One thing about growth is clear: the literature touting its importance keeps growing, and growing, and growing. What is less clear—and often needlessly obfuscated in management jargon—is how companies grow. Take the tricky, potentially paralyzing, dilemma that confronts most senior executives contemplating growth. On the one hand there exists a chasm between their current inventory of institutional capabilities and those required to achieve their growth aspirations; on the other, taking a discontinuous, "bet-the-company" leap could send the company barrelling down a deep and dangerous crevice, ending in the thud of extinction.

To provide some timely, practical advice on how companies can grow, we examined 40 of the world's leading growth companies to find out how they approach, and more important, implement growth strategies (see the boxed insert, "About the research base" and Exhibit 1). These companies—in industries from basic materials to high technology based throughout Europe, North America, and Asia—clearly know how to grow: they average 25 percent compound annual growth in sales and 32 percent in shareholder returns (from dividends and capital gains). Their response to the question "How do I get from here to there" would typically be "not by big bold leaps but by a...