Archive for the ‘New Revolutionaries’ category

Google+Apple=Goople, Goople = Game Changing

March 13th, 2008

From Umair on what makes Google and Apple so great:

The ends they’re working towards are similar: Goople aspires to – with laserlike intensity – change the world for the better. And where most of their competitors will sell out everything they believe in for a few bucks and a latte, Goople is deeply, radically purposive: they won’t compromise much, if anything, to achieve the goal of changing the world for the better. (One can argue that Google’s policy of following local content-filtering policies in China is a notable exception.) You’ll never see an ad on Google’s homepage, or a Mac that’s not a joy to use, even if Bill Gates, Gordon Gekko, and Lucifer held a fire sale, and mortgaged the world to Goople.

And that DNA opens new paths to strategy and advantage. Goople finds value chains and industries in deep strategy decay – where innovation and choice are stale, and consumers are besieged by lameness – like marketing, consumer electronics, TV, and perhaps the most troubled of all, mobile and music. Then Goople utterly eviscerates them: it reconstructs radical new ones – where friction has been vaporized, where complexity and variety explode – and so everyone really is better off. When Steve Jobs makes the iPhone carrier-neutral, kiss the traditional mobile value chain goodbye.

What will that influence look like?

The key components of DNA Google and Apple share let them overthrow yesterday’s stale approaches to strategy and advantage, and pursue entirely new ones with a vengeance. Goople does exactly the opposite of what orthodox strategy counsels: it makes peace where there was war, conquers through love instead of hate, listens to instead of shouts at consumers, perhaps most critically, takes huge risks to make the world better instead of avoiding risk to make it worse.

Goople is rewriting the rules of a very stale game: industrial-era strategy itself, which is really the prime mover behind the gathering economic storm on the horizon.

How Apple and Google Dominate – Umair Haque, Harvard Business

It couldn’t be more true and it the definition of Change the Game. As Umair says, “Google does exactly the opposite of what orthodox strategy counsels…” And that is why they continue to dominate, that is why they continue to innovate.

Rewrite the rules. Change the Game.

Zipcar Game Plan

March 1st, 2008

zipcarlogo

Car sharing meets car rentals. I love Zipcar (www.zipcar.com) because it changes the game. It creates green pastures of new business opportunity and growth, while it helps solve two pain points – car ownership & car rentals. The Cambridge, MA based company just announced the acquisition of Seattle based competitor Flexcar making it the only national car share company.

Zipcar excites me because they are solving consumer problems. We’ve all been through the hassles of trying to rent a car and know what a unpleasant time consuming process can be. For those living in a big city or attending a University know the troubles with car ownership and the simple task of parking. Zipcar solves both problems and in the process changes the rental car industry.

To join Zipcar all you need to do is become a member. You pay a low yearly fee ($50) and in return receive access to the zipcar online reservation system. In most cases Zipcar secures permanent parking spaces in parking lots or on campus where cars can be picked up and returned. You can rent the cars by the hour or the day and everything including gas and insurance is included in the membership.

In the last five years Zipcar revenue has soared from $2 million to $100 million. A recent INC. magazine article broke down the company’s road to success and I’d like to highlight a few points.

zipcar_mini

Before you grow – find your profit point. Zipcar figured it would need 40 members per car. To get it’s founding three cities profitable it would need 20,000 members. To get to these membership levels the company asked consumers what they required. The answer – better locations, better reliability. Zipcar answered by breaking each city into zones. Once they got one zone to work they would move to the next. They took a bigger problem, broke it up into little pieces and focused on making each piece work.

Get technical. Too often companies forget how important technical systems are to their growth. If your technical systems can’t scale with your growth, you’re done for. Make sure your tech works when you’re small and can scale when you get big. Zip car chose to go with the Japanese quality process Kaizen. Whichever operations approach you choose – follow it through.

Customize your branding to your customer segments. Zipcar highlights and places fleets of Prius hybrids in bohemian neighborhoods and BMW’s in upscale neighborhoods. Knowing your customer and delivering the right message to that customer is a key foundation for growth

Power, profits and rewards to those actually working. Give your managers and employees the power to make decisions and share in the profit and rewards. Zipcar puts its city managers in charge of their own profit and loss. This creates a competitive environment between city managers and sense of entrepreneurship. Each city figures out what promotions, events and service is most important to that specific city. Plus each manager has a cash incentive to keep things growing.

Expose your competitors weakness. Zipcar gladly allows consumers under 25 to become members. Traditional car rental companies charge huge fees or don’t allow rentals for insurance reasons. Zipcar knows college students paired with a sense of ownership means better driving records and lower insurance rates. The company also likes the Apple model of getting product into consumers hands quicker in the hopes they become lifelong customers later.

