Yesterday I received the new edition of the INC. Magazine, online. Reading through it, I stumbled over the article of Norm Brodsky, on page 52: “Are You Smart or Lucky?” Reading on I quickly realized that this message was about decision making.
Here´s the story of Norm Brodsky…..
Tell apart luck from smart!
There´s a big difference between being lucky and acting smart. The moment people look from a blinded (faulty) perspective on one decision criteria, which might be to again become successful with a new business real fast, the misunderstanding of the true reality might appear to “fool” you.
This is the case:
the new business idea was launching a chain of fast-casual Japanese Restaurants in NYC. The plan was to take them national which required 5 to 7 profitable locations in NYC. No easy task! To start the biz, the founders decided to launch the first restaurant in a location with a lot of foot traffic at lunchtime. The ideal answer was: near a college. Additionally it was a residential area which meant nighttime traffic as well. This is where they started and the restaurant was a success from the 1st. day on!
Early success was their indicator that the business model won´t fail because the concept was as right as the chosen location. The founders turned highly motivated …..
….. and real quick decided to open a 2nd. restaurant in another busy location. Now they chose a commercial area in Midtown, to reach the shoppers and employees of several local businesses. The result was that this restaurant was even more successful than the first.
Of course real quick they were ready for restaurant N°3! They chose a more “risky” location, uptown, with less foot traffic and no real lunchtime crowd, but other restaurants around did quite well. Their decision was set.
And what happened? Not as hoped or even expected (!), this new restaurant needed a lot more time than the 2 others. Even worse, for the founders it turned out to be a failure after only 3 weeks! They accidently benchmarked it with their 2 first restaurants which were placed in ideal lunchtime and traffic locations. Their thought process did not consider the reality of how long it normally takes to set up a successful restaurant. “Luckily” two men came in one day and confirmed their great biz idea and food.
The aim of the founders was to get to the next level real fast and the new third restaurant seemed to slow their process down. It was their perspective! But to prove the concept and model long-termly it was not realistic to always locate in high-traffic areas.
A good solution is to be creative to attract new customers!
The take away for you is: in terms of new business models we tend to make decisions via certain success-criteria. We focus on a benchmark to evaluate how successful a concept is. Therefore we compare figures to make further decisions. Be careful when doing a relevant benchmark for another big decision. Do not necessarily benchmark with your own biz, but rather with those around in the same location – as for restaurants.
If you think you´re “lucky” you might just be very smart, therefore stay realistic in the long-term process! A slower start doesn´t mean a big failure is ahead.
BE A DECISION MAKER. BECOME OUTSTANDING.
rita jaskolla – Leadership Architect –