[Case study] Why discipline and self-reflection unlock great innovation

TL; DR

This story about a Texas-based maker of high-quality cowboy boots teaches innovators a key lesson in four parts, namely:

We don't talk much about discipline and self-reflection. But they are the great enablers of corporate innovation work.

Specifically:

• Don't fetishize scale: Consider NOT seeking scale (even if you want it). Focus on making users absurdly satisfied. Scale may emerge as a side effect, if you so desire.
• You CAN beat incumbents ... but probably not via "disruption:" You have 3 ways to beat bigger competitors: Be better, move faster, go where bigger competitors can't.
• Paradoxically, limiting yourself eliminates limits: Boldly, "real-ly" stand for something. People may appreciate it far beyond your "target user group."
• Stoics rule: Bonus lesson, for fun: Ancient Greek philosophers still matter to 21st-century cowboys.

The story

Goin' Texas today.

Will Roman may have started his career in UX and Product. But nowadays, he's Founder and Chief Texan at Chisos Boots, an Austin-based maker of high-quality cowboy boots.

Host Josh Schultz interviewed Will for The SMB Ops Show podcast in early 2023 (though I just learned about it days ago. Thanks for the tip @CM).

As podcast interviews go, this was a rich one, covering branding, strategy, user centricity, caring about craft, operations, hiring, company tool stacks, and more.

I especially loved Will's description of how he began his startup, learned the craft, and built a business that reflected his true beliefs. (Would have loved to have known why he started it–the motivation or trigger. But unfortunately that wasn't covered.)

Will learned that most cowboy boots are made in Mexico today. He went there and tried to work with the big manufacturers but was rebuffed when he suggested creating a higher-quality boot that lived up to original standards and could last decades!

Eventually, he found smaller workshops at the metaphorical edge of town, learned from them, read all he could about making boots, literally cut up competitors' products to see how they are made, and just all around put serious effort into getting "head smart," "heart smart," and "hand smart."

Then, in addition to creating the best boot he could, he also built a business with perspective around it.

He made the true strategy choice not to go for scale to a maximum possible, which would have required compromising on quality.

He leaned into the brand of Texas. Not only does the state represent more than half of the U.S. market for cowboy boots. Everything he did came back to "Loving Texas," in addition to the other half of his motto of "Doing Right." Marketing, branding, community-building, and more all tied back to Texas.

And finally, he built a solid, credible business: Strong hiring, solid operational tools, understanding of the P&L, watching the metrics, finding a way to compete with stronger incumbents, and more all matter of course, no matter what you do.

Today, Chisos sells boots and related gear both online and in-store and prides itself on fantastic customer service and vibrant community-building.

[Source: Will Roman of Chisos Boots via The SMB Ops Show]

The point for doing credible innovation work

All of that is lovely of course. But let's also get to the corporate innovation that's our focus here:

For our specialized purposes–and with apologies to Josh and Will for taking their content into an entirely different and unintended direction–we will focus on just four points, captured in four quotes. They stood out to me so much that I put the podcast on loop, to make sure I caught all their nuances.

(Side bar: Why four quotes? Out of at-least-modest respect for the podcast's actual intent and because I get sick of the "Rule of 3." Comes from my days in Operations. In Operations, you don't get to pick an arbitrary number of topics for conversations, ... which magically is always 3. Instead, you have to deal with reality as it is. If there really are 17 topics, you just have to accept that. Reality is what it is. The SMB Ops Show being an Ops podcast makes me at least tip my metaphorical cowboy hat to the topics they actually discussed. Anyway, end rant.)

So what did I learn from Will and Josh?

Don't fetishize scale

Here, will muses about the benefits and balance of "craft" vs. "scale:"

I know the number of boots we can produce at maximum capacity with our current setup. And it’s a lot smaller than what our competition is making.

You know, there are reasons why they are making these tradeoffs. When you get to these ..., to scale. Look, there’s certainly a world if you want to go out and chase $200M, $300M in annual revenue, god bless you.

But that’s not the game I’m in. I’ve chosen not to be in that game. There’s quite a nice life in a world to be in, in the $10-20M revenue world. And it allows you to make decisions about what you are creating.



– Will Roman

I like both Will's actual point and a derivative of it.

I had never "considered" scale as a conscious choice for businesses before. It seemed like a self-evident goal, especially in innovation, where thought leaders like Ash Maurya, just to mention one, formalize "Scale" as an explicit part of our work. And that's not even getting into Silicon Valley's obsession with scale, or that of our corporate bosses.

To be clear, I love Ash Maurya's stuff. But it is actually a choice: We don't all have to become deca-corns and billionaires. Not needed.

