The other day I met with two CEOs whom I know, each leaders of emerging technology companies. They are both exciting entrepreneurs, but they each had different stories to tell about their businesses.

One company was growing profitably, even against the headwinds of the economy; the other was struggling, despite extensive sales and marketing activity.

Why the difference? The growing company has a narrow focus.

The successful company has figured out their strategic focus and is clearly trying to be one thing for one customer segment, after many years of trying to be all things to all customers in their changing market. They have already made the hard choices and are laser focused on telling one compelling story to their narrow target market. This CEO can explain their strategy clearly in one sentence. Now they are growing again.

The floundering company is still trying to create various products for multiple customer groups – and not winning in any segment. This little company has separate solutions for business professionals, small businesses and very large businesses. They spend a lot of time and money to reach these different customers because their story isn’t clear and they have to promote in different ways for each market. This CEO can’t clearly explain why his product is different than the competition and what their mission is as a company. Their employees are confused and their investors are frustrated.

Why doesn’t the struggling company simply redefine its strategy to focus on the battles which they can win?

It’s because they don’t want to give up any potential business that they might sell now or hope to sell in the future.

Of course, it’s hard to decide to narrow your focus as a company: hard on the ego, hard on short-term sales, hard on the customers you leave behind. But it quickly makes your business easier to run: easier to communicate to the market, easier to execute, easier to please your customers, and easier to grow in the long run.

“Narrow your focus to create growth” seems unintuitive to aggressive, sales-oriented entrepreneurs. But for small, cash-starved companies, you don’t really have a choice – you have to focus on only fighting the battles you can win.

“Man who chases two rabbits catches none.” (Confucius)

Are you chasing multiple rabbits in your business?

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Want an example of lack of focus?  See what happened when Dell chased too many rabbits.

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