Les Wexner felt very insecure about the opening of his first store. It was 1963 and the youngster, a son of Russian immigrants, had watched and learned from his parents’ tireless work ethic. He had worked in their small store named Leslie’s in downtown Columbus and gained the belief that anything in life is possible, if you are willing to work hard for it. And he was ready to launch a business of his own, but he wasn’t sure it was going to work.
He had no idea at the time that this single store would be the first piece of a business that would one day register more than $8 billion in annual sales and employ more than 92,000 people.
“I wasn’t sure it had any commercial value,” says Wexner, founder, chairman and CEO of Limited Brands Inc. “Then people started coming in and buying and I thought, ‘Gee, it was a pretty good idea.’ So I was curious to play with the idea. Some of it was right. Some of it was wrong. It became more proven from a customer point of view. I could make money and earn a living, and I was very happy, because I wasn’t going to be poor.”
Indeed, not. Limited operates more than 2,600 specialty stores across the United States and its brands are sold in more than 700 company-owned and franchised locations around the world.
“You have to be curious,” Wexner says. “People who are really curious have an enormous advantage. They’ve had it in the past. Curiosity and the ability to see things will be, as I look into the future, a higher and higher priority.”
Curiosity helped Wexner build a business that today comprises some of the most recognizable brands in the world. Bath & Body Works, White Barn Candle Co., La Senza, Henri Bendel and, of course, Victoria’s Secret are present in nearly every mall and shopping center one can think of.
“I had this idea about creating a lingerie business,” Wexner says. “People said, ‘You’re entitled to make a mistake, but it’s not a business. You can’t make money selling lingerie.’”
Victoria’s Secret generated $5.3 billion in 2009 sales, part of the company’s overall tally of $8.6 billion in sales companywide.
Wexner believes such success can be achieved when you realize that in addition to being a great leader, you need to be a great teacher.
Paint a clear picture
You could have the greatest idea in the world. But if you can’t share it with others, it will never amount to anything.
“Words matter,” Wexner says. “What’s clear in my mind’s eye in terms of imagining something, if I’m not real clear about my communication, you won’t understand what I’m really thinking in the fullest sense.”
Wexner has always had a sense of curiosity about what isn’t being done and what markets aren’t being tapped. But if he hadn’t been able to share those thoughts with others, he couldn’t have built his business by himself.
“I’m always fluent when I talk to myself,” Wexner says. “If you’ve got friends or a spouse or other people, there is the opportunity for confusion. An organization is just a large group. That gets to the subject of leadership. First, you have an idea. As the organization gets larger, you tend to discover what you know and don’t know about leadership.”
It’s your job to take those creative thoughts and curious personal discoveries and capture the most important aspect of it. At Limited Brands, it’s known as the main thing.
It reads: The main thing is the main thing is the main thing.
“It’s easy in an organization, just as in a family or a community, for someone to drift off what the main things are.”
You need to paint a clear picture of your idea so that your people can see it, think about it and ask questions about it. The tricky part is, sometimes, you and your people think you’re talking about the same thing, but you’re really not.
“I really like chocolate,” Wexner says. “I’m imagining milk chocolate, and you like chocolate but you like dark chocolate. When I say I like chocolate, you go to what you’re thinking, not what I’m thinking.
“The tension in an organization is you want people thinking about what they are doing. They are not marionettes. You need the feedback from people to say, ‘Did you mean this or did you mean that?’ One of the things you learn as you are developing an organization is you say, ‘This is what I’m thinking and this is what I’m trying to get done.’ People say, ‘Yeah, I got it.’ And then you say, ‘Would you explain it back to me so that I know you really do understand?’”
There are brilliant minds who serve as teachers and professors and bring a great deal of worldly experience to the classroom. But if they are unable to convey it to their students, it’s useless.
It’s much the same way in business.
“You have to think about how you lead, not just what you know,” Wexner says. “I could know things technically, but I may not be able to lead. Good leaders, they see themselves as teachers. They have to know what it is they know. Then they have to get it to a teachable point of view.
It was an aspect of leadership that was a challenge for Wexner at first.
“You know and you’re telling people, but my frustration was they’re not learning,” Wexner says. “They said, ‘Well, you’re not teaching them.’ You have to see yourself more as a teacher. You have to be able to distill what it is you know and what you’re thinking, whether it’s the values of your organization or things about quality or products, into a point of view where you can teach it. Part of teaching is for you to have a clarity of what it is and why. If I just tell you something and I can’t give you the reason, I don’t think it’s nearly as effective.”
Know it before you speak it
Wexner is hardly resting on his laurels after nearly 50 years in business. Limited Brands announced this year that it will open a Victoria’s Secret flagship store in London in 2012. The company’s brands have also launched their own Facebook sites to better reach their clients.
Fresh ideas are the lifeblood of a business and help it continue to stay relevant with a changing world. But you need to make sure the change is a good fit for your company before you implement it.
“People come in and say, ‘I really like what you’re doing. I’d like to come work for you. I would change it all,’” Wexner says. “I would say, ‘Maybe they’re right. Maybe as good as this appears to me, maybe it could be infinitely better. But my intuition is that this is working. I don’t think I want to let a stranger play with it. I don’t want it to get broken. You have to earn the right.”
Wexner illustrates his point by hypothetically placing himself as a new employee at Apple. In this imaginary role, Wexner says he suggests that the company use different fruits each month on its products, beginning with a banana.
“I’m sure they want to hire people who are creative and imaginative and can advance the company, but they have to earn the right,” Wexner says. “Do they understand the brand, their business and the customer when they are making suggestions? If they are seeing the world differently, is it in the context of something?”
The lesson is that in staying fresh, you can’t just hop on board any idea that is brought to your attention, just because it’s new and different. The idea has to be delivered with the context of organizational knowledge.
“I kind of like my own ideas, but have I really earned the right to have this idea?” Wexner says. “It may mean, ‘Well, it’s an idea. But I want to reflect on it.’ Sometimes I will argue against it. ‘I really like this idea, but if it failed, why would it fail? How would somebody else do it? How would a competitor deal with this?’
“I want to get other views. I could ask, ‘What do you think of it? What do you think of this idea? Help me critique it.’”
You need to have thoughtful people bringing you ideas and thoughtful people who can serve as a check against ideas that you get from outside your organization that just may not be a good fit for you.
“If I think Apple ought to be fruit of the month and next month it should be a banana, I’d like somebody to say, ‘You’ve lost your mind,’” Wexner says. “You don’t want people just sucking up and saying, ‘Yes, boss.’ They have to earn the right, and I think it’s an individual and a collective thing to judge.”
You need to spend time talking to your people about your business. Initiate conversations about where both you and they see your industry going to help stay tuned in to what your company needs to do to keep up.
“What do you do after everybody owns a hula hoop?” Wexner says. “It’s an easily copied idea. Successful people in their careers, whether they are entrepreneurs or working in enterprise, think about their own evolution and advancement in a way that they are always saying, ‘What if the dogs don’t eat the food? What if everybody had a hula hoop? What do we do next?’ Then they are able to extend their success.”
Despite all of the success he’s had, Wexner operates with a growing fear that his next idea won’t work.
“It’s probably just in my nature, but the more successful something is, the more successful I am, the greater the fear of failure,” Wexner says. “The more successful a product or a brand is, the greater the fear of failure.”
Every new idea that became great probably had quite a few people questioning whether it would ever work.
