|Date||February 5, 2016|
|Speaker||David SAMSON (President, Miami Marlins)|
|Moderator||MATANO Toshimichi (Deputy Director, Service Affairs Policy Division, Commerce and Information Policy Bureau, METI)|
|Time||12:15-13:30 (Registration desk and seminar room open at 12:00)|
The pipeline of tradition
I work in Miami in an industry where, if you are not careful, you will find yourself in a bottle, unable to broaden your horizons and understand how business is done in other places with other people. One of the great problems in the United States is what I call "nationalism." Americans believe that the way they do things is the only and right way. I always thought the best way, rather, is to pay attention to how everyone else is doing things and then make decisions with all of the information and move forward. I try to run my baseball team and my life in the same way.
When we are improving business, we must not get stuck. We need to see the changes coming and make necessary changes. Saying "that's how we've always done it" is not acceptable in my office when doing budgeting, making marketing plans, sales plans, etc. For me and my businesses, there are three categories: people who are running a business and trying to grow a tradition, trying to maintain a tradition, and trying to protect a tradition, and all three of these need to be done simultaneously. Many teams and businesses only succeed in doing one of the three.
Sales is a process. You need people who you are selling to start with, then you need to sell them an increased role in your company and then sell them to keep buying your products. I want the company to do all three at once.
I call this the "pipeline of tradition." We have this so that no employee in our industry ever gets stuck. People should not be doing the same thing over and over again. Even if the result is positive, they should continue to change how they do their job. From change comes progress, from progress comes ideas, and from ideas comes money and revenue.
Short-, mid-, and long-term strategy
As president of the team, people often ask me what it is that I do. The higher up you are in a company, the less you do. What I do is put the people below me into the best position to succeed. Growing our marketing and brand in Miami, we have a group of people who meet every week and talk about the pipeline of tradition. What are we doing in the short term to grow our brand? Mid-term to maintain our brand? And long-term to protect the brand forever? Those concepts are important to me. If a meeting is not structured in that way, it tends to only be about the short term.
When we are with the sales department, we talk about selling for the game on that day, for next month's game, and for next season. In marketing, we go out five seasons. The sales department has to be very focused on revenue. The marketing department has to be focused on helping the sales department and helping the tradition pipeline. They have to support corporate strategy.
How do you do something both short term and long term? I answer this by saying that this is precisely how I spend my day. I spend every day doing short-, mid-, and long-term projects, and I allocate the required time necessary to ensure that I work on each three of those every day. Sometimes there are emergencies when running a business. When that happens, I focus more on short-term issues: I sleep a little less and miss my family a little more, but I cannot let the sun set without touching on all three issues every single day. Some days there are no emergencies, and then I can focus more on the mid and long term. If you waste time, you can never get it back. It is the one commodity that no matter how hard you try, how much money you have, how many connections you have, how poor, rich or important you are, you cannot get it back.
In Miami, the biggest issue we have is that most people don't view time the way I do. They view it as some sort of commodity that never runs out. One result of this is that they run late to meetings. No one in my company is ever late. There is one chance to be late and that's it. Everything happens on time.
Meetings, money and efficiency
Having meetings all day can result in wasted time. How can such wasting of time be avoided? I do so by making sure that what we set out to accomplish in the meeting is done in the allotted time. In meetings, often there is a goal, and you are told it will take 45 minutes, but it takes twice that long. Understanding the objective for the meeting, the follow-up, and how long it will take is necessary. Some employees have meetings all day long so they think they are busy and productive. I think neither. Nothing ever comes of the meetings. Every year, we evaluate every single employee, and I read every employee evaluation. I want to see how our employees are being evaluated by the other employees. In an evaluation, people will write down that they had 300 meetings in the last month. I ask what percentage of those meetings led to revenue, sales, and the pipeline. But the intention behind all of those meetings often was to be busy or pretending to be busy. That's not how to move a company forward.
