Entrepreneurs: Ignore the Advice to ‘Stick to Your Knitting’

An old adage suggests that to be successful, a small firm or entrepreneur should “stick to their knitting,” focusing on what they do best. In some regards I think this is true: if you have a unique insight or distinct competitive advantage, reinforce it and don’t get distracted by what you don’t do well.

But in the modern economy, new entrants emerge daily, technology shifts quickly, and customer moods and tastes change rapidly. While sticking to your knitting may have been sage advice in times when change was more moderate, following that advice today could have devastating consequences for your business now.

Explore and Exploit

Two ideas that may seem like polar opposites must be working simultaneously in your business. Innovators love the dichotomy of “explore” and “exploit.” Exploit means to do well what you are currently doing – in other words, stick to your knitting. You should exploit your knowledge, advantage, and insights to the greatest extent possible. However, recognizing how quickly things change you should also “explore” and experiment, seek out emerging needs, markets, and customers segments. Find new solutions and technologies. If you aren’t exploring and experimenting, you’ll quickly fall behind a lot of new entrants.

Zero Sum Equation

The problem with trying to explore and exploit simultaneously is that both require very different activities and skill sets. Exploiting capitalizes on current knowledge and skills and promotes efficiency and lack of variation or exploration. Exploration seeks new knowledge and insights and is far less efficient, prone to risk and uncertainty. Most firms, even entrepreneurs and startups, become very good at exploiting current products and markets and quickly lose sight of the concept of exploration, much to their detriment. Does one focus have to require that you sacrifice the other? Clearly this capability needs to be built into the operating model and culture of your business.

Holding two opposing ideas simultaneously

Roger Martin noticed that many good innovators were capable of doing two competing tasks simultaneously. He wrote The Opposable Mind based on this premise – that entrepreneurs and innovators could and should be able to conduct exploration and exploit activities simultaneously. Given the rapid pace of change, you’ve got no choice but to introduce integrative thinking and the ability to conduct both types of activities simultaneously in your organization. If you are just building your business, reinforce both capabilities – explore and exploit. If your business has been around a while, you may need to rethink your culture and reward structures to introduce more exploration, because the inevitable focus will be on exploitation.