x Abu Dhabi, UAETuesday 25 July 2017

Lunchbox men just keep on delivering

The Life: Review of Repeatability: Build Enduring Businesses for a World of Constant Change

Repeatability: Build Enduring Businesses for a World of Constant Change, by Chris Zook and James Allen. Harvard Business Review Press
Repeatability: Build Enduring Businesses for a World of Constant Change, by Chris Zook and James Allen. Harvard Business Review Press

Come rain or shine, Mumbai's dabbawallas ("lunchbox men") pick up and deliver food to 200,000 customers every day. And they are always on time - at least, 99.999999 per cent of the time. That means a delay of one meal out of six million.

Their business model has been the subject of study for universities such as Harvard in the United States and companies including Tata, the Indian conglomerate, and Daimler, the German car maker.

Now, a new book Repeatability: Build Enduring Businesses for a World of Constant Change uses the model, along with Nike and Ikea, to drive home a point.

Business strategies, which can be constantly adapted and reapplied, and shorten the distance between the chief executive and the customer, are the winners, according to the authors Chris Zook and his Bain and Company colleague James Allen.

They call this "the great repeatable model".

"It is all-around training, all around the individual delivery men having their own constituency and having deep knowledge of their customers," says Mr Allen, the co-head of Bain's global strategy practice, referring to the repeatable model of dabbawallas.

A company should focus on its core activity, such as Ikea's pre-fabricated furniture, differentiate itself from others and have a commercial model that makes money and is repeatable.

Business models should also be transferable to other activities, motivate front-line employees to believe in that strategy, and have the power to adapt that activity and improve the model with time.

To focus on the core activity of the company, the authors recommend rediscovering its founding principles.

Lego, the Danish company, for instance, lost its way after diversifying into theme parks and clothing in the 1990s, which culminated in a profit loss in 2004. After a lost decade, it has gone back to its roots: building toy bricks.

The authors studied 200 companies in the Bain database that have been around since 1978 and singled out those that grew sustainably and profitably for at least 20 years.

The authors then identified 31 firms they describe as "rocket ships" because of their profit-making ability.

It is only with "repeatable and well-grooved response patterns can any strategy be successful at the highest level of the game", according to the book.

ssahoo@thenational.ae