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Ari Weinzweig is the co-founder of Zingerman's Community of Businesses and has some strong beliefs around why it's so important to teach people about business and how they can use it to make an impact in their everyday lives.
Episode with guest: Ari Weinzweig
Author & Co-founder of Zingerman's Community of Businesses
(This episode was recorded in May 2020.)
Key Episode Take-Aways:
1. It's the eye of the beholder which looks for the beauty. (click to jump to this topic below)
It's the eye of the beholder which looks for the beauty. That's the key. So how we change our eye alters what we see and experience, and that the beauty even in a crisis is still there. It's not about, I like pop art and you like Marc Chagall, or I like jazz and you like classical. It's really about how we change our own perspective to see the beauty because we know that when the beauty is out there, good things are going to happen.
2. Forget the how for now; just start with where you're going. (click to jump to this topic below)
Forget the how for now; just start with where you're going, describe what you really want. Later, we'll get to the how. Because when you get stuck in where the money comes from, and how do we take this budget and change it… you never get anywhere.
3. Always be looking for the opportunity! (click to jump to this topic below)
Well, there are always opportunities coming out. Again, for me, I feel like it's early to be predicting what they're going to be. It's early in the game. Like I said, we're in the bottom of the second inning, and already forecasting the end of the game. I think things will unfold in the coming months that will be very interesting. But there's always opportunity.
Continue scrolling to read the full episode transcription.
Announcer 0:00
Welcome to the "Change the Game" podcast, where we share stories of open-book management and highlight capitalism at its best. Thank you for tuning in to the 10th episode of the "Change the Game" podcast, with special guest Ari Weinzweig, CEO and co-founding partner of Zingerman's. This episode was recorded during the COVID-19 pandemic crisis in May 2020. Here's your hosts, Rich Armstrong and Steve Baker.
Steve Baker 0:27
Hello, everybody. Happy Friday, and welcome to the "Change the Game" podcast. It's the "Change the Game" podcast because we keep changing the name. We're coming to you live from the Great Game of Business. Actually, it's changing the game because we're doing business differently. We believe that businesses have the potential to make a huge and positive difference in the world and they can empower people to pursue their dreams and benefit our society as a whole. Like Jack Stack has always said, we want to demystify business.
We want to break down the walls and hype that make business an elite sport for the select few, and it keeps everybody else in the dark and out of the money. If we can change that, that's capitalism at its best. Wouldn't it be cool if we could save the American Dream by closing the gap between the haves and have-nots? That is how we're going to reach our big, hairy, audacious goal of transforming 10 million lives in 10 years. I'm Steve Baker, the Vice President of the Great Game of Business, and here with me always is my friend and the president of the Great Game of Business and co-author of our new book, "Get in the Game," Rich Armstrong. How’re you doing, Rich?
Rich Armstrong 1:37
Very good. Good morning, Steve.
Steve Baker 1:40
Is it raining like crazy over there where you are?
Rich Armstrong 1:42
Yeah, we're having a big storm right now. So hopefully we can stay on.
Steve Baker 1:46
[Laughter.] Exactly. Hey, we've got a very special guest with us today, serial social entrepreneur and prolific modern-day progressive business writer Ari Weinzweig from Zingerman's. I mean, Ari's a legend. He's a CEO and co-founding partner of Zingerman's Community of Businesses. If you haven't heard of him, this includes Zingerman's, the original delicatessen. They’ve got a bakehouse, a creamery, catering, mail order, a training organization called ZingTrain. They’ve got a coffee company, a restaurant called the Roadhouse, they got a candy factory, events space at Cornman Farms, a new Korean restaurant, Miss Kim, and Zingerman's Food Tours. They produce and sell and serve all sorts of full-flavor traditional foods in Ann Arbor, Michigan. And Ari has been recognized now, in addition to running all these businesses and creating all this great opportunity for people, he's been recognized, as one of the Who’s Who of food and beverage in America, by the James Beard Foundation, and has been awarded a Bon Appetit Lifetime Achievement Award, which is quite a deal. Back in 2017, Inc. magazine named him as one of the world's top 10 CEOs that lead in a totally different, unique way.
And on top of all of that--now Rich and I, you know, I keep pimping our book, called "Get in the Game," available where fine books are sold, or stolen--Ari has written a ton of books. Let me just run down this list, Rich, because this is impressive. As I recall, when I first came on the scene myself, I knew that he was famous for “Zingerman's Guide to Giving Great Service.” But he's also written “Zingerman's Guide to Good Eating,” to “Better Bacon,” “Good Vinegar,” “Good Olive Oil.” I mean, come on; this sounds delicious. And on top of that deliciousness, he's got business books that are called the “Zingerman's Guide to Good Leading.” It's a series so, part one is “A Lapsed Anarchist’s Approach to Building a Great Business,” then “A Lapsed Anarchist’s Approach to Being a Better Leader,” “to Managing Ourselves,” and “to the Power of Beliefs in Business.” And most recently, he's been releasing some pamphlets and articles. We're going to talk a little bit about that--things like “The Art of Business: Why I Want to Be an Artist,” and last year, “Going into Business with Emma Goldman,” a famous anarchist from Michigan. So what I'd like to do is welcome longtime practitioner and friend of the Great Game of Business community, Ari Weinzweig. How are you, Ari?
Ari Weinzweig 4:23
I'm good, Sir. Other than the pandemic, I'm doing awesome.
Steve Baker 4:27
Yeah.
Ari Weinzweig 4:27
That was quite an intro, though.
Steve Baker 4:30
I know; I'm tired!
Ari Weinzweig 4:32
You're making me nervous.
Steve Baker 4:35
[Laughter.] Well, we can fix that. All we want to do is have a fun conversation with you. And I thought maybe for folks who are not familiar with you, maybe you could just walk us through a quick tour of the Community of Businesses that you've built.
