Right Attitudes

The Key to Reinvention is Getting Back to the Basics

August 6, 2020 By Nagesh Belludi Leave a Comment

Leaders of turnarounds often succeed by putting the fundamentals on the table and insisting upon a greater emphasis on the basics.

The turnaround that CEO Brian Niccol has cooked up at Chipotle Mexican Grill [CMG] makes a great case study of the back-to-the-basics approach to management.

CEO Brian Niccol made Chipotle Fresh Again

The Basics Often Get Lost in a Speedy World

To set the context, here’s a concise history of Chipotle: founded in 1993 by chef Steve Ells, Chipotle found great success in marketing its near-local sourcing of fresher ingredients, using naturally-raised proteins, and on-premises cooking.

Chipotle grew swiftly and established itself as the flag-bearer of the fast-casual trend that spurned fast-food orthodoxy. McDonald’s was a major investor from 1998 until 2006 when Chipotle went public.

In 2015, Chipotle’s star began to fade away when hundreds of its customers got sick from infections with salmonella, E. coli, and norovirus. Worried that this short-term rough patch can turn into a long-term downward slide, the company’s board recruited Niccol from Yum Brands’s Taco Bell division in 2018.

CEO Brian Niccol made Chipotle Fresh Again by Focusing on the Basics

In two short years as CEO, Niccol has returned Chipotle to industry-leading performance and positioned the company for above-industry growth. His Barron’s ‘Streetwise’ interview with the inimitable Jack Hough provides an insight into how strategic business leaders think and make decisions:

When I arrived at Chipotle, I discovered that it was a company full of ideas; it lacked discipline and the focus to figure out the few things we wanted to do really well. Chipotle had lost focus on executing the basics of running a great restaurant.

We modernized food safety practices and emphasized avoiding contamination and educating food suppliers and farmers.

We went back to following the original culinary on how to make great food: getting the right char on the chicken, the right amount of lemon, and the right amount of chopped jalapenos.

Idea for Impact: Getting the basics right is often the first essential step to building a greater organization.

So many companies fail on their fundamentals—and don’t even realize it—especially when their businesses have grown, market conditions have changed, and the companies have taken on all sorts of complexities that have stumbled.

If you want your organization to pull through a slump or hit a new growth trajectory, consider cracking down on the basics.

Focus on your core values and your underlying business model, which are like beacons that can help steer you on the right track. Inquire why your organization exists. How should you operate? What is your market position? What matters to the organization’s mission and vision? Focus on doing the right thing—and doing it consistently over time.

A renewed emphasis on the strategic basics will put your company in the best possible position to navigate new strategic choices, as Niccol’s Chipotle has done.

Food Delivery Apps are Eating Up Your Money

August 3, 2020 By Nagesh Belludi Leave a Comment

Food delivery apps have been the salvation for restaurants—and laid-off workers—during the COVID-19 pandemic. However, the promotions and fees charged by the likes of Uber Eats and GrubHub are bleeding restaurants dry. According to the Washington Post, one restaurant with $1,043 in food sales was left with just $377 after GrubHub’s charges for delivery, commission, processing, and promotions.

The food delivery startups’ #eatlocal and #keeprestaurantsopen promotions are exploiting customers’ generosity. Customers aren’t really helping out local restaurants as much as they may think. WIRED notes,

Uber Eats has waived delivery fees to consumers on most phone orders but still charges a 25% commission on orders from restaurants it partners with.

On a normal Wednesday night, [one Miami restaurateur] would expect roughly $5,000 in revenue. This Wednesday, the total was $665. Of that, $523 came through delivery apps, primarily Uber Eats. Those commissions totaled $131, leaving him just $534 to cover rent, plus the cost of food and staff. His typical daily overhead is about $3,000. With reduced staff, it’s now $1,200—more than twice as much as his revenue Wednesday. “It’s not sustainable,” he says.

