Management Lessons from Zingerman’s CEO Ari Weinzweig

Zingerman'sIt was a very pleasant surprise that ASQ chose Ari Weizweig, a founder and CEO of Zingerman’s Deli (and other businesses) in Ann Arbor, to be the opening keynote speaker at the recent ASQ Lean & Six Sigma Conference in Phoenix. Paraphrasing Ferris Bueller’s Day Off — late February in Phoenix is so choice, if you have the means I highly recommend going. And the conference was great too.

I grew up in Michigan and lived in Ann Arbor right after college, so I’ve certainly been to Zingerman’s. Ari was a fantastic speaker, as his approach to business and leadership really resonated with me. Rather than spouting the usual MBA thinking, Ari has found his own path and I think he has a very compelling message.

Out of his first book, Building a Great Business  A Lapsed Anarchist’s Approach to Building a Great Business  Management principles from Zingerman’s, Ari shared his “12 natural laws of business,” which I’ll comment on here. Yes, you read that he’s a “lapsed anarchist” (something he describes in his book). That doesn’t mean he wants anarchy, but he’s just not real predisposed to answering to authority figures (or that’s how I’m paraphrasing it).

He’s certainly a capitalist, but the type who really wants to build something special for customers as well as being a great place to work and learn. There are probably aren’t enough data points to have a statistically valid comparison, but I wonder if the CEOs who were Russian History majors (like Ari) outperform the usual MBA suspects (and I ask this having an MBA myself).

Before getting into his 12 laws, the title of the talk struck a chord:

Fixing the Energy Crisis in the American Workplace

My thoughts that were spurred by the title: Why are so many workplaces so devoid of real human energy? Do these workplaces attract lifeless drones or do they manage to beat people down over time? Probably the latter, thinking of Dr. Deming’s curve showing that intrinsic motivation seemed to only go DOWN over time in the typically dysfunctional management systems. Ari said most companies are paying people full wages to work at “just 15 to 37% of their capacity.”

Ari said that “everything great we’ve done, people said it wouldn’t work” and he referenced Dr. Deming in that sometimes you have to “ignore everybody” and do what you believe in. I don’t recall that as being a key Deming teaching, but that’s who he cited. Ari cites three keys for his business success (for which “there truly is no secret”):

  1. Servant leadership – citing Greenleaf
  2. Open book management – citing Stack
  3. Quality

Ari crafted a great analogy when he said their business is “very much like an organic garden. Each element contributes to the other. You can’t quantify how each piece contributes. Everybody benefits.” This reminded me a lot of Lean as a business system — each mindset, tool, and method contributes to the other. That’s why it’s so hard to piece meal your way into a Lean culture by choosing a tool here and there within the context of a non-Lean culture.

Ari compared the “corporate world” to monocropping. When you grow just a single crop, you get higher yields in the short-term, but then problems occur. This reminds of Deming’s teachings (and Toyota’s) that you have to focus on the long-term over the short-term.

He pointed out that a farm can’t switch from conventional to organic overnight. Doesn’t that sound like traditional organizations that want to switch to the Lean model overnight? In farming, it takes “2 to 3 years to get the soil ready,” otherwise the new crops will die because the soil is not receptive and “there’s no energy in the soil.” What’s the parallel to soil in a business? How do we make leaders and an organization receptive to Lean?

Ari said it takes:

  • 2 years to get stability
  • 4 years to get good
  • 6 years to work on being great
  • 8 years to really get there

The lack of energy, Ari says, comes from violating these 12 laws — “this is how we’re running the country and it’s not a pretty picture.” I’ll share the 12 laws with my thoughts and what stood out to me, in regards to Lean management.

The 12 natural laws of business

1. You’re more likely to get to greatness if you have an inspiring and strategically sound vision.

Ari believes strongly in teaching everybody how to run a business, “even those employees who just want a job.” Part of this is having everybody understand the vision (it’s more than a short “mission statement,” he writes in his book). This isn’t just a 2-line throwaway statement, it’s a multi-page document with “emotional richness” about what success looks like. “What cathedral are you constructing?,” using the parable of the rock breaker and the cathedral builder. I agree with Ari that “everybody wants to be a part of something bigger than themselves” and that vision comes from the “inside out” – and he added, “there’s no right or wrong vision, just yours.”

A strategic plan (think about this in terms of Lean’s strategy deployment approach) is the map that gets you to the destination. Without a vision, “it’s like asking Mapquest to provide a map without punching in an address.”

 2. If you don’t give customers compelling reasons to buy from you, they won’t.

Ari is a big fan of the Net Promoter Score approach and he emphasizes having “loyal” customers over just merely “satisfied.” This reminds me of hearing Bob Lutz talk in the late 90s about it being better to have a car that some people loved and some people hated, as opposed to a car that everybody thought was OK.

