When Growth Strategies Harm: How to Prevent Ethical Blindness in Market Expansion

Abstract

Growth into new market segments drives business success – until it doesn't. As business school professors who also coach, train, and consult for executives, we noticed puzzling patterns in growth-related corporate disasters. The firms grew profitably for years using standard decision-making frameworks. But the same frameworks created ethical blindness when the firms moved from familiar customer segments into unfamiliar ones, causing serious harm to millions of new customers. To help managers, we identified critical red flags that signal when growth strategies risk causing societal harm and developed three practical tools that have proven effective in our workshops. Our experience shows that standard growth frameworks excel at identifying opportunities but fail to account for ethical risks when products safe for one segment become dangerous for another. Ignoring these warnings doesn't just hurt customers – it destroys billions in shareholder value.