“Change implies taking a different tact,” Wexner says. “Most people will reject that new idea or a fair number will reject that new idea, because you’re describing an animal they’ve never seen.”
Wexner brings up the idea of people being willing to spend several dollars for a cup of coffee.
“We’re going to sell this product at a premium price, three or four times what anybody else sells a cup of coffee for,” Wexner says. “You’d say, ‘That’s the craziest damn idea in the world.’ But, in essence, you’re describing Starbucks.”
You need to constantly be asking yourself whether what you’re doing now is working for tomorrow.
“The world is always changing and you have to be sensitive to that,” Wexner says. “Whether it’s channels of distribution or the products you sell or how you organize or how you think. If you don’t keep that flexibility, you obsolete yourself.” •
HOW TO REACH: Limited Brands Inc., (614) 415-7000 or www.limitedbrands.com
A good response rate to a direct mailer or business catalog is 2 or 3 percent, and that bothered Fred Meyers. There was too much waste.
“I was always really bothered by the amount of paper that we were wasting in the direct response business,” he says. “That was our entire business.”
As founder and chairman of The Queensboro Shirt Co., a North Carolina-based, custom-logo apparel company, he combines new communication like e-mail and the Internet to sell their products while cutting down paper consumption by 99 percent and using greener solutions in the textile industry.
“We recycle all of our cardboard and recycle throughout the company,” he says. “We got lights that are designed to go on and off on motion sensors so we conserve energy. These steps can help businesses turn green and also create a more environment-conscious company.”
Smart Business spoke with Meyers on how he turned his company into a more earth-friendly business.
What is the first step to take when you decide to go green?
The first thing to do is to do a process audit and eliminate any waste that is in the system. That could include paper, plastics or production material, any process that is not running efficiently. You have to go through a whole process audit and take all the waste out of your system.
From there, I would look at the supply side what environmentally friendly options are there for printing inks, for example, or whatever paper left that you are buying any other supplies that are in the buy process.
And the last thing is to look at how you are organized in the community, running your lights 24-7. Are people in more space than they need to be in and thus using more energy for that? Is your air conditioning running all day and all night when it doesn’t really need to be? Can people be happy and comfortable if it was four degrees warmer in the summer, then you can save on electricity by turning down the air conditioning, and things like that, which is a horrible waste of resources. It’s all about the whole process refinement and process management. It saves a lot of money when you do eliminate waste but it is an expensive process to undergo to uncover where the waste is.
How did going green affect the costs of the business?
It was more costly to go green, but in the long run it is more of an investment, an investment of the future for both the business and for the community in general. As far as products are concerned, they are organic products that we spent a lot of time and resources developing. I feel this is a responsible place to be, a good place. We feel like we need to make sure that the people understand when they come here that we are a responsible community member. That is something that you can’t take too lightly because it’s going to be about the quality of your people, employees and customers. That’s what is going to determine the success of your business.
What is one of the biggest challenges of going green?
My biggest challenge was figuring out a way of placing the marketing power of all the paper we were consuming in our marketing process. So for me, it was about figuring out how to draw people to our Web site, draw customers to our Web site without having to send them a ton of paper, which is historically what we had been doing. And that was our total marketing re-engineering for business. It was very challenging and very hard. We started doing that in late 2000. So, it was a long time ago, when Web sites were just being started.
Immediately, I saw the environmental impact because they get so many e-mails. But the environmental impact of e-mail compared to a letter, which has to be produced, printed and mailed and the gas it takes to move all the supplies around. They should be delighted for every e-mail they get because it’s not being piled up like the mail on their desk. So, that was definitely the biggest challenge of placing the marketing power that paper has historically been produced from.
How do you get buy-in from employees for going green?
You need to get with that program and not be afraid of that key person that may not be that change-orientated and may say, ‘We will never be able to do this.’ Make sure that you have the courage and the position to say, ‘We have to do this in order for our company to succeed and in order to perceived as a progressive company in the market,’ and that can be difficult. It’s our part, and everyone’s part, to be environmentally responsible.
HOW TO REACH: The Queensboro Shirt Co., (800) 847-4478 or at http://www.queensboro.com/
Richard Glikes sees the change coming, and he’s telling everyone he can about it.
As the executive director of Home Theater Specialists of America, he knows that people have changed the way they think about home entertainment drastically in just the last few years — and the more technology improves, the more they’ll expect.
So at HTSA, the 60-member cooperative of home theater and systems integration specialists, Glikes is constantly pushing the group to be ready for tomorrow.
“The business model is changing rapidly,” says Glikes of the group, which did $450 million in sales last year. “Our members who are retail stores are going to end up being like general contractors, they’re going to be like technology specialists … and there’s going to be a lot of new technology that we’ll have to understand and communicate to them.”
Smart Business spoke with Glikes about how he keeps his priorities straight while keeping up with those changes and about what Bob Dylan taught him about training.
Stay on track. I had a directing project in graduate school at Villanova, and I had a scene that had about 15 people and I called a rehearsal and I’d gone to all my friends and said, ‘Do you want to be in the play?’ And they all said, ‘Sure’ and about five people showed up. I called it again and eight people came. So what I did was I cut out the scene. Basically what that taught me to be was flexible — you have to be able to adjust on the fly, and you can’t be rigid.
You have to be able to adjust to the situation and be intelligent about it, and a lot of people get overwhelmed. If you have 10 different things you have to get accomplished, my way of business is you attack them one at a time. Other people get overwhelmed because, ‘Oh, I have 10 things I have to do; I can’t get them done.’ That’s because they’re trying to deal with 10 things at once. I will sort them out and deal with them one thing at a time. The same with personal problems: People have three or four personal problems, they get overwhelmed, they get stressed out. Deal with them one at a time.
I try to prioritize; I make lists every day. I have a yellow pad that’s on my desk and I try to prioritize who I’m going to call, and then I check them off as I call them, and I work through a list on a daily basis. You also have to prioritize where you’ll get the most action. I’m fortunate I have some very good assistants that I can delegate specific responsibilities to, and they do a very good job.
If you write it down and refer back to it, you get it done. If you just leave it to your imagination, you’ll get distracted. It’s much easier for me to have it down on paper, in front of me, and I know I’ll get through it. I don’t believe in calling people back the next day; I believe in calling them back the same day.
Treat people right. I think doubt, questioning and insecurity are very bad for a business environment. You treat people like adults, you give them specific responsibilities, and you compliment them. Most businesspeople don’t tell people they do a good job enough. I like them to know they’re appreciated. I also really believe in teamwork, so I try to let everyone know everything that’s going on with what’s going forward at least six months out. I try to keep them involved in the process, then there’s buy-in, then there’s not as many questions. We’ll review what’s coming up short-term, midterm, so that everyone knows what everyone on the team is working on. If you treat people like adults, you give them responsibility, and you mark their papers and they do well, you let them know so, and if they don’t, you tell them.
My people pretty much come and go as they please. I’m very flexible with that. They don’t have to be here at 8:30, they can be here at 10 so long as they get it done, and they get it done because they appreciate the fact that it’s not rigid. One of my favorite sayings is smart people can solve problems, and if you hire for intelligence and you give people flexibility to be themselves, you get good results.
Spend the resources on training. What did Bob Dylan say? ‘He not busy being born is busy dying,’ and if you don’t move forward, then you’re absolutely going backward. We’re in a fast business to begin with, and we are the leaders, really, in our category, and as a result of that, we need to be upfront with the latest technology. The bad news is that the vendors have basically abandoned training because it’s expensive. But the companies that still believe in it long term will have more success. We believe in it, we have a full-time sales trainer, so we’ve taken over the burden from the vendors.
