If you take some time to listen to successful entrepreneurs, you will note they keep coming back to one key ingredient that fueled their success – focusing on one thing.

Most will tell you that their businesses did not take off properly until the day they stopped trying to serve everybody. They learned that the magic actually lies in doing less, but doing it better.

Are you in position where you are trying to serve different markets at the same time, doing a little bit of this and a little bit of that? Conventional wisdom might have led you to believe that success lies in diversifying, that you shouldn’t keep all your eggs in one basket.

While that might be true for investments, it doesn’t really work well for business. If you look at some of the most successful businesses, you will notice that they are only known for one thing.

For instance, Domino’s is known for nothing else but Pizza. Starbucks is known for nothing else but coffee. KFC is known for nothing else but fried chicken.

If Domino’s tried to provide the best pizza, the best coffee and the best fried chicken, they probably wouldn’t be as successful. Similarly, if you want to succeed, you can’t be everything for everybody. Instead, you should focus on being something specific for a very specific group of people.

STEVE JOBS AND THE POWER OF FOCUS

There is an interesting story about Nike CEO Mark Parker and Steve Jobs. Mark Parker narrated that after he became Nike CEO, he had a phone conversation with Steve Jobs, during which he asked Jobs for advice on what he should do.

In response, Jobs told Parker that though Nike made some of the best products in the market, it also had some that were rather crappy. This was because Nike was trying to serve too many markets. Jobs’ advice to Parker was that Nike should get rid of the crappy products and focus on the good ones.

Parkers said that he realized Jobs was right and Nike had to start “editing”. He used this word to mean the process of making business decisions based on selection of the best products and elimination of the crappy ones.

Steve Jobs’ advice to Parker was based off the same philosophy that he used to build Apple and turn it into one of the biggest companies in the world. In fact, Jobs’ whole aesthetic and corporate vision was one of minimalism and focusing on doing one thing and doing it in the best way possible.

Jobs is famous for saying that focus is less about saying yes to one thing and more about saying no to a hundred other good ideas.

With this quote, Jobs reveals an interesting truth – by trying to do everything (saying yes to everything), you are actually making it harder for you to get the important things right.

When Steve Jobs came back to Apple in the nineties after his earlier ouster, he found the company on its deathbed. How did he manage to reinvigorate Apple and take it from near-death to becoming one of the most innovative, impactful, and valuable companies in the world?

The answer is simple. He pared down the company’s product line ruthlessly to only 10 products. Mind you at the time Apple was producing 350 different products. In other words, Apple was trying to produce just about every gadget it could think of and appeal to everyone who had some money to spend.

Jobs understood that trying to be everything to everyone was the reason Apple was in the red. The only way to save the company was to make it ruthlessly leaner and more focused.

Before Jobs’ return, Apple profits had fallen, and many insiders believed the company had only weeks, and at best, months, to live. That Steve Jobs manage to salvage the situation is a testament of the power of focus.

That was not all he did to help the company survive, but that is definitely the one thing that made the company start to thrive again.

Now that the company had streamlined and simplified its product line, Apple was able to focus on creating new technology and being innovative with design.

Beautiful, innovative, intuitive technology and design was Apple’s original niche in its heyday. After Jobs returned, he reminded the company of its roots – making technology simple enough for the common person.

After Jobs’ return, Apple created the first iMac, an iconic computer that made consumers start to care about Apple again. Later on, the company would introduce the iPod, iPhone, and iPad.

What do all these products have in common? They are beautiful, innovative, intuitive pieces of consumer technology that are amazingly simple to use. Trying to be everything to everyone almost killed Apple. Streamlining and doubling down on its vision with intensity saved it

THE HEDGEHOG CONCEPT

One of the best illustrations of the benefits of focusing on one thing, rather than trying to do everything is a concept known as the hedgehog concept. This concept was introduced by author Jim Collins in his bestselling book “Good to Great.”

In that book, Collins talks about how certain companies were able to move from being merely “good” companies to being “great.” By good, he means doing well but not phenomenal.

By great, he means phenomenal, outstanding success. According to Collins, the hedgehog concepts is one of the key factors that led to the dramatic transformation of these companies.

Collins drew this concept from a famous essay by Isaiah Berlin titled “The Hedgehog and the Fox.”

The essay itself draws the idea from an ancient Greek parable, so we are talking about an idea that is very old – and you know the older an idea is, the truer it is. Isaiah Berlin divides the world into two types of people: hedgehogs and foxes.

The idea behind the hedgehog concept is quite simple – foxes know a lot of things, but hedgehogs know one big thing.

Every time the fox comes across the hedgehog, he tries to eat him, but every time the fox attacks, the hedgehog simply rolls himself up into a ball and uses his spines to repel the fox.

