Domino's has personified not only why it’s so important to invest in emerging IT solutions but also how to execute a long-term implementation strategy with precision and confidence.
The results speak for themselves, with around 60% of their sales now coming from purely digital channels. That commitment to ITSM excellence has also done wonders for their stock price, outperforming tech giants like Google and Apple, as well as the rest of the S&P 500, by a wide margin during the past decade.
The future looks bright for Domino's and likeminded digital-first food vendors. As flailing brands like Papa John’s struggle to get their act together, the Michigan-based company continues to reign supreme in a world where convenience and instant gratification rule the consumer landscape.
How did they pull off such an amazing turnaround? The answer starts with a a truly agile change management framework that enabled them to build the best possible ITSM strategy. With those pillars in place, the company is primed for many more years of culinary industry success.
Let’s break down their incredible story!
Stop me if you’ve heard this one before: The first step in solving any problem is to recognize that there is one.
Most companies would relegate those realizations to board room meetings and hushed water cooler conversation, especially where it concerns how their ITSM best practices may be falling short. Not Domino's. They actually made their IT reckoning a public affair.
They company produced long-form online ads and shortened TV versions that admitted they had been delivering a subpar product to consumers for some time. It’s a bold move and one that could’ve easily backfired if they hadn’t committed to widespread organizational change.
This meant not only coming up with a new pizza recipe, which they did, but really starting over in terms of meeting their customers’ needs from the moment they placed their order to the second one or several pies were delivered.
The man responsible for spearheading this turnaround was CEO Patrick Doyle, who stepped down in 2018. It was one of the most successful leadership runs in the history of modern business.
“You can either use negative comments to get you down, or you can use them to excite you and energize your process to make a better pizza,” Doyle said in the aforementioned video campaign. “We did the latter.”
Domino’s took additional steps to go from a business that was bogged down by too many time-consuming, manual ITSM processes that provided little visibility to a company focused on creating a streamlined, automated operational standard that made synchronicity and integration much easier.
For more on how they accomplished transforming their approach to cybersecurity using Jira, check out their talk from Atlassian Summit 2017 below:
During Doyle’s time at the helm, Domino’s became known as a tech company that happened to make its money providing food to consumers.
"We used to be a pizza company that sells online and we needed to become an e-commerce company that sells pizza," Domino's Chief Digital Officer Dennis Maloney told the Detroit Free Press. "That was one of the big 'aha' moments that caused a lot of conversation within the company."
Focusing on that larger goal not only opened up additional revenue streams that weren’t being leveraged by competitors, but it also helped the brand ingratiate itself with a new generation of digital-first consumers.
As one such customer told the Free Press: "They understand people's desire to have things when they want it, how they want it — and get it through the channels they use. It's genius."
From devices like Google Home and Amazon’s Alexa to Facebook Messenger bots, the ordering possibilities are pretty much endless. Jon Hall explains why this pivot in mentality is so important to long-term ITSM success:
“Most enterprise IT functions were built around service provision, rather than product innovation, and around the needs of employees rather than external customers. Digital transformation will change this to a greater or lesser extent for every company.”
As Forbes’ Alicia Kelso observed in 2018, the pace at which Domino’s expanded their IT infrastructure was something completely unprecedented in the food industry:
“On Doyle’s watch, the company has served as an industry case study of sorts, particularly in the delivery and digital spaces. On the delivery side, the company has been pressed about how it will maintain its competitive edge as more brands [...] In fact, while [other] brands dive into delivery for the first time, Domino’s is now delivering to customers using hot spots on the beach and other locations that don’t have a physical address. Doyle calls the company's hot spot initiative a ‘game changer’ that will redefine delivery convenience [...] Also, and underscoring the company’s prioritization of forward-thinking technologies, Domino’s is thinking years ahead, testing driverless cars in Miami with Ford.”
Additional in-house software development initiatives included “zero click” ordering using the pizza emoji on your mobile device, and Pizza Mogul, a virtual pizza design platform that gave users the chance to make huge sums of money.
However, that consistently high level of innovative ITSM wasn’t an automatic. It required a culture reset and the message that the company was going to embrace risk-taking instead of running from it.
For Domino's, prioritizing the UX side of their ITSM processes meant they’d be setting sail in waters previously uncharted by companies in the food industry. That uncertainty, however, wasn’t going to be the force that held Doyle and his leadership team back.