(He) visits with them, and then we try to make it as advantageous as possible. Green is very big right now, and we’re trying to have a lot of green options available, so take solar. We’ve just sent 10 people to school last month, and we’re sending another 13 or 14 this month, and so they’ll be able to sell solar panels to save on electricity, and so what we’ll do is we’ll have twentysome people trained, and then we’ll bring that up again, and if they have success, then it will filter through the organizations.
When you have 60 different companies you want to have a unified message, you want to have a unified purchasing, you want to be all in step. I can’t travel as much as it would take to get to 60 stores or 60 dealers and 97 locations and so he does a very good job of that. And it’s done a very nice job of coalescing the members into the unity that we’re looking for.
How to reach: Home Theater Specialists of America, (610) 363-9055 or www.htsa.com
When Michael Feuer founded OfficeMax, he used to work all day and head into his stores at night to scope out the activity and observe customers. He noticed little things, such as they constantly checked the clocks to see what time they came in and how long they had been there. He also noticed that the large paper boxes that were on the first aisle often would fill their carts, and when the carts were filled, much like you know dinner is over when your plate is empty, their shopping trip ended, as well.
So he immediately took the clocks down in the stores and made the shopping carts 20 percent larger to encourage people to shop more, and sales went up 20 percent after doing so.
“The real way to drive innovation in any business is to first look at the obvious,” the CEO of the consulting firm Max-Ventures LLC says. “I think most people spend way too much time trying to find the (way) to get to the moon or the cure for cancer, when, in fact, the answers for innovation are there, but what you have to do to drive innovation is to stop thinking like an operator or an entrepreneur and think like the customer.”
As co-founder and former chairman and CEO of the office products chain OfficeMax and co-founder and CEO of Max-Wellness, a new retail chain to promote wellness products, Feuer has spent a good amount of time looking for low-hanging fruit. The key to this is an approach that he read in a book years ago called GOYA get off your ass.
“There’s not a business in this world that I know that doesn’t have customers, so you have to figure out what they want,” Feuer says. “If you have a retail store or you make a widget, you still have customers or would-be customers, so that means get off your rear-end, go out and talk to customers. But when you’re talking to them, you have to listen to what they’re saying. Then the same thing applies translate what they’re saying and put it into words.”
For instance, if people say they’re too hot, you have to dig deeper. Are they too hot because they’re wearing a coat? Are they too hot because the sun is out, and it’s 95 degrees? Or are they too hot because the air-conditioning isn’t low enough?
“Whatever they’re saying, you have to ask a couple of questions with it or make some observations with it,” he says.
He says that his approach to business is very simple: In the land of the blind, the one-eyed man or woman is king or queen.
“All that really means is you just have to do a little bit better than anybody else to win big,” Feuer says. “You can win huge when you do it, so ask a question or hypothesize the question you don’t even have to ask it.”
For example, Feuer serves on the board at University Hospitals, and while there for a meeting, he noticed that the water faucets in the bathroom only stayed on for five seconds at a time. But you’re supposed to wash them for about 20 seconds or the length of singing a song, such as “Happy Birthday.” Clearly, it needed to be reprogrammed, and he asked some people about it, and nobody had an answer. It’s those kinds of things that can lead to better ideas.
“Wisdom is the ability to see things differently than most people see it, and then come up with solutions,” he says.
This is key to surviving in business. He says that you always have to be one step ahead of the sheriff.
“This is a wonderful country and wonderful world, and someone is always looking for more innovation, so as you have a product, instead of resting on your laurels there are very few products that are perennial that they’re never going to change because people’s lives change,” he says.
You have to constantly be looking for a different way.
“I think the real key in terms of this whole process is if there’s a wall in front of you, most people walk up to that wall and say, ‘Damn, there’s a wall. That means someone else has thought of it before,’” Feuer says. “While the innovative people look at the wall and say, ‘OK, there are different ways to get past this wall, and it’s very simple go over it, under it, around or knock the damn thing down.’ That’s the way you innovate products and invent products.”
How to reach: Max-Wellness, (216) 765-2500 or www.max-wellness.com
Pedro A. Capó was born into the furniture business.
Before he was part owner and chief operating officer at El DoradoFurniture Corp., Capó watched his father build it from the groundup. Today, Capó and his six brothers all share in the leadership of thecompany, keeping the family element prevalent in the retail furniturestore chain.
Of course, as the company has grown to $166 million, even a furniture-first family like the Capós can’t do everything themselves.And not everyone in the world has the natural feel for the businessor cares about quality the way the family does. So as the companyhas grown to 750 employees, Capó has had to get people to takehis family business as seriously as he does. That requires not onlygetting them interested in the family business but also using astrong sense of leadership to encourage people to get behind thecompany’s belief in professionalism.
“You have to be a visionary and know where to go and how to getpeople to follow you there,” he says. “And unless you have that,you can have the best product in the world, you can have the greatest organization in the world, but you always have to know whereyou are going to be as a company tomorrow, and you have to convince and entice — not necessarily sell — entice your whole teamto follow you there. The word is basically right there, you can’t bea good leader if you ‘manage.’”
So while El Dorado Furniture makes it a point to welcome peopleto the family when they join the organization, Capó makes the distinction on the traditional family business model, demanding professionalism and passion from each employee. That can get a lot harderas a company grows, so he makes sure the company hires right, trainspeople in full detail, gives people a chance to retrain if they fail, andthen if they show they can match the family quality, Capó gives thema chance to move up the ranks.
Start with professionals
The idea of El Dorado Furniture as both a family and professional place starts at the beginning: If Capó is going to hire you,you better start off by showing you’re a pleasant person — someone he and the rest of the brothers could introduce over a nicedinner.
“We hire people that you would gladly invite them to your homefor dinner,” Capó says. “That’s basically the rule of thumb — youwant to make sure they’re pleasant people, people that are goingto respect other people as well as respect you in the process.”
But just having dinner manners doesn’t cut the mustard entirely.If you want to hire a winner, you also better look for someone whohas the professional credentials. That means you should take hisor her resume with a grain of salt.
“When you’re in the interviewing process, people will tell youanything or everything you want to hear,” Capó says. “Theresume, the same thing. Now, with the Internet, you don’t seeas much of the people physically, and they put a bunch of stuffin there that they’ve done and most of the stuff they put inthere, it’s not necessarily true.”
To vet their professionalism, Capó notes that the devil is in thedetails.
“We do an interview, and the person is called to be here at 9 inthe morning, if the person comes at 9:01, we probably would notsee him again,” he says. “If you call us and say, ‘I’m sorry I’m late’or whatever, that’s fine, I will wait for you until the end of time.When they fill out an application, there are instructions, and weactually look at everything, the way they fill out the applicationand if they give all the information, and you start to get a profileof that person. I mean sometimes people come in to us for a jobin sales and you come in in the morning with them in the elevator, and they don’t know who you are, and they don’t even say hior good morning, they don’t smile, it’s like, what are you doinghere?
“I’ve had people come in here for executive jobs in jeans and T-shirts ... and you say, ‘How do I eat this; what is going on here?’”
These simple tests, in conjunction with your normal hiring practices, act to help you flesh out someone’s attention to detail andprofessionalism, which is the first step in making a hire who willcare about your company.
Train your employees
Once you hire somebody, your training systems can really be thecatalyst for getting him or her to understand your interest in quality.
