Aaron Hoos

Every mall has a food court and, it seems to me, basically the same options: Usually a couple of Asian food places, an Italian place, a burger-and-fries place, and a sub place. The brands are usually pretty similar from one mall to another (at least in the malls I’ve shopped in).

Turns out, someone has been dubbed “the food court king” for his growth and broad brand lines represented at many food courts across Canada.

Stanley Ma is the founder of MTY, a food services company whose specialty is branding. They have 26 brands (some acquired and some developed in-house) and over 1,700 stores across Canada.

Read the article here: The food court king. Don’t miss the key lessons from this article:

1. Good growth is thoughtful, strategic, and patient.
2. Effective branding is an asset.
3. Successful businesses find synergies among its products and brands.

Learn more about MTY and see what brands they own at MTYgroup.com.

Last weekend was Canadian Thanksgiving, and my wife and I visited my parents in a neighboring province. I had brought along my Blackberry but not my laptop, and found myself with a few minutes of quiet to write a blog. As I was thinking about what to write, I discovered a problem:

I have hundreds (maybe thousands?) of blog ideas and whenever I think of a new one, I just dump it into a blog idea collecting point. The problem is, I have too many collecting points. I have blog ideas in my Blackberry, in Google Docs, in Evernote, in MindMeister, in my browser’s bookmarks, in a spiral-bound notebook by my desk, and in a couple of different files on my desktop. I usually blog while sitting at my computer and I usually have at least one of these collecting points open at any given time, so I can easily dive in whenever I want to write about something.

I never really thought about how inconvenient it was before… until I happened to be sitting in my parent’s livingroom, unable to access several of these collecting points.

Of course, it didn’t happen this way on purpose. It happened organically — a collecting point developed out of convenience and then just grew from there — but it isn’t very practical:

• There is duplication of ideas.
• Not all of these collecting points are accessible on my mobile.
• The topics I write about aren’t chosen strategically, but rather by in-the-moment convenience.

To solve this problem I need to consolidate my collecting points. I need one place to dump my ideas and to get an idea when it’s time to write. I’m streamlining this process to make it faster and easier to put ideas and to retrieve them.

Blog post ideas aren’t the only things that need to be consolidated. In the past, I’ve had similar situations with business growth files, customer contact information, marketing ideas, brand assets, business cards, to-do lists, and more.

I know I’m not the only one that this happens to. It happens to people in their personal organization and small business files, and it happens in large businesses, too. It’s a daunting task if you try to fix everything at once. However, if you start small and slowly move stuff into one source, it is solved in baby steps.

NEED A PLACE TO START?
The best place to start is on your mission-critical documents: Customer files or customer contact information — stuff related to your sales funnel. Get those in order. Anchor them into a single place… a place that is convenient to input data and to retrieve it. Find a place that allows you to use all the methods you typically input or retrieve with (i.e. mobile, desktop, remote desktop, etc.). If appropriate, consider the filetypes that will be there and make sure it can handle all the filetypes you need. Make sure you can search those files for information. Make sure it can scale with your growing pile of information.

Sure, this problem isn’t huge when you consider many other challenges that entrepreneurs face in day. But this kind of problem can reduce productivity, slowing someone down (or, in my case, making it very difficult to function at all). Streamlining your collecting points can make you operate your business more effectively.

In this BCG On Strategy series, I go chapter-by-chapter through the book: The Boston Consulting Group On Strategy: Classic Concepts and New Perspectives (2nd edition). Join me each week for BCG On Strategy at AaronHoos.com.

OVERVIEW: THE EXPERIENCE CURVE REVIEWED
Bruce Henderson wrote this chapter in 1974. In this chapter he continues with his line of thinking about the experience curve and its potentially positive cost-saving impact on businesses.

HIGHLIGHTS
Henderson writes that there are 4 factors that contribute to the experience curve: Learning, specialization, investment, and scale. Briefly…

• Learning to do the job better (whether it’s a small task or a larger business function) will help to speed up productivity by as much as 10% to 15% every time total output is doubled. This is the well-known learning curve.
• Specialization, which occurs when you narrow your focus on specific tasks, can also improve productivity — increasing output by another 10% to 15% every time total output is doubled. I suspect some of this was also apparent in the earliest studies of learning curves, and it’s one of the reasons why Ford was an early success in automobile manufacturing.
• Investment is a little more difficult to understand and there isn’t a specific percentage that Henderson ties to investment’s impact on the experience curve. He writes, “Return on investment does result in cost reduction. Without investment, capacity increase cannot occur and neither can cost reduction at constant capacity.”
• Scale, the addition of capacity (“scaling up”), is Henderson’s fourth contribution to experience curves. Henderson writes that in process industries, “an increase of 52 percent in capital cost [will] provide a 100 percent increase in capacity.” Here’s an example (adapted from Henderson): If your company spends $100 to produce 100 widgets, you can scale up with a total capital cost investment of $152 (your previous $100 plus another $52) to produce 200 widgets.

