Essential for any organization to posses is extreme clarity regrading what business they’re in. The answer to this goes beyond what they actually do and instead reaches into the heart of both the breadth and depth of the purpose of the organization.
By having a clear definition of what business you are in, then all aspects of the business – from products and services offered to employee motivation – obtain clarity. In the end, clarity in all these factors will lead to improvement of the bottom line.
In this article we will explore the various benefits any business can enjoy from having a clear definition of what business they are in.
The House of Mouse
One organization with a clear definition of what business they are in is Disney. Not narrowly defined to only amusement and theme parks, Disney shaped themselves to be in the business of family entertainment. Through this broad definition the organization takes advantage of business opportunities such as: Disney cruises, Disney movies, Disney destination resorts, and Disney music and television.
The opposite to this can also be true. Having too broad of a definition waters down what you stand for in business, thereby hurting your profits. A case in point is Sears. Once known for its Kenmore appliances and Craftsman tools, today consumers don’t know what business Sears reflects. In fact, in an effort to expand their offerings, Sears recently even tried to offer Rolex watches on their online store. The response overwhelmingly turned negative, with many consumers wondering if the Rolex watches were fakes.
Where are you going and what will success look like?
Having the clear definition of what business you’re in helps you and your staff see where the business is moving towards and avoids distractions that can erode your market dominance.
This also translates into tremendous motivation for your present and future employees. Your employees more effectively convey the core principles of the organization and have certainty in the way they conduct themselves while representing the company. Furthermore, new prospective employees will either be drawn to or repelled by this level of business clarity. This saves the organization time and money in hiring the wrong employees.
One organization that embraced this concept fully is Zappos. At Zappos, when an employee starts, they go through an intensive introduction to what the business is all about and what they expect from each employee. At the end of the orientation each new hire fully knows what the company strives to achieve and how the company measures success.
Once the initial orientation concludes, each new hire is offered the chance to either take $2000 and quit or accept the new position and continue with their training. By investing at the beginning, and inculcating their principles and expectations with each new employee, Zappos is able to provide one of the industry’s best customer service experiences. This catapults their profits and market dominance. The level of intensity and clarity can only be achieved by having a clear understanding of what business they are in.
Marketing strategies and their implementation become tremendously easier to implement once this basic premise of the organization is fully realized. All aspects of the company align towards a common goal. Without this common viewpoint in an organization, marketing initiatives fall flat due to a disconnect between marketing and the belief of frontline employees. Sadly, this results in a waste of money and eventually leads to market erosion.
Without a doubt, having a clear definition of what business you’re in can make a tremendous difference to the success of a company and to its profitability.
Concepts like this are but one of the many profitable and actionable ideas that you can benefit from at a Bay Area Mastermind Meeting. Each month, Members of Bay Area Mastermind get together to explore how to take their businesses to the next level by incorporating the latest strategies and techniques in business. You are invited to Test Drive a Bay Area Mastermind today by clicking on the link in this post on on the box to the right of the page. See you there.