Specialise to reap larger profits

The quickest way to know whether you are in America is to look for American Symbols. McDonalds, Burger King, Best Western, Waffle House, Wal-Mart, Exxon or J.C Penney. Every town in America seems to have certain landmarks no matter how small, new or remote. It does not matter whether the town neighbours the cotton fields of Mississippi, plains of Connecticut or the snow caps of the Rockies, America is that Uniform.

The quickest way to know whether you are in America is to look for American Symbols. McDonalds, Burger King, Best Western, Waffle House, Wal-Mart, Exxon or J.C Penney.

Every town in America seems to have certain landmarks no matter how small, new or remote. It does not matter whether the town neighbours the cotton fields of Mississippi, plains of Connecticut or the snow caps of the Rockies, America is that Uniform.

Yet behind this uniformity lies the secret behind the success of American entrepreneurs. It appears that to make money in America, all you need to do is to come up with an idea, good and practical, put it into practice in one place then like the spokes of a wheel fan out to all the corners of the country.   

You do the same thing, in the same way, only in different places. A McDonald hamburger apparently tastes the same irrespective of where you eat it.

American entrepreneurs have succeeded by focusing their energy and resources into one area of business, perfecting it, then conquering the domestic market before going global.

America is awash with men and women who tried this strategy and reaped the fruits, handsomely. Take Ray Kroc, the founder of fast foods chain McDonald’s. He did not graduate from high school (don’t burn your books yet). He worked for a milkshake making firm for 17 years then went on his own.

His focus was fast food; he had the knowledge and experience. His insistence on high standards for those he gave franchises was legendary. He trained the franchise owners at “Hamburger University” in Illinois where one could graduate with a “Bachelor in hamburgerology” and a minor in French fries (chips). Today McDonald’s boasts about 13,000 restaurants in the US only. 

One of Kroc’s competitors is Dave Thomas who founded Wendy’s fast food chain and named it after his daughter. Like Kroc he did not graduate from high School, he was an adopted child and by his death his firm had 6000 restaurants.

We could continue giving others examples, but the pattern seems to emerge, successful firms “stick to knitting”. Bill Gates’ Microsoft despite the fact that all software needs Hardware has no interest in hardware, Ford makes cars and cars, Coca Cola makes beverages, Price Waterhouse Coopers consults, Harvard offers education.

Long ago Kodak sold her medical business, Pepsi sold her restaurants.
Even towns in the US are focused, New York is the centre of Financial services, Boston hosts America’s top universities from Harvard to MIT, Los Angeles and Orlando are entertainment centres, Detroit produces cars.

US universities are too focused; Johns Hopkins is famous for Medicine, 20MIT and Caltech for technology, University of Chicago for Economics, University of Wisconsin for Computer Science and Columbia for Journalism while Yale is famous for her law School.

As we charter more universities in Rwanda there is a need for them to get focused. Without focusing on one business, these American firms may not have blossomed to what they are today.

In Africa we have failed to focus though some Asian Businessmen have tried the approach; they get into a business, become experts in it, and then open new branches either in other towns or in other countries.

An example being Nakumatt that was recently introduced in the Rwandan market. It is owned by Kenyan Asians who originally used to sell mattresses in Nakuru before transforming into the biggest supermarket chain in East Africa.

With time in one business, you come to know the suppliers, the market, the bottlenecks in the supply chain; you build one of the most valuable resources in business, goodwill and networks. All you need to do after that is to wait for the next generation to mature and take over.

Focus has been one secret behind the American economic success. It is the secret behind all the firms and institutions that we admire. By wanting to do everything, we end up doing nothing.

dedantos2002@yahoo.com

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