Ari Weinzweig
Yeah. It's not the quickest walk. So, backing up, I’m from Chicago originally. I came here to Ann Arbor to go to University of Michigan. I studied Russian history, I studied the anarchists, as you know, which you already referenced a few times. After graduating, I mostly just knew I didn't want to go home. In order to facilitate that financially, I needed a job. One of my roommates was waiting tables at a restaurant. Long story short, after applying three times, I got a job as a dishwasher. And that's where I met my future business partner, Paul Saginaw, who was the general manager.
I worked for that restaurant group for about four years, so learning how to cook and run kitchens. I left there in the fall of ‘81, which is right around the time that SRC was getting going. And Paul and I started the deli March 15, 1982. So we just had our 38th anniversary, which coincidentally, came like three days after all of this stuff fell apart. I'm not that big on those kinds of things anyway, but it wasn't a really great way to celebrate your anniversary.
Steve Baker
No kidding.
Ari Weinzweig
But here we are.
Steve Baker
Yeah.
Ari Weinzweig
So anyway, I guess long story short--you listed all the businesses, so I'm not going to bother--but everything we do is here in the Ann Arbor area. In the same way that you talked about the Great Game being a different way to work, we're even more different than that. And we can get into some of that if you want. We had--I don't know what we're gonna end up with after this--but we had about 700 staff members, and we were doing about $70 million in sales.
But I've already changed it on my bio, just because it's going to change this year and not for the increase. And everything we do here is just in the Ann Arbor area. And yeah, there you go.
Steve Baker 6:44
And that's by choice, right? I've known you for a number of years, and that's one thing I've always respected is that, you know, you've been offered a lot of franchise opportunities and that sort of thing. And you've decided to stay close and really work in the community. So one of the things that makes you really different is how you approach the ownership part of your growth. Could you talk a little bit about that?
Ari Weinzweig 7:05
Yeah, sure. To the first point, I do feel really strongly about staying in the community. I'm not here to judge what other people do, but for me it's a whole different way to do business. You know, like y'all are, when SRC is part of Springfield, it's a different thing. And I look at business a lot like agriculture and in the ecosystem. You know, it's not the same to just plop down the same store in Florida as it is in northern California, I mean, they're both fine, but they require different ecosystem adjustments. And I think being in the place makes a big difference.
In terms of ownership, we opened in ‘82 and in 1994, Paul and I wrote a vision called Zingerman's 2009--it's in the back of the first business book. And that's where we really described this idea of having a community of businesses where each would be a Zingerman's business, but each would have its own unique specialty. And then one of the key parts of it was that there would be a managing partner or partners, so somebody who really owned part of that business in a meaningful way and had a real passion for what that business did. In my belief, and yours, when there's an owner on site, it changes the game.
And so that's the big piece of it. And then--I don't know, it's probably five years ago; it took about five years to try to figure it out--but we have about 200 staff members own a share in the business also. It's challenging here, because there is no Zingerman's Community of Businesses legally; it's what we call Tinkerbell rules: it only works because we believe in it. [Laughter.] So the staff members work for each of the businesses, but Paul and I own the intellectual property, what in business school--which I didn’t go to--they would call the brand. And so that's after years of trying to jump through hoops and figure out how to do it legally and all that.
The employees own a share, and that model is sort of like a co-op. I own one share the other 199 or whatever, they own a share equally. And then we still have another class of stock that we were about to be rolling out now. I don't know exactly how it's gonna be affected by what's happening right now. But...
Steve Baker 9:24
Yeah, understood. No, that's cool. So you're kind of like an autonomous collective, in a way.
Ari Weinzweig 9:29
Yeah. Yeah. That's a good way to see it.
Rich Armstrong 9:31
Hey, Ari, I'm really excited to have you on today. When we talk about changing the game, in changing the way business is done, you've certainly done your part of sending a message out there. There's a lot of different ways and maybe there's some better ways of running businesses. Part of the foundation of your business is built on this thing we call open-book management? And I think you were introduced to that early on and I know Jack always talks about this, is that most people see this as probably it was pretty much of an “Aha” moment for you to see that there were other people in the community who actually thought a little bit like you, that there were different ways to run businesses. Can you talk a little bit about that?
Ari Weinzweig 10:12
Yeah, so again, we opened in '82, I can't remember exactly… what year did the book come out?
Steve Baker 10:19
The book came out in '92.
Ari Weinzweig 10:20
Yes, it would have been a year or two after that. I saw the book, I bought the book--I don't know if somebody recommended it to me or not. And then I liked it, and Paul read it. And, you know, for us--like Steve mentioned, the power of beliefs in business--we didn’t have negative beliefs about open book, which some people out in the world do; we just had what I would call neutral beliefs. I'd never heard of it. We weren't opposed to it; it’s just like in the food world, if you never tasted great olive oil and all you ever had is stuff from the supermarket, that's just sort of what olive oil means to you until you experience something different.
And that's a little bit what it was like for us with open books. So pretty quickly, we made the switch. We weren't trying to hide anything; we’d just never heard the idea of actively sharing it and teaching it. And, you know, I think it took us seven or eight years to get pretty good at it. And that’s not out of malice; we were already a good training organization. But it's like anything else--like getting in shape. You can go to the gym for a while, but holding it over five years in good form is actually a different challenge and [produces] a more meaningful result.
Steve Baker 11:37
I know that as I introduced you, Ari, and people that know you know that you blend a lot of the things that you learned in school, having delved into the archives in the library at school, and then you bring them to life in business. And one of the things, I read a piece in Corporate Rebels that you did called, “Four Anarchist Lessons for [a Successful] Business and Life.” I don't know if it's fair to throw that at you. I mean, I could read them.
Ari Weinzweig 12:05
I don't remember which are the four off the top of my head... I mean, I wrote it, I could go get my copy
Steve Baker 12:11
Oh, no, I have it here.
