These two graphs may look quite harmless, but actually together they illustrate a dilemma that faces many hospitality and service companies today.
Diminishing returns
The blue curve illustrates the phenomenon know as diminishing returns. Well known in the sports world but also observed in the business world. In short it is the experience you have when you start out on something and relatively quickly get a sense of progress – but once you have dealt with the ‘low hanging fruit’ it gets harder and harder and you need to put in more and more effort but at the same time you are getting less and less in return.
Shaving 1/10 of a second off the world record takes a lot of work
In a big picture perspective my experience is that the service industries in general went through significant innovation and improvements up through the 90‘s but that in the 00’s we have by and large, mainly seen incremental improvements. Slightly better versions of already well known ideas. In a sense several service sectors are finding them selves in a ‘cul-de-sac’ conceptually.
Speed of Change
Opposite this, is the red curve. A model that especially Ray Kurzweil has used to draw our attention to the fact that change is not linear, slow and orderly. But change is occurring around us at an exponential speed. And if you listen to the futurists we ain’t seen noting yet. We are just at the being of this curve, on our way into the steep climb. (If you are not sure that the speed of change is exponential, try and locate a mobile phone that is 5 years old and compare it to the one you have now)
You can see a great clip with Kurzweil explaining all this here
You may even feel that you are not experiencing big changes in your own company just now – but that you are doing things in more or less the same way that you have done for a while – well then there is all the more cause for alarm because you can be sure that your clients are experiencing exponential changes in their lives – and you will not be part of their stakeholder map very soon if you do not realize that.
If you feel that things are under control – you are probably not going fast enough”
Mario Andretti (World champion racing driver)
Where is your focus?
When we look at these two graphs together – it suddenly becomes very clear that the way forward is not to put a huge effort into becoming perfect. I.e working very hard on what we already do in order to get just a little bitt better. Firstly the effort invested will probably not produce more than the famous incremental improvements, but the real danger is that after all that effort we risk getting really good at something that is no longer needed!
So ask your self: What is your focus: Perfection or Differentiation?
This post was very much inspired by this post by Seth Godin