This is one of my favorite business stories of all time:
“Semiconductor giant Intel was originally a memory chip manufacturer. But by 1985, memory chips had been losing them money for years. Co-founders Andy Grove (CEO) and Gordon Moore met to discuss the problem. The mood was grim.
At one point, Andy turned to Gordon and asked, “If we get kicked out and the board brings in a new CEO, what do you think he would do?”
Gordon replied without hesitation. “He would get us out of the memory business.” “Okay,” said Andy. “Then why shouldn’t you and I walk out the door, come back, and do it ourselves?”
That year, Andy and Gordon shifted the focus of the company to microprocessors, and created one of the greatest success stories in American business.”
I recently read a similar story about the Milwaukee Brewing Company. After sixty years of successful business, prohibition came along and almost killed everything–all that hard work down the drain.
However, instead of throwing up their arms and saying “Well it’s the booze-apocalypse!” they shifted their focus. They started producing and selling everything from malted milk, malt syrups, candies and non-alcoholic beers.
We’re all facing some sort of crazy disruption in our respective industries and it will only continue.
Every day I read a new article in the NY Times or WSJ about another retailer suffering from the “retail-apocalypse.” I’ve had numerous clients tell me they’re struggling to compete with ever-increasing price pressures from overseas companies who can produce sub-par products at a fraction of the cost.
These are valid concerns – they’re things that you have to figure out how to solve. But if the whole of your focus is on these things, then you’re going to end up with the right solution to the wrong problem.
Because let’s face it–sustained value doesn’t come from solving your day to day challenges. It doesn’t come from squeezing out an extra tiny fraction of profit or savings from your clients or suppliers. Instead, it comes from consistently being able to recognize the key strategic advantages your company has, the key value you bring to your clients … and if necessary, to reorganize your company to deliver on those.
The questions that Andy asked in the story above are incredibly powerful. We’ve talked a lot about reframing in many contexts, and this is an amazing reframe.
In essence, it’s saying “Let’s forget about all the details that are bothering us right now. Let’s forget about the day to day headaches. What is the real value of our company? What is the opportunity that somebody else could take advantage of if they walked in and got to create a new strategic plan?”
Your Challenge For This Week:
It’s easy to get bogged down with the minutiae. Drowning in the day-to-day is easy.
It’s often worthwhile to step back and ask the Grove question:
“What’s the core value here?
What is the highest and best use of the assets we have, whether that’s our history, our internal knowledge, our people, our culture, etc?
If smart, focused, driven people were handed the keys to our company, what would they do with it?”
Take a minute and write down your answers to these questions. If you want bonus points, send your responses to me, and I’ll give you my feedback.