My friend and colleague at Decision Triggers, Dr. Steven Feinberg, would describe the art of questioning the givens as one of the strategic shifts that separate “advantage makers” – those business leaders who tackle seemingly insurmountable problems and come out ahead.
Question the givens: a tutorial
Ever notice how the world looks different when you’re looking at it from a different perspective? Viewing the battlefield from your opponent’s perspective – or from the top of a hill, a tree or a roof – gives you a view that the typical person doesn’t get when they’re knee deep in mud. The art of questioning the givens is the first step in finding a vantage point from which you can view the battlefield from a new perspective.
Bremen-based Prizeotel shows us an example of a brand that took a hard look at the givens and recast the idea of what a business hotel should be. “So what we really have is a design hotel, designed by an international designer, but we’re a budget product,” Prizeotel CEO and founder Marco Nussbaum told me.”We optimized the whole product and got the best of all worlds together in order to have Prizotel.”
The givens, budget hotel edition.
When you optimize a hotel for cost, you have to rigorously question the givens: whatever isn’t absolutely necessary is cut, and whatever adds labor cost needs to be reduced or eliminated.
Internationally renowned designer Karim Rashid handled the physical design of the entire hotel, from the selection of the bathroom fixtures to the room and lobby layouts. “Designing a high experience budget hotel was a fun challenge,” Karim told me. “The rooms were designed with a bargain budget per room for furniture, finishes and equipment. The design had to be very smart, maximize choices and use materials to have maximum impact. The budget constrains were challenging; however we were able to find solutions and suppliers that provided high design for little cost.”
As for the business decisions that drove Prizeotel’s P&L, Marco and his team had to make the hard decisions.
Do you need a fixed landline phone in the room? Do you know a business traveler today who doesn’t carry a cell phone? No. Out goes the phone terminal, the switch in the basement and the need to tally up the bill and argue about the long distance rates.
Do you need a minibar in the room? Why does that little bottle of scotch cost $8 anyway? Go down to the lobby, buy a drink and carry it up to your room. Problem solved. No fixture in the room, no labor to restock and tally up the costs.
Do you need a closet in the room? When the average business hotel stay is 1.2 days in Germany, so Marco told me, you don’t need to devote space to irrelevancy. Only half the rooms have closets, the others have a shelf for your suitcase and a place to hang your clothes.
Do you need pay TV? Do I need to tell you the problems that arguing over the bill in the morning is a hassle for hotel owners? Out go the infrastructure and the labor costs, in goes a flat screen television, free WiFi and an iPod dock. The room now has the amenities you’d expect in 2010 – not 1985.
Look at what just happened: all the costs that would normally get tallied up in the morning are now eliminated. Guests pay in full when they check in.
How would someone else look at this problem? Try on different personas.
What are “the facts”? These “facts” are your givens. Start here and ask yourself whether these facts can be manipulated, moved or replaced.
What structural changes have taken place in the world of your customers that materially impact your offering? For Marco, business travelers now have cell phones and laptops, meaning you don’t have to replace these in the room. What structural impacts affect your business?
Prizeotel now has the highest occupancy rate in Bremen and has plans for more hotels across Germany. Marco just has one problem. “Our problem is that people don’t always realize we’re a budget product. They think it’s a 4 star product but we’re a 2 star product at a 2 star price.”