When you push the envelope, you risk the paper cut.
That's the lesson I learned this past week when I flew out to Ohio's Cedar Point amusement park to catch a ride on the world's tallest and fastest roller coaster. It was not to be as Top Thrill Dragster was down, supposedly for a problem with a valve in the launched coaster's hydraulic system.
Yet like the coaster's spiraling plunge, there's a twist. While the park routinely draws a crowd from Miami, Ohio, I flew up from Miami, Fla. This was my third time at the Cedar Fair (NYSE:FUN)-owned scream machine haven. While I was averaging a trip to Cedar Point roughly every four years, Dragster's grounding this time has me staring at the 2004 calendar for a return visit.
It doesn't seem right at first glance. How can a bad thing be good for business? Why should someone profit from dashed expectations? But I started jogging through my memory -- which admittedly is more like a slow crawl over broken glass -- and it all started coming back to me.
Repeat business
Last month, I went to the AMC (AMEX:AEN) multiplex only to find that Bruce Almighty was sold out. I settled for something else with plans to go back a few days later. How many times have I gone through the McDonald's (NYSE:MCD), Burger King, or Wendy's (NYSE:WEN) drive-thru window to secure a specific kids meal toy premium only to have to come back a few days later to try again? Closer to home in the theme-park world, I remember making three day trips in the span of a month before I was finally able to check out Epcot's Test Track attraction at Disney's (NYSE:DIS) Disney World.
In all these cases, I rewarded the establishments with repeat business because we didn't quite connect perfectly the first time around. I know I'm not alone here. Remember that time back in March when you went out to your favorite restaurant and they were out of the entrée that you were craving? You settled on something else from the menu and wound up going back a lot sooner to fill that void, didn't you?
All this makes me wonder the obvious: Why is corporate America so bent on pitching a slider when it should be brushing up on mastering the art of the curve?
Sure, companies have often tried to manage demand by stifling supply. The easiest match to light under hype's bottle rocket over the holidays is to create a situation where a certain toy is having a hard time making it through the distribution channels. Remember Tickle Me Elmo, Buzz Lightyear, or the Sony (NYSE:SNE) PlayStation2?
Those shortages don't necessarily deliver as much in terms of incremental sales as they do in missed opportunities when the season's avid buyers resign to pick up something else. Frustrated shoppers get the last laugh, though. By the time many of the holiday's "hot" toys finally get to fill the shelves in volume come January, it's usually just a dropkick away from the clearance bin.
But that's the kind of inventorial incompetence that gives managed mismanagement a bad name. Sure, the proverbial "bait and switch" approach can be an ethical death knell if it's intentional. However, it can also be handsomely rewarding if a company is able to walk away still clutching to its integrity.
Because I don't blame the movie theater for a flick's popularity or fault a burger joint because it's doling out the wrong premiums. As for my two Dragsterless days at Cedar Point, my son, nephews, and I still managed to log just over 30 rides on the park's impressive fleet of 15 operating coasters. Mope is a four-letter word. Ride is a better one.
How to fail successfully
A quality outfit earns a second chance. Serial disappointers will be lucky to get away with the first swindle.
Why? There is little room in a crowded world for perpetual failures. Well, unless you just happen to own the market. Microsoft (NASDAQ:MSFT) can get away with buggy operating systems as long as the bulk of the world believes that Mac and Linux are country music singers. To Microsoft's credit, the early adopters know that free upgrades will fix the rushed flubs. Some utility companies can just get by when it comes to customer service because you're a captive audience.
But most companies aren't so lucky. Any old-time Fools remember when Iomega (NYSE:IOM) was handing SyQuest its lunch and the keys to bankruptcy in the removable data-storage market? How many tire blowouts did it take for Ford (NYSE:F) to realize that it had a safety image problem?
With every trip it gets harder to come back up. Patience? There is none for the boy who cries "Fluke!" But if the blip is the exception to the norm, play on. Cedar Point's record-setting coaster has had a spotty first month of downtime, in large part because it chose to raise the bar rather than play it safe and pass the buck with a more proven addition for the 2003 season.
I don't mind that. I applaud the company that takes chances. Industries like technology have been built on one-upmanship. In the corporate space, it's not always how you succeed that dictates your level of success, but, rather, how you fail.
Envelopes weren't made to stand still.
Rick Munarriz and his clan had an excellent time at Cedar Point's "CoasterMania! 2003." Rick owns stakes in Cedar Fair and Disney. His stock holdings can be viewed online, as can the Fool's disclosure policy.
