Monday, October 3, 2011

What You Do NOT Do Is More Important Than What You Do DO

The most difficult decisions you will ever make are the ones where you decide NOT to go ahead. We live in a world full of constraints – there are only 24 hours in a day, the bank is only willing to give you 50% of requested loan, you can only hire 5 employees. The list goes on and on. Given that there is only so much you can do with the limited amount of resources it is imperative that you pick your battles wisely. Decide to fight all the battles and soon you will run out of ammunition.

The companies that are successful today are the ones that decided not to pursue every opportunity. Instead they narrowed their focus on the few and executed with a laser like focus. The most valuable company in the U.S. by market cap – Apple – is famous for focusing on few products and devoting all the resources to make them best of the best. Look at the history of products they have introduced over the years – iPod, iPhone, iPad. All of them rule their category by wiping out their competitors.

Now contrast this with an auto company – GM – that went into deep trouble not too long ago. Before they filed for bankruptcy they had 7 different brands, each with multiple models. You and they too, would be hard press to answer what each brand stood for. Each would compete internally for limited resources, resulting in mediocre performance by each brand. No wonder they suffered such a fate!

The benefits you can achieve from saying NO are numerous. Undertaking few tasks means you will do them well. You can devote more resources to few, selected projects resulting in superior outcome. Again, look at iPhone, iPad or any number of Apple products! You will also have more time available since you will not be stretch too thin on number of different items. Finally, the price you can charge for superior items will be higher than your competitors resulting in better return on your investment.

To make the best use of limited resources you have to learn to say NO at number of decision points. The decisions could apply to the products you want to develop or sell, types of customers you decide to pursue, activities you decide to do in your personal time or even blogs you decide to read (we hope you decide to read this one as opposed to others!) Every step of the way you will need to narrow your selection based on the constraints you have in terms of limited resources.

So, before you decide to take on yet another project, take a step back, breathe deeply and figure out whether it is the right thing to do given limited resources you have. In the next post we will provide you tips on how to go about making the decisions.

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