Some leaders prefer not to sharpen the focus, assuming it gives them increased flexibility to respond to opportunities. But when vision is fuzzy, trust goes in the tank. Burning issues remain ignored. Politics can supersede performance. Bureaucracy can trump innovation. There is a sense of alarm when people can feel ineffective leadership. Here’s one example:
For nearly 100 years, Sears Roebuck was the greatest catalog retailer in the world. The primary goals were the invention of new ideas and superb consumer service. As the outcome, its financial sector aligned. Then in the early 1980s, Sears started to diversify into higher-margin, unrelated financial services in order to boost its stock price. Its vision became muddied. It appeared to be the leader in low price marketing? Was it to be the premier catalog marketer – which would have positioned it perfectly for e-commerce? No, money fueled the motivation more than anything.
When the focus shifted to profits, Sears went astray from its catalog and retail business. In rural areas, Wal-Mart and others aggressively marketed a different retail option. Through new strategic alterations, they discovered methods to enhance margins and generate significantly better profits. As soon as it happened, Sears’ boasted a mixture of service, quality, and pricing sharply declined. It lost its place in the marketplace and as a result, lost billions of dollars shareholder value.
When the strategic focus is understood:
People embrace change and adapt their jobs accordingly.
People measure themselves by how well they and their teams perform.
People took it upon themselves to take action without being told to do so.
People raise uncomfortable issues and discuss them openly.
High morale is connected to low turnover rates.
When the strategic focus is not understood:
People lack energy or motivation to change.
People gauge their success by accomplishing goals – or lack thereof.
People are reactive.
There is hesitancy to bring issues or raise eyebrows on current events.
The tendency for low morale and high turnover is prevalent.
Another example of fuzzy vision is America Online (AOL). Steve Case, the founder of AOL, initially wanted to change the way people accessed and absorbed information. In the early 1990s, AOL was battling Prodigy and CompuServe for dominant share of the online information business. The merger with Time-Warner was seven years away. AOL developed exponentially over the next six years. Case built partnerships with information providers, grew subscribers, and extolled the importance of “content communities.” At the pinnacle of the first dot com boom in 2000, AOL bought Time-Warner. Steve Case became a billionaire.
But suddenly they fell from grace.The tendency of AOL being a premier online information provider was lost with the AOL and Time Warner merger. It instead tried to build shareholder value through marketing partnerships. Its strategy to be a prominent online advertiser backfired because the advertising packages irritated subscribers and showed negligible value to customers and potential ad buyers.
When the hoped-for synergies with time Warner ’s traditional content failed to materialize, AOL’s focus became very fuzzy indeed. In and out came talent. the internet bubble burst. AOL relegated to the unscrupulous behavior of deceptive revenue reporting. the stock price declined dramatically. Case was ushered away quickly. in 2009, time-Warner announced it would spin off AOL, the final chapter in one of history’s worst corporate mergers and a symbol of fuzzy vision.
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