We need efficiency. If someone is not efficient when working, time will pass, and it will never come back. I talk to our employees and other business leaders. I am known in Miami as a very strict business leader, because I do not want to waste my time or anyone else's. It may lead to me not being very popular, but I am okay with that, as it is not my job to be very popular. My job is to be respected and work with others in a mutually beneficial way where the partnerships we make daily make money.
On the philanthropic side, I also engage in meetings, and often it is all fluff. We talk about an athlete in an entire meeting, showing videos of the person. I want to see that, but then I also want to talk about how we can raise money to have that athlete compete in the next Paralympics. What are we doing to push our brand? How do we finance it? You need money to do what you do best.
Tokyo understands this as the host of the 2020 Summer Olympic Games. What funding is needed to put on the best Olympics? July 24, 2020: that date is not flexible. Tokyo had better be ready, just like we need to be ready every baseball season. Planning in advance and knowing what to do to get ready is critical.
One of the things I respect most about Japan and Japanese business is that in every meeting I attended in Tokyo, there was an exchange of information before the meeting so that everyone was prepared before the meeting starts. In the United States, the first 10 minutes are wasted talking about what the meeting is going to be about.
As a country, the United States would be better served from education, business, and athletic standpoints if we understood more about time and efficiency. There is too much talk in the United States about how great everything is rather than about what to do to make things greater.
Flexibility and changing with the times
The Marlins is a very young baseball team—only 23 years old. For us, it is very important that we work with the city of Miami as both the team and the city grow older. Miami is the gateway to Latin America and is a city with one of the best growth rates as well as a destination for multinational corporations. Because of our location and diversity, companies with an interest in the tradition pipeline have to do business in Miami because we are a melting pot. We are known for nothing, but we do everything. Is that good for a city? It depends on how old the city is. If the city is young, it's fine. But when the city gets older, it is better to have a much finer focus of specialization.
It would not be good to have a 12-year-old boy tell me that he wants to be a professional baseball player and that's it. I want him to say that he wants to be a lawyer if the baseball plan doesn't work out. Your area of expertise condenses as you grow older. So, Miami and the Marlins are still young. We are building something, but we do not know what. Business is when you have an idea, a route and an endgame and you are flexible enough to know that to get from the beginning to the end you will not be able to take a straight line. There will be twists and turns. People who recognize that when the twists and turns happen, they have to get back on course to make it to the end are the people who do the best in business. Poorer businesspeople change their trajectory.
When you have a project, you envision how it will happen, and there are adjustments along the way. So, flexibility is important. The majority of students in United States have a plan and know they want to get from here to there, but they want there to be a straight line from here to there, which is not a good idea. You have to be willing to make adjustments. Unlike constructing a building where adjustments cannot be made, in building something in business, it is essential.
In Miami, as we market businesses and grow as a community, we work to "funnel"—to see that businesses that do not have an exact specialty grow into having one. The design district in Miami, for instance, was not a plan of how to get from one place to another. You have to allow for that evolution.
In United States, we have an issue with rehashing the same issues over and over again. I would like to briefly talk about politics as it relates to business and money and revenue growth. Donald Trump is a businessman running for president in the United States against Hillary Clinton. I've watched the presidential debates going back to before I was born, and I have seen that in the United States, we are still debating the issues that were debated 50 years ago. That greatly upsets me because when there is no progress, that means market share and market advantage are being lost. The United States is hence losing market share and advantage because we continue to debate the same issues without achieving results as there is either no plan or people who claim that they have a plan but do not execute it.
It is the same in business. People without a forward-looking plan in execution are being passed by because they are unwilling to adjust. They got off course, many times because of technological advances. The good side is that technological advances cause new companies to start, and with new companies you have another opportunity: new companies might understand the flexibility required, the new ideas, new marketing thoughts, and new ways to grow. Some cities are scared of such evolution, but Miami embraces that change.
