Never underestimate the input of your customers. Health club members typically know what they want and how they want it, according to Will Phillips and Eddie Tock, owner and CEO, respectively, of REX Roundtables for Executives. If you want your business to be a prosperous one, you must act as if you're in a relationship of sorts with your members and address their needs in "exquisite detail," they say. In the following interview, Phillips and Tock share insights from their Business Basics track at this year's Club Industry Show, to be held Oct. 4-6 at the Hilton Chicago.
Q: What is your mindset in assembling the Business Basics track for this year’s show? What will make this year’s programming different from previous years?
Will Phillips: The focus is on binding your club members to your club by addressing their needs and concerns in exquisite detail. The theme is listening to your members to help you design your business, all the way from renovations to pricing to programs to staff. With so many options for exercise available, there is an attitude among consumers of "we want what we want, the way we wanted, when we wanted." The consumers are taking control of the retail world. If we as club owners and staff struggle to stay in control, we will lose.
Eddie Tock: REX Roundtables works with over 120 club organizations and has been able to see what really makes a difference in terms of driving success. To create clarity, we have broken these down into three major areas: basic business, organization design and the development of the leaders. We call these the three agendas. We will focus on the first agenda. There are seven basic business components of a strong club business. When a club is performing modestly in all seven categories, the club generally performs well. However, it often turns out that a club performs exceedingly well in many of the seven but has a blind spot in one or two areas, which pulls the overall performance of the business down. Over three days at the Club Industry Show, we will help everyone learn what these seven components are and how to improve each of them.
Q: What remains one of the most common business-related missteps you regularly see from a club operator standpoint?
Will: The most common problem in clubs is also the most common problem in marriage and all relationships. Because club staff want to keep their members on a long-term basis, the quality of this relationship is critical. The common and widespread failure is that we only focus on what we do. We get training and degrees and certifications, and we fail to pay sufficient attention to the customers' wants, needs, peculiarities and desires. We gloss over mass customization and even sacrifice it for the sake of efficient operations. We focus on our solutions, not their needs. Full responsiveness to the customer requires a certain humility and vulnerability. They know things that we don't know. This knowledge would improve our interactions. So just as we lose 50 percent of our members every two years or so, something like 50 percent of marriages also fail.
Eddie: Thinking that you have all the answers [is a common problem]. Regardless of any experience and success I’ve had, I will never stop learning. Consumers shift their buying habits every two to three years, and we need to adjust how we deliver results. The most successful club owners who are REX members have also been the best learners.
Q: How can club operators go about implementing a rock-hard business strategy, especially independent operators, without becoming overwhelmed by competing demands?
Will: Rock-hard business strategies may have been possible in the 1970s and 1980s. At this point in business, I believe strategy is only powerful if it is well-designed. The book "Good Strategy/Bad Strategy: The Difference and Why It Matters" by Richard Rumeldt is the best guide on how to form powerful business strategies, and should be required reading for every business owner. But strategy is only valuable when it is surrounded by two qualities. The first is the ability to drive your strategy down to the front lines, showing that it affects every employees' behavior, every hour of every day, as well as every corporate-level decision. Patrick Lencioni's book, "The Advantage: Why Organizational Health Trumps Everything Else In Business," is one of the best guides on this sort of implementation. The second quality is the ability to navigate. This means you must have great radar for picking up small changes in the environment that are likely to impact the business and then making tactical or strategic course adjustments.
Eddie: I agree with Will. You need to adapt, adjust and then overcome. Sharing your successes and failures with your peers is a great way to help you develop and adjust your own strategy to become even more successful.