Do Business Well

The abundance and sumptuousness of its food characterizes the Club Med vacation. Breakfast, for example, is a smorgasbord of fruit, all styles of eggs, pancakes, French toast, hot and cold cereals, and even steak and fish dishes. When vacationers first encounter this display, most sample as much of everything as they can. After a few days, however, most settle on a few favorites, blithely ignoring the rest. But don’t make the mistake of limiting their menu. What seduces the searchers is the liberating effect of choice. Actually availing themselves of the cornucopia comes second. Continue Reading »

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For years, E*Trade was content with the small piece of the stock brokerage business it had carved out by being the lowest-cost trader on Wall Street, an achievement made possible by automation and the no-frills service it offered. For the most part, its sixty-five thousand customers were independent, cost-conscious people who were comfortable making their own investment decisions and pleased to be paying about $15 to $20 per trade, compared to the $65 or so charged by most brokerage houses.

But E*Trade’s complacency was shaken in the mid-nineties, when Charles Schwab launched a new division that offered trades at $29.95, encroaching dangerously on E*Trade’s bargain-basement strategy. The company responded by hiring a young, ambitious chief executive officer, Christos Cotsakos, who quickly took the company public and released a flood of advertisements designed to raise its profile. At the same time, E*Trade focused on making its Web site easy to access and, even more important, fun to navigate. Continue Reading »

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Competition is fierce. In any given year in the United States, about ten thousand new QSR restaurants will open. “The barriers to entry for the restaurant business are pretty low,” Babrowski points out. “Anybody with enough money to line up rental space and get a little bit of equipment in it, and knows how to cook, can at least attempt to start in the restaurant business.” This means, she adds, that “there is almost a limitless stream of competitors,” though it is the “branded, organized competitors,” as she calls them, that McDonald’s concerns itself with most: Burger King, Wendy’s, Hardee’s, Taco Bell, and Roy Rogers. Continue Reading »

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Nothing is more important to streamliners than being able to depend on their business relationships. Far from lazy, this group just doesn’t want to spend time rethinking its decisions. They want to know exactly what they will be getting, time after time. Beware the company that strays from the predictable, as Coca-Cola found out when it introduced New Coke some years ago, unleashing uncounted protests from customers who liked Coke just the way it was. Coca-Cola hastily, and with some embarrassment, reintroduced its old Coke, renaming it Classic Coke.

Streamliners don’t like surprises, and particularly not the disruptive kind. They value market leaders they can rely on, who, when needed, will guide them through changes with a steady hand. Continue Reading »

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