"I think the vast majority of companies are far too conservative in how they approach risk,” the former CEO said in 2015. “They simply spend too much time trying to figure out how to de-risk.” He made sure that the company backed that statement up, with the first iteration of Pizza Mogul going live just five months after the project began.
Getting the most out of your software development and your overall approach to being agile means you have to be okay with making mistakes and quickly adapting how you work. Waiting for the perfect moment to deploy a new feature, app or ITSM automation means you'll miss your chance to be a true innovator in your industry.
"If there is one thing we did particularly well at Domino's," Doyle told Investors Business Daily, "it's how we thought about investment and risk, and how that has driven growth in our business. We are simply not afraid of making mistakes. We have moved and changed this business at a pace that is dramatic and very unusual for a more traditional business."
That logic became more deeply embedded within the organization with each passing year, even when digital experiments went awry. A good example of this was the company’s Twitter integration, which led to rampant connectivity issues between the platform and their online pizza ordering interface.
"We literally were breaking various things with Twitter all sorts of times, because they just weren't used to that type of commerce experience," Maloney told Wired back in 2016. "We were building and creating new APIs going back and forth between the two organizations." However, it’s precisely that boldness of spirit that has helped Domino’s reign supreme.
As Doyle points out, no business should justify a stale ITSM system by falling back on a “do no harm” mindset:
"Often people feel far more remorse and guilt about something they do that doesn't work out well, than something they don't do that causes some amount of damage or lost opportunity [...] Some of the most damaging words ever written are the Hippocratic Oath, 'First, do no harm.' It doesn't say, 'go out and heal people.' It says don't do anything as a doctor that may actually hurt somebody. That slows down the pace of medicine, slows down innovation."
For more on the kinds of heroes your organization needs to execute meaningful cultural change as part of your digital transformation, check out our blog!
Domino’s is still seen as one of the culinary industry’s foremost investors in IT services and digital innovation, but the glaring question is: How will they maintain their dominance as technology continues to evolve at such a rapid pace?
The answer starts with their ability to use ITSM practices to keep their key IT services up and running on a consistent basis, as well as their appetite for tech-based evolution. “We are the technology disruptors,” Doyle said of his company’s mindset. “We’re making every effort to keep every advantage we worked so hard to build.”
Their future success also hinges on their continued integration of the latest IT tools into their ordering and delivery workflows. Among these potential initiatives is using driverless cars to streamline how they get pizzas to customers.
"It probably won't come as fast as everybody is saying, but faster than anybody believes," Maloney said of automated delivery. "We are well past the conversation now if autonomous vehicles are coming. Now, it's a question of when and how."
Transitioning from a human-led delivery force to a completely digital one means getting customers (not just employees) comfortable with that mission. The same applies for the company’s continued investment in cloud-based ITSM resources, as well as its newfound AI quality control system that ensures each pie is perfectly cooked.
The latter, billed as “the world’s first smart scanner,” uses an intricate ceiling-mounted camera interface to make certain that every pizza looks like the ones in the organization’s marketing photos. Nick Knight, CEO of Domino’s in Australia and New Zealand, said it’s a direct response to their top regional customer complaint.
Our #1 customer complaint is “My pizza doesn’t look like it should!". So, we introduced DOM Pizza Checker - world-first technology which is set to drastically improve product quality and consistency throughout all Domino’s stores in Australia and New Zealand! pic.twitter.com/Ve4WUizTuC— Domino's Australia (@Dominos_AU) May 26, 2019
During a run that included 30 consecutive quarters of same-store sales growth, exponential stock growth and their brand repositioning as one of e-commerce’s cool kids, Domino’s has certainly proven that a strong ITSM strategy and commitment to innovation can bring any company to the forefront of the digital revolution.
Since Doyle’s departure, Domino’s has seen their stronghold diminish somewhat as the food delivery wars reach a fever pitch. That said, they remain steadfast in their long-term dedication to pushing themselves to reach new heights from an IT service standpoint.
“The Grubhubs and Uber Eats of the world will [challenge] us,” says Art D’Elia, Domino’s Chief Brand and Innovation Officer, told Fast Company. “We need to keep pushing ourselves to maintain our advantage.”
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Originally published Aug 6, 2019 9:00:00 AM