Tag Archives: economics

What ever happened to full service gas stations?

Leave a reply

Octane options in west TX

First, let me say that as an open-road loving, completely car-dependent American, I have been pumping my own gas since I was 16. I’m not the squeamish type or afraid to get my hands dirty.

But whatever happened to full service gas stations? While popping my own hood and adding a quart of 10W-30 is a great learning experience for my daughter to watch me do, it’s not quite how I’d like to spend my morning when I’m already dressed for work. What I wouldn’t have given for just one full-service gas station anywhere on my commute!

Mornings like these make me think of the “old” ways when service wasn’t a four-letter at the gas station. But is it really an “old” idea to crave a deeper interaction with the company with which you do business?

In an age where exceptional customer service, rather than the product itself, is the key differentiator for so many companies, why are sellers expecting consumers to be more and more self-service?

While it may have started in the highly price-sensitive, highly commoditized market of filling stations, my missing gas jockey isn’t the only disappearing dinosaur. Consumers are being completely self-provisioned even in traditional, brick-and-mortar stores. I have often used the expeditious self-checkout at the grocery store and innovative retailers, such as Apple, are working hard to ensure I don’t even need to wait in that line. With a smartphone and the right app, customers can scan and pay and walk out without speaking to an employee or touching a single piece of store equipment.

Somehow, in the race to “cloud-ify” the purchase/transaction experience, companies have lost sight of how to authentically connect with customers. The benefits of this strategy, particularly during busy, holiday shopping times, are obvious. But how does it affect customers?

I rely on the expertise of knowledgeable staff to help me choose the right product and help me use it the right way. At the gas station, that’s someone to check my oil and tire pressure as well as pump my gas, if I want it. At the grocery store, a balloon for my toddler and a few free samples would do the trick. Savvy consumers are willing to pay premium prices for premium experiences.

Rather than an anonymous, self-serve self-checkout where consumers are completely disconnected from the brand, companies who want to succeed should focus on creating added value around their services, connecting with their customers, and providing an experience that exceeds their customers’ expectations. Seriously, if there’s a pretty girl in a skirt and heels on her way to work – show some southern hospitality and have staff to pump her gas for her!

Book Review: The Future of Nonprofits

Leave a reply

The Future of NonprofitsThe Future of Nonprofits: Innovate and Thrive in the Digital Age is a new book by Randal C Moss (@randalc) and David J Neff (@daveiam). In it, the authors strive to unravel the mystery around how nonprofit organizations innovate and implement new ideas.  It provides a roadmap for nonprofits to create a system to encourage innovation–a place for new ideas to be judged, tested, funded and eventually launched.

The book begins by defining the concepts of strategy vs. futuring.  Nonprofits must anticipate future states so they can be prepared to capitalize on emerging opportunities in the marketplace. Rather than focusing on contingency plans, Moss and Neff point out that organizations must plan for all (or at least the most likely) future states.  Futuring helps organizations to define the environments in which they can expect to be operating. The book describes how nonprofits can create their future through innovation, tolerating waste, and creating an organizational culture that welcomes change.

The book also discusses several major roadblocks to nonprofits effectively innovating.  One of these obstacles is having an operational mindset which is focused on productivity and execution–missing slow, incremental changes that build up over time.  Overburdened staff are busy focusing on day-to-day tactical activities, and organizations don’t allow for the nurturing and implementation  of forward-thinking ideas.

Moss and Neff explain that executive support is key factor to successful innovation – staff must have buy-in from the top down as well as laterally across departments.  For example, if implementation will need IT support, communicating early with IT along innovation stages/timeline can reduce pushback. The book even suggests ways staff can use their Board of Directors as an extra set of eyes to spot trends and changes that will affect the way the organization operates.

[Innovation is] “Easy to talk about, but not so easy to take substantive steps forward,” says Wendy Harman (@wharman), Social Media Director for the American Red Cross. (pg 24)

To take that next step, Moss and Neff suggest nonprofit leaders must move past metrics that measure success based on income/revenue alone and instead, focus on engagement. Understand the motivation of your constituents and get close to their experience. Rather than simply looking at how constituents currently interact with your organization, look at how they would like to interact with you.

