In the Focus phase of the cycle of business, companies concentrate on building their core business to its full potential. They expand their markets, cut costs, improve operations, and develop innovations in their core products.
Having a clear sense of business boundaries and of the definition of your core is a critical starting point for growth strategy. And identifying the core of your business is the first step in determining how to grow. In order to do that, you must identify your key assets.
The book Profit from the Core argues that most growth strategies fail to deliver value - or even destroy it - primarily because they wrongly diversify from the core business. The authors contend that this timeless strategic precept - building market power in a well-defined core - remains the key source of competitive advantage and the most viable platform for successful expansion.
The book identifies and explains three key factors that differentiate growth strategies that succeed from those that fail:
- Reaching full potential in the core business
- Expanding into logical adjacent businesses surrounding that core
- Preemptively redefining the core business in response to market turbulence