4 Secrets of Great Critical Thinkers4 Secrets of Great Critical Thinkers
In 2009, JD Wetherspoon, a chain of more than 800 pubs in the UK, was facing declining sales. Demand for beer had been down for five years. In addition, pricing pressure from super market chains was intense, and higher alcohol taxes further squeezed its already tight margins. What would you say is the company's real business problem? Most people see it as a sales problem and recommend better marketing and promotion. But this reflex may be wrong. In Wetherspoon's case, the company examined the problem more deeply, looked at data, and framed the situation from multiple angles. In the end, they found the real problem: A subtle but profound shift in consumer preferences. As a result, the chain responded with much bolder actions, transforming all its pubs into family friendly cafes during day hours. The strategy worked. Wetherspoon saw its earnings per share jump by 7.1 percent in the first year. Two years after this frame shift (2011), it has maintained its earnings per share and, with the investment in this new strategy, its free cash flow is up 12.9 percent. Exploring multiple problem framings, by zooming out rather than in, gets you to the root of issues and more creative solutions. If you fail to do this, you risk solving the wrong problem. Ironically, the more experience you have, the harder it will to break from conventional mindsets. Leading companies often get stuck in old business models. Kodak engineers developed an early version of the digital camera, while the
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