Thu 27 May 2004
Of Systems and People
Category : Commentary/systemsandpeople.txt
I'm finding this travellers' hostel thing that I talked about yesterday really intriguing. On the one hand, I've always had the belief that one shouldn't start a business unless one has a passion to really work at it. Like Bill Gates said, you shouldn't wake up in the morning and decide, hey, I'd like to be an entrerpreneur and, let's see, should I be a baker or a fisherman? Or as Steve Jobs say, go get a job as a busboy until you can figure out what you want to - because most people who start really successful companies want to do it so bad that the only way they can live is to start the business.
So I have only admiration for the people who're running these travellers' hostels like The InnCrowd. They're top guys.
But I also know that you cannot sustain a business like this, where you're doing everything, every single day. If you don't find a way to make it work like a machine, so it'll continue to provide a reasonably efficient service even when you're not there, you're going to find yourself chained to the store. What happens when the first kid comes along?
And the guys I'm trying to help compete - they may not have the same passion for the field (they're not even backpackers) but what they have is a fantastic location, a great space, and a possible synergy with the other activities they've already gotten running in the same space - a pub, restaurants, movie screening room and a playhouse.
So the interesting question is : how do you use technology to compete? It seems ludicrous to think that technology could have a place in a people business like this.
At the scale of operations that The InnCrowd or Hostel One-66 are on, technology loses and the people win, hands down, no questions anout it.
But even these have to grow, inevitably, or die. You can't keep still, I don't think. And running a 10-bed operation is wholly different from running a 60-bed facility (worse if you have to spread the operations across several sites). You can see this just by working through the reservation mechanism scenarios for a 60-bed facility. The permutations get to be literally mind-boggling. I guess in a 10-bed operation, you can just stand on a chair, call everybody around and shuffle the sleeping arrangements manually. Try doing that with 60 guys.
Or check in and out these guys within 5 minutes. And if you're going to start hiring some help, how do you know if the takings are correct and if the figures tie up? Once the owners stop being able to do things themselves, things start to fall apart.
So it's an interesting project. To concede the early ground and move the competition on to a larger scale where technology starts to make a difference. And how, precisely, could we use the technology? In our case, Mac-based technology? That's where it's fun to find out.