Ari Weinzweig 12:12
You tell me what they are and I'm going to talk about them.
Steve Baker 12:15
Yeah. So the thing is that they're so fascinatingly close to--and that was your point, right? That this really fits with a great way to do business differently. And so I'm going to read them off real quickly. This comes from, again, the piece that you called, “Four Anarchist Lessons for Business and Life.” Number one, design work that brings joy--thank you Marie Kondo--purpose, and creative passion.
Number two, don't just teach people how to do a job, help them learn to run the business. That's radical. Three, build an organization that helps people be themselves. Four, make business a tool for positive change where everyone comes out ahead. Wow. Thats awesome. So talk a little bit about that.
Ari Weinzweig 12:56
So that actually comes out of the Emma Goldman pamphlet, which you mentioned before. There's actually 18 in there. But for Corporate Rebels, they needed a shorter piece, so they got four. [Laughter.] But as you said, I studied the anarchists in school; I was always drawn to it. Most of the world has no clue what anarchism actually is. They think it's violence and throwing rocks and destruction, which--have there been anarchists who did that?
Yes. But there's also been, you know, Christians, Jews, Muslims, businesspeople, who have engaged in not productive acts. And so I don't think it would be fair to judge every American by one person's bad act. In the same way, it doesn't make sense to judge the ideas of anarchism by an extreme fringe. Really, for me, it's about respecting every individual, about honoring the fact that every individual is a unique human being, and then helping everybody around us through free choice to be able to be themselves, like you said.
And so, long story short, I studied it in school, then whatever, I went to work and started managing people. And I started reading Peter Drucker and Peter Block. He denies it, but Peter Block's writing is extremely aligned with anarchism. He says it's not, but I've studied both intensively.
You know, you mentioned the business books; when I was working on part one, just coincidentally, I happened to be asked to speak at the Jewish Studies department here at University of Michigan, by Deborah Dash Moore, who was the department chair. And she titled the talk, "Like Rye Bread and Anarchism," because I had just written this like 10,000-word essay on the history of Jewish rye bread, and she knew I'd studied the anarchists. And I thought, “Okay, that's cute,” and it was like a year in advance, so I didn't really worry about it.
And at business conferences, nobody knows who the anarchists are, so I’d mention it, and they’d chuckle nervously and then we’d just move on to other subjects. But when I got about 60 days out, I was like, “This is gonna be bad because I haven't even looked at my books in 15 years. And I'm going to look like an idiot, because at the Jewish Studies department, they actually studied Emma Goldman, and they actually know who all these people are.” So I did what every history major knows how to do, which is go back and get the books out and start rereading everything.
And it really blew my mind in two big ways. One, I had not consciously realized how much of what Paul and I and everybody else in the organization had created was already aligned with what was in there. And then the second thing, which really blew my mind, is how much what they were writing about in their own way was very aligned with what's now called “progressive business.” So here’s an obvious example: self-organizing work teams.
We call that anarchism. Hierarchy is unhelpful and gets in the way of effective organization, which I heard General Stanley McChrystal give a great talk on that. That's anarchism. So in a good way, all the stuff that Jim Collins and all these people that I was reading were writing about, they were really talking about in their own way a hundred-and-something years ago. The interesting thing, so Bo Burlingham, who you know well because he co-wrote with Jack “The Great Game of Business,” wrote the foreword for part one of the book because he also studied the anarchists, and he said they had to right yo-yo but the wrong string. [Laughter.]
Back in 1900, there really was hardly any progressive business. It wasn't a venue in which you could put efforts together to create human dignity, engagement, involvement; there weren’t training programs. None of that existed. And so they didn't really have the format. But the “Going into Business with Emma Goldman” is a joke, because she was not really in business. She actually had an ice cream counter--this is the story--or a little luncheonette in Worcester, Massachusetts.
And they only had it for like four months, and then they moved on. But the whole pamphlet was just like, well, what if they had decided to stay, and then put all these principles into place in business, rather than trying to create mass social change? Which wasn't a bad thing, but they might have made more headway by just staying in a small setting and really doing it on the ground.
Steve Baker 17:30
And people can take a lot when they're eating ice cream.
Ari Weinzweig 17:33
Well, it's what we've experienced. When you're in the community, when you're not telling people what they should do, but where you're actually modeling it, and you can see and feel the results in the energy of the staff, in both the Great Game and in our case, the longevity and the sustainability over time--and hopefully, we get through this one, too--of the businesses, then I think that sends a lot of messages.
And, you know, my anarchism is I'm not big on telling other people what to do, or judging how they live. I mean, I want to respect everybody. But I think by doing what we do in a meaningful way, and opening things up, so like come talk to somebody who works on the counter and get their perspective, because it's as interesting as mine.
Rich Armstrong 18:17
One of the things you're talking about is how do you make that particular change, Ari? You talked about, are we making some step change? Do you think this is catching on at all? It's just kind of one of those deals that we've been talking about--just with open-book management, that's been out for 35 plus years now, in somewhat of a big way. Why aren't we making more progress?
Ari Weinzweig 18:43
You know, I wrote a whole book about beliefs. Most people don't even realize that when I talk beliefs, I'm not talking religion, sports, and politics. Those are three categories I believe everybody likes to talk about but I'm talking more beliefs about stuff like open book--like, you know, that the employees are going to steal from you. That’s belief, right? And the whole book is based on a self-fulfilling belief cycle, which I learned from Bob and Judith Wright in Chicago, of the Wright Institute there. And essentially, it's self-fulfilling; if you believe employees are going to steal from you, then you treat them in ways that you start hiding things, then the employee starts thinking there's something to be found if they look behind the curtain. And then because you don't trust them, they don't trust you.
