OK, so I've figured out my particular issue and it sits squarely with Norton 360. 8.6 doesn't work properly with Big Sur, even though Norton say it's compatible with Norton 360, 8.6 it isn't.
I know I'll probably get a lot of replies saying "why are you running Norton" but it is what it is.
The loss of 'focus' thing comes about as Norton 360 installs a menu bar icon (which you can't get rid of) that appears and disappears for whatever reason, and each time it reappears it takes the focus away from the current window.
The ONLY way I could resolve this was to uninstall Norton 360 and then do a manual clean up of left over files. That coupled with loads of restarts I managed to get to a place where the menu bar icon no longer appears at all, and hey presto, no more issues.