First take the 5-second NoSpin Poll weekly poll: How focused is your business on what it does best and makes the most profit selling?

BADD: the evil twin of Business Focus

Lack of focus, or what I call Business Attention Deficit Disorder (BADD), is the Achilles heel of most businesses—large and small--that end up NOT making it.

From little start-up technology companies (perhaps with genuinely “cool” and useful stuff) to multi-billion dollar corporations like Vivendi (the one-time water and waste management company that sought foolishly to transmute into an entertainment conglomerate), lack of focus is the crux of their problems and often their death knell. All the water in France won’t save Vivendi from burning down and disintegrating into pieces at this point. And the technology world is littered with tens of thousands of neat “tools, “applications,” and “solutions” that no one ever sat down and figured out 1) a specific, concrete need for “it” 2) how to market and sell the thing at a profit.

Focus—A definition

Webster’s defines “focus” as: “…to fix or settle on one thing; concentrate…

or to direct one’s thoughts or efforts; concentrate.”

The common theme of focusing or concentrating is limiting one’s attention, resources and effort toward one thing. Not fifty-four things. ONE Thing.

BADD remains rampant

Lack of business focus is still rampant even after thousands of dot.com companies melted down and escalating numbers of technology and other companies have show that their “success” (that is, temporary survival) was a complete sham. BADD is:

Trying to do too much, too fast.
Trying to diversify beyond current expertise, competence, and skills.
Trying to expand, way beyond current strengths--without the resources.
Trying to jam a couple companies together without any tangible strategic or financial plan.
Trying to get bigger (usually increasing customers and revenues without a lot of concern about debt or added costs)—hence little concern for profits.
Saying to the marketplace that we do tons more than the business really does (or should be doing)—just to get a next customer.

But we can’t limit ourselves! We can do it all!

Some business executives say, “If we say we only do this, then we’re limiting our potential.” Or they say, “We have no choice but to innovate at the speed of light.” These are the laments of true business fools. Not focusing—although very seductive and soothing to some corporate egos—is the perfect recipe for failure. Here’s what else the fools who don’t make it (other than unethically, for a time) say:

“Sure we can do that (anything you want).”
“Ya gotta think big and shoot for the moon—or you’ll never get anywhere.”
“We aren’t going to put all our eggs in one basket.”
“The “solution” we’re offering is infinite customization—just tell us what you want.”
“Growth is all we need now, not profits. We’ll figure that out later.”
The synergies are obvious; we’ll figure out how to make it work (financially, operationally, culturally, etc) later.”

“BADD” starts at the top

BADD always starts with the top folks (also see the Debunker: “Drinking the Corporate Kool-Aid”) and then becomes contagious across the company. But a high percentage of these executives can’t really even tell you about the crux of their business, what they do (well), AND how they make money (profit, that is). Whereas they typically adore flitting from deal to deal, these deals often produce nothing of intrinsic value—or even worse, deflect the business from focusing on what it does best. BADD executives are always busy but lack focus, and hence, so do their respective businesses.

Many bankers, VC’s, and other investment types have fostered (virtually required) unfocused BADD business practices over the past several years. They’ve demanded business plans that show outrageously huge, potential market caps and phenomenal growth curves--and could have cared less about ongoing, lasting profitable business successes. But their game of guaranteed fees and quick exits (for their firms and a few top executives) is grinding to a halt.

It’s no longer possible to condone such BADD foolishness, though, especially in this day and age of a depressed stock market market, breakdown in corporate ethics, and the general poor financial performance of technology companies, in particular. I wish that I could discover the pill (maybe another use for Prozac?) that immediately improved executive-level attention deficit disorder. It would be more lucrative than hundreds of thousands of stock options in the old days of Enron or Global Crossings.

Why BADD companies fail

BADD companies are in (or say they are in) too many products and services, or too many unrelated types of products or services, or too many vertical markets or too many geographic markets. BADD executives really delude themselves (and fool others) that they can make anything happen in their own “space.” What does happen, though, is one or more of the following:

No customer growth because nothing tangible ever gets out the door and/or no one out there believes the pitch.
Customer and revenue growth, but without profits.
Customer growth without ability to deliver (and hence the creation of unhappy customers)
Markets that don’t understand what the company does or the value that it provides and/or just don’t believe it.
Mass internal confusion, turmoil, and turnover (and then layoffs).

Some BADD companies can hang on for quite some time, but the downward spiral is inevitable.

FOCUSING your organization

“Concentrating” or “focusing” in a business sense does NOT literally mean concentrating or focusing on a single miniscule product; nor clinging to one “winner” forever; nor not revamping an already successful (profitable) product/service to make it even better; nor marketing it the same way it’s always been done. It does mean honing in on a relatively narrow product/service/market set where the company has best chance of making a profit into the foreseeable future. Focus and avoid becoming a BADD company by doing the following:

Learn to say NO when appropriate: No, we don’t do that at this point. We do this. No, we aren’t ever going to do that. Others do that already. These are the tough decisions the enable you to grow your business a step at a time.

Dare to assess how much time and effort you devote to what your business is really good at and where you make the most money/have the most short term upside.

Significantly narrow your business focus for the next 6 months. Yup, it can be painful to admit you can’t do it all. In parallel, narrow your marketing messages and make them match your products and services (very unusual but very differentiating).

Then invest 75% or more of your business aggregate time, resources and energies in that key thing that you do best and generates the most profits.

Tell the truth and the good stories about your business to your customers and markets. In appealing to all types of markets that you do virtually anything, your messages usually become mush, you lose credibility, you lose attention (despite any level of marketing funding)—you create your own marketing and sales nightmare. All things to all people is not a position. It is a death sentence.

Grow organically for the foreseeable future. Sure there are business cases to consider to purchase highly complementary or directly competitive businesses, but those are the exceptions versus the rules. Try it the old fashioned way for a while.

Execute, execute, execute. This is the bane of BADD executives—who would rather go after that next windmill, do that next deal, and look busy--versus executing, which is a lot harder work.

Have a sense of urgency but don’t hurry your business. It always takes longer than you think it will (and especially in some industries like healthcare).

And remember, it’s virtually impossible to focus too much on what you do well and what creates profits for your business.

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Tom Ranseen NoSpin Marketing 615.383.7157