Barnes & Noble gave up on its color Nook reader today. From this NY Times article:
"Barnes & Noble Changes Course on Nook | Barnes & Noble conceded on Tuesday that it could not compete head to head with the iPad and the Kindle Fire, Michael J. de la Merced reports in The New York Times.
Reporting a big loss at its Nook e-reader division that dragged down the company's fourth-quarter results, Barnes & Noble said it would no longer make its own color tablets. Instead, it will work with third parties, which will make the devices in exchange for co-branding opportunities.
The announcement is essentially Barnes & Noble's white flag, signaling that it cannot compete in a market dominated by Apple, Amazon.com and Samsung."
This is why it's critical for a company to clearly define and articulate (both internally to employees and externally to the world) what business it's in. Barnes & Noble was a retail chain book seller trying to make a tablet. That didn't work.
Contrast that with Amazon. Amazon, too, was in the business of selling books originally. But its goal is "To be earth’s most customer centric company." And mobile is extremely customer-centric. Therefore, the Kindle fire is an integral part of Amazon's core goal. It's not a division to be spun off, or a sub-unit of a larger company with an entirely different goal.
I don't know the details of what went on inside of Barnes & Noble. But I'd be willing to bet that the company wasn't willing to de-prioritize its legacy retail business enough to fully bet on the Nook. And because of that, the Nook never got the company's core focus. I imagine that Barnes & Noble wanted to keep the revenue from its legacy business while investing in what might come next. But that means that every decision made at the company didn't have the lens of the company's core focus guiding it.
By contrast, at Amazon, it's easy. Whatever decision anyone in the company is making, the lens that the decision is held up against is "does this help us become the earth's most customer centric company?" If the answer's yes, then the path is obvious. There's no arguing whether a mobile tablet makes sense for Amazon to produce. If it gets Amazon closer to the customer, then they do it.
These changes in thinking at the most macro level have massive implications to the entire business and its ability to evolve and stay competitive. Get your most macro focus & goals right and the decisions will flow easily from there. But if those aren't clear, there will be immeasurable amounts of friction within the organization as employees try to wade through difficult prioritizations and decisions on a daily basis, with outcomes like the fate of Nook at the end of that tumultuous process.