At my recent TEC meeting, our presenter, Adam Hartung  (www.adamhartung.com) title his presentation, “Winning in all Phases of the Lifestyle”.  He challenges traditional thinking that prioritizes margin management, cost control, and internal efficiency as the primary drivers of success.

Instead, he argues that the real key to long-term survivability and valuation lies in:

  • Revenue growth (as a measure of market relevance)
  • Reinvestment (even at short-term risk)
  • Adaptability to external change

Below are some Key Concepts that may challenge your thinking, I know it challenged mine.

💡 Key Concepts

1. The Purpose of Business Is to Invest

  • Great leaders don’t hoard profit; they reinvest aggressively to fuel future growth.
  • High-value companies like Amazon, Tesla, and Nvidia win because they use today’s profit to fund tomorrow’s opportunities.
  • A conservative mindset (“keep powder dry”) can quietly kill growth.

2. Margin Obsession Is a Trap

  • Companies over-focus on protecting margins, yet 95% of what determines long-term survival is external (regulation, technology shifts, global events).
  • Margin must be positive, but once stable, the goal is to invest in innovation and market relevance.

3. Growth = Relevance

  • Revenue growth is the clearest sign that customers still value what you do.
  • Falling revenue is an early warning of irrelevance, not just inefficiency.
  • A company growing 10–12% annually can create exponential long-term value; growth under 10% often signals decline.

4. Resilience Through Scale & Adaptability

  • Bigger, diversified companies withstand shocks better than small, “simpler” ones.
  • The rate of change (growth speed) is more important than absolute size.

5. Play Offense During Downturns

  • Companies that kept selling and innovating during the 2008 recession or COVID recovery vastly outperformed those that retreated.
  • Stay in the game—even with thinner margins—if gross margin remains positive.

🧱 Practical Frameworks by Adam Hartung

Step 1 – Redefine What Business You’re In

  • Ask: What problem are we really solving for customers?
  • Example: A brake shop isn’t in the brake business; it’s in the “getting people safely from A to B” business.
    → Future opportunity: upgrades for EVs, sensors, automation, etc.

Step 2 – Explore New Value Delivery Systems

  • Start small experiments that extend your base business (adjacent innovations).
  • Invest modestly and iteratively—avoid “bet-the-company” decisions.
  • Measure by learning speed and customer response, not initial profit.

Step 3 – White Space Teams

  • Create small, dedicated innovation teams that work separately from the core business.
  • Their only mandate: explore new opportunities and future business models.
  • Examples:
    • Richard Branson’s Virgin Atlantic started with 4 people and 2 used planes.
    • Midwest Packaging evolved from printing dog-food bags to selling point-of-purchase advertising and consumer data—raising its valuation from $5M to $120M.

🧠 Strategic Takeaways

  • Relevancy Risk > Margin Risk.
  • Protecting today’s profits can cost tomorrow’s existence.
  • Leaders must look outward—study shifts in tech, regulation, and customer behavior.
  • Encourage teams to question assumptions about what customers truly value.
  • Embed a culture of continuous experimentation and structured reinvestment.

At Southbrook, we’ve seen time and again that the strongest businesses aren’t the most conservative — they’re the most adaptive.

The world doesn’t stop changing. Tariffs shift overnight. Tech moves faster than ever. And your customers’ needs evolve whether you do or not. That’s why our best-performing clients keep a simple discipline:

👉 Protect your gross margin — but reinvest everything else into growth.

Let’s make sure your business is growing, not just surviving.

If you’d like to review your reinvestment strategy or growth margin targets, book a quick chat with me below.

👉 Schedule a Business Review Call