"Strange as it may sound, sacrifice in the right places is often the answer and the springboard for the long-term prosperity for you and your company. I will put it this way—the sacrifice you make determines your fate."
John R. Bell became a “turnaround CEO” for an ailing company that had lost focus and diversified too much. He and his management team saved all their jobs—and the company—by strategically pruning away product lines and leaving behind the few most profitable ones. This experience, and other similar ones from being a consultant to many large well-known companies, taught him the value of strategic focus and pruning. His book Do Less Better: The Power of Strategic Sacrifice in a Complex World includes the lessons he’s learned along the way and many examples demonstrating their application.
Strategy Is Key
"A clear strategic course begins the process of coherence, and once everyone is on board, wise leaders shouldn’t deviate."
Everyone talks about strategy but few truly understand it. As John explains, strategy is often confused with goals or objectives, but strategy is not the what, it is the how. And understanding your strategy and making sure everyone else does too is the first step to achieving focus.
John recommends asking the following questions to define your strategy:
- What business are you in?
- What will you sell?
- To whom will you sell?
- How will you sell?
Once you know the answers to these questions, you can define your core business. This is where you should spend your money and resources—this is what you should do better. This can also be used to craft a short mission statement that can help both internal staff and external customers understand what it is you offer.
And while going through the above exercises, remember that once you know what your core business is you also have to figure out the how: how are you going to deliver on this and become the best at it.
Strategy Starts at the Top
"The most important question a CEO must answer is ‘What should we do?’ Once he or she has taken care of that, the next question is ‘How should we do it?’ This brings us back to the strategic options: Are we going to do more with more? Are we going to do more with less? Are we going to do less, better?"
Strategy has to begin with the CEO, whose job is to define what the company’s core business is and how it will be delivered. And CEOs that are true leaders use strategy to also create a winning culture: they define where the focus is, where it should not be, and what is rewarded along the way.
This is not easy to do, especially when there is opposition or challenge. John experienced this first hand: his approach to saving his company was not one the board approved, so he nearly lost his job on the way to saving the company.
And since every CEO needs to get buy-in on their vision, having their teams create a manifesto will help both staff and customers know what the company offers and stands for. The below checklist, which John provides, can help create one:
- State a compelling purpose
- Capture core values
- Be honest
- Link business life to personal life
- Be inclusive
- Always differentiate
Differentiation Requires Less
"If you want differentiation, you have to ask yourself this question: what am I prepared to sacrifice to get it? Differentiation in marketing requires giving up a benefit or two or three to make a compelling promise."
Differentiation requires doing less: it requires choosing something you will focus on to do exceptionally better. Lack of focus and doing more by definition means that a company cannot differentiate. This applies to marketing, branding, execution…and even staff. Determine what you do best, what you need most, what you want to offer and spend your resources on that one thing. Ensure all teams are aligned, ensure your messaging is on target, and ensure you hire the right people who can help you execute on this.
Keep thinking “do less better.” Hire the fewer right people who can help you focus and stay on track, and pay them more. Trim your project lists and execute well on the ones that make the cut. Make informed decisions based on your sales, your strengths, and your market.
The above is not limited to a type of product or service or to any given segment. And the brand names and logos that we recall are the companies that have successfully focused, differentiated, and delivered. Think Google, Apple, Nike, and Chobani.
Companies often “expand” to try and improve sales and profits, but if the expansion is not aligned with their core business and carefully planned and executed, the results are the opposite of what they hope for. Instead, although seemingly contrarian, refocus on your core and how you can be better at that alone. As John shows from his personal experience, this will lead to improved profitability and morale, and in a world where competition is fierce, doing less better is the only way to succeed.
Although John’s lessons and book are focused on business, they apply to our personal lives as well. No one can be good at or accomplish everything, so instead of trying to do so and failing, determine the less you will do better. As science and the news keep telling us, humans are not meant to multitask, so stop trying. Instead, strategically decide on your what and how, and focus your time and energy on what makes the cut.
Have you or your company diversified too much? What are the two or three things that you could do better if you refocused on them?