Sometimes It’s Just Not that Complicated

I had dinner last night with a new acquaintance who owns a highly successful manufacturing operation in the Midwest. It was fascinating hearing his story of how he left a job running a similar operation for a Fortune 500 company in the same town, because he did not like the way they did business. After several years of trying to work within the system (the big company had bought the privately-owned operation that he started with out of high school), he left, scraped up every available dollar he had saved, mortgaged his house to the hilt, purchased some used equipment, and opened his new company seven miles away from the old.

So many customers followed him that he was profitable within two months, and within four years the corporate-owned plant had shut its doors. He has since expanded to four times his original size, and is now enjoying his semi-retirement in South Florida, where I met him and his wife.

Here’s the funny thing: the company he originally worked for is a sophisticated $23B operation, founded over 125 years ago, with facilities around the globe. No doubt it enjoys cutting-edge strategic planning and best practices, as well as strict standards for talent acquisition and management. They could have made my friend the GM of their plant and saved a lot of trouble for themselves, but he was ineligible for the job because he hadn’t gone to college.

I asked him what his competitive advantage was that made him so successful. Was it low price, quality, service, some secret sauce? He immediately responded that it was not low prices at all—in fact, his prices are higher than his competitors’. He said:

“Jack, the reason people do business with us is that we do what we say we’re going to do. When someone calls us, a real person answers the phone. When they have a problem, we fix it as quickly as we can, even if we have to eat the cost. I’m old school, I never went to college, but I know what I’m good at.”

His words remind me of the Woody Allen quote: “Eighty percent of life is showing up.” Business pundits have written billions of words about what it takes to succeed, and maybe all their innovative ideas just mask the fact that there is a lot of money to be made by just doing the simple things well, and being someone that customers can rely on.