Capó’s company has El Dorado University, which is a trainingprogram where instructors from the company get qualified asdepartment experts to teach new people the ropes. Rather thanjust send a salesperson out on the floor, El Dorado Furniture givestwo to three weeks of training before a new person can even talkwith a customer. Giving extended time purely for training has distinct advantages, like the opportunity for a second look at anemployee’s professionalism and a chance to instill how importantyour standards are.
“Part of the training is the same way, if they’re supposed to comein for training at 9 o’clock and they’re not here, they get a warning:‘Tomorrow, if you come in at 9:01 and you’re not excused, pleasedon’t even show up. Because discipline is very, very important inthis business or any business,’” Capó says.
El Dorado Furniture is also constantly circling back withemployees to make sure they’re on top of the concepts they shouldknow. The company regularly sends leaders into stores just tocheck in on front-line employees. Capó also sits down with hisquota-based salespeople every two weeks to show people howthey are doing. Anyone who isn’t making the mark is sent back toa more expedited retraining session. Capó lays out an example of what the company does with salespeoplethat are coming up short: “We go throughthe entire process of the sale and say,‘Where are they, what are their faults?’because there is something that they’redoing wrong, and we say let’s look at thatand do a particular retraining on that particular subject, — and of course, we do arefresher on everything else,” he says.
That retraining session is not availableover and over again. If someone can’t do itin sales after the retraining session, Capóoffers the employee the opportunity totransition to another position — providedthe person is a good employee overall.
“We have some people that we know thatthey’re not going to make it in sales, butthey’re very good at everything else thatthey do — their paperwork, attendance,their personality, taking care of the customer issues and so forth,” he says. “So wegive them an opportunity, if we have anopening, to work in another department.”
If the problems a person goes to retraining for are about areas of professionalism,there is no such grace after a first coachingsession.
“Now, if the person is off in other areas,where they don’t have good attendance orthey don’t have good productivity, we dogive them the coaching, we train themagain, but from there, they are basically outthe door,” Capó says.
By giving the extra training and givingpeople the warning of being put throughretraining, Capó says you draw a clear linein the sand about expectations.
“We tell them, ‘If you keep doing thisthing, you’re never going to make it, soeither you try to make an effort or if youhave a problem, let us know, and let’s dealwith it and move on,” he says.
That personal attention doesn’t fix everyproblem, but Capó says it rehabilitates manyand even helps a few people realize they areexpected to and can do much more.
“I would say that probably about 60 percent of them [become good employees],”he says. “They might not become a super-star, but they actually get back on trackand see this is for real. And believe it or not,a lot of people don’t know their potential— there are people who have a lot of talent, but they’re missing that spark thatmakes everything else evolve.”
Capó’s interest in retraining employeeshits on another family element that’s prevalent at El Dorado Furniture: The companylikes to raise its own leaders.
“We’d rather have somebody inside thatknows the culture of the company andknows their way around the company,” hesays. “And when you hire somebody, evenif it’s a cleaning person, you say, ‘Could thisperson eventually be a supervisor, be aleader someday or be in charge of their particular area?’”
If you want to do that, you have to bethinking of someone’s potential and his orher interests right from the beginning.
“When they come for an interview ... theinterviewer would talk to the person a bitdeeper and say, ‘You know, how do you feelabout or what do you think about thisother position?’” Capó says.
This conversation is logged down in theperson’s original HR file to ensure that ElDorado Furniture’s leadership team isaware of the initial prospects of the newhire. That heightened awareness doesn’tstop after someone is hired.
“All of our leaders are constantly beingtrained and being told that part of theirresponsibility is to search for those peoplewho have a passion for whatever they aredoing and to let human resources know, sowhen the next available position comes up,you can go to those people, depending onthe job and the responsibility,” he says.
Once you start a culture where you arelooking first to promote within, it starts tofeed on itself.
“Now, to be honest, it’s a very difficulttask for them to do,” he says. “Let’s say it’sa sales leader in a particular store, and theyhave a great, great receptionist, she’s thebest, but she’s doing a hell of a job in there.Now sometimes, they try not to tell youthat they have a great person because theydon’t want to replace them, but they knowbetter. Probably all of them right now,especially the leaders in the stores, startedworking as a receptionist or in customerservice or as a salesperson, then becameleaders in the organization. They know thatthey were there one day.”
And for the rare person who might not beable to be that charitable, Capó makes surethere are other avenues in place for helpingpeople move up. Aside from counting onthe appearance of senior leaders in thestores, he says you should create systemsfor people to clearly spell out their interestin advancing their career.
“If someone’s really a shooting star, theywill shine so much that somebody else willnotice them,” he says. “The other thing isthat every single employee has a right tosend in for information or a document wehave available that says I request to workin this particular department — and thatdoesn’t mean that I’m going to give it tothem — but they always have that on file.Once you get that, we keep that on file andsay, ‘OK, we got this from you, what makesyou think you can be here instead?’ andthey tell you, ‘I can do this and that,’ and sothere is a mechanism there. If the leaderdoesn’t want to give them up, eventuallythere will be a way around it either by theemployee or by someone else.”
HOW TO REACH: El Dorado Furniture Corp.,www.eldoradofurniture.com
When Sharon Anderson Wright’s mother co-founded Half Price Books, Records, Magazines Inc. in 1972, the motto was that the company would buy anything printed or recorded except yesterday’s newspaper.
That’s still true today, and that philosophy has carried the $160 million media resale chain from records and eight tracks to DVDs and computer software. As president and CEO, Wright recognizes that the ability to adapt in business is crucial because the world changes so quickly.
“Don’t be too rigid or too stuck in your own ways that you’re not looking at what’s going on around you,” she says. “You don’t want to be a turtle — you’ve got to pop your head out and look around at what’s happening. Some companies have gone out because they say, ‘This is how we do it, and this is how we’ve always done it.’”
Smart Business spoke with Wright about how to look for new opportunities while also staying focused on your niche.
Focus but recognize opportunities. We see what happens to everyone else. We are careful but not afraid. We don’t deviate too much from the original concept that’s always been successful.
We do try new things. We have to be able to act quickly and spontaneously, whether it’s an item we could buy or a building. We don’t agonize and take a long time over opportunities. We have to act quickly to get things done.
Be aware and keep your eyes open and listen to the people in the environment around you. Look at trends, money, politics — your local area, what people are doing.
It’s basically not being distracted or drawn into things without looking at them carefully. I had such an easy concept to go forward with. Once you’ve got the concept, you just judge all new opportunities and think if it fits in with what you were originally doing.
Don’t get full of yourself. You see it happen so often — people get all full of themselves. Realize that you’re probably not as smart as you think you are. Respect the people that are actually doing the work because they probably know a whole lot more than you do.
Have other outside interests. I have my life and my kids — the company is just a part of it. Don’t let the company consume you.
There’s too much unknown to get cocky about it. I don’t know the details about everything. I have great people who know all the details and look out for me and tell me what I need to know. One time my husband told me, when I was feeling insecure, that Henry Ford had a row of a buttons on his desk, and he didn’t need to know anything. He just needed to know which button to push to ask the right question.
Be careful expressing opinions. I’m very open to listening to suggestions and other people’s ideas. Most everything is consensus around here unless I don’t like that direction or it seems to be moving off in a direction that doesn’t seem consistent with who we are and what we try to do.
That stops that. I don’t have to be that pushy because I don’t do it that often.
