Innovating things Featured

6:30am EDT August 31, 2004
Innovation costs money, but choosing to not innovate only has one result: death.

"In retail, you either innovate or die," says Suzanne Sutter, president of Things Remembered. "The biggest challenge in encouraging innovation is balancing it with the costs. I, as CEO, have to evaluate the risks before we implement anything different and new. Our executive team sits down and evaluates the pros and cons. If we think it's a great idea but if it didn't work or would have negative consequences, then we test it on a small scale. That way, if it doesn't work, the impact will not be as significant. If it does work, then we will roll it out nationally."

Innovation is in constant motion at Things Remembered. Ideas are constantly being evaluated and tested.

"At any one point, we are testing at least five big ideas on a small scale," says Sutter.

To keep the ideas flowing, you have to create a culture of innovation that rewards employees for success and failure.

"It is imperative for a president or CEO to celebrate and say, 'Thanks for having the courage to try,' when an idea fails," says Sutter. "The first time employees try something and it bombs, if you come down hard on them and admonish them, there are not going to be any new ideas. There have been a number of cases where we implemented new products and programs that didn't work and everyone is discouraged. We have to celebrate them because we tried something new. It didn't achieve expectations but we learned something."

You have to take away the element of fear to open up the potential of the employees.

"You have to remove the fear that if I present a bad or dumb idea or test an idea that fails, that somehow I will get punished," says Sutter. "It is extremely important to continually reinforce that you want ideas and suggestions. Many employees have worked at other companies where they served up ideas that went nowhere. The monthly awards make a difference. Our stores are encouraged to offer suggestions and are rewarded for them."

One suggestion was to offer personalized pet merchandise. The idea was initially met with skepticism, but the more they thought about it, the better it looked.

"At first we thought, 'You've got to be kidding,' but we eventually became so convinced it was a great idea that we didn't test it," Sutter says.

The pet line did more than $1 million in sales last year.

"Sometimes you just have to believe in it and go with your gut," says Sutter. "I challenged our marketing team to find new ways to encourage repeat purchases from our customers. They came up with a Rewards Club that gave customers a financial rebate check to use on their next purchase. Sales in that segment increased 25 percent."

Employees have to operate in a culture that encourages experimentation and innovation, and that culture is formed by the leadership of the company. Sutter formally recognizes employees for innovative ideas. Stuffed tigers are given to employees as a sign of being ferocious and conquering problems the same way a tiger conquers the trials of the jungle.

"The other thing I have done is really invest in learning in order to change our business," says Sutter. "We want to learn trends, concepts and best practices. We have invested in our merchandising people and designers to go to Paris and gift shows in foreign countries to understand what new trends are emerging. We attend conferences and study what the emerging trends are in the Internet arena."

Creating a culture of innovation extends beyond just the employees.

"We have an annual conference with our employees and our suppliers," says Sutter. "We share the company direction, then challenge them to be part of the innovation to achieve our goals. We give examples and awards to them that recognize major innovations to the business. They are well-attended, and we never have people that don't come.

"These are the people that can help us figure out how to grow our business. If you always do what you've always done, you will always get what you always got. You have to stay fresh and new."

HOW TO REACH: Things Remembered, www.thingsremembered.com.