There is a new facility in Miyazaki prefecture for the ORIX Buffaloes that is a beautiful first-class facility that underscores the importance of sports, economy, growth, and evolution. When you have those four concepts, you will have a city, region, and country, like Japan, that is the envy of people around the world. It is my belief that Japan consistently embraces those four principles.
I would like to tell a story which is my general philosophy. There was a king long ago who had 400,000 disciples in his community. He decided to hold a large party for the entire population, and the party had one rule: everyone had to come to the party with a glass of wine, stand in line, and pour the wine into a huge vat, and then dip their glass into the vat and have a new glass of wine that is part of all of the people's glasses of wine. The king's purpose in doing this was that he wanted to show unity: that together, we are much stronger than as individuals. People waited in line for hours, took their glass, put their wine in, and when they took wine back into the glass, they found out it was water. The people thought they could cheat the system: other people will pour in wine, and I will pour in water and get wine. That kingdom disappeared. I always bring wine to every party because I can only expect that everyone around me will do the same. When one person wants to turn water into wine, we all end up with water. Thank you.
Q1. You talked about control and imparting on all of your employees how to be ready. As a baseball team, you control so much of your connection with your consumers, control the weather in the indoor stadiums, and control everything except the score of the game, from a business perspective. How do you deal with the volatility of winning and losing from a business perspective? You've had seasons where you won the World Series and seasons where you did not do so well. How do you motivate your employees when the team does poorly?
Our product is not the final score. Our product is the game, the team, and the industry of baseball. I would never go into a business where I don't control the product I sell. When a salesperson sells wins and losses, they get fired. If you cannot control your product, you cannot control your revenue stream and cannot plan properly. Of course, we like winning, but it doesn't make anything easier in the business. Rather, it gives a false sense of security. You attract more attention and more people attend your games, but those people have no affinity to your brand. Those people have affinity to something that is going to disappear before you know it. We want affinity to the brand, not the result; and to the player, not the batting average. It is unheard of in any industry to sell a product that cannot be controlled.
Frankly, for me, this is the quick answer. When I talk to a father and son at a baseball game—knowing your customer is very important—when I ask a 7-year-old what the score is, he never knows it. He knows that his dad bought him a hot dog, he smelled freshly cut green grass, and he knows that he held his dad's hand for hours. That's his memories. We are in the memory-making business, for adults and children. The memory can never come from a result. Memories come from moments only.
Q2. I edited five of Ichiro's books. I would like to ask about Zika fever. This year, it might be a crisis control for you. Are you trying to come up with countermeasures for the disease?
Just today, there was the first case of Zika fever in Broward County in South Florida, where I live. I was immediately on the phone to two people: my wife and my head of ballpark operations. I am responsible for thousands of people every day, at a game, both physically and mentally, so I made a call today on that issue. What we are doing first is having a presentation from the Centers for Disease Control and Prevention (CDC) to help us understand what we need to do to protect our fans. Education is the best thing we can do at this point.
Q3. I would like to know a little more specifically about the short, medium and long term. How long is each and is there any special division in your organization as to who is responsible for each one? And is there a specific target in terms of the differences in the terms?
Short term is today. Midterm is tomorrow through 30 days. Long term is 31 days to infinity. Everyone has the same short and mid term. Different departments have different long-term goals. For example, the reason marketing has five years for their limit is that there is too much change after five years, and I want them to have a goal that they will be able to attain. Some marketing projects take three to five years before finding out if it works. For sales, long term is one to two years. The head of sales is looking at this season and next season. But in group sales, where we sell 30 tickets for a game to one group or individual, it is only one season. Ticket sales' long term is four months. We look at each of our departments and choose a different length for their long term. The higher you are, the longer your long term is.
Q4. On the great improvement of relations between the United States and Cuba, given your location, how are you working to capitalize on this? Also, how do you view the Moneyball concept?
Moneyball is not real at all. The movie and book are both fiction. Here is why. They had the best pitcher, three of the best pitchers, and the best position player of any team, which was not told in the movie. Moneyball would make you think they only use numbers. That is not true.
