Does anyone else agree that many organizations need a dose of back-to-basics common sense?

More and more organization seems to be breaking basic, common sense rules about being effective. The principal that stands out to me right now is the idea that it makes sense to focus. Everyone seems to agree, intellectually, that it is a good idea for an organization to focus. That way, employees are aligned. They are working towards the same goals. They don’t work at cross-purposes. Most importantly, customers know what the organization stands for and experience consistency in service and quality.

Unfortunately, I’m seeing more and more organizations that just won’t focus. Even though this seems to go against every grain of common sense, intuition, and research I’ve done, the leaders of these organizations are sure they are right to run around in multiple different directions. Often they don’t even see that their organizations lack focus at all.

First, let me give you two examples of organizations that do seem to understand the value of strategic focus, just as a refresher to any CEOs reading this article who need to be reminded.

A great example, from my own home town of Sarasota, Florida, is Tervis. This company has thrived in recent years by specializing in being the best at manufacturing one thing: insulated cups. You might have a Tervis tumbler in your home; if you drink from a clear, hard-plastic cup that has a logo from your favorite sports team, then you have purchased from Tervis. The company not only produce a high quality product backed by a lifetime guarantee, they are also great at licensing well-respected logos -- especially of professional and college sports teams, but also of creative works like Disney characters – so that their cups are more appealing to consumers.

The former CFO of Tervis shared with me that at one point they diversified into manufacturing insulated coolers. This step made a lot of strategic sense, because the technology for insulation is one of the company’s core strengths. However, even though the new line was profitable, they discontinued it. It took up too many resources from their core business of insulated cups. They used the common sense principles of focus and opportunity cost to double down on what they really did best.

Recently Google applied the same common sense to their business. They split the company into specific business lines under the Alphabet umbrella. This has allowed the core online advertising business to continue its growth and add even more value to customers and shareholders, while other top leaders at Google run other businesses without distracting from the core. Without the split into different business units, Google’s core advertising business would have faced distractions.

In contrast to the above two cases, I see many examples of organizations that are not following this fundamental principal of focusing on what they do best. As a result, it is harder to get things done. Employees are confused and frustrated; in one company that is missing its goals, they are even turning on each other. Worst of all, they are losing business because customers can’t count on them for consistent service and quality.

What’s most interesting to me as an outsider is that leadership doesn’t see the problem. They think that their companies can do lots of things well. To them, strategic focus is not the issue. Rather, the root cause of their woes according to them is about having the wrong people on board (except for them), lack of a clear message (paradox alert: a clear message is not possible when your company lacks focus), and lack of general accountability.

For instance, I recently worked with a healthcare system that was simultaneously trying to be consistent in providing quality care, a national innovator in developing protocols for best practices in patient care, and an insurance company that could cover lives across at least one state. Meanwhile, employees from the executive team down to the front line felt pulled in multiple directions. They could’t clearly or authentically talk about where the organization was heading. Here is the real tragedy: If you walked into a sample of patient rooms, you would see cracks in ceiling panels, dirty floors, and equipment in need of updating. The patient census remains consistently low – too low to fund innovation or the insurance initiative. Medical error rates remain relatively high, and staff productivity is low compared to benchmarks. Finally, by running around in multiple directions, the CEO and a few other top executives are burning out. Why can’t this organization first focus on the basics, like having clean patient rooms and consistently good patient care?

Similarly, a technology client consists of eight (8) autonomous companies that merged together to create one publicly traded entity. The stated strategy of the company is to be a top innovator, provide great customer service, and dominate their industry. In reality, service is inconsistent because each of the autonomous companies is too different. Despite promises to investors, these business units as a whole leave a puzzle that is many pieces short of completion.  As a result, the company is losing out to smaller niche players that serve customers better. Innovation is not happening at all, because the current executive team has more operational talent and not as much comfort with true innovation. If innovation is going to happen at all, it will be through acquisitions – and investors are running out of patience to continue to fund acquisitions that are integrated poorly. As the company struggles to meet its revenue and earnings goals, top executives are pointing fingers at each other and trust is at an all time low.

Finally, look at the US Federal Government, an example so out-of-whack when it comes to hubris and lack of focus that mentioning it in an article about strategy is almost required. For years the US government has been getting bigger and bigger, yet services do not improve and citizens on all ends of the political spectrum are frustrated. Outside the three branches named in the Constitution, the government simultaneously runs a mind boggling number of programs and initiatives – all at a huge deficit: military, border security, healthcare insurance, retirement benefits, disability insurance, taxation and collections, welfare, education, funding the arts, funding scientific research, oversight of national parks and forests, overseeing drug development, overseeing the federal funds rate and banking, and probably many more. Within many of these there are overlapping and redundant programs; programs within programs competing with programs. How is this sustainable or possible? Why would it be a surprise that no one is satisfied and nothing much productive gets done?

Leadership experts point to the importance of having communication skills, emotional intelligence, influence skills, and on and on. I agree. However, those skills emerge much more easily and authentically when a company is clear about its purpose and focuses on doing one thing really well. This makes it much easier to recruit and keep the right people; for instance, a company specializing in innovation needs to hire different people than a company specializing in consistent operations. It makes it easier to set goals and for people to come together and get their work done to achieve those goals. Leadership is much easier when common sense business principles, like strategic focus, are in place.

I wish we would see more leaders focus the way that Tervis Tumbler and Google have done. It takes leaders who are content identifying the company’s core strength and building on it to continue being the best. It takes discipline. It also takes humility, in a way, because it requires leaders to realize that they can’t do everything – or even many things – well. Unfortunately, too many leaders are overconfident about their own and their organization’s ability to do lots of things at once, and this leads to costly friction and frustrations.