Focused leadership demands a solid target
When leading a business, focusing on a single corporate competency is often far more useful than stretching the organization too thin and ending up with a wide variety of weak offerings. As the Forbes Coaches Council recently emphasized, embracing this laser-focused approach requires picking which objective to go after. (Nov. 20, Gulledge)
The most difficult element of choosing a business's main objective may involve cutting off other, seemingly productive, priorities. Sometimes, a particular arm of a company is turning a profit, and it can be hard for leaders to give up on it. However, the potential disruption of those extra offerings could do serious harm to the organization's ability to remain profitable.
This strategy has been employed to great effect at companies such as Procter & Gamble, which spent years divesting product lines that are wildly successful on their own merits but don't fit in with P&G's main strategic thrust. Despite selling off marquee brands such as Folgers, the parent company has seen its own valuation increase.
In addition to giving up on products, companies may also benefit from limiting their geographic scope. Sometimes, opening up a new regional market is a chance for an organization to reach an exciting new clientele. Other times, it's a distraction. Knowing which situation fits which category is a key leadership competency.
Subscribe to Return on Leadership to receive a bi-weekly round-up of the most provocative and important news and insights from leading business thinkers focused on the issues driving current-day strategy and board governance.