Why Is Concentrating On Your Core Business So Important?

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Current studies show most businesses fall short of their growth objectives by a wide margin. Failure rates are as high as eighty percent. Why is attaining your expansion goals so difficult?

No matter what growth strategy you choose, your company’s infrastructure must be able to support its successful execution. Devising the strategy and implementing it are two very different things. The solution lies in focusing on your company’s core business.

Your core business is defined as the products, services, customers, distribution channels and geographic areas that yield the largest return on your investment (ROI). It is mission critical that systems be put in place to measure the overall performance of each segment of your core business. Peter Drucker, the world renowned business consultant, said “you cannot grow what you cannot measure.”

The best place to start the assessment of your core business performance is with the following five questions:

Who are our core customers?

What is our firm’s main competitive advantage and how can it be strengthened?

What are the most attractive growth opportunities given our core business? What performance measurements should we use?

In what direction are key performance indicators going and why?

The answers to the above questions must include input from your employees, customers, senior management and external stakeholders such as vendors and strategic partners. Be sure to include both loyal and not- so-loyal customers in your research. For more information on performance management techniques, see the article in the Harvard Business Review titled “Reinventing Performance Management

The probability of fulfilling your growth objectives is significantly increased when your organization has a clear and well defined growth strategy combined with a strong execution infrastructure. One without the other can be devastating as illustrated in the Pacific Crest Group (PCG) case study “Creating a Strategy That Smoothes the Path for Growth.

Pacific Crest Group provides professional services that keep your business focused on your critical objectives. We create custom made financial and HR systems based on creative strategies that are always delivered with exemplary customer service. A PCG professional is happy to meet with you to discuss solutions for your unique requirements to maximize all of your business opportunities.