| The surgeon operates only one patient at a time. | | | | concentrate one's forces and anticipate correctly the |
| Similarly, a sick company needs to concentrate on its | | | | movement of the enemy in order to capture him." |
| core competence. | | | | To compete in the global market, it is important to |
| During the turnaround phase when the company is on | | | | narrow your focus to a specific segment, Olivetti has |
| the brink of bankruptcy, there are time and resource | | | | lost its competitiveness as its product lines proliferate |
| constraints. The company needs to concentrate all its | | | | from typewriters to computers. When the market is |
| resources on doing a few major things right. | | | | 58 million people in Italy, a broad line is all right. But |
| You should have a laser-sharp focus just as a | | | | when Olivetti went global it could not compete. |
| surgeon focuses on only one operative field during | | | | Hyundai, S Korea a major conglomerate also lost |
| surgery. If you are a patient, you will not allow your | | | | focus in the quest for expansion. It is involved in all |
| surgeon to operate on you and another patient | | | | kinds of businesses ranging from chemicals, |
| simultaneously. | | | | ship-building, engineering, automotive, pharmaceutical, |
| Similarly, an ailing company needs to concentrate only | | | | etc. As a result it confuses the minds of the |
| on its core competence and try to rid itself of | | | | customers. When the financial crisis hit S Korea in |
| activities that do not help the bottom-line targets as | | | | 1997, Hyundai was one of the first chaebols to fall |
| well as those that do not immediately improve its | | | | apart. Marketing will need to be focusing on specific |
| cash flow. Under such critical circumstances, you can | | | | niches for the riches are usually found in niches. |
| even succeed at far lower cost by ensuring that you | | | | The soft drink giant Coca-Cola tried to venture into |
| do a better job with the businesses and skills you | | | | the bottled water market in Europe with the launch |
| already have. | | | | of 'pure'water Dasani. News broke out that the |
| In order to release resources for its core business, | | | | Coca-Cola's treated tap water contains |
| the ailing company has to divest any unprofitable or | | | | cancer-causing chemical and it had to withdraw the |
| non-related businesses. Quite often, in their bid to | | | | Dasani from the market, creating a lot of bad taste. |
| bolster sales performance, troubled companies clinch | | | | Although Coke drinks and 'pure' water are in the soft |
| lots of sales contracts with thin profit margin. This | | | | drinks category, the technology and know-how can |
| tantamount to buying sales and they often turned | | | | be quite different. Coca-Cola should have stayed with |
| into subsequent financial losses. Such a scenario is | | | | the 'real thing', its core competence. |
| equivalent to having a lot of sizzle but no steak. | | | | Remember to have laser sharp focus. The laser is |
| It is better to amputate all loss-making ventures and | | | | actually a weak source of energy. A laser takes a |
| unprofitable sales whenever possible. According to | | | | few watts of energy and focuses them in a |
| the standard surgical procedure if there is pus, get it | | | | coherent stream of light. A few watts of energy are |
| removed. | | | | not useful. However, laser is able to drill through |
| In fact, the famous Chinese military strategist Sun | | | | diamond, the hardest rock and eradicate cancer cells |
| Tzu believed in the principle of concentration in | | | | as well for lasik treatment. Similarly, companies with |
| fighting a war. He said: "The strength of an army | | | | laser sharp focus can dominate a market. When a |
| does not depend on large forces. Do not advance | | | | company is not focused, its limited energy gets |
| relying on sheer numbers. Rather, one must | | | | dissipated over too many products or markets. |