As for Cuba, the atrocities of Fidel Castro will never be forgotten, especially in Miami. The renewed and improving relationship between the United States and Cuba does not change what Castro did to the people. I do, however, have a long-term plan. My mid-term idea is to listen to Cuban-Americans. Presently, older Cuban-Americans say never, middle-age Cuban-Americans say they would never go to Cuba but they might be okay with Cuban baseball players, and young Cuban-Americans want a better baseball team, and they are fine with the idea. I need to wait for someone else, though. I cannot be first into Cuba. Miami cannot go first. I believe many companies will make mistakes in Cuba. There are so many things that need to happen in terms of the antiquated infrastructure of the country. You have to be very careful. So, we have to be strategic, but we have a different agenda than the other 29 teams.
Q5. I wonder if professional sports teams would be helpful for the promotion of sports for health for people.
Will the growth of Japanese sports be related to the growth of people participating in sports? I do not believe that that is the correlation. We are involved in getting children active. In the United States, we fight something that I've never seen in Japan called "obesity." We have the fattest people in the world. The reason is that Americans do not eat well, do not exercise, and are generally lazy. We are trying to get people off their couch, not necessarily to get them to play sports. We just want to elevate their heart rate.
In terms of the sports business, our business is not made up of former baseball players. There are not enough former baseball players to make a fan base. I want people who want memories. Major League Baseball is only involved in youth baseball because we need players and you have to have kids play baseball. It's the "funnel." That's why we build academies all around the United States. It is always better to have kids play sports than walking the streets or doing nothing, but there are many things that help kids, such as reading or debating. To grow our business, we do not need only baseball fans and players. We need people who want memories. We need to educate people that memories are made through baseball.
Q6. You said that you don't want to be in a bottle. There is a Japanese saying, "a frog in a well knows nothing of the great ocean." I would like to know your favorite comparison to any other organization and what makes your company different from that benchmark?
There is no one company or industry we measure ourselves against. We model ourselves for customer service after Disney, giving our staff the same training. We look at Manchester United as our worldwide mentor, as it has built generations of overseas fans. One of the long-term brand affinity issues we talk about is building international and national fan bases. For example, Ichiro brings us an international fan base, a Japanese fan base, professionalism, a winning attitude, and veteran experience.
Another industry we focus on is operations. Part of operations is security. We have a relationship with the Department of Homeland Security to keep our fans safe. Google comes to mind. Cybersecurity is the number one issue to me today. Google has been an industry leader in that. If people do not feel safe with Google, their entire business disappears, so if we can have that level of cybersecurity, it will make people more apt to associate with our brand on many levels.
Q7. You are very active in your city. What about the Marlins Park? Did you always have interaction with the public government, the local government, or was it just done yourself?
Marlins Park is a new building we opened in 2012. It took nine years to develop because we needed a public-private partnership. The Marlins put in $161 million, and the public put in $355 million. We continue to work with the partnership of the city and county of Miami. We are the first ballpark that was finished on time and on budget. It is important to work with the public entities because I view sports as what makes a great city great along with its museums, parks, transportation, and infrastructure. The public should help in anything that makes a city great.
Q8. Could you share with us what you emphasize when making the ballpark a more memory-making facility?
Everyone has a different view of what a memory is, so we have to provide that opportunity for disparate people. Some people see it in photos, so we have a photo opportunity spot. Others make memories through food. We have different types of foods not at other ballparks, including sushi. Others make memories through their ears. We have areas in the ballpark with different types of music. Others make memories through eyes. We have art and exhibits. Still others make memories through their mouth. We keep things quiet enough to not interrupt conversation. I give customers the opportunity to help themselves to make the memories. Memories from the baseball game itself come through the five senses. Baseball is attractive, but we also try to help make memories through the facility.
*This summary was compiled by RIETI Editorial staff.