A Fox was boasting to a Cat of its clever devices for escaping its enemies. “I have a whole bag of tricks,” he said, “which contains a hundred ways of escaping my enemies.”
“I have only one,” said the Cat; “but I can generally manage with that.” Just at that moment they heard the cry of a pack of hounds coming towards them, and the Cat immediately scampered up a tree and hid herself in the boughs. “This is my plan,” said the Cat. “What are you going to do?” The Fox thought first of one way, then of another, and while he was debating the hounds came nearer and nearer, and at last the Fox in his confusion was caught up by the hounds and soon killed by the huntsmen. The cat, who had been looking on, said: “Better one safe way than a hundred on which you cannot rely on.”
Last Sunday’s big game was another example of what I am talking about. The biggest play of Super Bowl XLIX was the Seahawks’ pass play on 2nd-and-goal from the New England 1-yard line with 26 seconds remaining in the fourth quarter. Russell Wilson’s pass to Ricardo Lockette was intercepted by the Patriots’ Malcom Butler. Instead of handing the ball to Marshawn Lynch (the best running back in all of football) they tried to out-smart New England and in the end out-smarted themselves.
How does this relate to business in Tama County? We need to be focused on what we are best at doing. A business should understand its key strength and work on strategies to beef it up. Often, we are tempted by the success of others and enter into unfamiliar markets or employ new strategies. The cost of new equipment, re-training of staff, and marketing efforts usually do not yield profitable results.
To make matters worse, the resources, capital, and manpower of the company may be redirected from the core business into this new venture. In so doing, the profit from the core business is eroded while the new venture faces an uphill task breaking into a new market. There are of course companies that have very diversified portfolio, although more often than not, they maintain a core competence which
accounts for a bulk of their returns.
We have seen several examples: Domino’s selling fried chicken wings, Kentucky Fried Chicken trying to sell burgers, and most recently, Coca Cola announcing that it will be selling coffee. Coca Cola has been in the soft drinks business for so long that their name is synonymous with that fizzy carbonated cola drink. If you want to have a coffee, would you think of Starbucks or Coca Cola? It is still early days to know whether they will succeed although surely they have the financial might to aggressively promote any new product. Generally, the proven strategy that has worked for you is the one that you should continue to use.
I know we don’t have any KFC’s or Coca Cola’s here in Tama County, but we can learn the lesson from the Fox and the Seahawks – understand our key strengths and work on ways to become even better.