Storybook managers

Powerpoint presentations are the norm in business today.

Folks good at telling stories in presentations have become useful.

The trick is to follow the format of a children’s book. Don’t make more than two points per page and have a simple and nice looking graphic to illustrate those points.

The downside is that organizations need these folks at all. They’re needed because people find their way to high positions who don’t understand the basics of the business or of business, so having the business explained to them in a children’s book format is helpful.

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Three Rules for Business Success

In 2017, I wrote my Business Rule #1.

Here’s a more complete list.

#1: Have what customers want.

#2: Have it where they want it.

#3: Have it when they want it.

They sound simple. Most laugh when they hear them.

But, businesses too often violate these rules.

Sometimes they violate these rules because they miscalculated.

Coke’s New Coke disaster is an example of that. A key mistake Coke managers made was to assume the results of blind taste tests represented how customers would behave in the real world. One difference, for example, was that while a sweeter drink fared better without food, lots of folks  preferred original Coke with food.

Sometimes it’s a conscious trade-off.

The chef in the linked post closes the kitchen in her restaurant when the last person who’d like to eat there finishes ordering. Most other restaurants, however, make the conscious trade-off to close the kitchen at a set time every night, because keeping it open later doesn’t pay off.

Sometimes they simply don’t understand what their customers want. There’s a shocking number of folks in business in this camp.

In the early 2000s, Walmart became so singularly focused on low prices — what they thought their customers wanted — that they let the client experience slip. Stores got sloppy and checkout lines were long as they tightly managed their cashier labor.

Even price sensitive customers, like myself, got turned off and discovered that you ‘get what you pay for.’ I found myself frequenting Target more. The prices were higher, but the stores were well kept and the checkout lines were short.

It turns out that while price matters, so does convenience and experience.

To Walmart’s credit, they noticed and responded by investing in client experience by cleaning up their stores and shortening the checkout lines, just as they are now responding to the new conveniences innovated by Amazon.

The best businesses over the long haul tend to do the best job at developing a deep understanding of these simple rules.

“Just one thing”

In a scene in the movie, Central Intelligence, Kevin Hart’s character is reconnecting with a high school classmate, “Fat Robby,” played by Dwayne Johnson.

Hart asks how he got in such great shape. Robby responds:

I didn’t do much really. All right.

I just did one thing.

I worked out 6 hours a day, every day, for the last 20 years. Anybody could do it, right?

That reminded of something I see in the telling of a lot of success, and failure, stories.

People try to boil it down to just one thing.

But, the real story is more like what Johnson says after that. It really wasn’t just one thing.

Hart’s face is the typical response you get when you try to explain it’s really more than just one thing.

Walmart’s success is a good example.

The first thing people think about Walmart is low prices.

Many people think that’s the ‘just one thing’ for Walmart.

They missed that Walmart invested heavily in its supply chain management, long before other retailers. They did this to help save costs and keep prices low, but it also had an unexpected benefit. It meant that stores were stocked and shoppers more often found what they wanted.

Even the second generation Walmart management lost sight of this, and other, important value dimensions as they focused on the ‘just one thing’ of low price in the 90s and 00s.

They kept costs low by doing things like servicing shelves less and cutting cashier labor to the bone.

This led to messy, disorganized stores and long lines at the checkout.

Walmart may have what you want on the shelf, but they made it less appealing and less convenient to get it.

For a lot of customers, cleaner, more organized stores with shorter checkout lines became more appealing, even if the prices weren’t rock bottom.

Losing customers to competition made Walmart management realize they had neglected the importance of these other value dimensions. So, they put more effort into keeping stores clean and organized and making it easier to check out.

Business improved.

It’s good to remember that success and failures usually come down to more than just one thing.

Many times those other contributors are not obvious.

I thought so

Two-day shipping has helped double warehouse land prices.

I wrote about it here. Well, not doubling warehouse land prices, but causing the shift to online retail.

The first article mentions that old retail space will start to be converted to last-stop warehouse for extra fast deliveries. Sound good.

Good Advice from Seth Godin

From his post, It’s not about you.

Right in the front row, not four feet from Christian McBride, was every performer’s bête noire. I don’t know why she came to the Blue Note, maybe it was to make her date happy. But she was yawning, checking her watch, looking around the room, fiddling with this and that, doing everything except being engaged in the music.

McBride seemed to be too professional and too experienced to get brought down by her disrespect and disengagement. Here’s what he knew: It wasn’t about him, it wasn’t about the music, it wasn’t a response to what he was creating.

Haters gonna hate.

Shun the non-believers.

Do your work, your best work, the work that matters to you. For some people, you can say, “hey, it’s not for you.” That’s okay. If you try to delight the undelightable, you’ve made yourself miserable for no reason.

It’s sort of silly to make yourself miserable, but at least you ought to reserve it for times when you have a good reason.

Accidents are the mother of invention

Here’s a nice piece on the invention of the Slurpee (via Marginal Revolution). An excerpt:

Knedlik’s [Dairy Queen] franchise didn’t have a soda fountain, so he began placing shipments of bottled soda in his freezer to keep them cool. On one occasion, he left the sodas in a little too long, and had to apologetically serve them to his customers half-frozen; they were immensely popular.

When people began to show up demanding the beverages, Knedlik realized he had to find a way to scale, and formulated plans to build a machine that could help him do so.

You never know what customers are going to like. Here’s a secret, kids,– they do not teach you how to figure that out in business school. There’s not a formula or process to follow to do it, other than trial-and-error.

I think executives who are trying to find ways to grow their company should consider using more low-cost, trial-and-error discovery .

Better than charity

I agree (2nd to last paragraph), somewhat, with Google founder Larry Page: Give money to capitalists instead of charity (via Carpe Diem).

Where I disagree is that you don’t need to give them money. Rather, invest in them. Invest in entrepreneurship. Maybe get kids diddling less time away chasing college scholarships to play sports heavily subsidized by taxpayers and more time creating stuff of value.

Here’s more from me and Richard Branson on the subject.

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