I believe nothing can hurt a company’s mission, reputation or bottom line more than leadership that lacks accountability. Without accountability, good enough becomes a plague that spreads like a virus across an entire company. Good enough lowers the bar and contradicts promises that are made to customers, employees and investors. Good enough creates a culture where people begin to fear pushing themselves for the best and settling for far less. Over a dozen years ago, Jim Collins introduced me to the “good enough never is” mantra in his Good to Great book. I believe you need accountability to push past good enough, while not wasting time chasing the false promise of perfection.
Since April, GrowLife has conducted a 360-degree review of its internal operations, sought to identify what could be done better, and how we can raise the bar internally so we can lead the industry by example. We made considerable strides to strengthen our financial core, legal practices and have implemented several new governance controls and compliance policies. But these systematic changes do not come without a price. Drafting policies and building committees are not difficult; their practices and adherence, the accountability to them, is however demanding.
Over the last year, the market has watched our small company be catapulted to a large valuation company with a global presence and high expectations. Our financial controls have been stretched to keep up with our growth and, as a result, we’ve needed to create new systems, procedures and controls in just a few months.
Today, we announced the decision to restate some filings that we believe will provide our investors with greater clarity and consistency in financial reporting. Many factors such as complex transactions and the need for stronger controls have led us to this decision. We are confident that the vast majority of our supporters will appreciate our transparency and conservative approach to reporting.
So, what does this mean for GrowLife?
It means we are taking serious actions to get our company on the right track. While non-cash calculations have changed, cash reporting results have not. GrowLife still has solid business metrics with over 100% year-over-year sales growth, quarterly growth that shows a 24% revenue increase from Q4 2013 to Q1 2014, and gross margins doubling from 11% to 22% for the same period.
These are strong results for any company, and with greater accountability to measure our performance, we seek to optimize our organization to achieve our full potential. This is what our customers and our investors should expect, and the GrowLife team will not just meet their expectations, because that would just be good enough. We have every intent to exceed our customers’ and our investors’ expectations, and have taken the steps to do so.