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Challenge your assumptions and biases when assessing your ‘glass’.
Challenge your assumptions and biases when assessing your ‘glass’.

Glass half-empty, glass half-full – it’s so much more complex than that

SUSAN MARTIN explains how to change your thinking to go beyond optimism and pessimism when it comes to managing a business.

An important part of a stock planner’s job is mitigating risk. This carries a natural association with the concept of pessimism – anticipating the worst outcome – which can give planners a reputation for only seeing the downside.

I have a different view. Stock planners are often able to see things others don’t by employing lateral thinking – something that any business owner can also employ.

I’ve taken some creative licence to illustrate this concept by using the old ‘glass half- empty, glass half-full’ analogy.

Assumptions and facts

Half-full or half-empty may sound simple, but in practice it is not that straightforward.

Take, for example, the shape of the glass. We automatically assume the glass is a classic highball, with sides that run straight and parallel up and down – but if the sides aren’t aligned in this way, where is the halfway point?

Do we mean halfway in terms of the volume of liquid, or halfway in terms of the distance from the rim to the base of the glass?

This example illustrates that we need consider which assumptions underpin our ‘default’ thinking.

Here’s another consideration to make you grimace – what is in the glass?

Is it a liquid you would enjoy drinking? If not, half-empty is a much more optimistic view than half-full!

Now, apply this thinking to sales and profit. If you are having to ‘swallow’ a run of low- margin sales, wouldn’t it be good to know when you are nearing the end of that pain?

It’s important to think about how many glasses you’ve already had to drink, too.

If you’re already eight down, maybe the idea of that next glass still being half-full makes you groan!

This is another situation in which seeing the glass as half-empty would come as a welcome relief.

Maybe this is how you feel about problem stock that’s been weighing down your mix for too long: ‘Enough already!’

Perspective and progress

The next factor to consider is who owns the glass. Is it even yours? Whether it’s half-full or half-empty might not be relevant to you.

By this, I mean know your business and your strategy – stick to it or correct your course based on your specific goals, rather than being unnecessarily swayed by what everyone else is doing.

And speaking of goals – what are yours? Are you aiming to finish your drink in the fastest time possible, or are you aiming to make it last?

A glass typically considered half-empty, or even completely empty, could be considered half-full or completely full if you are measuring air rather than liquid.

Half-empty could mean you are well on your way to achieving your goal – which should lift your spirits, not dampen them!

How long have you been drinking, and what time do you need to leave the bar?

Perhaps you need to clear seasonal or problem stock that’s been holding up cash for too long. Drain that glass and be done!

If you’re in a hurry to finish up and go, half- empty is the optimistic outlook.

What size is the glass? If it’s giant, half- empty could still be good – though if it’s a tiny shot glass, perhaps not. Different types of drinks come in different size glasses, and more is not always better.

In planning terms, this analogy means that one size does not fit all – one view, one approach, and one benchmark, cannot fit all scenarios when conducting a retail analysis.

Measurement and management

When examining your glass, first determine exactly what it is you are measuring – the air, or the liquid.

A glass typically considered half-empty, or even completely empty, could be considered half-full or completely full if you are measuring air rather than liquid.

It matters what you measure.

Many businesses focus only on sales, without measuring other metrics that are just as important – or more important – in certain contexts, such as profit.

You get the picture – I’m a big advocate of embracing the ‘grey areas’ in stock planning, and I can see cases where a glass half-empty would be the preferred scenario.

When managing a retail business, it’s important to push past default positions and outdated assumptions, rather than plodding through analysis ‘checklist style’, with no room for interpretation.

It’s not really about optimism or pessimism – it’s about perspective and context, and when you apply those, you get realism.

Then, once you have a clear view of what’s really going on and consider all the influences in play, you are in a position to optimise your business’ outcomes.

To take the analogy way too far, as I love to do, I hope this concept will help you add a twist to the usual way you manage your business. Cheers to that!

 

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ABOUT THE AUTHOR
Susan Martin

Susan Martin is founder of Smart In Planning. She has 25 years’ experience developing stock planning systems for retailers in South Africa and Australia. smartinplanning.com

SAMS Group Australia
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