Ari emphasized that quality “for us is not just about meeting specifications.”

3. If you don’t create a great, rewarding place for people to work, they won’t do great work.

This is my example, but I watched an episode of the TV show “Bar Rescue” the other day. The chef at this California sports bar was a classically trained chef, working under some big-name people. But, he had basically given up and stopped caring about his work or the food at the bar. He wanted to give a damn, but the owner had given up and didn’t care about the place anymore. The bar consultant recognized the talent in the chef that was just waiting to be unleashed… but he needed the owner to want to make the bar a great place… Quality starts at the top, as Dr. Deming used to say.

4. If you want the staff to give great service to customers, you have to give great service to the staff.

This all about servant leadership, with Ari saying “the staff are our customers.” This seems to be really true in service industries – that if you take care of the employees, they will take care of the customers. The way you are treating the employees flows through to the customers. In a business where employees treat  the customers badly (looking at you American Airlines), it’s not because the flight attendants and gate agents are bad people – they’ve been mistreated by management over the years. In healthcare, there are strong correlations between staff satisfaction/engagement and patient satisfaction and clinical outcomes. We have to give great service to the surgeons and the nurses, for example, making sure they have the supplies, equipment, and time required to do the job right.

5. If you want staff to give great performance, you have to give clear expectations and training tools.

Ari said “I’m preaching to the converted here” (at ASQ), but “it’s not like this elsewhere.” At Zingerman’s, “everyone’s involved in re-designing work,” which sounds just like Lean.

6. Successful businesses do the things that others know they should do but generally don’t.

Pretty straight forward — what is your organization NOT doing?

7. If you aren’t consistently getting better, you’re not going to get long-term greatness.

Just like Lean, there’s a theme of continuous improvement at Zingerman’s. They opened their own bakery to provide bread for the deli not to make more profit, but to ensure the proper quality for their sandwiches, etc. Ari told a story about how great it is when a dishwasher says to the CEO, “Why are you doing it that way? That doesn’t make any sense!!”

8. Success means you get better problems—but there will always be problems.

This really reminds me of the Toyota/Lean mindset that we always have problems and “no problems is a problem.”

9. Whatever you’re good at is likely to also lead into areas of weakness.

Ari said “the things you’re good at are the things you’re not good at.” For example, Zingerman’s is participative, but that means they can be slow. When is your greatest strength your greatest fault?

10. It takes a lot longer to make something great happen than people think.

Well this sounds like a description of a Lean transformation, doesn’t it?

11. Profit is good (he stated as “Without good finance, you fail,” I think)

Ari wants a sustainable business, not one that’s based on win/lose approaches (this reminds me of Covey and win/win). Toyota, for one, has strong long-term finances by partnering with suppliers, not by screwing them over price in the short term. The need for profit reminds me of the common healthcare saying, “no margin, no mission.”

12. Great organizations are appreciative and the people in them have more fun.

Fun leads to success and success leads to fun. Ari said, “Everything we do is about believing in people and helping them to greatness.” What a great sentiment.

The YouTube video of an Ari talk, below, is probably pretty similar to what I saw, and you can read a Zingerman’s site about the 12 laws.

And here’s a shorter 10-minute interview with Ari:

Creative Commons License photo credit: carlcollins


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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an eBook titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

6 Comments on "Management Lessons from Zingerman’s CEO Ari Weinzweig"

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  1. Mark Graban
    Twitter:
    says:

    Re-reading this and reflecting on it a bit more, I’d extend “compelling” to:

    Companies should be a compelling place for people to work, more than just being a paycheck.

    I think those are going to be the successful companies in the future. Most places I go to as a customer, sadly, don’t have that feel.
    Mark Graban recently posted..Weekend Fun: An Elegant Solution by Subtraction (Parks & Rec)My Profile

  2. I have actually been to Zingerman’s and love their macaroni and cheese! This is a great profile of their CEO and has some great lessons in it. Thanks for the great post!

  3. Yes, not just compelling for customers and employees, but basically for all relations you have. For example suppliers. One big mistake in the Business Model Canvas by Alexander Osterwalder is that he equates value proposition with the product for the customer. And employees are pretty much missing. As was the value proposition as such, so that was his next book (although I still think it’s a patch job, which doesn’t address the fundamental shortcoming of the canvas).

    If you look at any organisation more closely, you will see that anybody working with you or in contact with you should have positive interactions and value from you (at least, no harm). And then you see how the shareholder model gets in wrong (value is focused on delivering returns for shareholders) and also the narrowly focused customer-focused company, since employees and the rest of the eco-system should be taken into account too. This is also what lean endeavours, unfortunately many companies using lean still are in the shareholder-value mindset, which principles lead to an exploitation of the rest of the ecosystem.

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