Do I contradict myself? Very well then….
- Kara Holm
- Jul 4, 2016
- 6 min read
I had planned to post this blog last Friday. However, Friday, July 1 was Canada Day and I am happy to report that the weather was lovely in Halifax and we were able to get outside and enjoy a day off – which morphed into a whole weekend of mostly down time. We walked in the park, tried a new restaurant, played cards in the yard, watched a lot of European football, and took care of some things that needed to be done. I was reminded that it is good to take time off because stepping back provides very helpful perspective. Unplugging, as I attempted this past weekend, is difficult. As a consultant I find the lines between work and my everyday life very blurry. This is an observation, not a complaint. Anyway I hope you all found a way to enjoy the long weekend, whether you were celebrating Canada Day or the Fourth of July, or enjoying some very exciting UEFA matches.
Now, onto the topic of today's www.itisadirtyjob.com blog. What do General Motors, Canada Post, Walt Whitman, and Canadian casinos have in common?
Last month I heard the President of GM Canada, Steve Carlisle, interviewed on CBC Radio’s The Current. [1] The host asked him if he notices how many GM cars are on the road when he is out and about. He said he did notice the cars brands, however, there was something else driving his observations: “…. I pay attention also to what people are doing with [cars], and how they’re behaving and where they’re going and how they’re using them.”
I thought that was a really interesting comment. Not only because it was customer-centric, which always peaks my interest, but because it suggested that GM is thinking about its business differently. For years, most of the big automotive manufacturers were working to get more people into more cars. This was the accepted way of doing business — particularly in North America — until the recession of 2008. Many automakers have emerged on the other side of the crisis, often with government support, fundamentally changed by the experience. Environmental considerations loom much larger in North America as increased density in urban centres and the popularization of the so-called sharing economy are changing how we think about transportation. Disrupters like Tesla Motors, a firm that is pioneering electric cars and energy storage, may be pushing the new direction but the old-school companies like GM have the production experience and distribution networks to deliver on new approaches, if they choose to accept the challenge.
And firms must step up and innovate if they want to survive. Many businesses that used to be dominant forces in the global economy are no longer in operation or have merged with other businesses or have lost influence. According to the American Enterprise Institute, only 12% of the companies that were listed on the Fortune 500 in 1955 were still there in 2014. Incidentally, GM is one of them. [2] As we have pointed out before in this blog, when a company is strategic and focuses on innovation, success follows. In this case we can equate success to long-term survival rates – although the path forward can be fraught.
Canada Post is an example of a company that has been fighting to stay relevant in the face of changing business realities. After struggling to find its way when email took over as our primary vehicle for correspondence, the Crown Corporation has recently been successful in developing its parcel delivery business to infill lost revenues from letter mail. Parcel shipments have been on the rise — I saw a report suggesting Canada Post’s parcel revenue grew by 12.5% during Q1 of this year — coinciding with the continued popularity of online shopping. Canada Post now makes frequent stops at my house delivering books from Amazon, The Book Depository and others. This morning I received a package from The Bay, which I was concerned might be delayed by the labour disruption brewing between Canada Post and its unionized workers. The amount of letter mail I receive declines every year. Many businesses, including major banks and utilities, are encouraging their customers to switch to e-billing, some even suggesting that patrons who want paper bills should pay for this service.
While the parcel business is going well, Canada Post has been the source of public controversy due to a decision to phase out home mail delivery. While eliminating home delivery may be a rational business decision based on volume and cost, many citizens believe getting your mail at home is a basic right. By ceasing home delivery Canada Post is seen to be abandoning its core identity, which is delivering mail. This attachment to home delivery of mail may seem like a strange contradiction – since the volume of letter mail has been declining and because suburban and rural Canadians have been getting their deliveries at postal boxes for years – because it is. As a Crown Corporation, Canada Post is subject to the pressures of public opinion.
Casinos in Canada face similar public pressure. They are also struggling to modernize and stay relevant to the next generation of entertainment seekers while satisfying their current customers. They are also required to operate within the tolerances of broader public perspective and the associated social licence.
So the challenge is: how can one innovate when people both expect continuity and want something different, and the business needs to be profitable? Is it possible both to fulfill the expectations people have of casinos and evolve? I believe it is… Walt Whitman wrote in his great poem Song of Myself:
Do I contradict myself?
Very well then I contradict myself,
(I am large, I contain multitudes.)
The advice we typically offer our clients is to be clear on your business objectives, and to know the audience you are trying to influence. Once you know your audience, you are able to focus your efforts in order to meet the specific audience's needs. Think about the present, but also look ahead to the future. We believe that in most cases your best opportunities are with your current customers, so casinos need to have short-term tactics in place that respect the legacy of the business and meet this important group's needs. That said, operators need to understand how to stay relevant to continue to generate revenues for their stakeholders into the future.
Increasingly, we see operators and Crown Corporations trying to balance their need to look after their current customers with the longer-term need to attract new customers. One provincial Crown representative said, correctly I think, that their job as a Crown Corporation is to look to the long term and operate the gaming business sustainably. This approach demands innovation and investment. These kinds of commitments and investments are more challenging for private businesses and publicly traded gaming companies due to the focus on immediate profits. As a result, non-government operators are often more focused on existing customers.
We also counsel clients to have a strategy for understanding and managing public perception. This is very often overlooked, despite the authority social licence has on the ability to operate. In Canada we have observed that most private operators leave this type of work to their provincial Crown partners, and many Crown Corporations (even those that directly operate their province’s casinos) tend to be reactive rather than proactive, in order to avoid political conflict. Neither approach supports the sustainability of the industry.
These is a lot of opportunity for gaming operators, their partners and suppliers to be more innovative in many aspects of their business – including their engagement in managing public perception. Our advice for today:
Be smart and strategic and make commitments. Focus on the people you can influence and engage with, and let go of those who will never engage with your products or services. Don’t waste your time trying to “win” business from people who don’t approve.
Be aware. Look for opportunities to evolve the business with new experiences, products or enhancements that extend your reach. But make sure you do not alienate your long-term customers as you evolve.
Be proud of your business and celebrate what you bring to your community – from revenues, to jobs, to great experiences.
Be large. Contain multitudes. Embrace the contradictions. Accept that it is possible to hold seemingly contradictory points of views without losing focus.
[1] Please view the transcript here.
[2] https://www.aei.org/publication/fortune-500-firms-in-1955-vs-2014-89-are-gone-and-were-all-better-off-because-of-that-dynamic-creative-destruction/
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