And then they do steal and people go, “See? I knew that was gonna happen; we better tighten up the controls even more.” I'm sure you've had the same experience there. I mean, we fired plenty of accountants over the years who said, “Oh, in my old job, I was always trained never to leave my screen towards the open part of the room; always have the back of my computer facing the other people in the room, so in case, God forbid, somebody walked in, they wouldn't see the numbers. Those are beliefs. You know, most people don't realize that they have the beliefs. They don't realize that they got the beliefs from somebody else. They're not genetic. They believe their beliefs are universal truths when that's generally not the case, unless it's like gravity. And then they just continue on apace.
And, you know, part of the belief cycle is that we all filter out the information that doesn't support what we believe. And we take in the information that does support what we believe. Without getting into politics, you can see it happening right now. Now, the polls show you that absolutely nothing changes, regardless of which side you're on. Everybody's gonna find evidence to support what they already believe. So, I think why do people stay with it? Because they don't know any other way. Because in the short term, it's more difficult to make change. Because their friends don't do it. You know, we're all impacted enormously by the 5, 6, 7 people we spend the most time with. So you and I study open book, we live open book.
Do we have problems? Of course, but we don't blame open book for it. If somebody else is skeptical, and they go, “Look, Zingerman's isn't as profitable as Google.” Well, yeah, duh, we're in the food business. You know, Google's the exception, not the norm. But they’re going to use that as, ‘Why go open book? I could be making so much more money.”
Steve Baker 21:22
Yeah. Enrich the few instead of the many, right?
Ari Weinzweig 21:25
Yeah. And I just say, hey, you do it. If it's working for you the way you're doing it, run with it. Not for me to judge.
Steve Baker 21:30
Exactly.
Rich Armstrong 21:32
Yep. What about the beliefs and practices that you live by at Zingerman’s? How is that helping you right now with this pandemic? What do you think is coming out that is very beneficial?
Ari Weinzweig 21:45
Well, I mean, we're in the same bad boat everybody is, pretty much. Somebody said, “We're all in the same storm, but it’s different boats.” So I guess that's true. But you know, it hurts. I mean, we've one of our businesses that's done really well in the last few months, which is mail order. Zingermans.com, people are shipping food like crazy, which is awesome. But because they are separate businesses, we're not a big corporate roll-up, we can't just pull money out of one and throw it in the other one, because there's different owners and different partners. And you know, we've got three businesses--ZingTrain, which I'm sure you all are in the same boat, all training got canceled; Food Tours, which you mentioned, which is totally zeroed out, because food trips to Europe aren't happening right now; and then you mentioned Cornman farms, which is our event space, so no weddings, no group.
So all that's almost dropped to zero. The three restaurants, we're more fortunate than some, because we're doing carry-out and delivery, and we've been doing carry-out for years. So we're at least used to it; a lot of restaurants have never done it, so they don't even have the processes in place to do it. But still, it's about a third of sales. So you know, I'm not an MBA, but you don't have to be one to figure out if your sales were here, and they dropped by two- thirds, the math doesn't add up. So we're struggling with how we make that work.
But to your question, my belief, if you look at business as an ecosystem, which I do, then in a healthier ecosystem, it's still shocked by the bad disaster, but it's going to be more resilient, and it's going to recover more effectively. And that doesn't mean we're not struggling. It doesn't mean I haven't had a lot of stressful days. It doesn't mean everybody here is not worried about the future. But at the same time, there's cultural stability and systemic stability that allow us to keep huddling. Some of the department and business huddles have fallen off because people aren't in the businesses, but we're restarting them.
The partners, we’re meeting generally twice a month, but now we've been meeting twice a week for the last eight weeks; we just cut back to once a week as of last week. People see the cash numbers. We haven't historically focused that much on cash because we’ve had some, but right now… that’s shifted.
I just wrote a piece in my e-news which, if people are interested, they can go on zingermanscommunity.com and sign up for it, but I just wrote a piece that came out on Wednesday, about how the level of appreciation within the culture has really stayed where it is. I mean, the pressure is clearly super high on every human being right now in the world. And yet, staff members here, everybody's stayed really grounded. I know inside they're anxious, but… So all that stuff continues on apace as I'm sure it does at SRC. I think it's always been true: the unhealthy organizations are going to have a harder time because people are not mission-driven, they're not clear on how things work, they don't know how their work impacts, and all they can see is their own pay rate.
And I understand that we have staff members who read about Amazon or whatever, and they want to get more money. But they also understand that we're losing a lot of money. So it's great that Amazon can pay you more, but here's the numbers; what do you want me to do? I mean, I'd love to pay all of y'all three times as much, but we're going to be out of business in 10 days if we do that. So what do you do?
Steve Baker 25:29
Yeah, it's a tough conversation, but an adult conversation, right?
Ari Weinzweig 25:33
Which is the whole point. And I mentioned Peter Block before; his work on stewardship and empowered manager and stuff are awesome books. And his whole thing was getting people out of patriarchy, and stop treating people like their children, which they're not. And 16-year-olds can understand business just as good as 66 year olds. It's not rocket science, with all due respect. Everybody has something different to offer the conversation, and the whole idea of open book. And for us, we took it even further, which is really all our meetings are open. With minor exceptions for HR or crisis stuff, the meetings are all open so people can learn to think like leaders, which is one of the basic premises of open book.
Steve Baker 26:16
Yeah, for sure. And that's how we started the podcast today, was to say we want to demystify business, and take it from an elite sport to something we can all do, as you said, and I agree.
1. It's the eye of the beholder that looks for the beauty.
Ari Weinzweig 26:26
Well, there's a lot to be said for that. As you mentioned, the “Art of Business” pamphlet, I really believe that business and life are like art or music and that the more we approach everything we do that way, that it just gets a lot more interesting. We're a lot more caring in what we do. In the appreciation piece that was in the e-news the other day, I referenced John O'Donohue, the Irish philosopher and writer who I never met--he passed away about five, six years ago, I think--but his books are incredible. And the quote--I don't have it in front of me--but he said that the commonly used statement, “Beauty is in the eye of the beholder,” is usually interpreted as [beauty] is subjective, and each of us decides for ourselves whether it's beautiful. But he said there's another way to interpret it, which I think was brilliant. And he said, it's the eye of the beholder which looks for the beauty.
