Last week, Fortune magazine featured five prominent CEOs and their views on new-millennium leadership. The five leaders offer very different insights and are all quite Foolish.

So I'm running through the Fortune piece, one CEO at a time, and showing you how the finest minds in corporate leadership today can help you find great investments. Today, we're looking at Anne Mulcahy, CEO of Xerox (NASDAQ:XRX), who offers this pearl of wisdom:

"The big companies and the big brands [don't] necessarily have the assumed power they thought they had. Besides, the real power isn't in scale; it's in alignment. And that's really hard for big companies to achieve."

Anne is talking about a powerful advantage that's available to small companies in today's marketplace. It's the flexibility to adapt to a changing marketplace, but it's also the ability to align operations with one's core competency and do only what one does best.

Once a company's core product reaches market saturation, as is arguably the case for Inside Value recommendation Coca-Cola (NYSE:KO) and BellSouth (NYSE:BLS), for example, it becomes much harder to grow the business. Everybody who wants the product is already buying it, so the company needs to find new markets, develop new products, or persuade customers to buy more of its products, or else stop growing. But in any case, the company's bottle-rocket growth-stock days are over.

It's hard for a company to stay focused on its real strengths at that point, and that's one reason successful niche operations within large corporations can be better off going it alone. Skyrocketing spinoffs such as Chipotle (NYSE:CMG) are living proof of the value in giving operational autonomy to operations with large, ripe opportunities in a fiercely competitive market. The stock price of this spicy taco has risen by more than 150% since McDonald's (NYSE:MCD) set it free back in January. And it comes with a healthy pinch of cilantro.

Or you could go the other way and refocus your business by divesting your company of noncore operations. That's how Middleby (NASDAQ:MIDD) did it. The supplier of commercial kitchen equipment scaled down to become the market leader only in commercial ovens. As a result, investors were rewarded with a three-bagger in the two and a half years since Tom Gardner first recommended the company to Motley Fool Hidden Gems subscribers.

Focusing on your biggest strengths, to the exclusion of everything else, can lead to astonishing returns on investment. Tune in tomorrow for another new-school management approach, this time from Art Levinson of Genentech (NYSE:DNA).

Further Foolish reading:

The thing about doggedly focused companies is that they are often small -- and on their way to becoming big. Tom Gardner's motley gang at the Motley Fool Hidden Gems newsletter service is standing by to help you find those opportunities before it's too late. Try a 30-day trial subscription to see whether that approach is right for you.

Fool contributor Anders Bylund owns stock in Coca-Cola, and he also drinks a lot of it, but he holds no position in any other company discussed here. Anders probably needs to have his back realigned. Foolish disclosure isn't just smart; it's the law around here.