“We Aren’t In That Business. Let’s Stay On-Course”

We’ve probably all heard stories of a company who went out of business by defining their business too narrowly, then being replaced by a superior substitute.  The leaders of these companies thought they were doing the right thing by focusing the company on “its business”. The problem was they were focusing inward.

A Sad, Hopefully Instructive, Tale 

Before “desktop publishing” became a thing in the late 1980s/early 90s, professional documents were output on printing machines which could only produce one typeface in one size.  Back then, headlines, section headers, and the like were produced as follows:

1. Print the document out with a blank space where header text was supposed to go.
2. Print the header text on a separate machine, made by a company called Kroy.  It printed in black on clear tape.  Imagine printing on a piece of Scotch? transparent tape, and you’ve got the picture.
3. Carefully position the printed tape in the open spot you left on your document. And seal the edges of the tape down to the page tightly.
4. Photocopy the page.  The tape outline disappears, and you got a truly professional looking (for back then) document. 

Kroy machines were sold in every office equipment and supply store. Kroy owned “the way to achieve presentation-quality documents” and dominated space in a large retail channel.

Then, according to company lore, in the late 1980s, two entrepreneurs came to Kroy with a new setup that they said would revolutionize the presentation industry. They wanted Kroy’s dominant position in the retail channel to transition the industry: from daisy wheel printers and Kroy machines, to Apple Macintosh computers and LaserWriter printers.  Kroy’s CEO made the “disciplined” decision to keep his company focused on its business:  machines that printed on tape. Yep. He told Steve Jobs and Bill Wozniak to pound sand.

He made the same mistake a few short years later when another startup asked them to use their channel dominance to distribute laser printers with a new page description computer language that could integrate all kinds of graphics…Adobe’s .pdf format.

The CEO defined the company's business by its current products -- inward focus -- not the customer outcome its products delivered (an outward focus).

Company Focus vs. Value Focus.

Sadly, this story repeats all the time.  You probably know one from your own industry.  Every business school and consulting firm extolls the value of “staying in your lane”, “stick to your knitting”, “discipline”, "staying on course" and/or “knowing when to say no”.  The idea is great, but companies apply in incorrectly.

Most companies focus inward.  Dashboards are dominated by internal activities, efficiency, and inwardly-focused metrics. Even sales forces focus on their products’ features and benefits.  Corporate overview decks inflict “death by powerpoint”.  Marketing is also feature/benefit focused.  And these are the customer-facing roles! Little wonder then, that companies mistake “what they do” for their value. They become so engrossed in their dashboards that they lose sight of what's truly important.

Value-focused companies are different. In "Radical Value", I talk about a value-focused culture: a culture where everyone in the organization:

1. Has a view of customer value (not just some watered down "voice of the customer survey"). Value deals with customer/client outcomes, not features, benefits, processes, internal customers, job descriptions, etc.
2. Knows how their job contributes to customer value, and
3. Is driven by the culture to continuously add more, new, and different value to the customer's world.    It means living in the customer’s world and trying to improve it.

Everyone, including leaders, is focused outward: toward the outcomes they help a customer achieve.

The Instruction from the Instructive Tale

What might have happened differently if Kroy didn’t think of their business inwardly, as “labeling and lettering machines”? What if they had thought in terms of customer outcomes, like “expression”, "communication" or even “printed communication”?  They wouldn't be a tiny shadow of their former self. If every leader focused on customer outcomes, we might never have heard of Clayton Christiansen.  

My practice wouldn’t exist either. Fixing your company's failing is my company's competitive differentiation. Contact me if I can help you focus your company – including your customer-facing roles – on customers, their world, and the outcomes you help them achieve.

To your success!