Revisiting Your Business Concentration

I woke up this morning and went straight into the bathroom. I turn on the tap and as I washed my face, I was intrigued by one of the natures of water – its ability to reshape itself according to its containers. This enables water to fill up any empty space regardless of its shape.

I suppose this phenomenon also applies in our daily life, not excluding business and marketing sections. Often enough, we will encounter situations such as marriage and migration which require us to change. I have personally experienced this situation when I chose to further my studies in Sydney. I needed to change my daily routine, learned the new culture and of course communicate in different language.

In this modern society, business environment is changing faster than what we can imagine. These changes occur because the technology, politic, culture and also the people are changing. A decade ago, how many of us can imagine that banking transaction can be performed via mobile phone as well as the internet? How many of us can imagine that the oil and gold price will rise to the current level? How many of us can imagine the tragic incident that happen on 9/11?

According to Hermawan Kartajaya, one important aspect of marketing is being able to create a sustainable value. Being a market leader does not make you a great marketer. A great marketer is one who is able to sustain their position at the pinnacle of the market from time to time. A great marketer is also one who can understand the cultural, political and technical fluctuation of the business environment. Basically, human desire is generated by these changes. Or in other words, business opportunities are always created by the changes in any aspects in the society. You just have to spot it by expanding your sense of sensitivity.

IBM had always been a market leader in hardware industry. However, their persistent concentration on the super computer market to obtain huge profit from big companies and their ignorance on the growing PC market causes them to lose their credibility as the most admired company. In addition, they also lost their position as the market leader. PC market eventually became the most substantial marketing in the computing industry since technology change enables smaller computers to have greater ability than the humongous computers. Dell Computer on the other hand quickly noted this technology change and surpassed IBM from the PC market and become one of the great leaders in the computing industry.

Encyclopedia Britannica (EB) had been a leader in the printed encyclopedia market for almost 200 years. However, technology again changed everything. The invention of CD enables data storage to be more convenient and since modern technology allows featured animation and sound effect, it appeals more to the public. EB’s decision to stay conventional and reluctance to produce encyclopedia in CD, eroded their profit and domination.

Many years ago, the fat content in Chinese food had attracted fierce media attention in USA. As the country with the highest obesity rate in the world, this issue gravely affected the Chinese food business. Most of their profit plummeted up to 50%. A restaurant called Hunan Garden Szechuan Restaurant decided to change to Café 19 Chinese Health Food Restaurant. Still serving Chinese food, this restaurant changed their ingredients and menus to comply with the healthy food standard in USA. The so called “fat-free” Chinese food business attracted sales income much higher than before the fat controversy.

These examples clearly pointed out that it is very important for a company to recognize the market in order to be sustainable. Surely becoming sustainable in business is not a simple task. There are some situations that require us to broaden our business scope, others might need us to shrink the business scope, and of course there are some cases that require us to change our business scope. The ability to redefine the business scope in every single situation would dictate the success of that particular company in the long run. As Andy Grove said “Only the Paranoid Survive”.

Comments, opinions, and questions will be greatly appreciated. Thank you