Uber Eats isn’t the only company accused of trying to capitalize on the crisis. GrubHub’s “Supper for Support” initiative, meant to encourage buying from local restaurants, drew widespread criticism. The deal offers a $10 discount on certain orders between 5 pm and 9 pm, but restaurants that opt in cover the discount, and GrubHub still charges its commission on the full price.

Customers ought to know about these apps’ deceptive business practices and be able to make meaningful choices about patronizing local businesses.

In 2018, food delivery raked an estimated $161BB in sales worldwide, and the potential market size has attracted a great deal of startup funding. En bloc, the food delivery business has struggled to sustain itself profitably. The restaurants are particularly agitated, not least because food is a low-margin business, and the fiercely competitive meal-delivery firms just can’t recompense restaurants and riders as much as needed.

Idea for Impact: If you want to support your local businesses, patronize them directly. Call your order in. Pick up the order yourself or get your food delivered by the restaurant itself. Cut out the intermediary.

Inspirational Quotations #852

August 2, 2020 By Nagesh Belludi

No wind favors him who has no destined port.
—Michel de Montaigne (French Essayist)

Water is the most precious, limited natural resource we have in this country…But because water belongs to no one – except the people – special interests, including government polluters, use it as their private sewers
—Ralph Nader (American Activist)

Take the risk of thinking for yourself. Much more happiness, truth, beauty and wisdom will come to you that way.
—Christopher Hitchens (Anglo-American Social Critic)

No nation became great by becoming rich. Neither does a man find enduring satisfaction in life by owning something—only by becoming something.
—Norman Vincent Peale (American Clergyman, Self-Help Author)

I never approve, or disapprove, of anything now. It is an absurd attitude to take towards life. We are not sent into the world to air our moral prejudices. I never take any notice of what common people say, and I never interfere with what charming people do.
—Oscar Wilde (Irish Poet)

Love me when I least deserve it, because that’s when I really need it.
—Swedish Proverb

This life is what you make it. Not matter what, you’re going to mess up sometimes, it’s a universal truth.
—Marilyn Monroe (American Actor)

The purpose of morality is to teach you, not to suffer and die, but to enjoy yourself and live.
—Ayn Rand (Russian-born American Novelist)

Do not leave to the morning the business of the evening.
—Turkish Proverb

Friendship is a pretty full-time occupation if you really are friendly with somebody. You can’t have too many friends because then you’re just not really friends.
—Truman Capote (American Novelist)

You will find out that Charity is a heavy burden to carry, heavier than the kettle of soup and the full basket. But you will keep your gentleness and your smile. It is not enough to give soup and bread. This the rich can do. You are the servant of the poor, always smiling and good-humored. They are your masters, terribly sensitive and exacting master you will see and the uglier and the dirtier they will be, the more unjust and insulting, the more love you must give them. It is only for your love alone that the poor will forgive you the bread you give to them.
—Vincent de Paul (French Catholic Saint)

Man is a paradoxical being—the constant glory and scandal of this world.
—Sarvepalli Radhakrishnan (Indian Philosopher, Political Leader)

It is more offensive to outshine in dignity than in personal attractions.
—Baltasar Gracian (Spanish Philosopher, Prose Writer)

Putting the WOW in Customer Service // Book Summary of Tony Hsieh’s Delivering Happiness

July 30, 2020 By Nagesh Belludi Leave a Comment

To keep your customers in the present day, you can’t be content just to please them. If you want your business to thrive, you have to produce enthusiastic aficionados—customers who’re so keyed up about how you treat them that they want to tell stories about you. These customers and their cult-like loyalty become a key element of your sales force.

American entrepreneur Tony Hsieh built the online retail store Zappos on the fundamental idea that great service is not a happenstance. It starts when leaders decide what kind of experience they want their customers to have—and articulate that approach in a clear mission and vision. As in the case of luxury hotel chain Ritz-Carlton, leaders keep the mission alive by empowering their employees to go the extra mile for the customer. Above all, when it comes from the heart, great customer service keeps customers coming back over and over.

