Solve the Issue Not the Problem

 

 

When I signed up for my HMO health care provider, I chose a D.O. over a M.D. In my research, I found that while both save lives and treat illness everyday the D.O. focuses on the “whole” person while the M.D. seeks to address the disease itself.

Much like my medical provider preferences, I have found that the holistic approach to management may be best in the live entertainment field as well. This is due to two primary issues inherent in our industry. The first is there are numerous stakeholders with varying agendas working on a single project (the show). Many times these needs clash with one another. For instance, the artist may feel like the bass is overpowering her vocals, making it difficult for her to reach specific notes. However, the sound guy argues that the current bass mix is paramount to the best F.O.H. sound. Off stage, the waitstaff feels the overall volume is too loud, making it difficult for them to take drink orders while customers in one section feel as though they are struggling to hear the boom stick. Each one of these stakeholders has different needs regarding this one element of the show – the bass EQ. Making matters worse, this is just the tip of the iceberg. There are additional sound frequencies that must be addressed along with lighting, seating, ticket pricing, bar service, security, and parking among others, resulting in a litany of stakeholders’ needs that must be balanced.

Contributing further to the need for a holistic approach is the subjective (and at times emotional attachment) these stakeholders place on the final product. This is especially true when there is a lack of communication between senior leadership and line-level employees. For example, a bartender may enjoy the light jazz he has always had in his room because he is a fan of Coltrane and it allows him to chat with his guests more freely. However, management has decided to attract a different demographic and in doing so has shifted entertainment to hip-hop, a style of music the jazz-loving bartender feels is nothing more than noise.

These two underlying issues in the venue space make reactionary approaches to problem solving oftentimes inefficient and short lived. This is because the quick-reflex tactic will likely address the problem, but only appease one stakeholder group, leaving the other factions feeling alienated. This alienation is only exasperated by their emotional attachment to the product, which can increase the probability that (given the chance) they will work outside the box to return to the environment they once deemed as satisfactory. This could lead to them challenging the new initiative a number of ways such as poor performance, internal gossip, and negative appeals to customers – all of which can ruin the guest experience and put the organization’s mission, strategy, and profitability in jeopardy.

While management will never have 100% buy-in from such a diverse and emotionally charged group of stakeholders, they can mitigate this risk by simply stepping back and analyzing the issue from a holistic approach much like a D.O. would do. For example, a few months ago there was a huge problem with volume at a venue I manage. Waitstaff in a particular location couldn’t hear their customers, so they demanded that the volume be turned down. The sound technicians obliged immediately and brought down the overhead speakers that made up the house. However, the volume was never low enough for the waitstaff who continued to complain and thus the cycle continued until there was nearly no sound in the house. The reactionary approach to the problem was not working and a result was needed. The technicians and myself decided to step back and walk the room. We stood by the bartenders who were having trouble hearing their customers and traced the problem to the position of the artist’s monitors. We then spoke with the artists, who informed us that they relied on the house system to hear their vocals and when it got lowered they needed to make-up the difference via their monitors, so they would turn them up. Stepping back, speaking with all stakeholders involved, and walking the room revealed that the reactionary problem solving approach of arbitrarily lowering the volume was actually contributing to a louder environment and making the problem worse. Instead, we followed a holistic approach, which led to true results that helped appease all involved and moved the program forward.

The take-a-way from this should be that it never hurts to slow down, step-back, and seek out the root of a problem. Most of the time it will only take a minute and a simple fix is all that is needed. However, the few minutes it takes to analyze the problem offers a host of benefits. As mentioned, it will provide keen insight into a potentially larger issue that will only re-occur or get worse if not properly addressed. In addition, there are numerous indirect benefits to the holistic problem solving approach. For example, it will force you to speak with and (more importantly) listen to your line-level employees. The benefits of listening to your troops on the ground are tremendous. They know your customers (probably better than you), have a unique view of the day-to-day operations, and can offer suggestions to better the guest experience, work environment, and profitability. After you are done listening, you can explain your plans to address the issue with them. They will see this as a sign of respect, which may help them buy into your ideas and act more patient as your plans unfold.

While this post is focused on my experience in the entertainment industry, the concept of tackling problems holistically can be carried over to many organizations. Give it a shot and let me know the outcome in your business model.

Photo Credit: Gavin Schaefer from Flickr.  

Strategic Analysis of Live Nation Entertainment

 

 

The following paper was the final deliverable for my MBA strategic management course at Southern New Hampshire University. The purpose was to analyze the macro-level strategy of an organization of our choice.  For ten weeks, we explored how that strategy impacted virtually every aspect of the firm from their financials to their competitive position and H&R practices. I chose to put my experience as a booking agent and undergraduate degree in music business to good use and analyzed the top promoter in the world – Live Nation Entertainment.