But that backfires against you sometimes when you say, ‘Oh that’s stupid, or I hate that,’ and then they don’t do it, and you’re going, ‘I was just commenting. I didn’t mean don’t do it,’ so you have to really be careful. I’ve had to watch myself because sometimes they listen more than I thought they listened. They won’t even approach an area if they caught me in a bad mood about it.
But then people who know me well say, ‘Did you really mean this or that?’ I go, ‘No, I was just shooting off my opinion, but it wasn’t an educated business decision. It was just my personal opinion.’
Listen. You’re talking to people, and your mind’s thinking, ‘I need to do this and this.’ Sometimes, I realize I’m not listening. Tell yourself to listen.
Treat them with respect. Look them in the eye, listen and be open to what they have to say.
You have to consciously make your own mind stop.
Stop thinking about your own agenda, and stop thinking about what you need to do next. That’s why I say look them in the eye because it slows you down and makes you focus on them.
Make people comfortable. Try to get people to relax and just be together. Get them out of the office, out of the cubicle or out of the hierarchical environment that they’re in.
We started doing one of our meetings away in one of our districts. We try to get out of the corporate office environment where people can relax a little. One time the meeting was in Seattle, and we were on one of those amphibious duck car boats.
We do bowling parties or whirly ball — just things where we’re all out being silly and having fun, and I’m not the boss — I’m just another person drinking a beer.
When I go visit our locations, I take everyone out to dinner and feed them, and let them drink whatever they want. That’s the best way to communicate and make people feel comfortable and let me know good things and bad things and everything going on in the company.
Most of the time, I don’t think the actual meeting is that important. I think it is the connecting and getting to know each other so you can trust and work with each other.
HOW TO REACH: Half Price Books, Records, Magazines Inc., (214) 360-0833 or www.halfpricebooks.com
Maxine Clark hears the same question from employees who’ve just been hired as she hears from those who have been with Build-A-Bear Workshop Inc. since the company was founded 10 years ago.
“How are we going to keep the company like this?” Since its inception, Build-A-Bear has grown to more than 275 stores in the United States, Canada, the United Kingdom and Ireland, along with franchise stores in Europe, Asia and Australia.
Revenue for fiscal 2006 totaled $437 million as kids both young and old flocked to their local Build-A-Bear store to create a cuddly stuffed animal of their own, with the help of the bright and cheery sales staff for which the company is known.
Clark, Build-A-Bear’s founder, chairman and CEO, credits the company’s success to its sharp focus on culture.
“I think everybody comes to work every day to make a contribution, no matter where they go to work,” Clark says. “For the most part, 99.9 percent come to make a difference every day. They want to be rewarded for their contribution. They want to be noticed. They don’t want to be anonymous. Our job as leaders is how do we make that happen every day? How do we make that come alive and transfer into results for the company and growth for the people individually?”
Developing a culture that meets these standards begins with the leader. But maintaining such a culture as the company grows and changes is a responsibility Clark says must be shared by each and every one of her 5,500 employees.
“The company is the people, not me,” Clark says. “It’s up to every single individual in the company because they interact with other people that are part of our company. I can’t interact with everyone every day. ... Everybody that works in our company and works in your company is part of that company’s brand. How do you make sure that they feel responsible about that and that they realize they work for a company that has certain values, even when they are in their daily life?”
It can start with something as simple as saying, “Hello.” “You’re automatically a mentor when you’re the boss or somebody that people look up to, and you have to take that seriously,” Clark says. “If I walk down the hall and I’m not saying, ‘Hi Susie; Hi Mary.’ ... People notice that I didn’t say hello to them. They may not say hello to me first. But that’s my job. It goes with the territory. And I like that job. Sometimes, you’re the cheerleader. Sometimes, you’re the disciplinarian. Sometimes, you’re just the greeter. Sometimes, you’re the hardest-working person in the building. Most often, that’s not me. You have a lot of roles as a leader, and those roles tell the company every day who you are and what you believe in.”
Here’s how Clark has conquered the challenges of culture to take Build-A-Bear to new levels of success.
Make it personal
When it comes to developing a culture, you should not be afraid to let your personal traits and qualities filter into what you want to develop.
“Somebody is a mountain climber, and every Friday, he wants to close his office because he wants to go mountain climbing,” Clark says. “That eventually becomes a part of the company culture. Maybe down the road, an exercise room is in the building built with a climbing wall. ... You have to know what it is you want your company to be and then execute around the things people can see and things people can touch and things they can just feel.”
For Clark, the design and location of her office says a lot about how she leads the way at Build-A-Bear. Clark’s office is at the center of the building and is painted yellow, matching the color of the company’s store locations.
“Whether we have one person in our office besides me or we have 15 or 150, we have open communication meetings,” Clark says. “My door is an open door. I sit in the middle of the building. People can always come in and talk to me. Everybody has total e-mail access to me. They have all my contact information. When I go out of town, I let everybody in this building know that I’m out of town and if they need me, to e-mail me.”
Clark says employees want to know that their leader cares just as much about the success of the company as they do.
“They’ll come to work, but it won’t be a fully contributing opportunity if they think you’re not serious about what you believe in and you don’t do it yourself,” Clark says. “People want to have people to look up to. They want to have heroes. Oftentimes, the only heroes they get to know are the people they work with.”
Culture is about more than how employees relate to and communicate with their leader. It needs to create an energy that employees feel when they come into work each day that will drive them to reach for success.
“You buy comfortable chairs for people and they realize that they are valuable and they take good care of them,” Clark says. “They are not just jumping up and down in their chair and then their chair breaks and you have to go out and order a new chair.”
Clark says simple things, such as having a recycling program to show the company cares about the Earth or hosting a Thanksgiving dinner where the company pays for the main part of the meal, help drive home the company’s culture.
“Sometimes, it’s the most simple thing,” Clark says. “It’s about how you look at the things and turn them into things that will energize your company, your vision and make the people feel good about themselves and feel responsible about the environment they work in.”
One of the best opportunities to show employees they are more than just a number on the ledger is to be there when they have a problem in their life outside the workplace. Clark uses the example of an employee who is coming to work late each day.
“Well, Susie is coming in late every day,” Clark says. “What you might have found out is she has to take the bus now because her car broke down and she can’t afford to get her car fixed. You look at it and say, ‘Gee, what’s behind this and what can we do to help?’ Maybe we change the hours because we don’t want her to be late. Now she comes in at 8:15 instead of 8, but she stays until 5:15. Work out things for people so that they can see that you do value their life and who they are as a person.”
Clark says having a culture where leaders care about their employees is something more easily communicated by action rather than a line in the company handbook.
“You just have to depend on the people that you’ve done the good things for saying, ‘Boy, I couldn’t get to work on time, but the company worked it out for me that I could still take the bus until my car was fixed,’” she says. “They feel good enough to share with others. That’s the best buzz that you can have about what your company culture is.”
Of course, if a company has a happy culture, but isn’t making money, the business likely won’t be around too long. And Clark says it would be a mistake, even for Build-A-Bear, to look exclusively for type A, shiny, happy personalities in each and every one of their employees.
“Everybody isn’t the same,” Clark says. “You don’t want it to be so homogeneous that nobody challenges each other. You don’t want it to be just like a lollipop cult where everybody is so happy. We value people’s challenges to our business. We want everybody to contribute. You have to accept people for who they are and help them be who they want to be not who you want them to be, but who they want to be.”
One of the best ways to get an employee working at their full potential is to lay out a path to get ahead in the organization.
