Stryker Corporation is a leading medical technology company headquartered in Kalamazoo, Michigan, that trades on the New York Stock Exchange. Following are selected financial data for Stryker for the period 2009–2013.

2009 2010 2011 2012 2013 Profit margin (%) 16.5 17.4 16.2 15.0 11.2 Retention ratio (%) 82.1 81.3 79.3 75.0 60.1 Asset turnover (X) 0.7 0.7 0.7 0.7 0.6 Financial leverage (X) 1.7 1.7 1.7 1.7 1.8 Growth rate in sales (%) 0.1 8.9 13.5 4.2 4.2 Source: Data from Stryker 2009–2013 annual reports

a. Calculate Stryker’s annual sustainable growth rate from 2009 through 2013.

b. What growth management challenge did Stryker face during these years?

c. How did Stryker deal with its growth management challenge? LO.1