Whether you started investing today or decades ago, you've probably heard a lot about the importance of diversification. That's the idea of spreading your investments across a variety of stocks and industries. You can even go beyond that by investing in various types of assets -- such as stocks, bonds, and cryptocurrency, for example.

But guess what? World famous investor Warren Buffett isn't one to diversify when investing in stocks. In fact, the billionaire has even criticized the idea. As head of Berkshire Hathaway, Buffett's portfolio is focused on a narrow selection of industries -- and the biggest positions are in a handful of stocks. We all would love to score even a bit of Buffett's success. Does that mean we should drop diversification from our strategy?

A focus on just a few sectors

First, let's consider the composition of Buffett's portfolio and exactly what he's said about diversification. As my colleague Sean Williams wrote recently, more than 90% of Buffett's portfolio is concentrated in only four sectors: technology, financial, consumer staples, and energy. And one stock alone -- Apple -- accounts for more than 45% of the fund's total value.

Buffett has made many statements about diversification. But the following two quotes sum up his views.

"Diversification is protection against ignorance," Buffett said. "It makes little sense if you know what you are doing."

He also said: "A lot of great fortunes in the world have been made by owning a single wonderful business. If you understand the business, you don't need to own very many of them."

It's a good idea to look at both of these comments together to get a true understanding of Buffett's views. He means investors shouldn't expect diversification to replace research and knowledge. You shouldn't diversify across a bunch of companies that you don't understand -- but count on success because you've bought into various industries and companies.

Whether you invest in one company or one hundred, researching and understanding the company/companies and their business is essential. As Buffett says, if you happen to find one fantastic business, you could make a fortune through that one particular investment. But, as he's acknowledged, that doesn't happen every day.

'A dozen truly good decisions'

Buffett, in his most recent shareholder letter, said that he has made many investment choices over the years that haven't worked out. "Our satisfactory results have been the product of about a dozen truly good decisions," he wrote.

Now, let's talk about whether you should follow Buffett and forget about diversification. It's a great idea to incorporate many Buffett ideas into our own investment strategies: investing for the long-term and buying quality stocks at reasonable prices are two good examples.

But most of us don't have Buffett's resources. We're investors with smaller portfolios -- and that means we have to operate a bit differently. We still should research and understand every company and industry we aim to invest in. But, like Buffett, even when you do that, you probably won't win on every investment. When Buffett loses on one investment, he still has the resources to win overall.

Smaller investors, though, could be crushed by one bad decision -- if they've put most of their eggs in that basket. And that's why most of us could benefit from diversification. If you choose carefully, you'll offer yourself many opportunities for success rather than just one or two.

Diversification doesn't require huge amounts of cash. If you only have a small amount to invest, you still can spread it across various stocks and industries -- even sometimes buying fractional shares of a market leader like Buffett favorite, Apple.

So, yes, all investors should aim to be like Buffett. But you can only do that by adapting this great investor's strategy to suit your own resources and situation.