The rabbit and the tortoise. The wolf in sheep’s clothing. The three little pigs. Animals have featured in tales about morals and decisions about life since dawn began. But have you heard about the hedgehog and the fox?
The concept stems from an ancient Greek parable, which roughly translates as “the fox knows many things, but the hedgehog knows one thing”.
In 1953, famous philosopher Isaiah Berlin applied this to how we live in modern society. He said that people can be split into one of two creatures – foxes and hedgehogs.
Foxes choose to pursue a great many things at one time, but as a result, they achieve very little.
In contrast, hedgehogs focus all of their energy and concentration into one thing and as a consequence, they become great. Berlin believed that simplifying life and channelling energy into one place makes people successful and happy, while trying to achieve everything makes people unsuccessful and unhappy.
The idea was then applied to the business world by Jim Collins in 2001, in his well-known book: ‘Good to Great’.
Collins believed businesses should adopt the hedgehog philosophy, and focus on one good thing to establish their individual identity and that, in turn, will help them scale and grow.
He said that businesses should spend time and energy determining their ‘hedgehog concept’ and pursue it in order to help their business grow.
What is your hedgehog concept?
When I came up with my hedgehog concept, I found going through the following three steps helped define what it truly was.
- Find your business passion
Look at yourself. What ignites passion in you at work? What motivates you and your team to go the extra mile? What keeps them volunteering to work late in the evening? Find the focus that maintains your passion level at work.
My passion is working with entrepreneurial leaders – I love their energy, their focus, their drive and their ambition to succeed. Being an implementer of the Entrepreneurial Operating System enables me to help a whole range of entrepreneurial businesses equip themselves for success.
- Understand your key strength
What is it that your company does better than any of your competitors? In fact, better than anyone else? If you were competing to be number one in the world at something, what would it be?
You can utilise classic business analysis tools such as a SWOT (Strengths, Weaknesses, Opportunities and Threats) to establish your Critical Success Factors. Plot your company onto a Perceptual Map to analyse your company against your competitors.
Establish the emerging key strengths and determine which is the strongest option to use.
- Your economic denominator
It is a critical part of the process to establish your ‘economic denominator’, i.e the amount of profit made per ‘X’. Some examples of common denominators include:
– Profit per customer
– Profit per branch
– Profit per sale
– Profit per employee
You can make this denominator more specific to your company’s industry, for example: ‘profit per pair of shoes sold’. Look at all of the economic denominators that apply to your company, and then decide which harnesses the most power.
- Find your overlap
You will now have three pieces of information:
– The passion
– The key strengths
– The economic denominator
These three pieces of information will have a common factor. Find this, and you have found the Holy Grail, your hedgehog concept.
Key tips to help you grow your business faster
From my experience, finding your hedgehog isn’t always an easy task. Here are a couple of useful tips to help you do this and grow your business faster.
- Don’t do it alone
Establishing your hedgehog concept can be a big task, and many hands make light work. We suggest you do this with your leadership team as a facilitated exercise. Map out economic denominators with the assistance of your finance team to understand where your strongest position is.
- Start macro, move micro
Begin broadly. Look at external factors that affect your business first, the ones outside of your control. Look at political, economic, social, technological, legal and environmental factors. Think locally, nationally and globally too. Next, move into more micro economic factors; things you can actively control within your business. This will help you assess strengths more clearly.
- Review and evaluate
When you have discovered your hedgehog concept, make sure that you constantly review it and are focused on it, using it as a filter for everything that you do.
If you want to grow your business faster, these steps can help you analyse your company and establish your hedgehog concept. It may help to work with a trained implementer to help you discover your core focus and help your business grow. Please contact us for help on +44(0)7795 667480.
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