The fox is a cunning and quick-minded creature. He comes up with a hundred different stratagems, but none of these are any match for the hedgehog’s simple tactic – rolling himself into a ball so he can be protected by his spines.

Jim Collins expands on this idea and relates it to the corporate world. Some companies, like the fox, try to do everything, serve everyone. They may succeed, but only moderately – they are merely good.

Other companies, like the hedgehog, identify the one thing that they can do really well, and put all their focus on this one thing.  These companies succeed too – but they succeed phenomenally. They are not just good, they are great!

The success of the hedgehog companies demonstrates the value of clarifying your purpose as a business. The fox companies, on the other hand, demonstrate the ineffectiveness of a strategy that is inconsistent, scattered, and diffused.

BENEFITS OF FOCUSING ON ONE THING

1. You Can Demand a Higher Price

When you focus on one thing, or one niche, it is a lot easier to become the best at it. Your customers start to look upon you as an expert in your niche.

This comes with the advantage that you can set your own price and customers will keep buying. After all, you are the best they can ever get.

On the other hand, if you are trying to be everything for everyone, you will have to follow the prices set by the market leaders, because you can’t get good enough to charge premium prices.

2. Branding

When you focus on a niche, it instantly makes you a distinct company. For instance, we all know that Apple is a consumer technology company in the information technology sector. When you talk about Apple, everyone knows what to expect.

The same applies to the companies I mentioned earlier, such as KFC and Domino’s. Brand differentiation is key to success and growth, especially when you are starting your business, and this can only happen if your customers know you for only one thing, rather than everything.

3. Less competition

There are many general brands in the business world.

When you try to be everything for everyone, you are competing with all of them. When you narrow down your focus, on the other hand, you also narrow down your competition.

That makes it easier for you to actually position yourself as the best in that one thing.

HOW TO IDENTIFY THE ONE THING TO FOCUS ON

If you want to be successful like the hedgehog, you need to find the one thing that you can do best, and the one thing that matters the most.

The idea is to acquire clarity of the marketplace and what you have to offer. When you try to be everything for everyone, it shows a dire lack of clarity.

Without clarity of purpose, you do not know where to invest most of your time, money, and resources. Instead of injecting your attention and resources on the most profitable areas, you scatter your attention and diffuse your resources among competing interests.

According to Jim Collins, the secret to the success of the hedgehog companies is they started asking the right questions. If you ask yourself these questions, you too can easily identify your proper niche and take your business to the next level.

There are three simple questions that you need to ask yourself. These are:

  1. What am I deeply passionate about?
  2. What can I be the best at in the market?
  3. What drives my economic engine?

Now, we will look at each question separately and what it means.

What Am I Deeply Passionate About?

Don’t underestimate the power of passion in bringing out the best out of you.

When you are passionate about what you do, waking up in the morning is a thrill. You don’t dread Mondays. You become so addicted to your job that you have to force yourself to take vacations and off days.

Why do artists continue working at their craft even when they make peanuts? Why do people continue writing books, even when it is not clear that they will make money? The answer is very simple – passion.

Passion is the fire that fuels our ambitions. When you are passionate about your business, you will be creative and intuitive, because for you it will be do or die.

If you encounter problems, you won’t start looking for an exit strategy. Instead, you will try to find solutions to the problem. Since you can’t imagine quitting, you will have to be creative when any problems crop up.

This is one of the main reasons technology startups are able to attract great personnel. People in tech startups work for very little or no pay, driven by a common objective. Think of the beginnings of most big tech companies, the ones that started in garages, like Apple and Amazon.

Do you know that Amazon started out as a book-selling company? That is what Jeff Bezos was originally passionate about. Today Amazon sells everything.

From those early days, Jeff Bezos knew he wanted to company to one day sell everything, but he also knew the power of starting small. He started with books. Over time, he expanded the hedgehog concept, until he turned Amazon into the behemoth it is today.

The example of Amazon shows us that over time, you can expand your hedgehog concept to include other profitable ventures.

However, for the sake of clarity, you should start small and expand the hedgehog concept from a point of clarity rather than greed. In another of his books (“Great by Choice”), Jim Collins describes this process as “fire bullets, then cannonballs”.

What Can I Be The Best At In The Market?

Passion is great, but are you actually good at what you do? For instance, you could say you love cars, but if you know close to nothing about cars, you will clearly make a terrible car salesman.

To be a great car salesman, you need to know as much as possible about cars. You need to know the names of different models and their years of manufacturing and their features.

You will also need to know about the internal mechanics of a motor vehicle and be conversant with different car maintenance techniques and so on.

Combine all this car knowledge and you are on your way towards being the best car salesman in your area. If you are the best at what you do, you will attract customers, because they can see you know what you are doing. Being knowledgeable and skillful in your niche lends you an air of credibility.

It makes you an expert the customers can rely on. Some will even come to you not to buy per se, but to seek your advice as an authority.

