CEO tack­les ‘piz­za­nomics’ with slices of in­no­va­tion

China Daily (USA) - - PEOPLE - By NAN-HIE IN for China Daily

“Have you seen my dou­ble-decker pizza? You will be blown away. We are al­ways lead­ing in in­no­va­tion,” said Richard Leong, chief ex­ec­u­tive of Pizza Hut Hong Kong. He leafs through one of the com­pany’s old menus and points to the tiered pie, a thin-crust pizza atop a larger pep­per­oni ver­sion.

Leong clearly en­joys re­ac­tions of sur­prise to his com­pany’s wild and of­ten bizarre in­ter­pre­ta­tions of one of the world’s most ubiq­ui­tous foods.

But this is a mar­ket where Pizza Hut’s Roulette Cheesy Bites — piz­zas with a gam­ing el­e­ment — is a top seller.

The crust’s “bites” are filled with moz­zarella or a pep­per­oni and cheese fill­ing, and one bite in the mix is a super chili ver­sion. Din­ers can chal­lenge each other us­ing this roulette wheel-style dish to see who is lucky or un­lucky: Who­ever picks the ul­tra­spicy “bite” is the loser.

“When it comes to prod­uct de­vel­op­ment, it’s not just about taste. Ev­ery prod­uct has an idea be­hind it; in this case it’s about who will be crazy enough (to risk get­ting the spicy bite),” Leong said.

Ev­ery two months, Pizza Hut launches a new con­cept. Ac­cord­ing to Leong, if that prod­uct does not res­onate with cus­tomers, sales de­cline. If the chain fails to re­lease an­other new con­cept in this time frame, sales also de­cline. This re­flects the tough “piz­za­nomics” of Hong Kong.

But the com­pany’s in­no­va­tion-geared ap­proach to sat­is­fy­ing cus­tomers’ ap­petites for novel items, among other strate­gies, has pro­duced a win­ning for­mula. Pizza Hut, part of the Jar­dine Restau­rant Group, has 110 out­lets in Hong Kong that gen­er­ate more than HK$1 bil­lion ($129 mil­lion) in an­nual rev­enue, said Leong.

So has the com­pany considered churn­ing out the ul­tra-purist Ital­ian piz­zas pop­u­lar in some busy Hong Kong din­ing dis­tricts?

“The prob­lem is, my con­sumers will not want that,” said Leong. “If you’re such a big brand like Pizza Hut, you need to cre­ate a pow­er­ful brand with prod­ucts that cater to all walks of life,” he said.

Hong Kong’s din­ing land­scape has changed dra­mat­i­cally in re­cent years, driven by the city’s high rents. More­over, these forces have af­fected con­sumer habits.

In the past, pa­trons would ven­ture into malls with their friends or loved ones to dine and hang out at Pizza Hut. But as prop­erty prices have risen, nicer res­i­den­tial neigh­bor­hoods have sprouted out­side of the city’s main cen­ters. Pa­trons now want to pop into a neigh­bor­hood place for a meal, and clients are de­mand­ing faster ser­vice.

In re­sponse, Pizza Hut has es­tab­lished Pizza Hut Bistro, a small­er­scale cafe ver­sion of its brand. Its op­er­a­tions are de­signed to serve cus­tomers quickly, and items on the dig­i­tal menu board in­clude crois­sants and curry rice.

This is just one of var­i­ous strate­gies the com­pany has em­ployed to adapt as the in­dus­try evolves. “I re­ally like my role be­cause ev­ery­thing you face is a dif­fer­ent chal­lenge,” Leong said. “It’s like com­ing to work with a new puz­zle to solve, and I en­joy those things be­ing thrown at me so I can find dif­fer­ent solutions.”

Leong has learned to thrive on op­por­tu­ni­ties and chal­lenges.

He was the youngest child in a Malaysian fam­ily, with an ar­chi­tect fa­ther, house­wife mother and three sib­lings— and the rev­e­la­tion that they were half-sib­lings made him a sen­si­tive child.

“My mother’s story was like a fairy tale,” Leong said. “She was a poor girl with a bunch of kids, then met my rich dad and they got to­gether.

At school, the young pupil dis­cov­ered Bud­dhism and its teach­ings about com­pas­sion and tol­er­ance. The phi­los­o­phy res­onated with him so much that at 19, he be­came a monk for two weeks at the Wat Saket tem­ple in Bangkok.

The newly bald, eye­brow-free monk prayed daily at 5 am and walked bare­foot through the city in search of alms.

This spir­i­tual jour­ney deep­ened his Bud­dhist be­lief sys­tem which has stayed with him through­out his life and shaped his abil­ity to over­come strug­gles.

“When ad­ver­sity hap­pens, there is a rea­son it hap­pens. You have to ac­cept it rather than to feel down about it; you also have to help other peo­ple along the way,” he ex­plained. Leong is a be­liever in karma, and looks back on this pe­riod as re­minder to be good to peo­ple.

To ap­pease his par­ents, he went to uni­ver­sity in the United King­dom and grad­u­ated with a de­gree spe­cial­iz­ing in bank­ing fi­nance, later land­ing a “bor­ing” job at a bank in Malaysia.

But he left for more cre­ative pur­suits at ad­ver­tis­ing, mar­ket­ing and pub­lic relations agency Ogilvy& Mather, and ca­reer suc­cess and re­gional Asian ex­pe­ri­ence fol­lowed.

By age 27 he had risen through the ranks to No 2 at Ogilvy’s Viet­nam of­fice.

But Leong was hun­gry for more. He pre­sented a restau­rant busi­ness plan to the agency’s chair­man, Miles Young, who liked the idea and helped fi­nance the ven­ture — so Papa Al­fredo’s Ital­ian restau­rant was set up in Bangkok, Thai­land.

The Kuala Lumpur na­tive dubbed that five-year restau­rant ex­pe­ri­ence “hard la­bor”.

He jug­gled two re­spon­si­bil­i­ties si­mul­ta­ne­ously, tak­ing on a con­sult­ing role for DDB, an ad­ver­tis­ing and mar­ket­ing agency for banks. When DDB asked him to work in its Hong Kong of­fice as client ser­vices di­rec­tor, Leong dived back into the cor­po­rate world.

Even­tu­ally he grav­i­tated back to Ogilvy & Mather, where Pizza Hut be­came his client for two years. Lit­tle did he know it would lead to a more sig­nif­i­cant role at the pizza chain.

When it comes to prod­uct de­vel­op­ment, it’s not just about taste. Ev­ery prod­uct has an idea be­hind it.”

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