In Delivering Happiness: A Path to Profits, Passion, and Purpose (2010,) Hsieh discusses the importance of cultivating happiness as a launch pad to better results for your business.

How Zappos Profits from The Happiness Business

Hsieh did not create Zappos. He was one of the startup’s initial investors but got sucked in to help the original founder after six years. Zappos operated in survival mode for a while. As it began to outlive its financial struggles, Hsieh and his leadership team went about building an intentional corporate culture dedicated to employee empowerment and the promise of delivering happiness through a valued workforce and devoted customers.

Over the years, the number one driver of our growth at Zappos has been repeat customers and word of mouth. Our philosophy has been to take most of the money we would have spent on paid advertising and invest it into customer service and the customer experience instead, letting our customers do the marketing for us through word of mouth.

Hsieh tells his entrepreneurial life experiences, often presenting biographical stories to make his line of reasoning. Many great entrepreneurs got started early, and Hsieh is no exception. He started with worm-farming (age 7,) button-making (elementary school,) magic tricks involving dental dams (high school,) burger joint (college,) and web-consulting (post-college) before having considerable financial success with the internet advertising firm LinkExchange (sold in 1998 to Microsoft for $265 million.)

In 2009, Hsieh sold Zappos to Amazon for $847 million under pressure from Sequoia Capital, a major financier of Zappos. As a point of reference, Hsieh later recalled,

Some board members had always viewed our company culture as a pet project—“Tony’s social experiments,” they called it. I disagreed. I believe that getting the culture right is the most important thing a company can do. But the board took the conventional view–namely, that a business should focus on profitability first and then use the profits to do nice things for its employees. The board’s attitude was that my “social experiments” might make for good PR but that they didn’t move the overall business forward. The board wanted me, or whoever was CEO, to spend less time on worrying about employee happiness and more time selling shoes.

How Zappos Fostered a Culture and a Business Model Based on the Notion of Happiness

Delivering Happiness - Tony Hsieh of Zappos Zappos’s corporate culture is guided by ten core values, which aspire to empower employees, create a sense of community in the workplace (employees are encouraged to “create fun and a little weirdness” in the office and build personal connections with colleagues,) and serve a higher purpose beyond bottom-line metrics.

Zappos’s core values include: deliver WOW through service (#1,) be humble (#10,) do more with less (#8,) be passionate and determined (#9,) and create fun and a little weirdness (#3.)
Zappos wants only those employees who really want to work for the company. All new employees attend a four-week training program that immerses them in the company’s strategy, culture, and customer-obsession. Zappos offers $2,000 to walk out at the end of the first week, and the offer stands until the end of the fourth week. Only a small number of new employees take the offer.
Zappos challenges all employees to make at least one improvement every week. Allowing employees to improve the tasks they’re doing and enhancing the processes that they’re responsible for executing allows them to make their jobs more meaningful.
Instead of measuring call center efficiency by the time each call center operator spends on the phone with a customer, Zappos developed its own scorecards. Zappos quantifies such things as the personal and emotional connections operators make with customers using measures such as measuring the number of thank you cards.

Zappos is Obsessed with Impressing Customers

By focusing on company culture, everything else—such as building a brand with sustained revenue growth, fast turnaround times at warehouses, and passionate employees—fell into place.

Happiness is really just about four things: perceived control, perceived progress, connectedness (number and depth of your relationships,) and vision/meaning (being part of something bigger than yourself.)

Recommendation: Read Tony Hsieh’s Delivering Happiness. This insightful tome is brimming with practicable ideas on customer service, building a positive company culture, best hiring practices, how to motivate and train your team, and setting business goals and values. The core elements of Zappos’s DNA—purpose, happiness, culture, and profits—are an effective framework for making happiness a business model.

Power Inspires Hypocrisy

July 27, 2020 By Nagesh Belludi Leave a Comment

Mark Hurd, whom I featured in Friday’s article, was one of the most respected and eminent leaders in Silicon Valley until his mighty fall following his dalliance with a contractor during his time as CEO of Hewlett Packard (HP.)

