A new business model helps fitness centers adapt and succeed in this ever-changing market.
Kjell Nordstrom and Jonas Ridderstrale's book Funky Business Forever discusses the seven elements of a "funky business." As discussed in last month's column (July 2008, p.54), smaller, flatter and temporary are the first three elements of the funky business model. The final four elements are horizontal, circular, open and measured.
This factor refers to working across disciplines, processes and divisions. Rather than be a fitness center that involves top-down leadership and micro-managing, a "horizontal" organization will be able to take people from various groups (e.g., fitness, sales, management) and get them to work together on projects. Interestingly, this step also involves integrating the organization's customers (e.g., members) and vendors. Everyone becomes a "doer" and "thinker," versus having thinkers in one corner and doers in the other.
One example of this situation is seen in World Class Fitness, a fitness organization based in Russia. World Class Fitness created a "culture team" composed of facility-level staff and corporate staff, all from different disciplines, who are charged with implementing and supporting the company's culture initiative. The goal of World Class Fitness is to create a "whole" that is far greater than the sum of its parts.
The "circular" aspect of organizational leadership is built on the principle that effective leadership requires 360 degree feedback. According to the authors of Funky Business, this form of democratic leadership allows the individual leader to better self-organize with constant and circular feedback from all parties. A Chinese proverb says that every point on a circle has a different view of the middle, and, as a result, no view is right unless each view is taken into consideration. From an organizational perspective, one view of how individuals are doing means nothing unless they are able to solicit, and then incorporate, the views of others (e.g., supervisors, coworkers). As such, individuals in a circular leadership organization depend more on 360 degree feedback and less on a supervisor's feedback. Beyond 360 degree feedback is the concept of shared ownership, thereby giving others the opportunity to be involved in the decision-making process.
"Open," in this instance, is similar to being networked, or connected. In an open organizational leadership, fitness centers will leverage relationships with vendors, members and other businesses to grow their facility. As such, the fitness center of the future will have to be adept at creating strategic alliances and partnerships. Organizations won't be able to look inside themselves for business growth; instead, they will have to pursue relationships with other groups that see a mutual benefit to working with them. This will become akin to Facebook, Myspace or You Tube, where the organization has a network of relationships that can enrich its performance by building on the core competencies of each other. For example, several facilities in Argentina worked closely with their vendors (e.g., sponsors) and other businesses in their local market to create grater value for their members.
The control freaks of business are about to have an aneurysm. According to Nordstrom and Ridderstrale, leadership can't and, more importantly, shouldn't try to control every activity of the organization. In this new and "funky" business, leadership will be used to measure the right things and the right metrics in order to provide everyone throughout the organization the information needed to make sound decisions. This process will not involve just measuring financial metrics, but also entail employee, customer and market metrics. Fitness centers of the future will measure key financial metrics, and expand it to a web-based business tool that provides instant feedback to all interested parties, which will allow them to responsibly and successfully act as part of a team. Control will not come from hoarding information; rather, it will arrive by providing meaningful measurements of key metrics to all those who play a role in making things happen.
Change is part of the process
The underlying leadership principles espoused by Nordstrom and Ridderstrale are not new. Possibly what is most innovative in the thinking advanced by these insightful pioneers is the integration of these leadership principles into a series of seven features that are subsequently fused together to create a leadership model that is not built to last, but build to adapt and succeed.