Stalls” and Stall Points?  (Why is failed international expansion now part of premature core abandonment?)

Even after our data analysis and case research findings are published, we seek feedback from our member network about our frameworks and findings.  In further discussions with our members, we learned that the management decisions behind failed international expansion outcomes were often the result of the same faulty strategic assumptions that manifested in stalls attributed to premature core abandonment.

Are revenue growth stalls limited to North American companies?

No, stalls often occur outside of North America as well.  Our data analysis shows that 75% of the European companies and 87% of the Australian companies in the sample stalled.  Due to the universal relevance of many of the stall factors, we believe that similar rates would exist in other geographic areas as well.

If your question is not covered here, please feel free to submit a question to the authors here.

Questions about Corporate Executive Board Research Processes

How do you decide which research topics to cover?

This process is entirely member driven. On an ongoing basis, we poll the members to identify their most vexing challenges, and we select for detailed examination the most urgent and widely shared problems. Sudden market and economic events are also addressed by the membership.

Why do the best organizations share their practices with you?

Three reasons in particular stand out. First, the most progressive companies recognize that a network has value to the extent that individuals participate in it--—and that no one (themselves included) is best at everything. Second, members have discovered the “two-way value” present in interviews with our researchers and the value of findings from research underway. Finally, we are meticulous about member confidences. Members should feel comfortable that any information shared with our research teams is completely confidential unless and until they authorize its release.

Are members required to share information with you?

No. Members choose whether or not to participate in individual research projects, as schedule and preference permit. However, more than 87% of our members participate in our telephone and on-site interviews, generally reporting that they learn as much as they contribute through their interactions with our research staff.

Do you work with any consulting firms?

We have no commercial relationship with any consulting firms, nor do we engage particular consultants in our work. That said, we do discuss ideas with consultant experts who are well versed in the topics we are addressing for the membership and routinely cite consultants in our studies if they have contributed to the thought therein.

Questions Corporate Executive Board Membership

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Does membership require a substantial time investment?

No. In fact, members judge us on our ability to conserve their time—to focus them on the correct set of strategic issues, to compress the time required to review the best current practices, and to weed out the bad ideas quickly. We publish best practices in a highly structured, graphical format that is meant to allow for rapid evaluation and assessment. Our executive education and decision-support tools help to compress time-to-implementation in even the most progressive organizations.

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Our member relationships generally provide the most value when they are housed with the seniormost executive dedicated to that function, who is able to direct our strategic research agenda to enterprise-level concerns and focus our resources on the organization's most critical priorities. With this overall direction, we are then able to interact on a day-to-day basis with direct reports and other functional staff throughout the member organization.

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