Learning from the Black Box: A Decade of Lessons

By Randy White

© 2000 White Hutchinson Leisure & Learning Group

Is this fair? A new industry peeks over the horizon and all the modern-day Chris Columbuses pack their bags, patch their sails, and head off to build profitable new businesses. A few years later, these entrepreneurial explorers discover that, whaddaya know, the world really is flat, and they've just shot off the edge of it. Peter Drucker, perhaps the foremost business thinker of our age, has observed that in any new industry, "Typically the speculative boom precedes the growth of real businesses by 10 years." Most of the first companies in new industries collapse or barely survive, only to be followed later by profitable models. Makes you wonder why anyone wants to be first.

It will be interesting to see whether Drucker's 10-year learning curve will be true for the indoor FEC/LBE industry. Evidence suggests that it will. Few of the early FECs, which were concentrated around the New York area in the early 1990s, still exist, and those survivors have been substantially remodeled; the early national model - Discovery Zone - is industry roadkill.

The history of a related industry, children's eatertainment, followed the Drucker 10-year learning curve. Chuck E. Cheese's and Show Biz Pizza (since merged) expanded rapidly after starting in the late 1970s. Then, after Chapter XI reorganizations, their designs and business execution were significantly changed because they realized that animatronics and games were not enough to bring in customers. They switched their approach to offer a focused assortment of events packaged in an appealing environment with complementary management, and today Chuck E. Cheese's is a successful company with more than 350 locations.

So if FECs (and now their urban adaptation, LBEs, and mall versions, RECs) are at the end of the speculation-to-success transition cycle, perhaps what has been learned, sometimes very painfully, can now be used as a foundation for continued profitable growth. The problem may stem from all that baggage the explorers take with them on their journey. They pack up their past experiences and what they know about other industries; those constitute the tools they use when they land in the new paradigm. In the rush to be first, they forget to test their old-world ideas against the new realities. This is very clear when we consider the lesson of the black box.

There's a reason our ancestors left the cave

When the indoor FEC industry began, the explorers had to figure out a way to contain all the rides and attractions. Out of their satchels they drew the interior design concept of the black box. "This'll work," they said. "It worked before."

The black box design concept comes out of the theatre industry, where the building needs to isolate the interior from the exterior world. Live theatres and cinemas are black boxes. The concept was then carried over to the theme park industry, where designers built buildings that really were large black boxes designed to contain interior attractions such as Space Mountain at Disney World or Back to the Future at Universal Studios. The idea was also to design a building so the attraction inside could be changed later. Accordingly, the building's design was not driven by the interior plan, other than to meet an overall footprint and height requirement.

It was natural that when the idea of the FEC was taken indoors, designers superimposed the old entertainment design paradigm. However, like many design and operational principles for indoor FECs/LBEs, the correct approach is counterintuitive. FECs are not live theatre or cinemas. They were not meant for boxy, cavernous, high-ceilinged buildings. Just about every characteristic the black box offers is wrong for indoor FECs/LBEs.

We don't need no stinkin' foliage

Other than the need to be isolated from the weather - to keep out the rain and control temperature and humidity - FECs/LBEs don't need to isolate their interiors from the outdoors. In fact, just the opposite is true.

Scientific studies have shown how important natural light and views of vegetation are to the well-being of humans. It just makes sense. For more than 99% of human history, people lived in hunter-gatherer bands totally and intimately involved in the outdoors. (While we slept in caves, we didn't hang out there during the day.) In relative terms, urban societies in built environments have existed for scarcely more than a blink of time. Our original nature-based evolutionary genetic coding and instincts are still an essential part of us and continue to shape our behavior and responses. We are programmed by evolution to respond positively to natural light and vegetation. Research has shown that both reduce stress and improve feelings of well-being - attributes you'd want to encourage in your guests.

Research has found that views of natural vegetation have a positive impact on humans. For example, when hospital patients can see outdoors, they recover faster. Likewise, a fascinating study recently examined the impact of natural light in a retail chain of 108 stores. Two-thirds had with skylights and one-third had only artificial lighting. Researchers used multivariate regression analysis to control for the influence of other variables, and they found, with 99% statistical accuracy, that skylights increased sales from 31% to 49%. When customers were questioned about the skylights, most were not even aware of their presence. When asked if the skylight stores felt any differently to them, a vast majority responded that the stores felt cleaner and airier.

Guests are not the only ones who respond well to natural light - so do employees. Wal-Mart developed an experimental store where half of the store was sky-lighted. Not only was employee turnover in the skylight portion lower, but also employees in the non-skylight portion were constantly asking to be transferred to skylight departments.

A little fresh air does a body good

Somehow, the early explorers deduced that fresh air and sunshine were toxic to guests of FECs and LBEs. They created facilities that not only were unnecessarily seasonal, but also deprived their guests of something they value - the chance to be outdoors in good weather. Just look at restaurants with outdoor patios. Good weather produces lines for patio seating when there are plenty of empty tables indoors.