“People should see that they can grow in the company,” Clark says. “When you do have internal promotions, make sure that everyone knows about it. They can see, ‘Hey, Don got promoted. I can get promoted.’”
Employees, whether they are new to the organization or have been there for some time, also have to know specifically what it is that they are expected to do at the company.
“I do believe that people come to work for a career, but they have to know from time to time what that career is,” Clark says. “If you don’t share that with them, they will leave. The people will go where they can grow. They’ll stay if they can see you’re trying to help them.”
A culture in which employees are encouraged to improve and are given updates as to how much they are improving also helps weed out troublesome workers.
“If a store manager has not had a lot of turnover, that’s a good thing,” Clark says. “It could be a bad thing, too. If they are not letting bad people go, then they are hurting their company. Good people don’t stay when bad people stay. Over time, if you have 20 people on your staff, and five of them are terrible, you’re going to lose five people because of it. That’s just the way it works. Good people do not want to work around people who are not making a contribution.
“The best thing you can do for somebody who is not making the kind of contribution that they need to make is to help them find another job. I’ve said to people, ‘If you’re not happy here, come to me. Tell me. I know a lot of people. I’ll help you find another job.’ If they are a good person and they didn’t steal and they showed up on time and this just isn’t the place for them, there are a lot of other places that would be for them. Every company has its own little personality.”
Sorting out the good from the bad to come up with a cohesive team of employees is a constantly evolving process. The leader who ignores the importance of culture in building their business will likely find problems.
“It takes so many people to make a good company,” Clark says. “The competitive landscape is such that you’re going to be competing with people who are going to figure out that it takes people to make a successful business. ... As a leader, I think you can take people at least a few notches past where they ever thought they were going to go and maybe even farther. That’s the fun of it. It’s helping people grow to be all they can be.”
HOW TO REACH: Build-A-Bear Workshop Inc., www.buildabear.com
Living in the shadows of Victoria’s Secret and Bath & Body Works, the dynamic duo of new millennium brands, nearly killed The Limited Stores Inc.
After all, as quickly as fashions come and go, so does capital especially when a business is underperforming relative to others in the corporate portfolio.
“As Limited Brands started to focus more on Bath & Body Works and Victoria’s Secret, the apparel businesses did suffer from neglect,” says Linda Heasley, chairman and CEO of The Limited Stores, which was the cornerstone of Les Wexner’s fashion empire until its sale to Sun Capital Partners in August 2007.
It’s a move that benefited both enterprises.
Limited Brands shed itself of the last of its seven apparel businesses, which had become a drag on the corporation’s financials. The Limited Stores, which had become stagnant and unprofitable under Limited Brands, was now armed with new capital and ownership bent upon restoring the stores to their former glory.
“If we’d stayed with Limited Brands, we would always have gotten the second-level of attention and focus and capital,” Heasley says. “It would have been an ongoing struggle to get proper investments made in the business.”
Heasley isn’t bitter about the lack of attention and resources focused on The Limited Stores during the rise of Victoria’s Secret and Bath & Body Works. Quite the contrary. She credits Wexner with helping to make the brand a trendsetter of women’s fashion in the 1970s and ’80s, and she’s confident his vision will live on to see better days ahead.
“The good news is, despite ourselves, we hadn’t lost a lot of equity in our brand base,” she says. “The Limited is still a name people recognize as a good business.”
With Sun Capital’s $50 million equity investment in The Limited Stores and the additional $75 million line of credit Sun Capital arranged already Heasley is starting to see a turnaround.
“Since Sun has purchased us, we have started a program to refresh the [stores] and remodel,” she says. “Even things like replacing the carpet and painting fitting rooms we hadn’t done that in years. So that’s all very positive for the business. The focus has been very refreshing.”
In addition, the split from Limited Brands has allowed Heasley and her staff to explore new product lines, such as sleepwear, loungewear and accessories, that are breathing fresh life into a brand that was quickly becoming stale under its former corporate umbrella. Another plus: Ideas that would have taken months or years to get approval through the former corporate hierarchy are now able to be acted on almost immediately.
“Bottom line, we’re just a lot more nimble now,” Heasley says. Here’s how Heasley is working to take The Limited Stores from underperforming to over-the-top success.
Under its own flag now
“When we first announced that Limited Stores was going to look for a buyer, it was very emotional for many of our associates who had been here for a long time,” Heasley says. “Initially, I think people were very shaken.”
That didn’t last long. With Heasley and then-co-president Avra Myers touting the potential upsides to being independent of Limited Brands, associates’ reservations about the sale gradually diminished.
“We’ve been turning it into a good thing,” Heasley says. “It has actually caused us to become closer as a company.”
The key to getting associates to rally around the opportunity that a sale offered, she says, was consistent, open communication.
“The whole time we were interviewing prospective purchasers or owners, we sent out communication to the field to let them know how the meetings were going,” she says.
Heasley also set up round-table discussions with associates over breakfast and installed boxes around the Columbus headquarters as well as the New York offices for associates to submit anonymous questions about the impending sale. She sent out e-mails. She did monthly meetings in Columbus that were video conferenced in New York and vice versa.
“We demonstrated our willingness to share with them as we had information,” Heasley says. “We weren’t keeping anything back. As soon as I knew something that someone was wondering about, we would get that information out to them. I found that multiple touchpoints were good. They seemed to like the e-mails so I tried to do one every two to three weeks saying, ‘This is what we know.’”
When the buyout by Sun Capital was finalized on Aug. 3, 2007, associates were ready to celebrate.
“We threw an Independence Day party,” Heasley says. “And we created our own ‘Declaration of Independence.’” A large copy of the missive hangs framed on the wall outside Heasley’s office.
“We wrote it ourselves, and then we signed it,” she says. “I think people were really energized by the whole thing.”
Of course, some acts of independence such as securing a completely separate location outside the Morse Road campus of Limited Brands and undergoing a name change to further differentiate the stores from their former corporate owner were not included in the deal. Still, Heasley says a name change is not off the table.
“We have talked about it,” she says. “But we don’t have an answer yet. That is on the list of things that we are thinking about. It’s a tough call. The Limited has got a great history.”
So stay tuned. Another declaration of independence could come later this year.
Reconnecting with customers
Revitalizing The Limited Stores involves more than gaining new-found independence underwritten by Sun Capital and an enthusiastic sales force. It’s going to require a long, hard look at why customers like or dislike the store. It’s going to mean tracking all customer traffic not just sales. It’s going to mean getting reacquainted with customers on a more personal level. Heasley is all over that.
“The most critical area we have is our stores and our store experience,” she says.
That’s why getting to know customers again has become priority No. 1.
“We’re developing a lot of metrics right now around the customer,” Heasley says. “Metrics that we probably should’ve used historically but haven’t.”
For example, in the past when customers purchased an item from The Limited Stores, a toll-free phone number would randomly print on receipts inviting them to answer a handful of questions about their store experience. Now, exit interviews will be added to capture information about why customers decide to buy or not buy merchandise. Ditto for traffic counters, which track how many people enter the store.
“Right now, we’re only getting information from people who actually complete a transaction,” Heasley says. “For me, it’s as much about who doesn’t complete a transaction. I’ve watched too many people go in our store, turn and go out without a bag. That bothers me. I lose sleep over that.”
Further complicating the task of better connecting with customers is the fact that The Limi ted attracts an extremely varied demographic among women.
“She’s anywhere from 25 to 50 years old,” Heasley says. “That’s a very broad range. And you can’t be everything to everybody.”
