Strategy That Fits

Does your scale support all your programs?

Too many companies try to be everything to everyone. A lack of strategic focus can cause customer confusion, a lackluster sales pipeline, and a disorganized response. A stronger position can direct your resources toward your best long-term sales opportunities through market differentiation and brand expression.

There are many ways to focus your resources, but a straightforward starting point is scale. Every company has bandwidth and budget constraints. Small companies often think larger ones have endless resources, but that isn’t true. Smaller companies have less, but they should do less. All companies need to align their appetites for complexity with available resources.

A $100M company is not a mini $1B company.

Most companies start with a simple product or a small collection, targeting a particular niche. Small organizations are niche, and they know it. It goes without saying that large organizations do many more things, but many Commercial Interiors manufacturers find themselves somewhere in the middle. Their growth has earned them a place that is no longer a small niche. Mimicking large companies can be a mistake. When growing companies benchmark market behemoths, they can misinterpret what’s best for their own organization.

It’s easy to overlook how those larger companies got there. The product team wants a broad offering like industry leaders, which often results in too many products for their size. Meanwhile, the sales team wants to be toe-to-toe with larger players in a bid process, and the marketing team wants to create industry-leading support materials to accomplish all these aims. But there is insufficient time, money, or expertise to do the job right. It’s not only a matter of champagne taste on a beer budget – a company caught in the middle struggles with priorities, frustrating teams, and has only marginal gains. Climbing a mountain doesn’t happen instantaneously. It comes step by step, with solid footholes.

Does your scale support all your programs?

Here are some levels to consider.

Product specialization can be a winning strategy for smaller, growing companies. In a post-COVID, hybrid, work-from-home (WFH) world, many niche startups are cutting through historical industry patterns, selling à la carte products using e-commerce, social media, and targeted rep groups. Not all these strategies will scale, but they cut into traditional channels and brand perception. Many new niche brands have their sights on a changing industry to steal market share from conventional competitors in targeted and differentiating ways. WFH on TikTok looks very different from the traditional dealer model.

Beyond a niche product, growth naturally extends into related products for a segment of buyers. Product families can anchor buyers with those needs, but growth eventually leads to market segments like workplace, retail, hospitality, healthcare, and education. Many segment-focused competitors will outperform industry generalists by doubling down on vertical market expertise, reach, message, product offering, and paths to market.

Focusing on a single segment can seem too narrow, but there can be a kind of Alice In Wonderland effect, in which a bright new world exists through the rabbit hole. Deeper expertise can open new doors for products and services. Also, remember that plenty of room can grow in a single segment. The U.S. healthcare industry alone is over $4 trillion. The education market is perhaps half that size but is still more than 50 times larger than the entire Commercial Interiors industry.

Many competitors aim to serve multiple segments. The common formula is building from overlapping office settings. Hospitals, schools, and nearly all other kinds of businesses have some form of a traditional workplace. The workplace is the traditional starting place for many commercial players because it’s the easiest to get into, with the fewest product requirements and less industry knowledge. It’s also the most competitive and commoditized, which can mean a race to the lowest price. Brand differentiation can help, but serving multiple segments is a larger endeavor than many companies are willing to admit. You may serve office, healthcare, and education customers, but can you say you specialize in each?

Some companies arrive at multiple segments through acquisition. When this occurs, organizations are moving beyond multiple product brands to multiple company brands. Depending on the size of the companies, market potential, and brand equity, the combined new entity is compelled to sort out its brand portfolio – particularly if the aim is to streamline and combine sales channels. The customer experience can become disjointed, causing brand confusion. Strategic focus with clarity on how multiple segments overlap in ways that help both the customer and the provider will maximize resources and performance.

Multi-Business Focus

The “major” commercial furniture providers (let’s call them the $1B+ club) play a different game than most in the industry. First, they have aligned and dedicated sales channels. They have multiple companies and brands with histories and narratives to preserve and counternarratives to dodge. They have a global reach by choice and necessity to meet the demands of global customers. With industry consolidation in recent years, most have extensive company portfolios, which is both an asset and a problem if they have too many brands.

Sometimes, they may have more resources and more problems. A market leader is a great advantage, but these brands must significantly differentiate themselves from hungrier, scrappier, and more focused competitors to sustain that position. They must leverage their extensive networks and make sense of a complicated organization.

Of course, the largest corporations in the world are not confined by one marketplace. Only a few industry competitors have taken an even bigger step outside the industry entirely. In some ways, a practically wholesale push toward retail due to a WFH-inspired blurring of B2B and B2C has pulled traditional competitors into an adjacent industry. It isn’t easy. An innovation strategy aims to uncover the right combination of capability and possibility, playing within or outside the boundaries of the industry.

Focus Your Vision

Determining your strategic focus and finding the right benchmark can be challenging. It requires leadership, patience, and originality.

To manage change, companies must target their strategic vision and focus their resources on the best opportunities. When near-term resources are scarce, progress can mean emphasizing the smallest things in the biggest direction rather than spreading yourself too thin. Growth can be difficult. If you’ve never been this large, it can feel like you’re white-knuckling a steering wheel in a car starting to break down as you speed up. Remember, people have been here before. Focus and refocus.

As with a camera, strategic focus is finding your subject matter and focal length. How wide is your lens? How tight is your focus? A photographer might ask: Do I have the right equipment? What are my limitations? We might ask: How might we focus our resources? Have we set the right expectations? Are we dreaming big enough?

Whether in photography or business, creativity is about constraints. Find your strategic focus, establish the right guardrails, and align your resources for better results.