My analysis of Live Nation Entertainment revealed an organization executing a well-crafted strategy to vertically integrate the unique value chain elements of their main concert business. As a result, the company has catapulted past their competition in the U.S. concert and event promotion market as well as the global online ticketing industry where they hold commanding market shares in each. Despite this success, there is much more opportunity for the company to grow…almost an entire planet.  I touch upon management’s future plans throughout the paper and offer my own insight as well.

Jeremy Larochelle’s Strategic Analysis of Live Nation Entertainment

Lessons from a Mexican Restaurant

 

The other day I went to my favorite Mexican restaurant for lunch.  It is a quaint little “mom and pop” shop that makes some great food, has an awesome atmosphere, and plays great Latin music.

I noticed they had a sign by the cash register that said:

Join Our Email List

Get 20% Off Your Meal

Get Great Coupons and Chances to Win Prizes

That sign made me realize that so many artists offer me nothing to join their email lists, and you know what?…It greatly reduces the chance I will.

Seems my homegrown Mexican entrepreneurs know more about marketing than most entertainers.

Musicians undervalue the power of the email list.  It is a direct connection to your consumers. It is a way to tell them about your new album, so they buy it. Inform them about upcoming shows, so they go. Showcase your newest merchandise, so they wear it. And to like, follow and join your social media networks so you can keep them informed and connected.

Most of you looking for a record deal have no idea that labels place a lot of weight on your mailing and social lists. Why? Because they know if you can get 2,000 people to follow you on your nothing budget than their $500,000 check would get exponentially more fans interested, which leads to more money.

Even those of you who want to make it on your own have no idea the power of an email list. That list is a great way to keep your fans coming to shows and buying into your brand. It is also a great selling tool to help you get money from sponsors who want to put a link on your site, a banner at your show, or a tattoo on your drummer’s forehead. And the more names you have, chances are the larger the paycheck.

Basically put, in today’s marketing world the email list is gold, so you have to work hard to get people to join it.

Remember it is a business transaction and every exchange with a consumer (even when there is no money involved) requires you to give them something for their currency, even if that currency is their email. Offer them a few free tracks, a free concert ticket, a chance to win something cool and there is a greater chance they will join your cause.

Never underestimate the power of consumer information and the email list is a great way to get it.

With the Launch of Beats Music, Streaming will Ramp Up Encroachment of Digital Music Sales

 

 

Editors Note: The following is an academic paper I presented in a managerial economics course while working towards my MBA. I have included it in its entirety with citations, only edited to reflect the launch of Beats Music.  

Beats Music has tossed their hat into the streaming market. The popular company, known for their high-priced headphones, follows Apple, who jumped into the streaming ring in the fall of 2013. These two companies are attempting to capitalize on a market estimated to rise from $5 billion this year to $46 billion by 2018, and is currently dominated only by a handful of companies including SpotifyPandora, and Google Play (Snider, 2014).

Streaming is encroaching heavily on the market for digital downloads, which has many in the music industry concerned. Billboard reported on January 3rd of this year that digital track sales fell 5.7% while digital albums fell 0.1%, which is a historic first since iTunes opened their doors. Industry managers and pundits alike have concluded that the consumers growing appetite for streaming is most likely the culprit (Christman, 2014).

From an economics perspective what the music industry, particularly the digital sales sector, is witnessing is a leftward shift in the demand curve brought about by a combination of the price of related goods (streaming) and changing consumer tastes. This demand shift will continue as more and more solid brands such as Beats, Apple, Spotify, Pandora, and Google ramp up their advertising to sway consumers into paid subscriptions, which, in turn, will lead to a decrease in demand for digital downloads (a substitute good).

In conventional economics, such a shift would lead to unsold inventories held by retailers, which would inherently lead to a decrease in the price by retailers as they attempt to achieve the new equilibrium. While this is certainly possible, it is also equally likely that this will not happen as companies such as iTunes and Amazon do not carry a physical inventory of digital downloads and have less of an incentive to reduce costs to unload excess product and achieve their new equilibrium point. Instead we may find that they attempt to shift the demand curve towards the right and back in their favor through more advertising and entering more untapped global markets.

References

Christman, E. (2014, January 3). Digital Music Sales Decrease For First Time in 2013. Billboard. Retrieved January 13, 2014, from http://www.billboard.com/biz/articles/news/digital-and-mobile/5855162/digital-music-sales-decrease-for-first-time-in-2013

Snider, M. (2014, January 11). First Take: New Beats Music may spur streaming growth. USA Today. Retrieved January 13, 2014, from http://www.usatoday.com/story/tech/personal/2014/01/11/first-take-look-at-beats-music/4430383/