So Heasley and her team fashioned a more specific customer profile, gave her a name and plastered her likeness upon the walls throughout the company’s headquarters to help associates envision who they’re catering to at The Limited Stores.
“We call her Tyler Monroe,” Heasley says. “We believe she’s 28 to 35 years old. She’s a professional woman. She likes fashion, but she’s not a slave to fashion. She’s probably in her second job, but she’s career-minded. She’s involved in a relationship. ... We created a whole brand story around Tyler.”
Limited executives even created a detailed day planner for Tyler listing everything from an upcoming Key West getaway to sticky-note reminders to call her mom.
“It’s a tool to bring life and a face to our customer,” Heasley says. “The associates rally behind it. The design and merchant team really love it. ... It’s been a very helpful way for us to get very clear in our minds where the assortment needs to go. What would Tyler wear? What wouldn’t she wear?
“It also gets to the customer experience in the stores. How would Tyler want to be addressed when she goes into the stores? What would be the store experience she would want? So we’re now carrying this all the way through our service offering.”
Heasley’s only concern with the Tyler prototype is that she may narrow the customer target a bit too much.
“Our customer is broader,” she says. “When you walk in our stores, we have a lot of women who are stroller moms now, but they’re career women. So we’re all Tyler. That’s the theme we’re talking about now. How do we keep it inclusive relative to who the customer really is? How do we capture all of that? That’s what we’re trying to refine right now.”
The new black
Increasing store traffic and converting more browsers into buyers are two main goals of The Limited Stores these days. Yet the importance of returning The Limited Stores to profitability certainly can’t be downplayed.
“We haven’t been profitable in some number of years,” Heasley says. “So the goal here is to get us back to a level of profitability.”
Focusing on the Monroes more than the Benjamins is how Heasley plans to get the company there.
“The measurement of success for most of us in retail is proving your relevance to the customer and establishing a loyal customer base while continuing to attract new customers,” Heasley says. “If we do that well, then profitability falls out. It should happen.”
In fact, she predicts The Limited Stores whose revenue rebounded to $500 million in 2007, up $7 million from 2006 figures will turn a profit in 2008.
“We’ve got a very strong balance sheet,” Heasley says. “We didn’t have that before. Sun is very supportive of growing the business.”
Illuminating the runway to better financial performance is a list of 21 initiatives developed jointly by Heasley and Sun. Among them: growing the accessories business, establishing an e-commerce site, assessing the most efficient way to bring in merchandise and even opening new stores.
“The target is three to five new stores in 2008,” she says. “It’s been years since we’ve had a new store.”
And these stores will be new throughout. “We are looking at a new concept for the brand, which is very exciting,” Heasley says. “I think one of the hallmarks of The Limited is our approachability. It’s not stuffy. It’s supposed to be a fashion statement, but it doesn’t make you feel intimidated to come in. So having a store design that’s a bit more contemporary is key. We’re very excited about that work.”
A lot is riding on this new concept. “For many years, the brand has been playing defense,” Heasley says. “Now we’re trying to play offense.”
That involves taking risks, yet staying true to the brand. “Les Wexner left us an incredible legacy,” Heasley says. “How do we build on that legacy, yet be relevant today? How do we leverage that past and move forward? That’s been one of the biggest challenges. Do we mention the Forenza sweater again or not? That was a defining product. Or do we come up with our current defining product?”
The possibilities are unlimited. “We’re going to be swinging for the bleachers,” Heasley says. “I call it regaining greatness.”
HOW TO REACH: The Limited Stores Inc., (614) 415-7000, www.thelimited.com
Bert Boeckmann’s wife first heard it on one of the sales floors at Galpin Motors Inc. a while back, as a salesman was relaying an issue to his manager.
“Well, W.W.B.D.?” the manager said in response.
Boeckmann’s wife stopped and asked the manager what the abbreviation stood for.
“What would Bert do?” the manager replied. “When we’re not sure what to do, we always stop and ask, ‘What would Bert do?’”
Later on, Boeckmann’s wife told him about the exchange. Boeckmann, a 55-year veteran of the auto sales industry in Los Angeles, found the manager’s words both humorous and telling.
“I think it’s probably the fact that I’ve been here 50-plus years and the example I’ve set,” Boeckmann says. “I think it does permeate our business. It’s a reason we’ve set sales records no one else has.”
From starting out at Galpin as a salesman in 1953, to taking over as president in 1963, to becoming the majority owner in 1964 and sole owner in 1968, Boeckmann has made customer service and well-trained employees the calling cards of Galpin, a company that has grown to become the top dog among California car dealers with more than $700 million in annual sales, including well-known auto brands such as Ford, Volvo, Honda and Saturn.
He has done it by creating and closely maintaining a company culture that begins with detailed training both in the classroom and at the dealership, training that is constantly honed through meetings and other interaction between management and employees.
After more than half a century, Boeckmann says he’s learned that having a winning culture is not about secret formulas. It’s about common sense, knowing what you want to value as a company and communicating that to your employees.
A servant’s attitude
As Galpin has grown, keeping every employee on the same page has become a monumental task. The company now employs about 1,200 people, and all of them have to embrace the same values.
Boeckmann says keeping the message simple has become very important. With that in mind, he has distilled the overarching mindset he wants his employees to exhibit down to a four-word directive:
“Have a servant’s attitude.”
Boeckmann says that you can never lose sight of the reason why you are in business, and it’s not just to sell your product or service. It’s to take care of the people who use your product or service.
“We have no reason to be here unless we serve our customers the way they deserve to be treated,” he says. “A lot of people say, ‘I don’t want to be a servant,’ but that’s not what we’re talking about. We’re here for a paycheck, but if you’re working just for a paycheck, you might not be serving the customer the way you should. But if you are serving the customer the way you should, you’ll definitely get a paycheck.”
Boeckmann trains Galpin employees, particularly those who interface with customers, to be sticklers for detail. It goes beyond doing what the customer expects you to do and reaches another level of anticipating what might go wrong during and after the purchase process, and doing whatever possible to eliminate inconvenience for customers.
Boeckmann says Galpin was among the first to make loaner cars available for customers having their cars serviced. As society has become more fast-paced, Galpin has taken steps to reduce the time necessary to make a car purchase, such as appraising trade-ins while a customer shops.
“We try to reflect a real joy in serving our customers and taking away the fear and dread of the buying process. That’s really what we train for.”
Boeckmann says that if you want a culture of service to sink in, you have to immerse your employees in it by setting an example from the top down every day. Along with that, regular training sessions can help to reinforce the lessons you are teaching.
“In the training, we reinforce our ethics, which is really no more than being honest and transparent with the customer,” he says. “That’s really the key. Everything we train for, everything we do, is built around the customer.”
Boeckmann says developing great customer service is really rooted in making your customers believe that you are genuinely interested in the experience they are having with your company. An interaction that might be purely transactional to you, might be an experience that has an emotional impact on a customer, and that is something you should always remember and cascade throughout your organization.
“You not only want to treat people in the way you want to be treated, but if you can, to go beyond that and do something that is of a greater benefit to the customer. If there is a problem, we want to take care of it. We want them to feel that we are interested in whatever experience they are going to have with us.”
Every week, Boeckmann and his two sons, who also help run the business, meet with Galpin’s entire sales staff. They do the same with the company’s managers, usually during lunch.
