A company that is able to execute well on its strategy, even if that strategy is far from perfect, will have much greater success than a company that cannot execute on a great strategy.
 
Most companies struggle to leverage their core competency to take advantage of complementary markets.  I agree with Joe Thomas, who in a recent vlog, used Disney as an example of a company that is "on the ball."
 
One of the things that impresses me about Disney is that they are one of the few companies who have been able to successfully move beyond their core competency and succeed in new markets. They went from being a media company to a much more diversified enterprise.
 
It is easy to see how large companies can get stuck trying to develop and refine the best strategies and end up falling behind the competition. When they fail to address issues related to managing information, coordinating activities among multiple lines of business and controlling management costs, they often lose their competitive advantage.
 
Sony is an example of a company who has struggled with diversification issues. Once the dominant player in the consumer electronics industry, they were poised to take the Walkman to the next level (remember those?). They diversified beyond their core competency to get involved in movies, music and all sorts of ancillary markets. Their television unit, which hasn't made money in the past eight years, lost more than $2 billion last year.
 
A funny story about their acquisition of Columbia Pictures illustrates how little they knew about the realities of the movie industry.

A Columbia executive, explaining their business to a group from Sony, said something along the lines of: "We'll make ten movies this year.  Five or six will lose money. Probably three or four will break even and maybe we have one or two big hits that will make us a huge profit."

An executive from Sony asked, "Why not just make the movies that make money?"
 
Maybe someday Sony will be able to achieve the illusive state known as "synergy" and sell a robot dog that fetches the PlayStation remote or some other futuristic product to capture the consumers' imagination.
 
Back in the early days of the World Wide Web, Netscape focused on the browser market, ignoring the web portal market where it enjoyed a strong early advantage. We know what happened: Netscape Navigator went away and Google, Yahoo and Bing took over a much larger market.
 
Obviously, you want your company to have focus on its main business and also not miss new opportunities to leverage what you already do really well.
 
Any thoughts?