Prove you’re ready for the prime time. Zipcar didn’t raise money until they could prove the concept worked. This meant technology, cars, service, managers…all the things highlighted in this post. Once your company or product has proven it can scale, then raise money and scale like crazy. $2 million to $100 million in five years is proof in this continual growth through scale approach.

Zipcar plans to go from $100 million to $1 billion and based on how well they’ve executed to this point I wouldn’t doubt it. Zipcar is Changing the Game. Zipcar is a New Revolutionary.

The In-N-Out Burger Formula

February 20th, 2008

In-N-Out Burger Night For those of us living outside California, Arizona and Las Vegas a visit to In-N-Out has become a ritualistic requirement when visiting the southwest. I had the opportunity to once again bite into burger perfection this last week while on a golf vacation to Phoenix. Is there a fast food chain with a bigger cult following?

What makes In-N-Out a game changer is their constant pursuit to not be like the other fast food joints. Burger King, McDonald’s, Wendy’s they all play the market share game. If Wendy’s has a spicy chicken sandwich then Burger King and McDonald’s add one. What entails is a bloated menu of choices without a clear direction. Side Note – Carl Jr.’s/Hardees also thought the market share game played by the big 3 was a losing proposition. A few years ago they rebranded themselves as where you go for over-the-top, enough fat intake for two days in one burger and it has worked.

In-N-Out Menu

The first thing that sets In-N-Out Burger apart is the menu. There aren’t a bunch of crazy choices from salad to tacos. You get three combo choices a couple different drink choices, but thats about it. The beauty is in the simplicity, this is industrial engineering at it’s best. Everything at In-N-Out is made to order so building in efficiencies to the order/delivery process is very important. Advanced computer systems and algorithms developed by In-N-Out are rumored to actually predict 70-80% of the orders before they happen.

These slight enhancements only help speed up and deliver product sooner without sacrificing quality.

The easy lesson here – less is more. Less allows you to focus on what’s important to the customer (quality), focus on something and do it right, don’t worry about the 3% who want a salad, don’t let feature creep happen. Ask what can be taken away not what can be added.

The 500 Mile Rule. In-N-Out limits its expansion to 500 miles from its distribution center. This ensures each restaurant is getting the highest quality ingredients possible. In-N-Out doesn’t truck frozen patties across the country. They don’t truck frozen fries either. Everything made at In-N-Out is fresh. You can watch the employees slicing potatoes whole, preparing things like tomatoes and lettuce in front of you. With everything made fresh to order the company has made a decisive statement within the industry. You know exactly what you’re about to get when you visit an In-N-Out burger and I like that.

The Secret Menu. One of the easiest ways to build a cult following is through exclusivity. Not only do you have to be in one of three states but you can also order things not on the menu if you know what they are. The secret menu at In-N-Out is really not that secret. They post it on their own website and many fan websites list the options. But by offering a Flying Dutchman or Animal Style, In-N-Out creates a feeling of insider knowledge within their customer base. It never ceases to amaze me how excited people will get because they ordered something off the menu. This empowerment of the customer creates evangelists that help spread the company lore.

In-N-Out ad

For these reasons and many more In-N-Out helps define Change the Game strategy. They break out of bloody market share battles and create their own green pastures. They focus on quality and simplicity when the others focus on speed, price and multiple choice. They empower the consumer, they rely on word-of-mouth, they create an air of exclusivity.

In-N-Out Burger is 50+ years old, but in my book they are a New Revolutionary.

The Mario Batali Formula

April 20th, 2007

Mario Batali

While channel surfing last week I came across an hour long TV show on the Food Network called Chefography. The episode chronicled the success of Mario Batali and was actually quite interesting. As I watched I became more and more impressed with how far ahead of his time Mario is. There are so many lessons that can learned from his successful formula for any startup business.

The first thing that jumped out at me was his epiphany of simple things. From 1989-1992 Mario apprenticed in a small Italian village that led him to change everything he believed about food. In the documentary he says, “The most significant thing I’m sure I learned while in Italy was less about what to put on the plate and more about what not to put on the plate. The food was so simple it really implied absolute confidence in the ingredients. It was less about the cook’s white noise, what was rattling around in my head, and more about the peas being perfect, the papadelli being perfect and the cheese being perfect”.

You could easily switch out the food references with ’software’ or ‘product’ and get the same effect. It was less about what to put in the software/program/product and more about what not to put in the software/program/product. And he was coming to these conclusions back in 1992. A simplicity formula that would make 37signals proud.

And it still remains at the core of what Mario does. His first cookbook was title Simple Italian Food, 250 recipes containing Mario’s belief in the power of simplicity. The guy really does get it. He’s full of insightful quotes, “If you try to build something for a group of people you will never succeed, so you have to build it for yourself”, sounds a lot like some of the most popular websites. Built for the needs of a few people that caught on with a larger audience…sometimes for a different reason – think myspace, facebook, flickr. » Read more: The Mario Batali Formula