2 - The Mindset Shift From Growth-First to Efficiency-First
A series about business efficiency, finding profit and how to get there
Introduction
For decades, SME success in New Zealand and globally, has been measured by one dominant metric growth. More customers. More sales. More locations. More staff. In many cases, that growth has been synonymous with progress, and rightly so.
But what happens when growth stalls? When markets tighten? When external conditions don’t allow “more” to be the lever?
Welcome to the reality many NZ SMEs now face. The economy is flat. Forecasts are soft. Yet, businesses still need to turn a profit, stay resilient, and support their people.
This article is about a new kind of leadership mindset. One that doesn’t chase growth at all costs, but instead seeks efficiency - the kind that unlocks hidden profit without a single new customer.
Efficiency is not about doing less. It’s about doing better. It’s about extracting more value from the resources you already have. In this world, success is not about scale, it’s about clarity, intent, and intelligent design.
Actions to Be Taken
Here are five tangible steps SME leaders can take to initiate the mindset shift -
1. Redefine Success Internally
Replace revenue goals with profitability, sustainability, or customer lifetime value targets.
Have leadership team sessions focused on “How might we do better with what we have?”
2. Audit Your Time and Focus
Track where you, the owner/leader, spend your time for one week.
Identify areas where time is spent on legacy habits rather than future-value creation.
3. Interview Your Business
Ask each team lead If you had to reduce your workload by 20% while keeping the same outcomes, what would you stop doing?
Record and compare insights. Hidden inefficiencies will surface.
4. Align the Team With the Shift
Communicate the reason for the shift openly “Growth is not our only measure. Efficiency is our new frontier.”
Reinforce that this is about working smarter, not harder.
5. Build Feedback Loops
Introduce weekly 15-minute huddles to gather insight from the frontline on what feels inefficient, redundant, or unclear.
Psychological Perspective
Letting go of “growth-first” thinking is deeply personal. For many SME owners, growth validates risk. It’s proof that the sacrifice, the stress, and the long nights were worth it.
So when growth slows, it can feel like failure, even if the business is solid.
This shift to efficiency-first is a mindset of maturity, not retreat. It’s a move from ego to ecosystem, understanding that success is not about how big you get, but how well you operate.
A surprising benefit? Efficiency creates emotional space. Less chaos. More focus. Better decisions. You’re no longer spinning plates, you’re crafting systems.
HR Best Practice
From an HR standpoint, this shift requires transparency, inclusion, and reassurance. Here’s how to manage the transition well
Involve staff in identifying inefficiencies - they'll have ideas leadership won’t see.
Avoid fear language. This isn’t about job cuts; it’s about improving the way we work.
Highlight skill development opportunities - efficiency often involves upskilling.
Offer support to team members feeling anxious about change - psychological safety is key to engagement.
Red Flags to Watch For and Mitigate Against
Be alert to these common traps that derail the mindset shift -
Efficiency as a euphemism for burnout – Watch for teams quietly overextending themselves to “prove” value.
Top-down dictates without consultation – If staff feel “streamlined,” they’ll disengage.
Paralysis by analysis – Avoid excessive metrics or over-auditing. Keep things practical.
Romanticising the old way – Owners can unconsciously resist efficiency when it threatens traditional control structures.
Narrative Story - Meet Sarah from Invercargill
Sarah owns a 12-person architecture practice in Invercargill. For years, her mantra was “growth = success.” They’d expanded quickly - new hires, new office, flashy CRM.
Then came a slowdown in residential development. Projects dried up. The growth engine stalled.
Instead of panicking, Sarah got curious. She began interviewing her team. What she found shocked her duplicated processes, outdated tech, and “busywork” that no one had questioned. Worse, her own calendar was 70% reactive - not strategic.
Over six months, she shifted her leadership focus. They mapped out every major workflow and cut or restructured 18% of their tasks. No one was let go, but roles evolved.
The result? Profit margins grew by 11%. Not from a single new client, but from reducing the drag inside the business.
Her reflection - “For the first time in years, I feel like I own the business — it doesn’t own me.”
Golden Nugget - “Efficiency isn’t the opposite of growth - it’s the discipline that makes growth worth it.”
If you’d like to know whether this programme might be what your business needs, email me at john.luxton@regenerationhq.co.nz or call/txt me at +64 285 665 682 and I’ll send you a set of questions for you to ponder and set the stage for a free, no obligation and confidential conversation.