But let's say you still need or want scale.

Even then, we need to do "things that don't scale" early on, to learn intimately from users about what's worth standardizing and scaling.

Separately, we don't grow markets in one chunk. Instead, we "nail the niche" and move user segment by user segment. Each user segment on their own may not be scalable. They only become scalable as a mosaic.

And finally, it turns out that humans are terrible at knowing up-front what makes for a "good solution." In other words, 99% of the time when business leaders "funnel," "hopper," or otherwise "prioritize" initiatives up-front, it's probably bunk. If it's easy to do, it simply means that a bunch ideas being considered are bunk. But if the ideas are plausible winners, people sitting in a room won't know which ones win. In reality, we need to activate a portfolio of efforts, some of which will work. And then some of those that work will turn into big winners. One favorite example of mine for that is Bosch, who have talked publicly about how it took 214 efforts to create 19 attractive businesses.

You CAN beat incumbents ... but probably not via "disruption"

Here, Will describes how his small company took on major, incumbent competitors:

“We are small. And we are fighting these big, giant companies, legacy companies.

And so, the way you beat a legacy company, I think, is that there are 3 broad areas:

1. You build something better
2. You move faster
3. You market the things that they cannot say, right?

So, what can these big guys not say. They can’t say they are a small business. Their small founders can’t get on the mike and the video.

Some of them have tried to copy us, and it was, literally, an utter fail. They were like: “never again, get this guy off the camera. He’s like a New York private equity money guy.” … some of these guys, they just don’t really care about the business. They are there to make money, and only money, and it comes through.

And if that’s you, that’s fine. More power to you. But you can’t get on camera. But we have that advantage. And we wanted to showcase our differences.”

– Will Roman

Another day soon, I'll talk about my "four ways to win," the only four ways I have found for creating winning businesses.

But I never considered that the feasible "ways to win" differ by context. Will taught me that. His three ways to win map to mine. But they are more specific, to match the specific needs of his competitive situation.

(BTW, my four ways to win are (1) be better, (2) keep out competitors, (3) outsmart competitors, and (4), the one that doesn't apply to Will or he at least doesn't mention, enter a space that is so big and growing that one doesn't have to "win," merely be one good choice.)

Paradoxically, limiting yourself eliminates limits

Here, Will and Josh discuss how Chisos' loud focus on Texas appeals to people's cowboy aesthetic and needs even if they live far beyond the Lone Star State:

“I introduce you as the chief Texan. [I love] to see how well that plays with non-Texans, even non-Americans, just everybody that meets you.

I don’t have to be what you are marketing to.
But I can love who you are and what you’re doing in your marketing.”

– Josh Schultz

You really need to do yourself the favor of listening to Will's rant about the difference between being "real" and being "authentic."

Essentially, he correctly points out that the only people who describe themselves as "authentic" are actually faking it. Otherwise, they wouldn't need to point out just how "authentic" they are.

Instead, Will advocates for and lives being "real." He is not a Texas poser. He really loves it.

But it doesn't stop there. The real magic comes in his follow-on point:

You might think that being real limits you. For example, his focus on Texas might seem to limit him to the Texas market, big as it might be. But instead, people recognize his excitement and being real and see it as a human connection to something in them, for example to their yearning for the freedom of a cowboy life. And so, his Texas-focused business sells plenty of goods to the rest of the U.S. and even beyond its borders.

Said more generally: If you focus on your lead users/ extreme users, it's not limiting. It's simply clarifying. It still is relevant much more widely.

Stoics rule

Here, Will re-emphasizes the point that even small companies can control their own fate:

“It makes me think of the stoics:

‘The obstacle is the way.’

You’re small. And now 'small' is actually the advantage.”

– Will Roman

This one is mostly for fun. But it also captures an important point:

In strategy, you don't get to choose your starting point. You have to deal the hand you are dealt. You must win with what you have.

And often, that source of victory is a new perspective on the existing situation.

Practically, consider what keeps you from winning. Then spell out all the reasons why it's so bad. But then also spell out what all the good things about it are. And conversely, spell out all the benefits that your competitors have, followed by describing all the ways in which their strengths limit them.

And there you have it. Again, in summary:

T.I.S.C.

Footnotes

Organizations involved or mentioned (External links)

Chisos Boots

The SMB Ops Show

Further reading

Schultz, Josh. "How To Operate A Boot Brand: A Masterclass in Brand Building." SMB Ops Show. Season 1. (Accessed Mar. 07, 2024)

Credits

Photo "Cowboy going uphill on horseback" by Matt Lee on Unsplash

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