That's the key. So how we change our eye alters what we see and experience, and that the beauty even in a crisis is still there. It's not about, I like pop art and you like Marc Chagall, or I like jazz and you like classical. It's really about how we change our own perspective to see the beauty because we know that when the beauty is out there, good things are going to happen. And there's nobody on this call who contributed to the crisis that we're having coming into play, but here we are. And even within this, there's still beautiful acts of human dignity and caring even at the hospitals where people are very sick or even sadly dying.
Steve Baker 28:05
For sure, and it is very interesting. I love talking to you. Because I started one of our podcasts a few weeks ago by quoting Viktor Frankl and the whole idea of the last of the human freedoms, which is to choose how we approach any particular set of circumstances.
Ari Weinzweig 28:21
Yeah, which is very anarchist, by the way. And I've written a lot about free choice. And it changed my life a lot when I realized I didn't have to do anything. There's consequences to what we do. But when I realized it was my choice to be nice to customers who were not being the easiest to deal with, it was my choice to get up early, it was my choice to do the little extra things--there was nobody forcing me to do it--it really altered my energy a lot for the better.
And there's an essay in Part Three of the book on self management about that. And it's remarkable, honestly, it's not tied to age, income level or anything else, but how many people go through life acting like they have no choice: “My wife tells me I have to do this. My boss told me I have to…”. No, you don't. There's consequences for sure. But you don't have to pay taxes. There's consequences. You don't have to live here. There's consequences, you know, so this is what we're all dealing with.
Steve Baker 29:17
Good. And when we talk about these things, it also makes me kind of go, “Okay, we've been in not dissimilar circumstances before as far as economics go.” Could you compare a little bit about the conditions--I realize that when the governor says, “All restaurants shut down,” that's something we haven't experienced before, as far as I know. Can you talk about the difference between the great recession of '08-'09 and today?
Ari Weinzweig 29:44
Well, today we're--I know, Jack likes baseball, so I would say we're like in the bottom of the second inning. We’ve got a long way to go here before we're gonna really know what happened. I'm a history major, and I'm reading Robin Kelley's biography of Thelonious Monk, the jazz musician. I don't actually even listen to jazz, but it's a great book, and he's a fascinating human being. And he was born in 1918, the year that the Spanish flu started.
And it's about a 500-page book--very well-researched, very well written--and the Spanish flu, which was even worse than what we're dealing with now, got three sentences out of a 500-page book. So when we get 100 years out, man, this is gonna be just a little blip on the screen, right? I don't know how it's all gonna play out. The difference, obviously, is that then the limitations were economic, that were keeping people from coming in. Now it's probably going to be both economic and physiological or epidemiological, in ways that we don't know how to deal with it.
You know, we did get the PPP loans for our businesses. I think it was well intentioned--like at ZingTrain, it's been very helpful because we bring people back, they work from home, everything's great. But if you're in a restaurant and you're only doing a third of your sales, and your forgiveness is reduced drastically by your headcount, compared to a year ago, it doesn't make sense. And then also, because they gave eight weeks--which at the time I think that it was passed, nobody thought this was going to be as serious as it clearly is; they thought, oh, eight weeks, fine. But the origination date requires you to use it all up in eight weeks. So everybody's scrambling; what do we do? How do we deal with this?
And then, as you know, in the Great Game context of changing the rules in the middle of the game, it's sort of like we're in the third quarter and nobody told us where the three-point line is. And they’re changing how many timeouts you get, and then they're telling you the timeout you took in the first quarter doesn't count. So we're taking time off the clock. And I've been doing a lot of work with a group that started up seven weeks ago, a fabulous group called Independent Restaurant Coalition. This is all independently owned people--no chains, no publicly traded--and they're really doing some awesome work with lobbying in Congress, which has not historically been my thing.
But just to try to get some stuff in place that really will help the independent businesses and not just help the giant corporate settings that are publicly traded. So actually, Congressman [Earl] Blumenauer of Oregon, who I had never heard of but seems to be a very thoughtful guy, just introduced this week into the House, a bill that had actually come up with the acronym RESTAURANTS, because of the unique situation that restaurants are in--everybody’s suffering, let's be real; I’m not trying to say restaurants are taking...
Steve Baker 32:48
But you're taking a really big hit.
Ari Weinzweig 32:50
Yeah, cuz there's no quick comeback. We're still in stay-at-home at Michigan, and I'm not rushing the governor at all, because my nightmare would be what I think's going to happen, which is they're going to open places and then they're going to have to close them again, six, eight weeks later. I’d rather just stay with carryout and delivery and keep people grounded in what they're doing. So there's no rush. But even if you open, at best, you're going to have 30, 40, 50 percent of your sales. And that's going to be tough. So this is to introduce a stabilization plan that will essentially take the PPP loan and carry it all the way through. So Independent Restaurant Coalition, they’ve got stuff on air; if anybody wants to be supportive of it, there's ways to send letters to Congress.
Steve Baker 33:33
Awesome.
Rich Armstrong 33:34
Ari, is there anything that you're doing with your organization right now and saying, “Look, is this going to carry on for a while? Is there anything you should do to change the business, your model, your services or anything like that?
Ari Weinzweig 33:48
We're trying to figure it out. I mean, we clearly have already changed a number of things. Personally, I believe it's early; everybody's making these big pronouncements about [how] everything is going to be different. Yes, and you know what? Everything was different on January 2 from January 1, also. It's just the incremental scale is… And so, yeah, there's gonna be things that are changing. I mean, clearly, I never envisioned people wearing face masks while waiting on customers. I think that's a given until somebody comes up with a vaccine. We've added delivery at the Roadhouse, which we never did before, because peak volume periods didn't really allow for it. But now we're at a third of sales so volume levels allow for it. So there's definitely things that are going to change. I think it's early to really say what it's going to be.
