The concept of the popular book and film Moneyball is a simple one. Baseball teams in the United States were picking players based on traditional methods rather than looking at cold, hard data. And once they did, they started winning. A lot.
One restaurant entrepreneur in the United States is doing the same thing with his business. And it’s helping him build an empire.
Geoff Tracy owns four restaurants in Washington DC, Maryland and Virginia. They’re fairly common looking restaurants, according to the Washingtonian. But behind the scenes, Tracey is tracking hundreds of different categories of data, from the amount of time it takes for a dish to reach a table, to what temperature the dishwashers have to be set.
It’s as meticulous as it sounds.
“Did Elizabeth bring your Pinot Gris within three minutes of the time you ordered it? Were your appetizers delivered within seven minutes, entrées within ten, desserts within seven? Were these plates described at the table before they were set in front of you? Were napkins refolded when you went to the restroom? Was non-bottled water referred to as “ice water” (correct) or “water” (incorrect)?”
It’s such a serious collection that every month Tracy says he brings in reviewers from an agency to do a comprehensive evaluation, noting even the tiniest of errors – a plate took 10 minutes when it should have taken seven.
This data is then collected and used to maintain consistency across all the locations, and a high performance among the staff. Each employee is assessed on 800 individual standards.
“Are all items chilled to 70 degrees before being placed in the walk-in refrigerator? Are wines by the glass dated to ensure freshness, and are they less than two days old? Is the dishwasher’s final rinse set at the proper temperature?”
This data is all then filed into reports, with monthly and quarterly reviews as well.
“Consistency,” Tracy says, “is a lot harder than it looks. It might just be the hardest thing of all to achieve.”
Tracy, who the publication notes is a down-to-earth entrepreneur, has always been a fan of control. When he waited tables in high school, after a fellow waiter was fired he offered to take over the whole front-of-house.
Interestingly, his boss told him to “stay the f–k out of the restaurant business”. He was apparently too nice.
Eventually, Tracey noted he didn’t want to run restaurants the way they’re normally run. He’s built an empire around this “super-actionable, super-precise data”.
He uses the data to provide reports to all his managers. It shows the tiniest of details – a spike in one report showed a manager was spending too much on bar minutes.
“I don’t think just measuring is what differentiates us,” one of the company’s employees notes. “What differentiates us is that we share that information with our managers in a way that is actionable, so that they can drill in and find out what’s wrong and make intelligent decisions.”
It’s a fascinating way of using data patterns that are usually collected online, to make improvements in bricks and mortar. As Tracey says, “the idea is to get better. To constantly improve”.
It’s certainly working. Last year the restaurants earned a profit of $1.1 million. Online review scores have coincided with the attention to detail.
“It’s work. It’s constant. It never ends. But it’s got to be fun, too.”
The investors who actually think buying Facebook shares is a good idea
The Facebook IPO has been a disaster. Listing at $US38 on May 18, the shares have lost more than 40% of their value since then. Last week they were trading at just $US21.
The listing was a disaster, with the NASDAQ suffering a technical glitch that shut investors out for several hours, while the stock itself didn’t enjoy the double-digit rises seen among some other tech stocks.
LinkedIn, the other social network, managed to perform better and has continued trading scores above its listing price.
But despite the disappointment, it turns out there are actually investors who think buying up Facebook is a good idea.
The company is actually heading into a period filled with question marks. Starting today, more than 1.6 billion shares are permitted to hit the market. Many of these investors are actually employees.
Many executives and investors have already sold off. Peter Thiel sold a huge chunk of his own shares, and early investor Accel Partners dumped a bunch of its own at the listing price.
But as it turns out, there are some investors who actually think Facebook still has what it takes. At The New York Times, Firsthand Funds chief investment officer Kevin Landis says an opportunity is arising from the ashes.
“Right now there’s a separation between the people who bought in because it was hot and the people who believed it could be one of the most valuable franchises,” Landis said.
After all, Facebook is profitable. It has hundreds of millions of active users. Its revenue is growing strong.
Chief operating officer Sheryl Sandberg attributes the disappointing stock level to a market figuring out how advertising will work within the social media framework.
“It took a long time for the TV market for advertising to be understood,” she told analysts last week. “We are still in the learning curve.”
There are good signs. Netflix chief executive Reed Hastings bought $1 million worth of shares last week.
And one investment trader admitted to the publication that customers are beginning to ask him: “When does it get stupid cheap?”
Meet the most important eCommerce entrepreneur in Russia
Building eCommerce in Russia has been a hard slog. Entrepreneurs have mostly categorised the country as too remote, too corrupt and too poor to build anything of value.
But there’s one company that’s acting to change that – and it’s making significant inroads while doing so.
Ozon Holdings is the largest company of its kind in Russia, turning over $303 million in sales last year. That’s nearly double the $165 million it took in 2010. The online department store, chronicled in this Fast Company piece, sells books, electronics, and household goods – just like Amazon or Walmart.
Who is at the head of this growing enterprise? Maelle Gavet – a woman who dares to run an online company in a country that respects neither women nor online companies.
Gavet has been able to succeed by arguing the long-awaited Russian online revolution is actually happening.
“It’s happening now,” she says. “Ecommerce is at a tipping point.”
The growing Russian median income is helping. It also has more than 70 million online users, which is more than any other European country.
Gavet is also attacking parts of the system that have prevented online commerce from working in the past – a shoddy postage system. So she’s created her own courier company, along with an online shoe store, and a site that sells airline tickets.
“We want to build the biggest online player in Russia,” Gavet says.
She’s certainly on the way. And she’s one of the few players tapping into a market that could prove to be extremely lucrative during the next few years.