“Pretend the business you own – or want to own – is the prototype for 5,000 more just like it.” (98)
If you create a solid foundational system for your business that employees can follow, it will make your business more system-oriented and less dependent on the whims and quirks of your employees. The better your system, the less that the quality of your employees matters.
One of the main benefits of having a written Operations Manual and a structure behind your business is that it helps the customer get a uniformly predictable, reliable service. This means that if the customer likes the service, he knows the next time he purchases it, it will be just as good.
The basic expectation of customers is that they will get a consistent experience. Do not regularly violate this expectation.
Basically, think of your business itself as a product.
“Creativity thinks up new things. Innovation does new things.” -Theodore Levitt, Harvard professor
Anytime you improve anything about your business, you will make more money than you would have otherwise.
“Innovation continually poses the question: ‘What is standing in the way of my customer getting what he wants from my business?’” (121)
Quantification – numerically measuring the impact of an innovation.
The only way to know the exact impact of an innovation is through rigorous quantification (ex: counting how many people came through the door at the time of a promotion).
Orchestration – ensuring that a good innovation is implemented every single time by eliminating employee discretion.
Without orchestration, you can’t have a franchise.
If you don’t know what your Primary Aim is, you can’t know if you’re moving toward it.
Ask yourself the following questions:
- What do I wish my life to look like?
- How do I wish my life to be like on a day-to-day basis?
- How much money will I need to do the things I wish to do? By when?
Strategic Objective – a clear statement of what your business must do to reach its Primary Aim.
The first standard of your strategic objective is money: how much money do you expect your business to make? Unexpected circumstances always happen, but some estimate is better than no estimate.
Focus on core values when defining your business. Commodities are just the things that your customer walks out with, your product is what your customer feels after dealing with your business.