My feeling is, if this is something we’ve got to gut out for a year is a different thing than if this is for 10 years. If it's for a year, then it's sort of okay, how do we marshal cash? How do we cut back on expenses? We've already furloughed almost 300 people at the start of this, and some have come back through the PPP loans, which is great. It's difficult. Probably most of the people on the call are in the same boat. But if you start getting rid of all your top managers this week to save cash, and then in two months you’re booming again, you know it took years to put that team together. So at the same time, if you keep people on too long, and you're broke, then it's not helping anybody either. So I think it's a combination.
My feeling always--this was true in ‘08, ‘09; it was true when 9/11 happened--and like you all, we opened in 1982, when interest rates were like 18 percent. So I think it's a combination of staying true to who we are and our values and the way we work, and in our case, staying true to our long-term vision, which we were about to formally roll out for 2032. That isn’t really going to change. There's nothing in there about wearing masks or not wearing masks. Exactly how we do business in the short term needs to be adjusted relatively quickly in each business in order to adapt to the current economic setting, but where we're coming from and where we're going probably don’t change.
Steve Baker
I'm glad you brought up your vision because you are famous for your visioning process. And I can't tell you how many people I've sent the link to your article on it.
Ari Weinzweig
If I send them to the books, then we'll get a sale.
Steve Baker
There you go. Exactly. Well, from now on, that's my new vision.
Ari Weinzweig
If they go on ZingTrain community 2020, we’ll give them a code for a 20 percent discount for books and pamphlets.
Steve Baker 36:37
Oh, great. Okay. Do me a favor, if you could for those of you who aren't aware of your process and that sort of thing, could you talk just briefly about visioning? And then also tell us about what you see down the road; what's your long-term vision?
Ari Weinzweig 36:55
Yeah, so the visioning work we learned, we did not... like you said, we've adapted a lot of things from a lot of people. We adapted the Great Game and sort of have our own tweaks and twists on it. Stas Kazmierski, who passed away, sadly, three years ago, I think, taught us a lot. And he always said, “Adapt, not adopt,” which I think is a helpful little slogan.
So if you think of business as an ecosystem, then if you just take growing methods that are used in Michigan and put them to work in Mississippi, it’s not totally going to work; you’ve got to adapt to the climate and the ecosystem. So the visioning work came originally from a guy named Ron Lippitt, who was a social psychologist here at the University of Michigan, in the ‘50s, ‘60s, ‘70s, and early ‘80s, and he did work around what he called “preferred futuring,” which we've adapted, and we call visioning. But the core elements of it came from him.
2. Forget the how for now; just start with where you're going
And really, it's about describing the future of your dreams. So it's not a plan. The plan is how you get to the vision. But what he pointed out, which is true, is that people flip-flop back and forth constantly between where they're trying to go, and how to get there. And he said, “Forget the how for now; just start with where you're going, describe what you really want. Later, we'll get to the how.” Because when you get stuck in where the money comes from, and how do we take this budget and change it… you never get anywhere. And whether it's a week down the road, or a year down the road, or 10 years down the road, or 20, it's still describing the future of your choice. So it's not what you should do. It's not what you could do. It’s what you want to do. And we do it in a much greater detail. I never went to business school.
But it's not the three-line vision statement, which I've never been able to understand the difference between that and the mission statement. I like mission statements, but this visioning is a much more detailed description of the future. It talks about emotion, how people feel; it can talk about your financials, it could talk about the quality of your product, but it's really about what's important to you.
Steve Baker 39:01
So for what it's worth, I've shared this with people that are business associates, and strangers and people really close to me. And it's interesting how people will either grasp it, they'll grab on to it, or they'll shun it. It’s like, “Yeah, yeah, yeah; I just don't get it.” I don't know what the answer is there. But I love it when people go, “Huh, I never thought of that.” And you just lay it out for folks. And we'll make sure that in the materials that are in the links that we've got at the end, we'll send them out your way as well for that because it is a powerful process and you've done a beautiful job of laying that out for folks.
Ari Weinzweig 39:37
There's a lot in the books--actually all four of them have stuff about it. Part One has probably the most but there's some in Part Three and Part Four. When I teach it, I try to tell people, you already know how to do it; it's a natural human process. Anybody with a six-year-old, they may be doing a vision today--I was gonna say when you get home, but you might already be home.
Having little kids, we all do it. I mean, they turn the living room into a restaurant. They don't have to do social distancing, so the stuffed animals can sit right up close to each other. And it's really through social pressure that we start to lose that natural ability. And we start to get more worried about what we're doing wrong and what we should do, and what the competitor’s doing and what our mother said we should do, or what you read about in a magazine. And all those things are pressuring us to do something that we may not really want to do.
Rollo May, the psychologist said, “The opposite of courage [in our society] is not cowardice, it's conformity.” And I love that, because this is really about being true to yourself. And in the context of music and art, and what I wrote about in the Art of Business pamphlet, the great musicians, the great artists, the great whatever it's coming from here. It's not coming from copying what the person who already had the number one hit is already doing, because they already did it. This is, how do you become yourself and make something special happen in a really meaningful way that's true to who you are?
And if you look at Great Game, that's what it is. I mean, it's not just Jack; it’s all of y'all. But clearly it came from that original group, [who] was true to who they were. And did they know what they're doing? No, but the Beatles didn't know what they were doing. But it's the truth for all of us. And I think when we own our humility, and say that we don't know what we're doing--that's one of the key premises of open book, that when we don't involve the rest of the team, we're missing out on a lot of valuable perspectives. And it’s the same for all of us.
Steve Baker 41:34
Amen.
