Walk out the door of any major urban hospital and you will soon find yourself among buildings full of physiotherapists, medical device suppliers, specialists’ offices, pharmacies, diagnostic imaging and, helpfully, malpractice lawyers. Welcome to the hospital suburbs.
Other businesses and industries have suburbs too. Spreading out from the centre of enterprise software and hardware suppliers are suburbs teeming with integrators, programmers, trainers, installers, power experts, designers, conferences and user groups.
Some suburbs are deliberate, like the ecosystems engineered by Apple or the Linux communities; others come about because the organizations at the centre either don’t want to provide the ancillary goods and services, or haven’t managed to figure out a way to do it profitably. A few have ceded the suburbs to outside suppliers as they go along. IBM is a good example of an organization that has created suburbs by stepping away from former territories in retail and consumer hardware.
The auto industry is the best example of concentric suburbs successfully stretching out from the core. In the diagram below we see the activities in successive neighbourhoods as we move away from the core.
As with real cities, however, not all neighbourhoods are nice. Sometimes we create artificial neighbourhoods, and sometimes we manage to spawn downright nasty parts of town.
Show me a jurisdiction with standardized school testing (especially if it’s tied to funding) and I’ll show you a cardboard community full of consultants, tutors and hired guns barking at parents, teachers, principals and school boards to step right up and learn how to blow away the competition. This isn’t a real neighbourhood; it’s more like a carnival midway. Easy to erect in the wake of temporarily popular legislation, and just as easy to take down the road when the political landscape shifts.
We can see these Potemkin villages all over the place when there is an artificial or temporary thing that needs doing by people with more skill or nerve than most of us. Most of it is legitimate, high-value work like Y2K readiness, Affordable Care Act compliance, immigration law and anything to do with taxes or elections, but its existence depends on something that can unravel pretty quickly. The successful players here are the ones who can layer in or adapt to a more sustainable model when the music stops. Seagrams comes deliciously to mind.
But some industries and some brands have created far darker places. Places where we walk a little faster, keep our heads down and our purses close, where street lights flicker, babies cry and cats fornicate loudly (which, in fairness, happens even in the nicest neighbourhoods, but stay with me). These are the mean streets created by incompetence, ignorance or an unwillingness to address a fundamental gap between what these brands should be doing and what they really are doing.
There is, for example, a booming industry around healthcare advocacy. Hospitals have become so unfriendly to patients and families that Social Workers of Fortune now patrol their hallways as advocates for the victims of institutional inefficiency and entropy. Some of these services are probably covered by your health benefits plan. Sigh.
My friend Gurmit has built a successful business helping companies understand their phone bills. You heard that right. The wireless and wireline telecommunications industry, hobbled by ancient, disparate billing and facilities management systems, are basically unable to generate accurate accounts of what their customers owe. For individual consumers, there is a Customer Abuse number you can call to have a billing error fixed. But for businesses with dozens or hundreds of lines, on-premise equipment like PBXs or multiple wireless devices on different plans, the phone bill can run to dozens of pages per month, written in Klingon and presented in six point type. Gurmit routinely finds charges dating back years for phone lines that never belonged to the company to begin with.
The music industry briefly created a terrible suburb. During that time when it hated its customers for having the temerity to want digital music they could buy online, the industry watched as Napster and other peer-to-peer services stepped in to help us out. iTunes and other aggregators have built leafy gated communities where music can be purchased legally and without any dark alleys, but for a time it was somewhere between a speakeasy and an Occupy camp.
The message here is this: if you can look out your window and see healthy suburbs full of fan boys, interested journalists, profitable aftermarkets and people with ethical reasons to work with your customers, you have got a nice thing going there, and you should invest in and nurture it. On the other hand, if you have created industries that feed off the rotting carcasses of your competence, customer patience and credibility, then it’s time for some urban renewal.