Google’s big announcement this week stunned some and was not a surprise to others. The crux of the announcement was focus and from my perspective, they made the right move.
The more success a company has, the more options it creates for itself. And the entrepreneurial founders usually have lots of ideas that can take the focus away from the golden egg that led to their success. In my book, I call it “bright shiny star syndrome” and every entrepreneur has suffered from it at one point or another. The interesting thing about Google is that with their phenomenal success, the options to try new things are immense. So rather than jeopardize the core money making business, they will spin off all the bright shiny stars into separate entities with a parent, Alphabet, over all the companies. This will create focus.
Doing one thing well and knowing what that is. Describing it in a way that people understand and value. If you look at the successful companies, both large and small you will see this. It doesn’t mean they only have one product, it means they have one area of focus. Google rightly separated search engines from self-driving cars and glasses, they are completely different stars.
Some companies address the issue of focus with different divisions, but still operate as one company and often this results in territorial behavior and fiefdoms within that company, ultimately dragging down performance. Focusing the way Google/Alphabet just did, will actually create separate companies that are held by the same visionary founders, but don’t actually operate together.
For entrepreneurs, this is really the key to success. Focusing on the one core product or service that they do significantly better or uniquely than anyone else. There is so much competition out there that if a small entrepreneur starts up in very crowded waters – or a red ocean (from Blue Ocean Strategy) – they are likely to go down and be one of the 9 start-up companies that fail out of 10. Focus doesn’t ensure success, but it gives the entrepreneur a fighting chance.
Maybe it’s time to take stock in your business and see what you are focusing on. What areas of business are completely unrelated to your core products or services? What is one area you can identify, that if you focused on it, would make the most difference to your success?
When I became an owner of my first company, I had to do a turnaround as the business was in serious financial trouble. The only thing I could think of was to shed two lines of business and go back to what grew the business to what it was in the first place. This ended up being a good strategy and I became an owner as a result. Although my strategy was accidental, I definitely learned from it and have used it ever since. Regardless of the amount of resources a company has, big or small, focus is always a winning strategy for success and for the shareholders.