Rich Armstrong 41:35
Here’s a question, Steve, that we have from Robert. Ari, do you see any opportunities that may actually come out of this current crisis? Is there anything that you're looking at?
3. Always be looking for the opportunity.
Ari Weinzweig 41:47
Well, there are always opportunities coming out. Again, for me, I feel like it's early to be predicting what they're going to be. It's early in the game. Like I said, we're in the bottom of the second inning, and already forecasting the end of the game. I think things will unfold in the coming months that will be very interesting. But there's always opportunity.
There was opportunity on March 10, and there was opportunity on March 15. Clearly, in a crisis setting, things will move more quickly--sometimes for worse, sometimes for better. So ZingTrain, like all y'all down there, I'm sure has switched over to doing virtual training. And we're doing it pretty quick. I'm doing one on hope in the workplace next Wednesday; it's on the ZingTrain website. Would I have been doing that otherwise? No. So I think definitely things are going to come from it. And it'll take time to unfold.
Rich Armstrong 42:48
Well, if you kind of think of it as we're in the second inning, what are some things that you would advise our listeners to be really focusing on now?
Ari Weinzweig 42:59
I can only share what I believe and it's up to them to play out their own game because only they know themselves and we barely know ourselves. So even then it's hard. But I truly believe that the same practices that were working on March 10 remain equally important. So open book works; it's just what it is. And if cash was not on the board in one of the businesses, like on ZingTrain, where they had good cash, because they have--like y'all, probably--a lot of deposits from people coming to seminars, but people want their deposits back. Can't blame them.
So all of a sudden cash goes right to the top of the board. So the principles of open book don't change. Visioning doesn't change. You know, after 18 months of working on it, we were just about to roll out this 2032 vision, which will put us at 50 years.
Steve Baker 43:53
Nice.
Ari Weinzweig 43:54
I went back and reread it; everybody’s like, “You’d better change your vision now.” Now I'm like, “Actually, no; there's nothing that I would change.” It talks about working with kids. It talks about being grounded in the community. It talks about how people who work here feel about working here; it talks about financial health. That's not going to change.
Steve Baker 44:12
We have another one, Ari. And by the way, we do want to recognize how much you do contribute to the community. You're always involved in the conference and always ready to take a call like this. And that means a lot to us. So we appreciate that.
Ari Weinzweig 44:25
Well I learn from you all, too. So it's a two-way street.
Steve Baker 44:29
Well, we're all in the ecosystem, as you say.
Ari Weinzweig 44:32
And I say, Hi, Frank Smith.
Steve Baker 44:34
There you go. So so here's one from Mark. He says, "Thank you from a fellow anarchist in your ilk. I'm excited by your Community of Businesses model and wonder if you've explored the possibility of forming a holding company through which all the businesses could implement a shared ESOP,” or employee stock ownership plan.
Ari Weinzweig 44:53
I am not the world's expert on this. We have a holding company. There's a lot of conversation around what ESOP does well and what ESOP doesn't do well, so it's a longer conversation and I'm not the world's expert here. But the staff members don't work for the holding company. They work for Zingerman's Bakehouse. They work for Zingerman's Mail Order, for ZingTrain, etcetera. So they're not employees of the holding company. And that's why, for better or worse, we ended up using the intellectual property as a way to get them ownership. So they own in the brand, but they're employed by Zingerman's Delicatessen or Roadhouse or whatever.
Steve Baker 45:34
I have another question. I didn't know if we would get to it or not, but you don't have to answer it. But I'm curious because you-- Rich and I know what it's like to write a book. And it is painful. You've written so many...
Ari Weinzweig 45:48
That's a belief. If you think It's painful, then it's gonna be painful.
Steve Baker 45:50
Dammit. See, another takeaway. It's easy and it's awesome and fulfilling.
Ari Weinzweig 45:55
It's not easy. Nothing good is easy.
Steve Baker 45:57
That's true.
Ari Weinzweig 45:58
Everything that's meaningful and lasting is a lot of work. And once one accepts that that's okay, and that's appropriate and healthy. It's true in relationships--my loving girlfriend just came home from a run--it's true in business, it's true in farming, it's true in everything, right? So once one accepts that that is the work and that there's a craft and a beauty to it--back to the "beauty's in the eye of the beholder"-- I used to hate it. But Brenda Ueland's book, write that one down, dude, and order it. You can probably get it for 99 cents somewhere.
Her book changed my life because she really said, ‘Why don't people understand that writing is just talking on paper?” Because like so many people, I just paralyzed myself, agonizing over commas and sentences. And then I just sat and learned, I taught myself just to plow ahead, man, just keep writing--even if I curse up a storm, it doesn't matter. Because you're gonna go back and rewrite it anyways. And with computers, it's super easy. When I used to write in the old days on paper, then it was harder. But on the computer, you could just type the same letter for 10 minutes and whatever, who cares? So I've learned to find the beauty in it. I actually just finished--not the first draft, it's probably the 20th draft--a draft that’s going out for editing of a pamphlet that I hope will be out this summer on humility.
Steve Baker 47:22
Great. Well, my question went on to ask, do you have a passion project that you've had to shelve while this is going on?
Ari Weinzweig 47:31
No, I try to have passion for everything I do, pretty much. I can't say it's 100 percent. But I try to find the beauty in everything. And for better or for worse, Tammy and I, our personal lives haven't even really changed that much. We're both really introverts. We never go out. Nobody comes over. I like cooking. We've been cooking at home every night for ages. She's a farmer. So she goes by herself and talks to the tomato plants. You know, we both run and we run by ourselves, so our personal lives are what they are. People keep asking what I'm doing differently right now. It's like I journal every morning, same as always, run every day, same as always.