Hurd had hired this contractor, a glamour model, as a “hostess” for “executive summit events,” even at out-of-town places where there is no HP event, but Hurd happened to be.

Power Corrupts and Inspires Hypocrisy Hurd was ultimately exonerated of violating HP’s sexual-harassment policy (nothing was consummated with the contractor, and Hurd settled with the accuser for undisclosed terms) but he was officially charged with drumming up expense reports.

Hurd walked away from HP with a $34 million severance package. Almost immediately, he became co-president of Oracle, earning $11 million a year and options.

Much has been speculated about the real reasons HP’s board gave Hurd the boot, especially considering that he probably falsified his just an expense report just the once. Even then, said expenses were petty compared to the massive turnaround he had engineered at HP after walking into a very troubling situation. Hurd was famed for his no-nonsense management style and for finagling a culture of operational excellence at HP.

When the Hurd controversy broke out, Wall Street Journal’s Jonah Lehrer argued that when nice people rise to positions of power, “authority atrophies the very talents that got them there.”

The very traits that helped leaders accumulate control in the first place all but disappear once they rise to power. Instead of being polite, honest and outgoing, they become impulsive, reckless and rude.

Contrary to the notion that nice guys finish last, research shows that the surest way to accumulate power is to do unto others as you would have them do unto you.

But once nice guys reach the top, the headiness of wielding power causes them to morph into a very different kind of beast. They lose their ability to empathize with others, especially lesser mortals, and ignore information that doesn’t confirm what they already believe. Most tellingly, perhaps, they learn to excuse faults in themselves that they are quick to condemn in others. That’s not to say that every CEO is a secret villain. But even the most virtuous people can be undone by the corner office.

Idea for Impact: Power can become an enabler of corruption, deceit, and hypocrisy. People in positions of power have incentives to hold others to strict account for their behaviors even as they themselves act up, especially when the odds of being caught and punished are slim.

Inspirational Quotations #851

July 26, 2020 By Nagesh Belludi

There is all the difference in the world between the criminal’s avoiding the public eye and the civil disobedience’s taking the law into his own hands in open defiance. This distinction between an open violation of the law, performed in public, and a clandestine one is so glaringly obvious that it can be neglected only by prejudice or ill will.
—Hannah Arendt (German-American Political Theorist)

Satire lies about literary men while they live and eulogy lies about them when they die.
—Voltaire (French Philosopher, Author)

They say that nobody is perfect. Then they tell you practice makes perfect. I wish they’d make up their minds.
—Wilt Chamberlain (American Sportsperson)

The decay of logic results from an untroubled assumption that the particular is real and the universal is not.
—C. S. Lewis (Irish-born Author, Scholar)

Worship is a way of seeing the world in the light of God.
—Abraham Joshua Heschel (American Jewish Rabbi)

The artist belongs to his work, not the work to the artist.
—Novalis (German Romantic Poet)

Never forget that your life passes as swiftly as a flash of lightening or a wave of your hand, while you have the opportunity to practice, don’t waste a moment: devote all your energy to the spiritual path.
—Dilgo Khyentse Rinpoche (Tibetan Buddhist Teacher)

Today is the first day of the rest of your life.
—Abbie Hoffman (American Political Activist)

There are some things which cannot be learned quickly, and time, which is all we have, must be paid heavily for their acquiring. They are the very simplest things and because it takes a man’s life to know them the little new that each man gets from life is very costly and the only heritage he has to leave.
—Ernest Hemingway (American Author)

I don’t look to jump over 7-foot bars: I look around for 1-foot bars that I can step over.
—Warren Buffett (American Investor)

Pride is increased by ignorance; those assume the most who know the least.
—John Gay (English Poet, Dramatist)

