Over time, many companies lose their way. They reach a point where they no longer know who they are, where they are going, or why. They start out to do one thing, but then they gradually migrate into something else. And most of them do so for all the wrong the reasons.
Some organizations do this by deliberately leaving behind their original products. Time’s online magazine has cited companies such as Xerox, Nokia, and Apple as examples. Other companies deliberately pursue a new path, but realizing their mistake, retreat back into familiar territory.
Several years ago, The New York Times reported that Agilent Technologies had sold its semiconductor arm so that it could focus all of its resources on making “electronic testing and measurement equipment” – its core business.
You can probably think of others, too. But the real question is, what about the rest?
Why do companies lose their way at all? How is it possible for them to forget who they are, or where they should go?
It really comes down to just one thing: core business. That means that for companies to be themselves, they have to know who they are.
The flip side, of course, is that they have to stop trying to be someone else. It’s worth remembering that your core business is different from that of any other company. If you lose sight of that, then you’ll forget who you really are.
Entrepreneurs have a knack for spotting gaps in the market. That’s why companies are started in the first place. But that doesn’t mean that any one of those enterprising individuals or their companies should attempt to exploit all of those opportunities.
Yet, many companies, over the past 50-60 years have been enticed by the prospect of getting into unfamiliar markets simply because they could. They had the industrial capacity, but very little knowledge about competing in those markets.
Do remember when you were taught how to play baseball? What was the one thing you were told over and over? It was to “keep your eye on the ball!”
Why were we told to do that? Because the tendency was to focus on the place where you wanted the ball to go. And what happened when you did that? You struck out.
Your core business was to hit the ball; and you couldn’t do that unless you kept your eye on it.
The same thing is true here. You need to focus on your core business rather than where you think your company could go.
Lest you have any doubts, core business is what your customers pay you for right now. Of course, that doesn’t mean that you give up on all R & D, for example. But it does mean that you remain focused on its purpose.
You understand your core business better than anyone else, and if you devote yourself to it, then you are more likely to experience the greatest success.
Companies that lose their way, however, do so because they ask the wrong question. They ask, “What markets could we develop?”. The right question is, “What markets complement our core business?”
The key to growth lies in developing those markets that are most closely related to your identity.
So what should you do next?
Put this sign on your desk, on the wall in your boardroom, and at the top of your mission statement: Keep your eye on the ball!
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