MY THOUGHTS
These four factors that contribute to the experience curve are good to know and important to implement in business. Unfortunately, entrepreneurs and small business owners can’t always afford the additional funds required to invest and scale. If they can’t get some additional funds (i.e. through a loan or through investors) those factors may be unavailable to them.

Fortunately, two other factors cost less up-front while still being able to provide dramatic cost savings (which could fund investment and scaling up in the future): Learning and specialization allow the business owner to get better and faster at what he or she does without having to spend more than they are already spending.

So, if you want to reduce costs and improve output, the fastest, cheapest way to do it is by learning everything you can about what you do and then breaking your work down into discrete units and learning to do each one better.

Several years ago, I drove a friend to the emergency room at a hospital. We checked in with the nurse and waited around for a while until a doctor saw him. The time we spent waiting (a couple of hours? I don’t remember exactly) was mostly spent wondering if the nurse had forgotten about us.

Compare that to a recent trip to the hospital: I hurt my lower back playing frisbee last weekend and on Thursday night the pain became so unbearable that I had to go to emergency. As soon as I entered, I was met by a security guard who had me fill out my basic information and who seated me in the triage area. Then about fifteen minutes later, I was called up to a processing clerk who checked my information and asked about allergies and stuff like that, and gave me an initial triage bracelet. Fifteen or twenty minutes later, a nurse met with me to ask for details about my injury, to check my temperature and blood pressure, and then to make a final triage assessment. Then, thirty to forty minutes later, I met with the doctor who did whatever doctors do to make us feel better. (Basically a couple of prescriptions to nice, strong medicine).

My experience was very different: Even though yesterday’s experience in the hospital required more people, I felt like I was being moved along in the process. There was a “touchpoint” every fifteen-to-twenty minutes where more information was gathered. Now, some of the information might have easily been gathered by the processing clerk instead of the initial triage nurse, and some of the information that the triage nurse gathered could have been gathered by the doctor instead. But I don’t think this was a “make work” situation. These were distinct events that helped me see and feel that my “file” was being moved in the right direction. Without a doubt, an efficiency expert might have something to say about this but as a patient, I felt like there was forward motion. It kept me from feeling frustrated and impatient.

HOW THIS RELATES TO YOUR SERVICE BUSINESS
Your business has a process and your customers are in that process. When someone buys from you, they want to take delivery right away, which isn’t always possible in service-based businesses. (As a writer, for example, it might take me days or weeks to deliver something that someone bought today).

Service businesses can draw their inspiration from my hospital experience by making sure that customers encounter a touchpoint from time to time throughout the waiting period.

It doesn’t have to be much — a quick phone call; a “here’s an update” email — but it will help your customer to feel confident in the attention you give to them and to sense the value of the relationship you have with them.

When I say “innovation”, what do you think of?

Chances are, you think of innovation in your products and services; you may think of blue widgets instead of the normal red ones, or you might think of a way to deliver faster, cheaper service. In the early days of the automobile, other manufacturers provided cars in other colors, innovating beyond Ford’s “any color as long as it was black”. Southwest Airlines provided faster, cheaper service at regional, non-core airports, innovating beyond the other mammoth airlines and their bloated operations.

Books like Blue Ocean Strategy (one of my favorites!) supports this idea of product- or service-specific innovation. However, your products and services aren’t the only place where innovation can happen.

Innovation can happen in your processes, too.

Your processes are the functions and actions required to operate your business but which aren’t necessarily tied to a specific product or service. Examples include:

• Accounting activities
• Order-fulfillment and distribution activities
• Sales funnel activities

A great example of this kind of innovation is Amazon. They didn’t invent or really innovate books (well, until they came out with the Kindle) but they did innovate their sales funnel and order-fulfillment.

Process innovation is better than product or service innovation anyway:

• Process innovation is harder for competitors to quickly discern and copy
• Process innovation doesn’t alienate customers as much as a change in products or services would
• Process innovation can have an immediate, positive impact on financials with some expenditure but without the same related tooling, inventory, or marketing costs

The only drawback (if you want to call it a drawback) is that you don’t end up with whiz-bang products and services because of it and you can’t always promote your innovation to customers. (“Buy from us. We have the most amazingly innovative accounting processes!”)

So you’ll still want to push for product or service innovation to stay ahead of competitors. But you’ll want to continue process innovation to turn your business into a finely-tuned machine.

Here’s what to do:

1. List the steps in your process. For example, your sales funnel might be: lead, prospect, customer, etc. Or, your accounting process might be: gather data, sort, input, submit to the accountant.
2. Identify the specific actions you take at each stage. Write down all of the distinct, discrete actions. For example, you might have an action in your sales funnel where you capture an email address. Or you might have an action in your accounting process where you put your documents into a box to bring over to the accountant’s office.
3. Treat each stage and each action like a specific sub-process that can be modified.
4. Apply some of the well-known innovation-creating tools. Start with a SWOT analysis then try Kim and Mauborgne’s Four Actions Framework.