Hedgehog Concept

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Jim Collin's term for a strategic focus that winning organizations develop to guide their decision making, strategy execution, competency development, etc.

Three intersecting elements of the Hedgehog Concept --

  • What you are deeply passionate about -- Passion refers to what you get excited about doing. The goal is not to stimulate passion but to discover what makes you passionate.
  • What you can be the best in the world at -- What you can be best at is analogous to ""genetic capability"". This is a capability that if properly channeled, guided, and focused upon can make you the best in the world. The corollary is that this same ""genetic capability"" also tells you what you cannot be best at. You may not be capitalizing on what you can be best at when you come to an understanding of what that is.
  • What drives your economic engine -- Building a sound economic engine requires profound insight into the economics of the organization. This insight should be expressed in terms of the one economic denominator that is most critical to the organization. Ideally, this metric is expressed in the form of a single ""economic denominator"" that ties to the strategy and will be formulated to measure strategic progress and success. In a business, this is expressed as ""profit per __"". The search for this denominator forces a deeper understanding of the key drivers of the economic engine.

Finding your Hedgehog Concept -- Finding your strategic focus requires a severe standard of excellence

  1. Understanding what your organization truly has the potential to be the very best at
  2. ...sticking with it
  3. ...while building on strength and competence
  4. Focusing solely on what you can potentially do better than any other organization is the only path to greatness
  5. Allocating resources based on the above understanding
  6. Avoiding distractions

Hedgehogs simplify a complex world into a single organizing idea, a basic principle or concept that unifies and guides everything. This reduces a complex world, with all of its challenges and dilemmas to simple ideas. Anything that does not relate to the hedgehog idea holds no relevance. This approach keeps the organization focused on what it can best do to achieve greatness, a sustainable competitive advantage. Motto, see what is essential, and ignore the rest.

A Hedgehog Concept is not a goal to be the best, a strategy to be the best, an intention to be the best, or a plan to be the best. It is an understanding of what you can be the best at. Focusing solely on what you can potentially do better than any other organization is the only path to greatness.

Source: Collins, 2001. See: jimcollins.com