While many traditional (for-profit) management theories eliminate waste from organizational processes, Moss and Neff instead profess that “waste is wonderful!” (pg 49) The book points out examples of companies like Google, which encourage staff to spend up to 20% of their time pursuing things they are passionate about.  The process of rapid innovation which results from this freedom enables staff to take advantage of opportunities that may have otherwise been missed. Innovation is not something that can be run in a side department or as an ancillary program.

This review only scratches the surface of what is covered in this very timely book.  There are interviews with nonprofit leaders from American Cancer Society, Nonprofit Technology Education Network (NTEN), American Red Cross, and others to get perspective on what current nonprofit leaders are doing to support innovation.  There are also specific recommendations of blogs, conferences, and websites with resources about nonprofit innovation and identifying future trends, in general.

Readers will come away from this book with the confidence that you don’t need an expert to create an innovative organization.  Managers must encourage a willingness to be aware of your current situation, an eagerness to explore opportunities, and have a tolerance to fail. This book shows there are opportunities to solve massively complex problems with simple technologies and it gives organizations a roadmap for creating an environment where innovative ideas are encouraged, evaluated, and finally implemented.

What do Social Entrepeneurs and Sesame Street have in common?

Leave a reply

Blake Mycoskie of TOMS recently had appearances to both SXSW in Austin, TX and the Association of Fundraising Professionals (AFP) International Conference in Chicago.  I learned about his inspiration and motivation around his now famous TOMS brand and one-for-one movement.

Combining social good and the power of consumers is nothing new.

I came across a great article by Allen R. Bromberger, A New Type of Hybrid.  In it, he discusses how social entrepreneurs are using a hybrid model to combine the for-profit and nonprofit models.

Museums and performing arts organizations create for-profit retailers to sell merchandise, such as posters, jewerly, and books. And the hybrid model is nothing new to public broadcasting. The Children’s Television Workshop, owners of the Sesame Street characters, use separate nonprofit and for-profit organizations to both achieve business objectives and further a social mission.

Dan Pallotta, in his book, Uncivilized, points out why this arm’s length model is used for supporting social good with commercial activities. Rather than being politically or economically motivated, it was a religious view held by the Puritans who came to America in the 17th century. They believed that any commercial activity was sin. However they also understood it necessity, so to atone you could perform charitable activities and – never the twain shall meet.

In his article, A New Type of Hybrid, Bromberger discusses how modern social entrepreneurs are using separate, but contractual linked entities to accomplish their goals.

For any nonprofit concerned with the legal implications of UBIT (Unrelated Business Income Tax), or for-profit entities concerned that the pursuit which want to pursue a social mission, a single hybrid structure that contractual binds the nonprofit and for-profit entities may be a solution.

But Bromberger points out, it isn’t simple.

In the article, Bromberger describes various types of legal entities typically used in social entrepreneurship including, B corporations and benefit corporations and how they differ as well as the low-profit limited liability company (L3C) option.

He describes legal options to enter into activities together to achieve social good.

  • Parent-subsidiary model – where a nonprofit creates for-profit subsidiary
  • Commercial transactions and collaborations between nonprofit and for-profit companies (arm’s length model)
  • Corporate sponsorships and commercial co-ventures
  • Contractual hybrids

There is also a great discussion of legal ramifications of some of the various options and Bromberger spells out the particular IRS rules to consider.

  • Joint Ventures
  • Private Benefit
  • Unrelated Business Income Tax
  • Conflicts of Interest
  • Related Party Transactions
  • Form 990

The lively comments are also a must read.  One commentor notes a new option being considered in California which would allow the formation of a Flexible Purpose Corporation (Flex Corp.) You can read more about it in California to Allow Corporations to Blend Mission and Profit at corpgov.net.

I also loved Milton Friesen’s comment about using the open source model – create a platform upon which individual organizations can built new models – like allowing developers to create apps for an app store.

So what does all this very geeky, public policy mumbo jumbo mean?

Through open collaboration, we can essentially crowdsource innovation in social good and social entrepreneurial models! How cool would that be!