What works = FECs that have both indoor and outdoor areas. This increases revenues by removing seasonality and, just as important in an increasingly tight labor market, allows for full-time staffing. Reduced turnover results in more-satisfied guests, according to studies in the service industry showing an inverse relationship between employee turnover and customer satisfaction.

The outdoors should not perpetuate another design paradigm - the concrete desert. In this industry, the conventional wisdom seems to be that the outdoor areas should be a barren concrete slab with only the events and minimal or no vegetation, trees and shade. This approach is inexplicable when you consider that women and children especially feel in harmony with nature, and that being in nature is relaxing, reduces stress and increases feelings of well-being.

Once you have a nicely landscaped outdoors, plenty of windows allow the inside to visually borrow the outdoor vegetation, even in inclement weather.

Just a tiny dot in a giant universe

The people who first created indoor FECs basically built giant warehouses around amusement parks and called it entertainment. It's like putting a roof over the Grand Canyon - without the sky and clouds and fresh air, it's just a badly-lit hole filled with tourists and donkeys.

People expect indoor spaces to feel different than outdoor spaces; they need a certain amount of warmth and intimacy. This explains why very few people choose to live in warehouses with 24-foot ceilings; even in loft apartments, residents carve out intimate living spaces. Now imagine that you are six years old, much shorter than an adult, and you're in one of these gigantic warehouse-style FECs: The ceiling that's 24 feet to an adult feels like 40-some feet to you. It's pretty darned intimidating.

Architects like huge, grand exteriors (and so do architecture design magazines), so their bias is for the black-box style. But when you walk in the door, it's the work of the interior designer that determines whether you feel welcomed or over-stimulated and insignificant. Interior designers approach design from an emotional perspective versus the exterior orientation of most architects. Interior designers consider how guests will feel and act in the space, versus the architect's concern for the exterior aesthetics. This explains why interior designers start with a 3-dimensional space plan while architects focus on fitting the function into a building.

What? What'd you say? I can't hear you!

If you've ever been in a busy warehouse, you know how quiet and serene they are not. The noises bounce off hard surfaces and dance around the building until they land squarely on your pounding head. This literally makes people freak out, increasing their adrenaline flow, blood pressure, and heart rate.

Loud noises stimulate the fight-or-flight response that kept saber-tooth tigers from sneaking up on our cave-dwelling ancestors. What kept our ancestors alive was the instinct to get the heck away from loud noises. That explains why people in loud, reverberant environments like most indoor FECs are stressed, irritable, and grumpy. And your staff members, who have to stay, are even more miserable. Service, productivity, and even safety deteriorate.

Our studies show that FEC customers, including kids, dislike the acoustics at indoor FECs. We've found that the constant background sound level in indoor FECs throughout the country is in the 80-90 decibel range or even higher. Keep in mind that 85 decibels is the maximum sustained sound level permitted by OSHA for workers over a typical work day without management having to provide hearing protection. People build cars in factories that are quieter than most FECs.

The four primary acoustical design problems that affect indoor FECs/LBEs are:

1. The zoning of areas of noise-generating components and activities from quiet areas;
2. The control of noise from one area to the next;
3. The acoustic or reverberant build-up of sound; and
4. The control of noise at its source.

The black box design is a major contributor to the first three problems. The larger the space, the more reverberant it will be. Most black boxes only have exposed decks for the ceiling, further exacerbating the problem by not having ceiling acoustic absorption. And with a large open space, there is no way to isolate naturally noisy equipment and capture sound before it goes flying throughout the entire space.

The answer lies beyond the black box

With that critical first decade under its belt, and with many of its explorers lost, it's time for the industry to build new FECs based on what guests really want, rather than using tools left over from a previous age. The Black Box Epoch is over.

The answer? Let the interior design needs and layout drive the shape of the building or renovation of the space. This means creating an environment that is pleasing to your guests, not just one that looks nice on the pages of an architecture magazine. Yes, often there are some rides or soft contained play or other equipment that require height. In those situations, that area of the building is designed to accommodate tall equipment. But it's foolish to design the entire building to match the height of a small portion of the attractions. Spaces with 10- or 11-foot ceilings, even 9-foot ceilings, create a much more hospitable and enjoyable environment for guests and staff than a 25,000 square-foot space with 20-foot ceilings throughout. Some architects will argue that a high ceiling in a large space is spectacular. Spectacular to whom? King Kong? For regular-sized humans, they're impressive for a brief moment, then they're just noisy and intimidating and cold. Put your guests' needs above your architect's; you may show up in fewer architecture magazines, but you'll stay in business longer.

Randy White is the CEO of the White Hutchinson Leisure & Learning Group, a Kansas City, Missouri, U.S. firm that specializes in market feasibility, consulting and design of FECs and family and children's venues. The firm has won many awards for the design of its domestic and international FECs. Mr. White can be reach at voice: +816.931.1040, fax: +816.756.5058, or via e-mail or on the web at <www.whitehutchinson.com>.