In fact, last week was five years that I haven't missed a day--super slow, I just keep going. And we cook a good meal every night. And those are like my rigor, right? And that hasn't changed. And I think that's where people can get in trouble, we all can get in trouble, is if we're like, “Oh my God, it's a crisis.” And we stop doing what we really know in our gut is the right thing to do, like huddling. And when we don't do those things, because we're in a crisis, it gets worse, whereas if we can hold with the rigor we have a better chance of staying stable.
Steve Baker 48:49
That is wise. Thank you for sharing that. I know a lot of our listeners are going to be taking furious notes. I know I am, Rich. I think we should try to get a couple more from the board.
Rich Armstrong 49:01
There's one here from our friend Frank Smith.
Ari Weinzweig 49:04
Hi Frank.
Rich Armstrong 49:06
“What one or two tips do you have regarding keeping your team realistic about the future of the business?”
Ari Weinzweig 49:12
Well, I think just be real. One thing I started doing tactically, I guess, early on is I started writing an email to all the staff every night, and 've done it actually since March 15 or 16. Every night I send an email to them. So it's interesting. I'm teaching this class on hope on Wednesday. And I didn't write the note to be hopeful. I just did what I do. But there's a couple of essays in Part Four in the beliefs book about hope and my learnings around it and how to actively create hope. Or if you're not careful, you can crush hope. So magical thinking, like in my fantasy, which I have: tomorrow the vaccine arrives from UPS and all this ends in a really good way. And it was a joke, and it didn't really happen. That's great magical thinking.
Hopefulness is: This is gonna suck; in many ways, it sucks now It's going to be challenging. But if we stay true to who we are, and we manage our money, and we manage our customer relationships, and we give people great experiences, and we're kind to each other, we can get through this stuff.
And I believe that, so it's not phony. And then just reminding them of all the things that are in this six-pointed hope star that I created, you know, made up out of my own mind of how to bring this hope stuff alive. And I realized when I started hearing comments from people, like, “Wow, these notes are so hopeful.” And I'm like, I didn't really mean to do that. I wasn't opposed to it, but it wasn't my intent.
But I realized as I went back through the notes that I actually was touching on all of these six elements, not in the exact order, in the note and that's really one of the things that comes out of it. So again, I think being true to who you are, being honest with people--but also not honest like, “Oh, my God, I'm freaking out. I might die today”; it’s accurate that you feel that in the moment but it's not helpful. Telling your six-year-old you're worried that you might not have a job next month is not helpful.
Steve Baker 51:25
Right, exactly.
Ari Weinzweig 51:26
Telling the six-year-old money's a little tight right now, honey, and we can't afford to do these things. But we're going to be okay in the long run is real and accurate.
Steve Baker 51:35
Right, very good approach. Rapid fire as we come into the last few minutes here. “Would you recommend redoing our 2020 plan?” This one comes from Courtney--as in our 2020 budget.
Ari Weinzweig 51:49
Well, we typically here do not change our plan. We change our forecast. So if you haven't changed your forecast yet, then you're one of like eight people in the country. [Laughter.] And then these guys should write a blog post about you. But in seriousness, I mean, I think it's clear, stuff’s changing rapidly for everyone. My good friend Ashlyn Rogerson, at the Family Cafe in Dublin, calls it "riding the Corona coaster," which I thought was a fabulous way to describe it, because it's true. You know, this morning, this is how we do the PPP loans, but by five o'clock, three things might have changed.
Steve Baker 52:32
There's another quick one here. “Are you using third-party delivery services for the restaurant? If so, how are you managing margins given how much they take as a commission?”
Ari Weinzweig 52:40
Yeah, that is an awesome question. So at the deli and Miss Kim, our Korean restaurant, we have been using third-party delivery groups for a while. At the Roadhouse, we never did--I think I mentioned this--because during peak periods, it was tough. The other piece of it, which I didn't mention, is I don't have a big love for those third-party delivery systems, for the reason that the question-asker is asking.
So at the Roadhouse, we're using our own staff. And I personally believe that's a more holistic way to do it. I don't believe that the way that those third-party deliveries work makes sense. I didn't go to business school, but I don't understand how you can give up 30 percent and it still makes sense because you're a food business. That's all you had anyway, was 30 percent.
And the classic thing of, we're gonna make it up on volume, doesn't quite... I kind of get it with incremental business, but for us, I feel much better with the Roadhouse model. We're paying our staff, they get benefits. They're getting tips still from the people they're delivering to. And for me, it's a more holistic model. I have a good friend who's been very active in dealing in a somewhat challenged setting around Uber and some of those relationships in the way they're treating drivers and stuff. And she's Alex Carbone. She's done a really awesome job of organizing people against some of that stuff. We all use it, but it's still not great.
Steve Baker 54:08
Right. No, I appreciate it. It's been awesome to talk to you again. And I appreciate your openness and willingness to share with the community; it's super. I do want to remind everybody that you can go to zingermanscommunity.com/enews and get signed up there. You can also find all of Ari’s books at zingermans.com.
Ari Weinzweig 54:28
Zingtrain.com will have the books. They're on both, but zingtrain.com will have the books and it'll give the community 2020 discount will work at ZingTrain but it won't work at zingermans.com. But they can order food.
Steve Baker 54:41
I would go to anything zing; that's what I would do.
Ari Weinzweig 54:45
There you go. And Steve, my mail is ari@zingermans.com. So anybody who's on here that didn't get their question asked or whatever, just please reach out.
Rich Armstrong 54:52
Oh, thank you.
Ari Weinzweig 54:53
And eventually come back and visit y'all. We're gonna have to make up for a lot of lost ground.
Steve Baker 54:58
That is so true. Well, Ari, it's been fantastic. Thank you so much and we hope to have you back sometime.
Ari Weinzweig 55:04
Anytime, man. Take care, everybody. Be safe.
Steve Baker 55:07
Thank you.
Announcer 55:09
The “Change the Game” podcast is produced by the Great Game of Business. To learn more, visit greatgame.com.
