Tuesday, March 11, 2008

Analogy #163: Challenge Your Assumptions

What is it with Americans and breakfast foods? We seem to segregate food into two categories—food appropriate for breakfast and food appropriate for the rest of the day. And heaven forbid that we would confuse the two and eat one of these foods at the wrong time of the day.

Take, for example, oats. Oats are a common breakfast food found in oatmeal, oat bran muffins, and Cheerios cereal. However one almost never eats oats at any other time of the day.

And what about bread? For some reason, if it is eaten in the morning it has to be toasted. The rest of the day tends to be toast-free.

At McDonalds, I can get all kinds of beef patty combinations the rest of the day, but no pork. For breakfast, I can get all kinds of pork combinations, but no beef.

And then there are these silly substitutions:

1) I can only eat potato chips the rest of the day. For breakfast, they must be crispy hash browns.

2) I cannot eat chocolate cake for breakfast, but I can eat a gooey chocolate muffin.

3) I cannot eat a fruit pie for breakfast, but I can eat a fruit Danish.

4) Corn chips the rest of the day, corn flakes in the morning.

And then, of course, there is the magic egg. You can put almost any combination of any type of food on a plate, and as long as it is inside or next to an egg, it magically becomes a breakfast food. Take away the egg and it might be no longer appropriate for breakfast (think steak and eggs versus just steak).

As an act of defiance, for dinner today I made Ham and Eggs.

Our actions are based on assumptions. Some things are assumed to be right and other things assumed to be wrong. We are much more likely to do the things that fit into our assumptions about what is the right thing to do.

In the case of food, we tend to have assumptions about what is appropriate to eat for breakfast and what is appropriate to eat the rest of the day. Therefore, we eat different foods for breakfast versus the rest of the day.

Is there some medical reason for this? Do oats only have nutritional value in the morning? Is there something about the roundness of a muffin verses the triangular shape of a cake that makes round things better in the morning? Of course not. But the assumptions of what to eat at what times persist never-the-less.

Business decisions are also based on assumptions. We may not even consciously know what the assumptions are behind those decisions, just like we may not know why breakfast potatoes need to be in the form of hash browns.

Strategic planning is often about finding new opportunities. Many times these new opportunities can defy the prevailing assumptions of the day. If we do not challenge the root assumptions of society in our strategic planning process, we may become blind to all of the great opportunities which come from re-writing those assumptions.

The principle here is that behavior is an outcome of assumptions. Unless we challenge those assumptions, we may never get to the optimal behavior.

Take, for example the idea of re-engineering. We may have a ten-step process for getting something done. As part of a productivity strategy, we may want to make that ten-step process more efficient. One way to do that would be to examine each of the ten steps separately to find ways to make each step more efficient.

However, this is based on the assumption that all ten steps are really necessary. If we look at the process holistically, we may find that assumption to be invalid. Perhaps we can get that process done in only 5 steps if we re-engineer the whole thing. Eliminating half the steps could be a far greater productivity gain than just making each of the original ten steps marginally better. However, if the assumptions are never challenged, that 5 step process would not be discovered.

Great new business opportunities often fly in the face of old assumptions. There used to be an assumption that people expected drinking water to be essentially free. Nobody in their right mind would pay for a drink of water. Now the bottled water business is huge—one of the greatest new businesses to hit the food industry in a long time. People think nothing of paying more than a dollar for a drink of bottled water. If the old assumption had never been challenged, this great opportunity might never have occurred.

In an earlier blog, I talked about all the different business models that can be found in the pizza business (see “There’s More Than One Way to Slice Pizza”). If the old business models had not been challenged, then the new business models for pizza would not have been discovered.

Let’s go back to the breakfast foods. There really is a reason behind the segregation of food into these two categories. What one has to realize is that at one time, making dinner was a very time consuming chore. A little more than a half-century ago, the typical time for dinner preparation was around an hour and a half. If you go back more than a century, dinner preparation could take two hours or more. In addition, every day you had to find the time to bake your own fresh bread.

So here was the deal. Nobody had the time or inclination to spend two hours making a meal in the morning. You wanted to eat sooner than that. Back in the 1800s, there were only a limited number of foods you could prepare quickly. They were things like eggs, oatmeal and pancakes. That’s how they got assigned to the morning. The other foods took too much time to prepare, so they were relegated to later in the day.

The toast? Well, fresh baked bread at home did not have preservatives, and back in the 1800s, they didn’t have those nice plastic bags to keep the bread moist. As a result, the morning bread left over from yesterday’s baking was a little dried out. Toasting made the dry bread taste better.

Of course, those assumptions about time seem silly today. The average prep time for dinner these days is close to 15 minutes. Thanks to modern packaging and microwave ovens we can have just about any kind of food we want in about seven minutes or less. So all of the assumptions about what is appropriate for breakfast no longer apply. Yet the habits remain because not enough people are challenging the assumptions.

Yes, some restaurants are serving breakfast all day long. But why don’t they serve dinner all day long?

There is some movement in this direction by the fast food chains. McDonald’s attempted to position its McGriddles breakfast food as an end of the day meal for people who stayed up all night enjoying themselves at nightclubs. McDonald’s is also considering serving breakfast all day long. After all, it is among the highest margin meals they make. Taco Bell invented a new meal, which they call the fourth meal. It is eaten sometime between dinner and bed time. And of course, they plant the assumption that Taco Bell food is most appropriate for that fourth meal.

Therefore, sometime during the strategic planning process, it is wise to bring up the topic of assumptions.

First, we need to bring those hidden assumptions to the surface. If we are unaware of them, we cannot deal with them. They is a “why” for every action and if we know the assumptions, we will know the whys.

Second, we need to challenge those assumptions. Are they still valid, or have they become obsolete, like the assumptions around breakfast foods.

Third, if the assumptions are weak or obsolete, is there an opportunity to replace those assumptions? Great business opportunities to cut costs or create new industries may be possible under a different set of assumptions.

Fourth, we must assess how ingrained current habits are to determine how difficult it will be to change those habits and thought patterns. Some are harder to change than others. For example, clear beer was too far of a stretch for people to accept. The assumption that full-bodied beer must have full-bodied color was too hard to break.

Assumptions drive activities. If you want to optimize the activities of yourself and your customers, it is wise to challenge those assumptions.

This past week, the comic strip Mutts captured this idea of challenging assumptions well. The comic showed two birds sitting on a branch next to a warm, tropical beach. The first bird said to the second bird, “Bob, it’s about time we started to fly north.” The second bird looked at the current surroundings, thought a moment, and then replied, “Why?”

This bird was challenging the assumption that one has to fly north for the summer. Why not just hang out at the tropical beach?

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