1: In 2017, Panera Bread founder Ron Shaich sold the company for $7.5 billion, one of the largest deals in restaurant history.
What does Ron believe is the “the singular element” that created this enormous amount of value?
The “Concept Essence” document that he and his team created twenty-one years earlier.
What exactly is a Concept Essence?
It “isn’t a business plan,” Ron writes in his book Know What Matters. “It doesn’t contain financial projections, market analysis, or sales strategies. All that comes later. . .
Instead, a Concept Essence is “an emotional blueprint for how a company is going to go to market and how it intends to compete,” he explains.
It answers the questions: “What makes us special? What makes us a better competitive alternative? From where do we derive our authority? Why do we stand out in the marketplace?”
The original document served as the company’s “North Star for almost two decades,” he writes, “until the time came to rewrite it around a revised vision in 2015.”
2: Looking back, Ron reflects: “In today’s world, [the words] resonate differently than they did back then. But when I read them, I can still feel the vitality that every key word held for us as we reached into the future and put our stake in the ground for a new kind of restaurant experience:
“Bread is our passion, soul, and expertise.
“Our food must be as good as our bread.
“We build trust through relationships with our customers and communities. We are a club that allows our customers to feel good about themselves. We are of them. Our brand can be trusted.
“We are an everyday oasis for our customers.”
For each statement, Ron and his team “wrote paragraphs expanding on its meaning and the way in which we would bring it to life,” he explains.
They also had a three-word shorthand that captured the essence of what Panera Bread stood for: “Share the warmth.”
“The kind of warmth that makes you feel nurtured and special,” he writes.
3: At the same time, Ron was working on the Concept Essence for Panera Bread, “a cautionary tale was playing out for us in our own company,” he observes.
At the time, Au Bon Pain was the company’s primary brand.
That restaurant “had started out with a powerful, innovative idea,” Ron writes, “but as it scaled, it was losing the characteristics that made it stand out from fast food.
“If managers and associates don’t have an intellectual and emotional grasp of the essence of a company’s authority and differentiation, the concept will revert to the mean an lose that essence, becoming like everything else,” he explains.
Which is why Ron believes creating a powerful Concept Essence is so important.
“Some people might balk at giving so much time and energy to words on a page,” he writes. “But words matter. Words precede actions.
“To this day,” Ron reflects, “I’m certain there are folks who roll their eyes when I sit down to work on yet another version of a company’s Concept Essence statement, or when I spend hours debating a particular word or phrase.
“But I know that getting it right is the difference between that vision coming to life as a fully differentiated concept and it becoming another copycat.”
More tomorrow!
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Reflection: How deeply do I understand and communicate the emotional essence that makes my organization remarkable?
Action: Commit to reviewing and sharpening my organization’s concept statement, ensuring every word captures our true point of difference in the market.
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