From The Source: Don Meij, Domino’s
As a university student studying to be a high school teacher on Brisbane’s north side in 1987, Don Meij took a part-time job as pizza delivery driver at Silvio’s Dial-a-Pizza. Over the next six years Don progressively worked his way up to store manager, area manager, then state and national manager. When Silvio’s purchased Domino’s in Australia in 1993, Don became GM. In the ensuing years he moved from a franchisee of 17 Domino’s stores to chief operating officer, and then moved into his current position as CEO of Domino’s Pizza Enterprises in 2002. Don led the company to become Australia’s first publicly-listed pizza chain on the ASX in 2005 and has seen the business grow markedly under his watch.
Brisbane-headquartered Domino’s Pizza Enterprises is the largest pizza chain in Australia in terms of both network store numbers and network sales. It is also the largest Domino’s Pizza franchisor in the world, holding the exclusive master franchise rights for the Domino’s brand in Australia, New Zealand, France, Belgium, The Netherlands and Japan. Across these six countries, Domino’s Pizza Enterprises boasts more than 1500 stores and employs approximately 30,000 staff.
Justin Grey: Going back 28 years to 1987 when you started as a pizza delivery driver for Silvio’s, was there any inkling that this would be your long-term line of work?
Don Meij: Definitely not. Back then it was passing some time while I was at university, then that evolved into passing some time as a manager before I could go back to university to do a new degree. And that just kept evolving. But no inkling at all, other than that I wanted to be in business and that I liked business more than I liked what I was studying. I was driven, but not driven to create anything like this…you just can’t dream that.
JG: FY15 results for Domino’s Pizza Enterprises were impressive. Were expectations exceeded?
DM: Definitely the end result was a lot higher than when we started the year in our forecasts. We started the year with a 20 per cent forecast, and we upgraded it at the AGM to 25, and then upgraded it to 32.5 in February. And we came in at 40. So clearly the year continued to be better than what was originally expected. But a lot of these things are the result of a lot of long-term work, which then gets delivered. It’s all the groundwork that we’re doing. Today, we’ve got projects that we’re building for this year, next year, and even some that are potentially three to five years away. For example GPS driver tracker started four years ago with the need to think about safety, and here we are getting the fruits of the benefits this year. When we’re giving out outlook to shareholders, we have to be real that not everything will work. Not everything just hits it out of the park. So we may start a little more conservatively, but there’s not many businesses forecasting 20 per cent growth this year. And that’s a more conservative year for us. It just keeps unfolding an evolving…we’re really proud of the results we’re getting.
JG: Things have been on the fast track, particularly the technology innovation side of things, over the last 10 years since the Domino’s group listed on the ASX in 2005. Did everything ramp up once you went public?
DM: You’ve really see it jettison in the last five years, and that’s all this becoming a smarter, more trained, more disciplined organisation. And that’s just made us a better corporation. The fact that we’re listed means we’re transparent; we’ve got a scorecard, and it drives you. We’ve been listed now for 11 years, and the learning is that this is long-term. It’s a long marathon, and back on back on back great results come from all of the flags that you’re posting into the future and shooting for. The results in the market today are just as much about all the planning and execution that’s happened in the years before.
You can’t just turn on a great year. If you do that, you’re most likely going to follow it with a bad year, because you’re doing too many shortisms.
If I wanted to, I could clearly work with the board and do a whole heap of short-term things and deliver even better results for this year, but only to then short the future. And why would you do that? That’s not in the best interest of anybody. There is no benefit in shortism; it’s all about the bigger picture – where you’re going and how you’re creating it. We’re thinking long-term all the time, and I don’t live in the fear of that. I live in the fear of not getting the long-term results because we didn’t think big enough or we just didn’t think far enough about the capabilities and capacities of this business.
JG: The investment in technology and e-commerce that Domino’s is making is quite unheard of in the QSR industry in Australia…
DM: We live in a disruptive world and the age of the internet has bought such an immediacy to solution finding. We’ve learned to become lean and agile and we work in more of a, one might say, Silicon Valley way. That contemporary thinking of shifting paradigms, and we look at old problems with new solutions, whether they be technology or something other. And we’re just getting a lot done because of it.
