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Lady Gaga Isn’t a More Efficient Brittany Spears.

May 27th, 2011 · 1 Comment · Ideas

Big Idea:

  • You can’t optimize yourself to greatness, outrageous results require outrageous actions.

Business Lady Gaga Style

Entrepreneurship, Lady Gaga Style

Love her or hate her, there is no denying that Lady Gaga is a superstar. She knows how to shock, entertain and continually push the bar. From bikini stage outfits to arriving at an awards ceremony in a man-carried egg, Lady Gaga knows how to make a splash.

Most businesses don’t think like Lady Gaga. Playing by the rules and doing what everyone else is doing is much safer than taking bold risks. That is why the state of business is so damn lousy. How often are you wowed by a company?

The Problem with Businesses

Ramit Sethi of Iwillteachyoutoberich.com wrote something that has bothered me for a while:

Years ago, American Airlines removed one olive from each first-class salad, resulting in a savings of $40,000/year. They are a massive public company with huge scale, so you can’t get those kinds of results. But the principle — focusing on small actions that give you incredibly huge results — is something you can do.

I am a huge fan of Ramit and I certainly believe in the idea of the Pareto Principle or the 80/20 rule where focusing on high impact areas can deliver disproportionate results, however I don’t think American Airlines cutting an olive from salads falls in that category.

Far too many businesses strive to cut costs and get more efficient as a way to success. That mentality might of worked in the industrial age, but we are long past that stage.

Do you think Lady Gaga has achieved the level of success she has because she is more efficient or better at cost cutting than the hundreds of thousands of less successful performers?

So many businesses are obsessed about keeping labour costs to some predetermined percentage of sales. Squeezing even an extra 0.1 percent can potentially add a lot of money to immediate profits but at what cost? Companies bullshit about how important customer service and employee satisfaction are, yet try to cut worker hours down to a bare minimum. The result is overworked, stress out employees and customers that are not getting satisfactory service.

What if those companies took a hit up front and actually increased the amount of staff on hand? What would be the long term benefit of a less stressed workforce or customers that can actually get the assistance they need?

United Airlines cut the olive from martinis in business class. Do you think those passengers noticed? I know some that did. What is the cost of an olive per business class traveler? They are saving five or ten cents on a fare that can be thousands of dollars.

That type of cost cutting is short sighted and self-defeating. I wonder how much the consultants were paid that provided the idea to cut an olive from the two airlines? My guess is that companies spending their time counting olives have much bigger problems to deal with.

Seth Godin said,

We see one organization after another, left unchecked, pushing miners or laborers or bureaucrats to exhaustion, all in the name of enhanced productivity.

Cash flow and costs are important but you can’t optimize your way to greatness. (Unless you do it to an extreme, Walmart style.) Instead of trying to giving your customers as little as possible, how about taking a cue from Lady Gaga and go full out for every interaction?

Action Items

  • Are you running your business with an accountant or entrepreneur mindset?
  • Are your trying to be more efficient or are you growing a business?
  • Instead of trying to cut from your customers, think about where you can add more value.
  • What small thing could you do for your customers or staff that would generate disproportionate results?
  • Is there merit in diverting a portion of your marketing budget to making current customers happier? It is much cheaper to keep a current customer than it is to find a new one.

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