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Entrepreneurial learning journey: restaurant innovation in Boston

November 19, 2015

Learning is something I care passionately about, and I’ve been fortunate to have the opportunity over many years to put myself in the position to feed my curiosity and acquire new knowledge. This has come from structured education, ‘hands-on’ experience, practitioner and peer learning.

It’s been a combined process of autonomous and interactive development. I love to learn new things, and to share the things I learn with others. I feel fortunate to follow a career which allows me to do something I love doing for my job. My mantra is to learn something new everyday – ask my kids, I used to ask this of them each morning every day they went to school.

So I recently set off to spend some time in America, visiting planned locations, businesses, individuals and conferences I’d researched. My objective was to unearth new insights from startups and established entrepreneurs that operated in different cultures, from practitioners sharing their experience, and to satisfy my curiosity about unearthing new thinking from new research.

My first stop on my entrepreneurial learning journey was Boston, home to the disruptive free thinkers who ignited America’s independence – John Hancock, the first signature on the Declaration of Independence, Samuel Adams, one of the Founding Fathers and second cousin to John Adams, second President, and Benjamin Franklin, another Founding Father and polymath.

If someone asks you to name a U.S. city associated with tech startups, chances are you’ll list San Francisco or New York, probably not Boston – however, it’s the city where Facebook and Dropbox were born. It isn’t home to many consumer focused tech companies, so doesn’t hit the radar, but the intellectual power here is staggering, with Harvard and MIT providing the academic capital. As a result, for years, Boston has topped the list for most venture capital invested per capita across the U.S.

Located in downtown Boston, steps away from the waterfront, Faneuil Hall Marketplace is alive today as it was in 1742 when it was proclaimed it ‘The Cradle of Liberty’. It was built by funding provided by a wealthy merchant, Peter Faneuil, as a gift to the city and has been a hub of free thinking since.

Firebrand Samuel Adams rallied the citizens of Boston to the cause of independence from Britain in the hall, and at 10am on July 4, 1776 the Declaration of Independence was read in public for the first time from the balcony to the crowds below. Subsequently, George Washington toasted the nation here on its first birthday. It was also in Faneuil Hall that a young John Kennedy gave the first televised political speech in America.

Historically, the edifice was home to merchants, fishermen, and meat and produce sellers. The market remained a vital business hub throughout the 1800s, but by the mid-1900s, the buildings had fallen into disrepair and many stood empty. The once-thriving marketplace was tagged for demolition until a committed group of Bostonians sought to preserve it in the early 1970s.

Today, Faneuil Hall Marketplace is actually four places in one location – Faneuil Hall, Quincy Market, North Market and South Market, and 70 retailers occupy the 200,000 square feet of retail space, all set around a cobblestone promenade where food emporiums of every flavour, culture and genre exist side by side as jugglers, magicians and musicians entertain the passers-by. So by all means, stroll, shop, eat, laugh, wander, wonder and explore it all, a hub of creativity and a mixed-use festival marketplace.

The Union Oyster House, located outside Faneuil Hall, enjoys the unique distinction of being America’s oldest restaurant. Housed in a building dating back to pre-Revolutionary days, it started serving food in 1826 and has continued ever since with the stalls, and its centerpiece, a fabled semi-circular Oyster Bar. Since 1826, the Union Oyster House has known only three owners.

As an aside, the toothpick was first used in the U.S. at the Union Oyster House, enterprising Charles Forster first imported the picks from South America. To promote his new business he hired Harvard University students to dine at the Union Oyster House and ask for toothpicks. They caught on.

So on one side of Faneuil Hall, heritage, longevity and an established brand; across the road, a community of food startups, elbowing their way into the market, creating noise and attention, using innovation as their go-to-market weapon. Are there lessons for both the new and old here, should we focus on innovation or core – seeking to get market share from the same customers with food they know they want, or to provide something different? The answer is both.

Start-ups and established businesses alike must balance their focus on their core business, while also pushing an innovation edge. How do you innovate (experiment) in new areas while maintaining strong execution on your core business? While it seems that start-ups tend to do the former well, and larger firms the latter, it is possible to do both? Not only is it possible, it’s necessary.

If you’re a large company, the pull of ingrained processes and practices, and the pressure to produce short-term results, naturally inhibits creativity and new ideas. It’s hard to devote your precious resources to risky propositions, but you need to if you want any chance of surviving in the ever-changing marketplace.

