Get All Access for $5/mo

5 Things Domino's Pizza Can Teach You About Being a Better Leader It's not how you deal with the 'knowns' but with the 'unknowns' that will help you make your business a success.

By Jeffrey Hayzlett Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

The following is an excerpt from Jeffery Hayzlett's new book Think Big Act Bigger. Buy it now from Amazon | Barnes & Noble | iTunes

What makes a company admit in the most public way possible that its namesake product sucks? In 2010, Domino's Pizza not only said it in a major advertising campaign but also showed actual social media posts and focus group footage of their customers saying the pizza tasted "boring," "flavorless," "the worst" and, most commonly, "like cardboard." Employees at the company headquarters, from the chefs to the PR people to the senior management to CEO Patrick Doyle, read and responded to customers' comments.

When I saw the Domino's commercial for the first time on TV, I was stunned. Who in their right mind would actually do that--spend millions of dollars on a national TV campaign to tell the world your product was awful? How risky was it to go and admit to your customers that you suck? Domino's was certainly doing well enough. Brand recognition was high, and business had been by most measures successful and profitable. So why take these risks and change when things are good?

I went to Ann Arbor to find the answer for my TV show The C-Suite with Jeffrey Hayzlett and learned the answer was all about awareness: Domino's found out it didn't know what it didn't know.

In some ways, Domino's is less one big business than a unified group of small and medium-sized businesses with deep company ties: 95 percent of its stores are franchise-owned, and 90 percent of those franchisees started out by working there. Together, they'd been united under one brand promise for more than 50 years: to be the best pizza-delivery company in the world--getting your order delivered in 30 minutes or less. Domino's wasn't about taste; it was about convenience and speed.

The truth is, Domino's knew its pizza wasn't the best--it cared more about getting us the box than what was in the box. And so did we. That would all change when Domino's said its pizza sucked.

Simply put, Domino's listened beyond the bottom line to the customers who were saying they wanted more. Research showed those customers' palates were changing--what they valued was changing. They still wanted fast delivery but not at the expense of flavor. Domino's saw this change as permanent and inevitable and started remaking everything, and when the company was ready, it decided to do something really radical: tell the truth. Domino's owned what they'd been and communicated it openly, honestly, and transparently. In saying they sucked, they also said, "We listened to you, and we are aware. Our chefs are going to satisfy your taste buds and give you the best quality product for the money."

What I learned at Domino's underscores essential lessons in genuine leadership when it comes to finding out what you don't know and thinking big and acting bigger. Take a look at those lessons:

1. Listen to your customers.

For years, companies have hidden behind emails that go nowhere, online help that never seems to be online, and 800 numbers with endless options ("If you want to talk to a representative ... good luck."). We've forced customers to comply with our own policies and procedures, but through social media, the voice of the customer has become more critical and provided opportunities for genuine two-way dialogue. Listen to them, and you might find something you don't know that leads to radical change.

2. Respond to your customers.

Once you've decided to listen to your customers, you need to make sure you're responding to what they really want and know exactly what they're talking about. Domino's had heard the complaints for years about its pizza, but once the company had committed to the change, it made sure it was responding exactly to what the biggest complaints were. Today, it replies regularly to complaints and compliments online. Do you?

3. Listen and respond to your people, too.

Even when we're listening to our customers, we're too willing to make decisions without listening to, responding to, and involving our best assets: our people. Ask them, without consequences, to tell you what they really think, offer ideas to help solve the problem, and have a stake in delivering the results. Domino's showed how it did this in its commercial using real employees to tell the story of what sucked, how they felt about the criticism, and how they helped enact change.

4. Take a risk.

If something has disrupted your business, you're not going to win by striking back with small, measured steps--"Now with tastier sauce!" That's about thinking small. Taking risks can be great if everyone (including you) who's taking that risk is aware of where you want to go and is genuinely 100 percent committed top to bottom.

5. Be "radical" by being transparent, open, and honest.

Whether it takes a crisis or simply a moment of serious self-scrutiny, the most important thing is that we act honestly when we act radically.

That last point is the key: Can you engage in real, honest communication? If you're claiming to be authentic, you had better actually be authentic, because someone will find you out.

What if Domino's staged the focus groups? What if it used actors instead of employees in its commercials? What if it wrote those customer complaints itself? How long do you think it would have taken for that to leak and social media to spread it everywhere? Domino's got real instead and used genuine radical transparency. Telling its customers the pizza sucked worked. Domino's sales grew 14.5 percent. As I write this, its stock has doubled to an all-time high. Around the Super Bowl, they would have run out of pepperoni if its executives hadn't gotten in trucks to deliver more to the stores.

The key for Domino's, and for any company that engages in such a dramatic reboot, is to not fall back in the same trap that got it there. Domino's knows the consequences of not maintaining the promises it's made, relationships it's forged, and awareness of what it doesn't know. It has to: Everyone from microwave brands to chains like Papa John's and Little Caesars to local pizza places and beyond are constantly competing for business. To stay ahead and maintain brand loyalty, Domino's will need to stay active on social media and continue to adapt by listening and innovating with its menu and services. To that end, Domino's is focusing on ordering and delivery again with its app replacing the landline phone and removing the middlemen between the customers and the pizza.

Jeffrey Hayzlett

Prime Time TV and Radio Show Host, Author, Speaker

Jeffrey Hayzlett is a global business speaker, host of All Business with Jeffrey Hayzlett on CBS Radio's Play.It and Executive Perspectives and C-Suite with Jeffrey Hayzlett on C-Suite TV. He is the CEO of The Hayzlett Group, an international strategic business consulting company focused on leading change and developing high growth companies and author of Think Big Act Bigger: The Rewards of Being Relentless (Entrepreneur Press, September 2015).

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick


Four Takeaways for the Franchise Industry From My Time at the Republican National Convention

Matt Haller, President and CEO of the IFA, says the stakes are high for franchisors and franchisees in the upcoming presidential election.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

How to Build a Successful Startup, According to an Investor Who Made Early Bets on Twitter, Lyft, and Twitch

He's found a few patterns after nearly two decades of investing in startups.

Growing a Business

The Top 5 AI Tools That Can Revolutionize Your Workflow and Boost Productivity

Discover the top 5 AI tools for marketing and content creation that every marketer needs to know.

Science & Technology

No More ChatGPT? Here's Why Small Language Models Are Stealing the AI Spotlight

Entrepreneurs can leverage this growing tech to create innovative, efficient and targeted AI solutions.