Singularity of Focus - Article Analysis

As I plan to do for most of the semester, I would like to analyze an article that I feel provides insight into the Entrepreneurial Process. Today's article was written by Steve Denning and published by Forbes.com. The link to the original article http://www.forbes.com/sites/stevedenning/2012/09/03/whole-foods-and-the-triumph-of-customer-capitalism/

As a frequent patron of Whole Foods (WF) I found the article very easy to relate to, and I prefer WF over Stop and Shop or Shaws for the same reasons as the Mr. Denning, better selection and better customer service. This article was intended to guide management however it provides some insight to entrepreneurship as well, and since that is the focus on the blog that will be focus of the analysis.

Lesson 1: Customer Focus
The author makes a very interesting comparison between Safeway (SW) and WF, showing how the cost-focus of SW leads to a reduced customer experience while WF's customer-centric goal enriches the customer experience. The correlation between their respective strategies and stock prices speaks for itself. When one considers that goods that are not unique to WF can be acquired for less at Walmart, SW, or Stop and Shop there must be more to the value added to the customers than the food in their basket. The singular focus on the customer and its subsequent improvement of the shopping experience helps create long term repeat business, which leads to long term and consistent profitability. These are the kinds of results that keep shareholders happy, even if they are not the sole focus of the organization's endeavors. The fact that this customer-first culture is woven throughout the very fabric of WF ensures that all stakeholders at all levels are fully aware of this goal and working towards it, which adds more stability and consistency to both the customer experience (shopping), partner experience (suppliers and employees), and shareholder experience (consistent stock price growth).

When starting a new company, as entrepreneurs do, committing to customer focus from day one is a great way to ensure that it becomes a cornerstone of the culture. Customers are the ones that provide you with revenue; repeat customers give you repeat revenue. The best way to ensure repeat customers is to offer a rich and rewarding customer experience, regardless of market segment or product. Whole Foods provides an excellent example of this and aspiring entrepreneurs should consider it strongly.

Lesson 2: Singular Focus
The author also points out the benefit to all levels of Whole Foods when a singular goal or focus is accepted and worked towards by the organization. By establishing the singular focus of customer value from the beginning Whole Foods eliminates distractions, debates, inconsistencies, and confusion. When faced with a challenge, each employee at every level of the organization can think critically and find the answer to dilemma by simply finding the course of action that maximizes customer value. This adds consistency since the same solution should be reached regardless of who is deciding or where the dilemma occurs, so the outcome at the Providence, RI WF should mirror that of the Boston, MA market.

The lesson for entrepreneurs seeking to establish their company's culture is to find a singular focus and let it shape the culture and by extension govern operations. It does not necessarily have to be customer value, as noted by the author, but it does have to be the one overriding goal that provides frame work for decisions at the most microscopic of levels. By removing the obstacle of balancing interests, whether they conflict or not, logically effectiveness and efficiency go up. If time per decision goes down then more decisions get made per day, and if each decision is intended to maximize the company goal, then you have more decisions snowballing into more aggregate progress towards the one goal.