A while back I read an article about the Florida Panthers. They are an NHL hockey team with the seventh largest arena in the league. In Florida, I am certain that hockey does not reign supreme. It is a state where most kids seldom see a dusting of snow growing up, let alone a frozen pond to skate on.
As you can imagine, the team was having a hard time filling the stadium, and was planning to cover seats during games to reduce the apparent capacity of the venue.
The first is about balancing capacity to demand. Having too much capacity costs money. In the case of the stadium, it probably means extra security, more ushers, additional vendors, and extra cleanup. Blocking off part of the stadium cut costs dramatically.
The same concept holds true with takt time. Matching production to demand makes for an efficient operation. Instead of covering seats, though, on the shop floor a longer takt time means that fewer operators are required. It also can mean that less inventory is needed, as there is likely less standard work-in-process and lower usage that can mean smaller kanban bins.
The team is actively managing the supply of a good to prevent devaluing it. If the TV shows mostly empty sections, viewers won’t think a ticket is worth the cost. After all, if the team can’t put backsides into seats, how good can attending a game be? But if the blocked out areas are strategically placed, it will increase the density of people in the stands. That makes the seats appear more appealing.
Sometimes, it is better not to try to serve everyone. Focusing on the top tier of your customer base at a higher price point can yield better profitability than selling to more people with a lower margin. The slower pace also has a side effect of providing breathing room to spend time on process improvement.
It is easy to fall into the trap of gaming metrics. Perhaps attendance is measured as a percent of capacity. By removing some of the capacity, the performance appears to go up. Note that I don’t know if this was actually done here. I am merely pointing out how a change in the way something is measured can change how a team appears to be performing on a KPI bowler.