On the surface, it makes perfect sense. Identify your niche and the very specific way you can offer a service or product to improve your odds of succeeding. However, what happens when you fall into the trap of doing one thing so well that it blinds you to what’s happening around you?
This blind spot came to mind when I saw a recent list of brands that no longer exist. Lehman Brothers, Washington Mutual, and Wachovia were obviously casualties of the financial crisis. But the one that caught my eye was the disappearance of Saab.
Saab had a niche and delivered a very specific product. But Saab made a mistake. It picked a niche that didn’t give it much flexibility or room for growth. So despite managing to do one thing really well for many years, Saab went bankrupt December 19, 2011.
In a report reviewing the demise of Saab, authors Matthias Holweg and Nick Oliver highlighted how Saab feel into the trap of relying on doing one thing well. But that one thing proved to have an expiration date:
Taking a wider perspective, the fundamental economics of the modern automotive industry simply can no longer support individualistic designs at the prices that Saab was able to command. Low volume producers can survive when their customers are ones with very deep pockets. If their customers don’t have deep pockets then they at least need to be plentiful in number. Sadly, Saab’s customers were neither.
Whether it was planned or not, Saab’s strategy placed it in the middle of the road, another aspect that doing one thing well can blind us to. We tell ourselves that because we focused on one thing we aren’t hedging our bets, but the entrepreneur’s trap opens wide if we’ve picked one thing that doesn’t inspire much emotion one way or the other.
For instance, one of the reasons restaurants like In-N-Out, Five Guys, and Shake Shack have made us willing to pony up $5+ for a burger is they’ve changed our expectations of a fast-food burger. We want this different experience. It’s such a clear step up from the McDonald’s, Wendy’s, and Burger King experience that it stands out. Even more interesting, if you take a look at their menus, the available options are fewer than what you see going through the standard drive-thru.
Now, they can get away with this strategy of offering fewer options at a higher cost, but only so long as they continue to deliver food that excels AND customers are willing to pay more for that experience. They’ve picked a side, they’re doing one thing well, and for now they’re avoiding the trap. In the coming years we’ll have to see how or if these companies can adapt if we move on from our love affair with expensive burgers.
So as you assess your options consider these questions:
- Does my one thing give me room to grow?
- What triggers can I add to help me see what’s happening around me even as I’m succeeding?
- If the one thing I do well stops being needed, how could I transition to something else?
To be clear, doing one thing well isn’t the primary problem you face. Instead it’s assuming that doing one thing well is all the strategy you need to succeed as an entrepreneur.
Photo credit: Vilseskogen