What is the Hedgehog Concept?

The Hedgehog Concept was developed by the famous American Business consultant Jim Collins highlighting on the various factors that how a person or a company can attain the pinnacle of success and growth in the business. The concept harps on the power of simplicity that elevates the chances of success in the business.    

Breaking Down the Hedgehog Concept :

1. In the year of 2001, Collins in his book ‘Good to Great’, he highlights and describes the various similarities between the large corporate and multinational organizations and his famous Hedgehog Concept.
2. To become successful in business, it is the complex play of the various interconnected links and parts, but Collins harps on the fact that the main essence of the success lies in the solid principle to focus and concentrate on one facet and aspect of business at a time.
3. This generic principle enables the companies to attain the competitive advantage in the market and become successful in the industry by attaining all the aims and objectives.
4. As per Collins, it usually takes an average of about 4 years for the company to fine-tune the Hedgehog Concept within the business operations.

The classic story behind the Hedgehog Concept :

The Hedgehog Concept by Collins is based on an ancient Greek parable that tells the story about the hedgehog and the fox. The fox is a multi-tasker and can do many things at one time. The fox is smart and is aware of its environment and can access his prey even from a long distance and makes many strategies to catch his prey, the hedgehog.

And the story always ends with the fox being thwarted having to withdraw his nose full of the hedgehog’s spines. In this classic story, the hedgehog can do only one thing and does it in a perfect manner; it defends itself from the fox by curling up itself into the ball and raises its spine for the protection.

Collins applies this old and ancient parable to the large companies and corporations. The people who set up the large companies and attain the realms of success can be compared to the hedgehogs as they focus on one thing at a time.

Whereas, the companies that focus on many things at ones are the foxes. Focusing and working on many things and tasks at once can make them lose focus reducing their chances of success in the market. Despite the hedgehogs being slow and relatively less smart than the foxes, they are able to simplify the various tasks around them as they focus on a single and all-encompassing vision that leads to their success.

The circles of the Hedgehog Concept :

The concept of Hedgehog by Jim Collins comprises of understanding the 3 circles that start with the question and the area where all the 3 circles overlap is defined as his Hedgehog Concept.

1) Circle One: What are you passionate about deeply?

Passion is one of the most factors for the organization as it truly determines the growth and works as a huge motivator. The first circle talks about understanding and figuring out the passion of every employee in the organization. What factors inspire them? The core values of the organization with which they connect the most? What are the most enthusiastic about?

All the great and successful companies never tell their employees on what to be passionate about, in fact, they find out what their employees are passionate about the most and then assign those specific projects that are well aligned with their passions. It is very crucial to make a note this point that, the first circle of the Hedgehog Concept doesn’t harp about finding the various elements of passion but it harps on doing the work that you are completely passionate about as it will garner you all the success in the long term.

2) Circle Two: What can you be the best in the world at?

The second circle of the Hedgehog Concept is all about understanding why the organization is good at the things that it does and why the organizations do those specific things better than the other organization’s competitive organizations in the market.

Rather than developing the great set of core competencies within the organization, it focuses on the main and vital strengths of the organization and developing the competencies that the organization hasn’t been able to attain even after having the innate strengths. It also focuses on that the organization is allowed to have weaknesses and score lower in some of the areas.  It is also about focusing on that one key area that is exclusive to the organization and gives it a competitive advantage as compared to its competitors in the market.

The main objective of this circle is to focus on what aspects of the business you can be the best at and not on what you want to be the best at.

If you are not at the best in your core business, then your core business cannot be your Hedgehog Concept. You will have to find out the business that is your core strength and in which you are capable of doing it better than anybody else in the market.

3) Circle Three: What drives your economic engine?

It is very important for every company to generate the constant flow of cash, revenues, and profits. It has to be well aware of its economic engines that helps generating profits and revenues and this crucial insight will give more clarity to the management and will have a huge and long-lasting impact defining the long-term success of the organization.

The economic engine of the company is like the blood that flows in our bodies. It is so important that without it, we just cannot survive. Same goes for the companies, no matter how strong the objectives of the company are, without the economic engine the company will go bankrupt.

The Overlap of the Hedgehog Concept :

Apart from following their passion, the companies have to do a thorough research on the questions of the three circles and then determine where they overlap. And that overlap is where the concept of Hedgehog is found and it determines the central vision that works as an organizational strategy making the management more aware of its strengths and competencies.

It helps in the overall decision-making process. The Hedgehog Concept is just not a goal or a strategy but it is an insight that works a guiding principle for all the strategic choices.

After the intersection of all the three circles, the organization has defined its passion, core competencies, factors that make it the best as compared to its competitors, and the economic engine from which the regular money can be created.

Conclusion :

The Hedgehog Concept helps the companies to review their current and existing business strategy and figure is its working for them or it can be done in a distinguished manner to attain success and higher revenues.

The key members of the management needs get involved in a detailed manner to revise the strategy and they need to understand that the Hedgehog Concept lays its emphasis on finding out the true passion, talents, and the various revenue generating opportunities. The application of the Hedgehog Concept helps the organization to focus and improve on what they are best at rather than trying to find out the alternative strategies.

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