How to Challenge Lumber Industry Dogma

I am interested in your thoughts on these questions. Please add your comment at the end of this article. The sentences in red are my questions and challenges for the building supply industry.

How to Challenge Your Industry Dogma

by Umair Haque

It’s kind of like air. Invisible but omnipresent, every industry, market, and sector has a dogma — “a doctrine or code of beliefs accepted as authoritative.” “This is just how things are done,” dogma whispers, every second of every day, to every decision-maker in every boardroom.

What does it mean to be a revolutionary? To challenge an existing dogma, instead of complying with it: to reject its tenets, highlight its flaws and improve each of its shortcomings.

What makes Apple so revolutionary? Why is it able to disrupt industry after industry, and topple the mightiest of incumbents? Steve Jobs is, from an organizational perspective, more Che Guevara than Jack Welch: he’s always challenging dogma, instead of complying with it. Apple’s rivals, like most companies, do exactly the opposite: “this is how things are done,” they think — and then try to do it harder.

Here are six ways to challenge the dogma that’s invisible and omnipresent in your industry — to be a breath of fresh air:

Challenge products. Most companies make the same toothpaste, car, or shoe — just in a slightly different color or flavor. Not Apple. Every once in a while, it challenges the existing dominant design, the accepted ideal of what a product should be. That is, of course, the story of the iPad. Yes, tablets have been around for a while — but none with the features, attributes, and pricing of the iPad. Instead of contesting the same old stuff, Apple challenged everyone to rethink it.

Do you think the building industry currently challenges or rethinks its products design, or is the industry stale? What company will be the Apple in our industry?

Challenge strategy. Think of strategy as a pattern of investments a firm makes. What is it — really — that makes Apple different? It invests significantly more in design and usability, where its rivals don’t; as an organization, Apple is more like a design studio (replete with control freak overlord) than a “company.” Rivals never invested in design — because design was seen, in biz parlance, as a “cost center”, not a “profit center”, a frivolous, soft, unproductive use of hard-earned capital. Apple’s great challenge has proven that design is perhaps the single most productive investment a firm can make — and that’s why its rivals are desperately playing catch up. But they’re missing the point: It’s not about following Apple. It’s about challenging dogma.

What do you think should be the new strategy in the building industry? Would it be design, service, or distribution of products?

Challenge distribution. In the early noughties, the music industry rolled out wave after of portals, channels, and platforms: all new distribution mechanisms. The problem was that they were the same old distribution mechanisms, with a slightly prettier face. As PC World famously said, “the services’ stunningly brain-dead features showed that the record companies still didn’t get it.” Who did? Apple. iTunes challenged the preconception that music could only be distributed in walled gardens — iTunes isn’t perfect, but it is far more of a truly open market that anything that came before it.

Can the building supply chain be an open market? What would be the new distribution mechanism?

Challenge business models. Apple’s replicated iTunes’ success with the App Store, of course. The App Store challenges business model dogma by turning media from product to service, letting new profit possibilities open up. Publishers can earn revenues from app sales — and perhaps further revenues from in-app sales. Apple is spearheading its own mobile ad service, shifting into a new industry, offering new products to a new market — ads that let publishers get more creative bang for the buck, and alter their business model dogma that digital ads are low-value commodities. TIME asking five bucks an issue isn’t what I mean by challenging business model dogma — two kids at Stanford topping the charts with an awesome newsreader, one that people actually pay for, is.

What would be the new business model for lumberyards, distributers, manufacturers?

Challenge sales and service. Apple sells very differently from its rivals, and I’m not just talking Apple ads. Instead, I mean the Apple Store. Yesterday, electronics were soulless “product,” commodities hard-sold by tuned-out teenagers in big-box megastores. The Apple Store challenged every aspect of that and turned it on its head. The act of exchange became personal, passionate, and interesting. Who doesn’t stop into an Apple Store every now and then just to check something out? The Genius Bar turned service upside down — giving people, well, actual service, instead of just outsourced script-reading (imagine that). That has paid steep dividends: the Apple Store is (by far) the most productive and profitable store in your local mall.

Who is going to turn the building supply retailing industry on its head? Who will turn their company into the next Apple Store? Can we have a Lumber (Window, Doors, Flooring) Bar in our stores – “giving people, well, actual service” on all aspects of the building process?

Challenge production. Apple has, as we’ve explored, challenged in a variety ways. Here’s it’s next and greatest challenge. Can it challenge how its products are made? As a recent spate of suicides at Foxconn’s Hon Hai suggests, the effects of producing “magical and revolutionary” devices might not be so magical or revolutionary. Can Apple, well, “Apple” not just distribution, marketing, and retail, but the global economy’s lowest-common-denominator battle for “labor arbitrage,” making it simpler, cleaner, and more productive? If it can, it just might give Apple yet another edge for the next decade.

Can we challenge the dogma of production in this industry?

Lesson? It is through challenge — not mere compliance — that the disruptive outperformance is earned.

You might be wondering — what about Apple’s dogma? After all, Apple’s a pretty dogmatic company. Of course it is: that’s the point. Don’t accept it: it’s becoming the new industry dogma. Now you know how to challenge it.

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4 thoughts on “How to Challenge Lumber Industry Dogma

  1. Greg,

    This (and many of your previous posts) are extremely helpful in introducing me to the LBM industry. I’m looking forward to working with you!

    Helene

  2. Greg,

    I think the challenge that faces the lumber industry is that most of us are used to going the speed limit or even a little under when changing the way we do business.

    The word change itself comes with some baggage for us. It implies that something different has to happen quickly, or the proverbial boat will be missed.

    Instead of putting the time in to try to adapt and innovate, we keep our noses to the grindstone and carry on like we always have.

    People forget that even in the case of Apple the transformation into the media/tech giant it is today didn’t happen overnight.

    It was quite a while ago that it seemed as though Apple had lost the tech war to the Microsofts, H-Ps, Dells and IBMs of the world. Macs were viewed as only for graphic-intensive users, while PCs were for all other users.

    Apple turned the tide by appealing to the younger, tech savvy generation through its iTunes, iPhone, iTouch, iPad, iMac, machines; visually appealing designs of its stores; and clean marketing materials.

    Plus, and this is extremely important, it manages its distribution and price points diligently by not cutting prices or making their products available on the cheap anywhere. Their price is THE price, no matter where you shop.

    When you think about it, NOW is the best time for LBM retailers/suppliers to be gaining a competitive edge by selling better products when it looks as though the average American will be living in their current homes longer than they have in the past. There is a permanence and humility in our psyche now that lends itself to values more suited to our industry.

    If people are going to stay in their home and take pride in their residence, then they are going to invest in higher grade, longer lasting, LBM products. And that’s our bread and butter.

    Instead of competing down to the HDs and Lowe’s of the world on price, we have to go up, beyond their price-only orientation, and offer a much more satisfying retail experience with brighter, friendlier, more comfortable stores in which to transact business.

    We are Apple, while HD/Lowe’s are PCs.

    –Jeff

  3. Great post about relevant stuff. The lumber industry is loathe to consider much in the way of new ideas. So anything to “rock the boat” appropriate.

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