Large companies also need to figure out how to make failure fast and cheap after all, the primary reason behind most enterprises’ risk aversion is the hefty price tag of failed experiments. But if you design research and testing protocols that make it easy to determine the viability of new ideas early in their development, you reduce the cost of failure.

Scanning the periphery is also important. If you’re only looking at your current competitors and customers, you might miss crucial demographic shifts, new rivals, technological developments, and other macro-environmental changes at the edge, which can creep upon you unawares.

If you’re a start-up company, you have the opposite challenges. Creativity, agility, and risk-taking are your hallmarks. While your entrepreneurial spirit makes innovating easy, it also may pose challenges to solidly executing on your core business and a ‘business as usual’ being. It’s easy to get distracted by new possibilities and it’s tempting to constantly tweak things. Your efforts need to be focused on, well, focus.

So what are the entrepreneurs’ lessons I picked up from the food innovators in Boston?

Hold your ambition. Drill down to your absolute aspirations and lock them in. Then be sure to execute on them flawlessly so that customers learn exactly what you stand for and come to trust that you deliver.

Stay relevant. Keeping a sustained relevance with customers by ensuring an up to date understanding of the relevant cultural and contextual changes in your market, and a strategic approach to interpreting them.

Be creative. Apply creativity in all aspects of your business model. Innovation shouldn’t be limited to new products and offerings. One restaurant had a simple menu with items priced at one triangle ($6), two triangles ($12), three triangles ($18) and four triangles ($24).

Stay Fresh. Keeping your business model as fresh as your fish by leading the charge to change the dining experience. One restaurant has done away with tipping, paying employees a living wage that’s already included in the price of the food.

Create demand. One restaurant puts aside 25% of its tables as ‘not bookable’. If you have the luxury of flexibility, same-night tables are the way to go. These tables are released each day via social media and are rewarded to the first to respond via e-mail.

Be smart. Take customers on a new journey to keep your offering new and different. One restaurant had full tasting menus of avant-garde dessert dishes. Individually they wouldn’t sell as part of a meal, but a sample menu created new demand.

Be quirky. Create eye-catching product names. One restaurant had visually stunning plates. Dish names are abstract, like ‘The half moon, silky and smoky’ and ‘Nature rejoice, chasing childhood memories.’ This leads to an extreme element of surprise, as a diner never knows what will arrive at the table next.

Provide product information. One place that had a QR-code sticker pasted on the glass in front of each fish to find information about the species, harvest location, ecology and fisherman biographies that caught my eye. A simple way of providing more product innovation.

Shock your customers – in the nicest possible way. In a new restaurant, there are no menus. Rather, your waiter will ask you what foods you like and don’t like, what you’re in the mood for, and whether you have any food allergies or sensitivities. After he conveys this information to the kitchen, chef will whip up a unique meal, with each course conceptualized not from a recipe or menu but out of his whimsy.

Make it personal. The personal one-to-one interaction with the waiter is as important as the food. I had one waiter who took my order, then he spent five extra minutes doing something special. He transformed himself from a workman into an artist. In those few extra minutes, he became remarkable, and memorable, he made me feel like I was his only customer that night. It takes 99% of the time you spend just to be average. The remarkable stuff can happen in 1% of your time – in a flash.

Some useful learnings for sure, but underlying all these food entrepreneurs is that they marketed their products and restaurants with a story around their purpose, passion and vision. Here is a stand out story that was on the back of a particular menu.

A man wrote a letter to the restaurant: I would very much like to bring my dog with me. He is well groomed and very well behaved. Would you be willing to permit me to bring him into your restaurant?

The reply from the restaurant owner, said: I’ve been operating this restaurant for many years. In all that time, I’ve never had a dog knock crockery off the table or pictures off the wall. I’ve never had to evict a dog in the middle of the evening for being drunk and disorderly. And I’ve never had a dog run out without paying a bill. Yes, indeed, your dog is welcome at my restaurant. And, if your dog will vouch for you, you’re welcome to eat here too.

People don’t necessarily buy what your product is. They’re buying into your story, the values you have and the experience you will give them. The restaurant with the menu with the dog story was small, but they are not actually selling food. They’re selling a complete experience. You’re not buying food from them, you’re buying interactions with them.

Boston is a city with a heritage based on its people – the patriots and those who inspired the independence revolution. They had no resources, they just got people together and made stuff happen. Likewise business model innovation isn’t all about product development and design, as I found in Boston, it can be quite simple, and be about people and making the customer experience memorable, distinct from from the competition. In doing that, it truly creates a point of uniqueness that no innovation can directly copy.

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