Self-interest is the most powerful force in the world. People in unethical, predatory, and nonsense jobs will do mental gymnastics to convince themselves they’re doing the right thing. Those who criticize the behavior of “greedy Wall Street bankers” underestimate their tendency to do the same thing if offered an eight-figure salary.
—Morgan Housel (American Financial Journalist, Investor)

A great statesman is he who knows when to depart from traditions, as well as when to adhere to them.
—John Stuart Mill (English Philosopher, Economist)

Steak, Not Sizzle

July 23, 2020 By Nagesh Belludi Leave a Comment

Mark Hurd, the recently-departed executive of NCR and CEO HP and Oracle, recalled this best advice he ever got:

When I moved to a head-office in Dayton in 1988, an NCR executive was giving a presentation; he had great slides and an even better delivery. The CEO, Chuck Exley, listened to the entire presentation in his typically gracious, courteous manner. At the conclusion, he nodded and said something brief but profound: “Good story, but it’s hard to look smart with bad numbers.” And as I reflected on it, the presenter, articulate as he was, as good as his slides were, simply had bad numbers.

That comment has always stayed with me. You have to focus on the underlying substance. There’s just no way to disguise poor performance. I’ve tried to follow that advice throughout my career. Deliver good numbers, and you earn the right for people to listen to you.

Idea for Impact: Don’t Succumb to Hype

Steak, Not Sizzle - Don't succumb to marketing and branding hype Marketing and branding have conditioned society to play up—and be attracted to—sizzle over steak. Style over substance.

Sizzle can only get you so far.

Focus on the steak. It is considerate and farsighted and more fulfilling to focus on substantive ideas, products, and presentations.

For sure, sizzle is important. Only when you have a good steak, add some sizzle to promote the bejesus out of whatever it is you have to offer.

How to Read Faster and Better

July 20, 2020 By Nagesh Belludi Leave a Comment

Look at the big picture first.

When reading new, unfamiliar material, do not leap directly into it. You can increase your comprehension and retention if you scan the material first.

Skim headings, subheadings, photo captions, and any available summaries.

Sense how the author has organized the key points. With reports and articles, read the first sentence of each paragraph, with books, glance at the table of contents, and chapter introductions. Scan the initial and concluding paragraphs of each section.

All this previewing will help anchor in your mind what you then read.

However, speed-reading doesn’t work if you need to really get to grips with the content of a piece of writing. So much of what’s significant about reading isn’t just about processing words.

Learn to pace your reading as per your purpose:

Read very fast if you’re looking only for a specific piece of information—skimming over revision notes before an exam.
Skim over text rapidly if you’re trying to get just general idea without worrying about details, like scanning a news article.
Read at a moderate pace if you want to comprehend and retain what you are reading. The more difficult the text, the slower you’ll read. Some texts will require rereading.
Read very slowly if you’re probing a text or soaking up its substance. When you just want to sit down and enjoy a good book, what’s the point in rushing anyway? After all, reading is about exploration, appreciating the beauty of a well-crafted sentence, thinking deeply, and following your imagination. Refer to Mortimer Adler’s guide to intelligent reading, How to Read a Book (1972; my summary.)

Idea for Impact: Reading is a skill, and, like any other skill, it’s worth your time to take, master, and enjoy. Skimming will help you cope with the overwhelming amount of text you’ll have to read in this day and age.

Inspirational Quotations #850

July 19, 2020 By Nagesh Belludi

All wish to possess knowledge, but few, comparatively speaking, are willing to pay the price.
—Juvenal (Roman Poet)

Never lend books, for no one ever returns them. The only books I have in my library are those that other folks have lent me.
—Anatole France (French Novelist)

Prayer is the little implement through which men reach; where presence is denied them.
—Emily Dickinson (American Poet)

The difference between one man and another is not mere ability … it is energy.
—Thomas Arnold (English Educationalist)

Of all God’s gifts to the sighted man, color is holiest, the most divine, the most solemn.
—John Ruskin (English Art Critic)

