While at NAFCD’s 36th Annual Meeting in Austin, Texas, Ari Weinzeig presented the session, “Key Elements of the Zingerman’s Experience: Building a Community of Businesses.”
To download the presentation Click Here
Below is a follow-up Q&A with Strategy Editor Dennis Coyle.
Dennis Coyle: You opened your presentation defining the differences between mission and vision statements. How important is that a company define both statements instead of stopping at a generic mission statement?
Ari Weinzeig: I think it’s critical. They’re both very important and I’m sure that having one is better than none, but I really recommend doing both.
The mission answers four questions:
- What do you do?
- Why do we do it?
- Who is that’s doing it?
- For whom are we doing?
A mission statement is essential but it really doesn’t give the clarity of what the organization will be like and be doing say five or ten years out. The vision by contrast paints a picture of what success is going to look like at a particular point in time in the future. It’s at much greater detail than the mission. Which, if you think about it, then also helps to define what the organization isn’t going to do too. So for instance, our 2020 vision says that all our businesses will be in the Ann Arbor area. Which by definition means that we aren’t going to open elsewhere.
DC: When you told the group you recently defined your vision through 2020, they all gasped. How can explain the process to them so that they feel they, too, can create a statement for 12, 15 years in the future?
AW: Basically it requires us to suspend the desire to figure out “how” we’re going to get to the vision. Instead the vision process starts with a blank piece of paper where we answer a question along the lines of: “It’s the year 2015. Paint a picture of a positive future — what does the business look like? Roughly, how big is it? What do the people who work there say about it? What does the community say? If you’re the owner, what do you do? Etc.”
The vision does not explain how we will get there. That’s something you do after you’ve agreed on the vision — it’s your strategic plan. That’s the “how.” The vision is the “what.”
DC: NAFCD members work within a competitive market, just like you in the restaurant industry. I know you have done a lot to differentiate yourself from other restaurants. In our industry, though, many try to differentiate themselves by offering the same products as their competitors but at lower costs. That is not healthy for long-term success. What are your recommendations to floor coverings people to differentiate themselves by something other then the cost of their products?
AW: Agreed. Our experience is that although it’s important to be competitive on pricing and provide value for our guests, competing mostly on price is likely doomed to failure. As you said, it’s not sustainable. We want to be around for a long, long time. Anyone can come out with a lower price at any given moment on any given product. In terms of positive differentiation, our mission and practical experience both dictate that what we’re here to do is provide a great experience for everyone we interact with. That experience is the work. We need to make sure that there are enough meaningful differences about our food, our service, the environment in which we’re working, etc. to make it worth the customer’s while to come to us. If we don’t have enough good reasons for them to come here then realistically they won’t. And of course because other businesses are trying to do the same thing we have to always be working on more ways to make the experience special.
DC: In regards to great customer service, you mentioned a story about a blackout. However, I lost my notes on it. Can you sum it up in a few sentences?
AW: I can’t remember off the cuff what year it was but I’m sure you could find it online because the whole Mideast was blacked out. I think it was the year after 9/11 in August. Basically…it was the evening of our annual plan kickoff session. The power went out all over the state/Mideast (of the United States!) and no one knew why or when it would be fixed. I went over to the deli to do what needed to be done and I found that everyone was already doing what needed to be taken care of long before I’d gotten there. the various Zingerman’s businesses were coordinating. Staff at the Bakehouse had gone to sit outside in the sun and was working cell phones since the phone lines were down. The deli staff were sampling gelato to customers in cars that stopped at the stoplight because they knew it was going to melt if they didn’t do something with it. You get the idea. I felt useless at first and felt like I should find some way to really “take charge” in the crisis, as a “good leader” would do. But then I realized that the leadership work we’d been doing for 20 years was paying off because everyone knew what to do in the crisis and was just doing it and doing it and having fun in the process. In the moment, they didn’t need me at all. And that was a good thing! So I went for a long run. The story still makes me cry when I tell it today because it was so great to just see people spontaneously pulling together to do the right thing the way they did.
DC: You provoked another gasp from the audience when you mentioned open book finance. Can you define exactly what open book finance is and why it can be successful? What are the benefits?
AW: The best book on it is Great Game of Business by Jack Stack and Bo Burlingham. In a nutshell, it’s where everyone in the business is involved in managing the finance. They see the numbers, they’re plan and forecast, and they’re responsible for getting results. They all see the profit and loss statements, balance sheets, etc and are a part of running the financial end of the business, regardless of whether they’re a dishwasher or a partner.
DC: When a company defines its guiding principles, what should they focus on? What advice do you have for them?
AW: In brief…getting clarity on one’s values or principles is very important. It’s not “why” we’re here but it’s how we’re committing to relate to each and the world en route to fulfilling our mission and vision. The guiding principles are not “best practices” — they’re what we truly hold in our hearts, what we really believe in and what we would do even when living them is actually not very strategically sound.