The meetings are an opportunity for everyone to get in a room and meet face to face, the communication method Boeckmann prefers above all others. Boeckmann and his sons announce upcoming events and review what the company is trying to accomplish. Managers and salespeople are given an opportunity to provide feedback and voice their own concerns.
“When you work for Galpin, whether it’s Galpin Ford, Lincoln-Mercury, Volvo, Aston Martin, Mazda, Saturn, Honda, you’re working for Galpin and you need to adhere to the Galpin philosophy,” he says. “So every week, I am with our salesmen, seeing what issues they have.”
Boeckmann values face-to-face communication the most because it is the method that offers the most immediate feedback. While it can be time-consuming and not always practical, he says in-person communication should be how you operate whenever possible.
“In face-to-face communication, you’re looking at the other person and you can tell an awful lot,” he says. We communicate better when we see facial expressions. I can tell if you understand what I am saying, if you’re a little bit perplexed or if you have a question just by looking at you.”
Though the 76-year-old Boeckmann says he finds e-mail and other forms of Internet communication annoying at times, he also says it is a valuable tool that should not be overlooked, particularly when it comes to internal communication.
“It’s still a tremendous way to communicate. It’s a tremendous way for the assistants in our business to communicate with each other.”
Galpin uses e-mail as one of the staples of its communication with customers. Whenever someone purchases a car, the associate handling the sale asks for an e-mail address, which serves as a way to not only notify customers of upcoming promotions, but also as a way to get feedback on their experience with Galpin.
Customer feedback is an important part of the communication formula in any business. Boeckmann says it serves two main purposes: To improve the customer experience and to educate employees on how to do their jobs better.
“We solicit feedback when we sell a car, we ask the customer upfront if there is anything they’re unhappy with,” he says. “We also follow up by telephone for every service visit.”
If you want to have a company that has successful, long-term relationships with customers, you need to learn to see every piece of customer feedback, positive or negative, as an opportunity to improve.
Handling dissatisfied customers is one of the most difficult areas in which to train an employee, but Boeckmann says it’s well worth the training time.
“A lot of our people talk among themselves and they say, ‘I really don’t want to call an unhappy customer,’” he says. “But I tell them, ‘Wait, that’s an opportunity, not a negative.’”
He says employees who work in an environment where open communication is valued are employees that are more likely to communicate well with customers. A dissatisfied customer who has his or her problem addressed in a timely fashion could very well become a satisfied customer, and one who sticks with your company because you took care of them.
“It may take a little time and a little patience, but if a customer comes in to see me with a problem, our secretaries have a joke about how long it will take before we’re all laughing,” he says. “If you handle it right, they can end up as even more loyal customers than they were before. You not only didn’t lose them, they are a stronger customer than they were before.”
The importance of recognition
You can prepare employees for their jobs, give them the tools to succeed and communicate with them every day. But it’s only part of the battle.
Once employees have taken all the ammunition you’ve given them and turned it into something that benefits the company, Boeckmann says you must recognize what they’ve done, or they won’t repeat it.
“Regardless of who you are, you’d like to know you’re doing the job the way the people you work for want the job done,” he says. “All of us like to be recognized if we’re trying very hard to accomplish something and are successful at it.”
He says that if you want to reward employees for going above and beyond the call of duty, you must first define what the call of duty is, then acknowledge when someone does more than that.
“It’s important that the person knows what their job is. Any time they do their job very successfully or exceed what we would expect, it’s important to recognize them, particularly in front of others.”
At Galpin, employees are awarded a pin for their anniversaries of employment every five years. Salespeople receive recognition rings for meeting certain sales objectives.
Boeckmann says it’s not really about the material gifts. The gifts are symbolic of management’s gratitude for a job well done. That is what employees are seeking above all even if a monetary gift does help to sweeten the pot.
“If a guy does something that made a lot of money for the company and they thank him, that would be nice. If they give him some kind of financial reward to go with that, it would be very nice. But there might have been some circumstance where he treated a customer very well and they wrote back a glowing letter, and he certainly wouldn’t have expected a $20 bill included with that.”
But the best kind of recognition to Boeckmann is the kind that signifies that a company is going to have a strong customer base for a long time. All the individual recognition Galpin gives to its employees is aimed at encouraging them to provide a level of service that keeps customers the lifeblood of any business coming back.
“When I walked into my office recently, there was a letter sitting on my desk that had just arrived,” he says. “It said, ‘We’re still with you 41 years and 24 cars later.’ That’s really where our focus is and where we come from.”
HOW TO REACH: Galpin Motors Inc., www.galpin.com
A president hired a guy to run his company, and his first month on the job, the new hire made a decision that cost the company $1 million. The guy tells the president he knows he is going to be fired. The president responds, “Are you crazy? Your education just cost me $1 million. Now go earn it back.”
Simtob, president and COO of wireless retailer Wireless Toyz, shares the same beliefs.
“We all make mistakes,” he says “Use it for the learning experience, and never let it happen again. I’m not a big finger-pointer, but I like to hold people accountable. I’m going to let them know it was wrong and ask them how they are going to fix it. I’m going to work with them on how to fix it.”
Simtob has used the philosophy to help lead the company of more than 120 employees to 2006 revenue of about $80 million. Smart Business spoke with Simtob about how he keeps employees involved in the vision of the company.
Q: What are the keys to being a good leader?
To create a vision. I believe in open discussion. Taking people off-site usually works. Doing a lot of brainstorming and look at the future where you want to be 10 years from now.
We just came back from a three-day executive retreat where we took our executive level off-site, basically to focus on where we are today, where we can improve and where we want to go in the future. It put us all on the same page. When we left there, we knew exactly where we were going.
Coming in, we all had an idea, but now we’re focused more on what it will look like. We got more buy-in. There are too many phone calls and distractions in the office.
Q: How do you communicate your vision?
You do it in letters, monthly meetings and weekly executive meetings. It’s repetition. It’s not something you do and say once and it’s done. It’s something you do every day. People hear it and say it sounds good, but it becomes vital when they hear it all the time.
Some people change the message and vision, and that confuses people. By hearing the same thing over and over again, it’s, ‘This is the vision, and I know I’m working toward the right place.’
It’s not a moving target. It could be impactful, and it has to be relevant. It’s not repeating the same story over and over again. It’s making it relevant. Our vision is to be the premiere national wireless retailer. I can’t just get up in front of the group and say ‘We are going to be the premier national wireless retailer, next.’ It’s ‘We’ve made a decision or hired someone today that fits with our vision of being the premier national wireless retailer.’ Your activities tie in to the vision.
Q: What do you ask during job interviews?
I’m always asking where they want to be in five years and what areas do they need most improvement on. If someone says the thing I have to work on the most is my communication skills, and 50 percent of the job is communicating, you might have an issue.
If they say the thing I’m working on is organization, well, at least you know going in that they are strong enough in other areas to make up for that.
Q: How do you retain employees?
Keeping the job fun and interesting. You have to give them challenges. If you come to work and you get bored, you start looking for another job. A lot of it is high fives, ‘You are doing a great job,’ recognition in front of peers and taking time to coach and develop people. At the end of the year, they feel like they grew this year or they got better, and can’t wait to start a second year at the company.
Someone who is an executive assistant, that could be a mundane job. I keep it interesting for my assistant. We have a written job description and I keep adding things to it, and I throw her new challenges and things we’ve never done before. At the end of the year, it’s, ‘This job really grew into a great position.’ She’s always developing to really excel at the skills she has.
HOW TO REACH: Wireless Toyz, (248) 426-8200 or www.wirelesstoyz.com