There is but one way to tranquillity of mind and happiness; let this, therefore, be always ready at hand with thee, both when thou wakest early in the morning, and all the day long, and when thou goest late to sleep, to account no external things thine own, but commit all these to God.
—Epictetus (Ancient Greek Philosopher)

Life is a journey up a spiral staircase; as we grow older we cover the ground covered we have covered before, only higher up; as we look down the winding stair below us we measure our progress by the number of places where we were but no longer are. The journey is both repetitious and progressive; we go both round and upward.
—William Butler Yeats (Irish Poet)

Literature is a great staff, but a sorry crutch.
—Walter Scott (Scottish Novelist)

Shakespeare, Leonardo Da Vinci, Benjamin Franklin, and Lincoln never saw a movie, heard a radio, or looked at a TV. They had loneliness and knew what to do with it. They were not afraid of being lonely because they knew that was when the creative mood in them would mark.
—Carl Sandburg (American Poet, Historian)

It matters not how long you live, but how well.
—Publilius Syrus (Syrian-born Latin Writer)

Nothing is more dreadful than a cold, unimpassioned indulgence. And love infallibly becomes cold and unimpassioned when it is too lightly made.
—Aldous Huxley (English Humanist)

If only people thought a little more about it, they would see that life is not worrying about so much.
—Mikhail Lermontov (Russian Novelist, Poet)

There’s no voiceless, there’s only the deliberately silenced or the purposely unheard.
—Arundhati Roy (Indian Novelist, Activist)

All oppression creates a state of war; this is no exception.
—Simone de Beauvoir (French Philosopher)

Gratitude is the memory of the heart; therefore forget not to say often, I have all I have ever enjoyed.
—Lydia Maria Child (American Abolitionist)

Easy Ways to Boost Your Focus & Break That Awful Multitasking Habit

July 18, 2020 By Nagesh Belludi Leave a Comment

If you’re struggling to focus on getting work done, perhaps the following tips may help.

1. Simplify Your Environment. We, humans, are biologically programmed to pay attention to new stimuli. Disable notifications on your phone, close the unnecessary windows on your screen, and clear up unnecessary papers. Switch off to switch on. Find a quiet space in the office or retreat to the local library or a tearoom.

2. Make Your Mind Up to Focus. Set aside a block of time—even if it’s just ten minutes—to handle a mentally challenging task without interruptions. Quite often, seemingly difficult tasks get easier once you get working on them, even if you force yourself to go through the motions. Extend the time further—schedule ten, twenty, or thirty more minutes of work.

Easy Ways to Boost Your Focus & Break That Awful Multitasking Habit 3. Embrace Your Struggles. Any task that takes mental effort, or involves critical thinking and creativity, is going to be a little daunting initially. When you hit a wall, don’t quit and breakout to something easier. Labor through and push onwards.

4. Take Adequate Breaks. Humans work in cycles; we can focus for a period but then need time to rest. Try the popular ‘Pomodoro Technique’: work for a concentrated 25 minutes, take a 5-minute time out, then dive back in for another Pomodoro. After four Pomodoros, take a long break. During each break, leave your desk or take a break from your screen. Go for a quick walk around the block, step away from your desk for a few minutes, or make a cup of tea. Realizing that you only have a set amount of time to complete a task before a break, the Pomodoro Technique tends to keep you on the task rather than drifting from one diversion to another.

By ditching multitasking and regaining focus, you can reduce distraction, lower stress levels, and put more of your energy into what’s important instead—one single task at a time.

The Basics Often Get Lost in a Speedy World

CEO Brian Niccol made Chipotle Fresh Again by Focusing on the Basics

Idea for Impact: Getting the basics right is often the first essential step to building a greater organization.

Wondering what to read next?

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How Zappos Profits from The Happiness Business

How Zappos Fostered a Culture and a Business Model Based on the Notion of Happiness

Zappos is Obsessed with Impressing Customers

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Idea for Impact: Don’t Succumb to Hype

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