What Business Are You In?

Where does a discussion begin from a strategic standpoint?  Similar to the old illustration of the man who climbed the ladder of "success" only to realize that the ladder was leaning against the wrong wall...launching a discussion about strategy without first clarifying what business you're in can lead to some disastrous consequences.

Couple observations: First, even if you're a non-profit you're in a business.  You may not think of it that way, but if you're working on developing a winning strategy you've got to start with agreement on what business you're in.  Second, there are some organizations that already have a crystal clear understanding of their business.  I've found that those organizations are in the distinct minority.  How can you tell if your organization has clarity on this question?  For starters, you'll have fewer times when you get to the top of the wall, look around, and say, "Dohhhhhhhhhhh!"

Need a little bit on how to think about what business you're in?  It's not always the first thing that pops into your mind.  One of my favorites is Domino's Pizza acknowledging that they're not in the pizza business.  They're in the delivery business.  30 minutes or less.  How about Target?  They staked their claim on low price but with a designer's edge.  They're different than Walmart.  Can you see it?  What about Apple?  Think they're in the computer business.  Or the digital music business?  Or the phone business?  They're not even really in the tech business.  What business are they in?  How about the cool business?

Back to you.  Do you know what business you're in?  Can't do the strategy thing without knowing.  Doesn't go where you want to go.

Comments

[Michael Wagner]

Love this question!

We play it periodically as a game here.

And we insist on it as part of our work with clients.

We once asked a regional jewelry company what business they were in.

They're first answer - the diamond business.

Not an uncommon answer - we usually think we are about "the mousetrap".

Their ultimate answer - "the female memory making business".

Keep creating...strategic meaning,
Mike