When I look at my business, I believe that it is becoming increasingly more complex.
Perhaps I am just getting older, but I’d like to think that’s not it. I am clearly old enough to remember when we were open from 7 a.m. to midnight, when eight cooler doors and two cash registers were plenty. Our basic advantage over other retailers and grocers was that we were open more hours than our competition was, and our stores were positioned on convenient corners.
This relatively simple strategy worked well for a lot of years, but competitors increasingly figured out the “convenience model” and responded. Today, grocery stores are open 24 hours a day and have gas pumps. Fast feeders are also open 24 hours and have sophisticated drive-thru systems, and relatively new competitors such as Starbucks are keenly focused on our high-margin coffee customers and offer customer-friendly technology such as mobile payment.
I started in the c-store business in 1972 at the age of 12, working summers while I went to school and college. I am celebrating 25 years since I returned to my family’s business. As I look at the c-store model today, I see 24-hour operations, huge physical and costly stores with restaurants, bakeries, 20 fueling spots and so much more. Although some retailers have not changed their model much in the past 25 years, many of them are seeing decreasing sales and customer traffic per store. I have studied retail history, and that is not a good long-term formula. So you must change to survive.
An Effective Process
As we enter 2015 and create our long-term plans, the ability to sort through business challenges and develop successful strategies is increasingly important. Fourteen years ago, I came upon a strategic planning methodology that has helped to transform Rutter’s culture and playbook. If I had to identify just one thing that has driven our business success, it would be our strategic planning process. Today, we use this process and tools in every facet of our business.
I know that business strategic planning is a little like Baskin-Robbins ice cream: There are a bunch of flavors, and each flavor is not right for everyone. However, too often I see businesses approach strategic planning as a once-a-year exercise during which they get a bunch of people in a room and throw ideas up on a wall to see what might stick.
People leave that room feeling a bit better, but they really don’t have a good plan regarding what they are supposed to do, when they need to do it by and how to get the broader team involved. Team support for the plan can be lukewarm at best.
In no way do I want to suggest that our process would be effective for all organizations. However, I want share some of the basic concepts because I attribute so much of our success to it. So here goes.
A Culture of Discipline
The methodology is by Basadur and is called The Simplex Method. It is a planning methodology founded in a culture of understanding your complex business challenges and undertaking a process to find solutions. It forces your team to do things such as a SWOT analysis (strengths, weaknesses, opportunities and threats). It makes you identify the complex problems, and then begs the question: So what’s stopping us from overcoming these problems?
The iterative process of working your way through problems to find solutions is amazing. The building-block system creates a visual strategic map to guide you. The map is supported by specific goals and objectives for the team, which are updated and built upon each year.
To be effective, the whole team must be disciplined. I refer to it as the rowing-team model. If you observe rowing teams, you see that the winners always have their oars in the water at the same time. And, like the rowing metaphor, the system is also designed to engage the whole team, from the beginning to the end of the process.
We have used this process to drive our business changes across foodservice, technology, store design, personnel hiring and more. We develop all of our capital expenditure plans to it our strategic map. The process of paring down all the capital expenditures and operating budget requests is simplified by using the iterative process to both prioritize and reduce the list of requests.
Major initiatives such as our rewards program and pricing strategies all go through the same deliberate process. It is something we use all year long.
Without a doubt, much of our success and recognition is attributable to this process. Trust me: I do not own a business interest in it, nor do I make any money off recommending it. I just thought it was something worth sharing.
Wishing you and your team the very best in 2015!
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