Passion actually flows into this. If you are passionate about what you do, it will be easy to learn everything you can about it. For instance, if you are obsessed with cars, you will easily gobble up as much information as you can find about cars.

Since cars are your addiction, you don’t have to sweat it when acquiring the knowledge. Learning about cars is a fun and enjoyable thing to you. In due time, you become a car expert.

When you are picking your niche, ask yourself in which area do you have a superior level of skill or knowledge? What did you study at college? What are your hobbies and interests?

If not an area where you already possess superior knowledge and skill, find an area where you have the capacity to become very knowledgeable and skilled.

What Drives My Economic Engine?

Last but certainly not least, you need to think about money. After all, you are not in business for fun. What you do must give a good ROI for it to be worth the capital and time investment. There is no need to emulate starving artists who have a) passion and b) skill, but no c) money.

The trick is to have all three. You should focus on something you are passionate about, something that you are highly skillful and knowledgeable in, and finally, something that can make you money.

For your business idea to make money, it must fill a certain gap. By that we mean, it must provide a solution to an existing problem in the marketplace. For instance, if you are selling cars, ensure you locate your shop in an area where people have the capacity to actually buy cars.

Once you have answered the first two questions, you then ask: but do people need it? If they don’t need it, you should either a) drop it, or b) tweak the idea until it becomes something people need or want.

Combine the Three

The one thing you decide to focus on should fall in the shaded area in the middle of the three circles as shown by this diagram:

Three Circles of the Hedgehog Concept. Source: jimcollins.com

If you are not highly skilled or knowledgeable at what you do, you will not capture a large market share. Your competition will be more attractive to the customers.

If you are not passionate about what you do, you will not be creative, innovative, or committed enough. You will easily quit. This is not the kind of mindset that leads to phenomenal growth.

If what you are doing does not solve any problem, if it is not something the market needs or wants, you will not make enough money to sustain your business.

Now, if you find something that combines all these three, you will have stumbled upon your secret sauce. Your chances of becoming wildly successful will rise exponentially if you tick these three boxes.

All you need to do now is to focus on it and become the very best at it, forgetting everything else.

That is how you move your business from being mediocre (or even just good) to being great.

HOW TO EXPAND YOUR HEDGEHOG CONCEPT AS YOU SCALE YOUR BUSINESS

Now, note that a narrow focus works best when you are starting out.

However, if you want your business to grow and gain a larger market share, you are going to have to expand what you are offering the market. Otherwise, you will stay small.

Earlier on, I gave you the example of Jeff Bezos, who started Amazon as a book-selling company. In those days, his biggest competitors were other book sellers like Barnes and Noble. Amazon had an advantage because it was an online bookstore.

Jeff Bezos is well known for his strategic mind. He is a long-term thinker. Even in those early days, Bezos knew he wanted Amazon to be more than an online bookstore. On the other hand, he was aware that he couldn’t start with everything. If he wanted to gain traction in the marketplace, he would have to start small.

That was a stroke of genius on his part. It is what Jim Collins calls the “firing bullets, then cannonballs” concept.  Amazon started by being a force to reckon with in the book selling market. After that, the company introduced other products to its online store, one by one, until it eventually became an Ecommerce giant.

Another example we can give is Apple. It started out as a computer hardware company. Apple made the most beautiful computers in the world. That was what the company was passionate about, they were the best at doing that, and it made them a lot of money.

Later on, the company started to expand its hedgehog concept. The new hedgehog concept became: making the most beautiful consumer technology products in the world. That led to the invention of the iPod, the iPhone, the iPad, iTunes, and the Apple Watch.

If Apple had stuck to selling computers, it would not be what it is today: one of the most valuable companies in the world. Maybe it would have lost steam and gone down.

This is my way of saying that while diversification might be good, it shouldn’t come at the beginning.

What you need when you are starting is clarity. That means, you need to understand who you are and what you have to offer and what the market wants. Once you figure that out, once you master that, you can then start thinking about expanding.

However, even if you decide to expand, you should keep to a certain core focus, rather than trying to be everything.

For instance, when Apple decided to add more products after their success with the Mac, they expand to other consumer products – well within their niche. They did not expand to cars and farm equipment.

WRAPPING UP

The key to achieving success, both in business and in life, lies in knowing what you do best, and then focusing on mastering that and forgetting the rest.

If you try to do everything at once, you will spread yourself thin, and the result is that you won’t be able to achieve any significant results in any of the things you are doing. Therefore, you need to stop trying to be everything to everybody.

This is not to say that you should never expand. However, if you decide to expand, keep it close to your core niche, and follow the same strategy.

Make sure you have mastered the first thing before adding a second, and focus on mastering the second as well as you have mastered the first one before you think of adding a third.

You Can’t Be Everything For Everybody So Stop Trying

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