What Is The Hedgehog Concept (Explained: All You Need To Know)

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What Is A Hedgehog Concept

A hedgehog concept is a notion that requires companies to identify their core area of expertise and value proposition and put their time, energy, and focus on what they do best.

The hedgehog concept states that companies that do not have a clear focus on their value proposition may lose track of their overall purpose and mission.

As a result, without the right focus, the company can lose efficiency and fail to dominate its market niche.

The Hedgehog Concept is developed in the book Good to Great where the author indicates that entrepreneurs should identify what they are truly passionate about, what they can be the best at, and what best drives their economic or resource engine.

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Origin of The Hedgehog Concept

The hedgehog concept comes from the Greek parable saying “”The fox knows many things, but the hedgehog knows one big thing.”

In other words, the fox can catch prey in a number of ways.

However, the hedgehog knows one thing great thing which is to escape the fox.

The idea behind this parable is that companies that try to sell and promote many things to many people may get around to doing it and can succeed.

However, those that focus on what they are really good at can always succeed.

The hedgehog concept is a useful concept in business as it brings companies to assess their business, understand what are their strengths and weaknesses, and focus on what they really do well.

Many argue that companies that invest their time and energy in building and expanding on their core area of expertise can have a better chance at long-term survival and can achieve a greater competitive advantage.

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How To Apply The Hedgehog Concept

Applying the hedgehog concept is not very difficult but takes time and careful consideration.

A business of any size and in any industry can apply the hedgehog concept to better focus its overall business strategy.

The first step is to understand what your company’s core mission is all about.

Why are you engaged in the business that you’re engaged in?

What is unique about your business that is attracting your clients?

Second, you need to assess whether or not your business is investing in its core area of expertise.

Are you spreading yourself too thin in many areas?

Can your clients define what it is that you do best?

Third, once you’ve identified the areas that are your core focus and most profitable to you, define a plan to bolster this operation.

Simultaneously, see what are the least profitable products and services that you offer and slowly discontinue those areas.

Last, once your strategy is established, execute it flawlessly.

After a certain period of time, it’s good to reassess your results and see if you are heading on the right track.

It’s important to make changes and tweaks to your strategy to ensure that you are making progress.

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Hedgehog Concept In Business

According to Jim Collins, the Hedgehog Concept consists of understanding three main aspects: what are you deeply passionate about, what you can be the best in the world at, and what drives your economic engine.

To answer the first question of what you are deeply passionate about, you must understand what are your core values, what work inspires you the most, and what gets you excited every day.

To answer the second question of what can you be the best in the world at, you should understand why you do what you do. 

What’s unique about your business that other businesses do not have?

What allows you to differentiate yourself in the market?

To answer the third question of what drives your economic engine, you should understand what products and services are the most profitable to your business.

It’s best to focus on selling your most profitable products and services rather than spend time and resources on things that do not generate as much return.

By answering these three main questions, you should be able to narrow your company’s focus on its core mission, spend time and resources doing what you do best, and what brings you the most revenue.

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Takeaways 

So there you have it folks!

What is the Hedgehog Concept?

In a nutshell, the Hedgehog Concept is a notion developed by Jim Collins where the idea is that companies that focus on one thing and do it well will outcompete those that do many things but without being great at it.

In other words, just like a fox and a hedgehog, the fox can hunt in many ways and is smart but the hedgehog can do one thing very well, which is to defend itself against the fox.

No matter how the fox may try to hunt the hedgehog, the hedgehog will be able to curl itself up into a ball and raise its spines.

The hedgehog has only one defense but it will always be successful at it.

In business, the Hedgehog Concept states that companies that are able to invest in their core area of expertise and offer products and services that are the most profitable to them will succeed.

Now that you know what the Hedgehog Concept is all about and how it works, good luck with your research!

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