I’m in the people business and so probably are you because retail is very much people oriented. It’s therefore amazing how many businesses in this industry (and that of the leisure sector) have a total disconnect between the people at the top of organisations and the rest of the employees.
Disconnected: a common complaint in many companies.
Part of my role is to undertake surveys of employees, which is always enlightening to say the least, because it highlights just how often there is a serious disconnection between those running the show and the rest of the team.
This is not a problem at the strongest-led companies, and within such organisations are some of the most satisfied people. At the crux, it involves having clarity of vision and a strategy that is clearly communicated throughout the business.
The obvious example is Apple where the most amazing people work on the shop floor. You almost get the impression that they would work there without being paid such is their enthusiasm for the products. But this is only channelled into great service by the strong management vision.
Another great operation is the Lancaster Hotel in London where the general manager is running a £45 million business, which can seem like he is in charge of a whole town. His stance with his team is that ‘it’s your business, not mine, so you run it as you see fit’. He’ll help and guide them and those who fly, fly while those who don’t will likely get booted out.
It’s harsh in some ways but it works – especially compared with the alternative of taking the head in the sand approach and not wanting to listen to anything your employees say. It effectively means operating a closed-door-closed-mind policy that contributes to stifling vibrant individuals.
A recent survey I’ve been working on highlighted how one company’s top managers have the view that ‘this is my company and I’ll run it how I like’. Such is the disconnection caused by this approach that its employees put their future career prospects entirely down to luck. They reckon it depends entirely on who are their direct managers rather than their actual abilities.
Innocent but not naive about managing people.
This is very dangerous because valuable people want to be led in a clear and vibrant way. I’d say Innocent Drinks is another good example of how to successfully manage people. Its strategy is to be the best fruit smoothie producer and against this backdrop the management say: ‘How you run your life in the business is your choice. Go and do it and keep in touch’. Sometimes they’ll stop by and ask what employees are doing? And ask if they can help them in any way.
In contrast, pub business Mitchells & Butlers has a bad case of disconnection as its senior level people have been all over the place – with boardroom coups and arguments – that has led to a dearth of clear direction given to the employees. But despite this the people on the front-line have been delivering the goods.
The big question, therefore, is how long can this disconnected situation last and just how successful could M&B be with proper connections (and clear communications) between its management and employees. What exactly could this business be with a strong chief executive who can communicate a strategy coherently?
The retail sector undoubtedly has one of the best communicators and advocates of connectedness – Sainsbury’s chief executive Justin King. Consider that at the top of the company’s balanced scorecard, which it uses for its employee assessments, is ‘Colleague Engagement’.
If you don’t achieve a certain percentage against this metric then effectively your appraisal finishes and you go back into training. The company’s view is that you’ve got to engage with your people.
Without having a strong connection with your employees then I question just how well you can be connected to your customers? I suspect we all know the answer to this one.
Sponsored column by Nigel Sapsed, director of executive search specialist Sapsed Stevens