In fact, when you’re inside the business, from the outside there’s a lot being outputted, but from the inside there’s the knowledge and ability that we can do more, but it’s always just the executional ability to do more. When you’re changing the structure of something that may have existed for decades, you’ve got to create new solutions. And we don’t always hit on the answer; sometimes it’s not commercial enough to bring to market, or we’re just not cracking the code. But inside the business we feel there are more opportunities on the table. We’ve just got to get to it. We’ve got projects right now that are very intense, to roll out this year, and some will flow into next year. Then some are three to five years out that are really, really big structural projects.
JG: What have been the key drivers behind committing so wholeheartedly to things like online ordering and GPS driver tracking?
DM: It starts with a consumer tension. A consumer tension could be, when I order a pizza, when is it going to arrive? And that’s the reason I don’t order it because sometimes it could arrive in 20 minutes and sometimes it could arrive in 45 minutes. And that’s a part of my life lost, which people don’t have tolerance for anymore. Our lives are busier – we can have more immediacy, so we don’t have a lot of tolerance for things that don’t have the effects of immediacy. And so pizza tracker is just one example, followed by GPS driver trackers, where we gave the consumer back time. We gave them back transparency and honesty, and it gave us a knowledge base to even compress time, because we once you start tracking time, you realise your inefficiencies in time.
It starts with finding a consumer tension, and then how do you build an emotional connector to that consumer tension? And that’s an art, because to learn about consumer tensions, you have to learn the art of listening. And listening is not just sitting in a room asking questions; it’s about being aware of the data and how to read the data. It’s looking for moments in life where there’s tension, and you need to have an analytical, diplomatic mind. And that’s what we’re trying to do – just endlessly look for the tensions.
JG: How has the introduction of these news technology solutions changed operations for the business?
DM: When you solve one tension, you can create new tensions. For example, the GPS driver tracker is so transparent. It was common in our business that you could take two deliveries in the past – but now, when you make it transparent, the customer goes, ‘why are they going on another order?’. And that now creates a problem for the customer, because even though you might still get there really quickly relative to your competitors, the fact that they knew that you were taking somebody else’s order before theirs means they don’t feel very favourably about you.
So we’ve had to create a new focus in the business on single deliveries. Now over 80 per cent of our delivery orders are singles, and 100 per cent is our goal. Yet if you went back a couple of years, you’d be lucky to have 50 per cent. So new solutions create new tensions, and you’re just endlessly making yourself better as a result of it. And it’s all customer centric. And that’s why the innovation factory just builds ahead of its own, because it starts with one thing and it leads into so many other things.
That GPS driver tracker has so transformed our business, and it all came out of one original intention – and that was that we wanted to make our drivers safer. And that single thing four years ago led to improvements in productivity, which then led to transparency to customers, which led us to improve our behaviour and focus on execution and knowledge. And now I’m looking at the project list for GPS driver tracker for the next 12 months and it’s huge! There are about 20 elements that have changed and there’s about 20 more coming. It starts with one tension – and an honourable tension – to make our drivers safer. We’ve been doing technology since 2006 now, and the knowledge that we’re getting has allowed us to dream bigger, wider and more creatively because we know about what we’re seeing. And we’re just changing the world in this space, which is very motivating.
JG: Domino’s Pizza Enterprises is the largest Domino’s franchisor outside of the US. It’s impressive the degree to which the group has penetrated overseas markets…
DM: And we’re very proud of that. We’re proud that we’re an ASX-listed company and that we’re bringing a lot of income back to Australia. We are a proud Australian taxpayer. A proud Brisbane company.
[Overseas expansion] wasn’t always the plan, but by the time we listed the business we realised we needed to find new avenues of growth.
We used to think that Australia would be a lot smaller than it is. When we listed, we thought Australia and New Zealand would be all grown out with 520 stores, so our future was a little closer back then. Today, we think it’s 900 stores, because we’ve reinvented and the customer has rewarded us and we’re getting a share from other categories.
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