Would you rather be a fox or hedgehog?

[Courtesy]

Philosopher Isaiah Berlin divided thinkers throughout history into two categories: those who pursue a single big idea throughout their careers (hedgehogs), and those who pursue many different ones (foxes).

The labels were drawn from Greek poet Archilochus’ aphorism “A fox knows many things, but a hedgehog one important thing.”

Applying this to business strategy; would you rather be a hedgehog or a fox? Should a firm focus on just one key area – be it an industry, product or customer segment? Or should it spread its options by placing multiple bets in various sectors?

If, say, a firm in hospitality sector decided to be a hedgehog, then it would limit focus to the main sub-sectors of the industry like lodging, food and beverage, events and tourism.

If that firm decided to be a fox, then the investment scope would virtually be limitless, with focus shifting to identifying and exploiting business opportunities without due regard to industry or products.

An example of a fox in business is a firm like Amazon. Started as an online bookstore, it has diversified into various areas, including e-commerce, cloud computing, media, subscription services, grocery stores and apparels, among others.

You need to be good at what you choose to focus on, so being a hedgehog is necessary, especially if you are in a relatively stable industry. But in a world where uncertainty and chaos reign, a fox stands a better chance of long-term success.

In the words of American Greek entrepreneur Peter Diamandi, “if you are given an option, take both”.