Business Issues  



We Do Business With People We Like Doing Business With

By Joseph F. Carroll


"WE WERE LOSING MONEY EVERY MONTH. We had become slow pay with our suppliers. We had high turnover among our employees. There was no feeling of teamwork. The most painful part of this was my growing sense of failure as a CEO.”

This statement was made in 2004 by Tom Phillips, CEO of Weekends Only, a 50-year old company with five stores in the St. Louis, Missouri area. Tom had joined his father’s furniture store in 1995 when it was called Phillips Furniture. It was a traditional independent furniture store carrying major brand names like Thomasville, Broyhill and Simmons Mattress. Two years later he launched what was then a relatively new retail concept. His new store would be open three days a week, only on weekends. He felt that lower overhead costs would allow him to offer better prices to his customers. He would also offer an ever-changing selection of merchandise to give his customer a “treasure hunt” experience. He would focus on brand name closeouts and special buys at discounted prices. There would be no options but the customer could count on instant gratification.

From 1997 to 2003 he opened six stores and closed one. He also opened a 7,000 square meter Distribution Center. His company had grown from 3 employees to just under 300. He had installed new hardware and an ERP software system. His sales grew to just a little over US$30 million in 2003. But in 2004 sales began to slide backwards. Tom began to analyze the reasons for the decline. He could see that he had hired some senior managers who just weren’t good fits. The company had grown so quickly that there was a lack of standardized processes and systems. The combination of poorly managed change had created a negative, stressful and unhealthy culture within the company.

Tom came to this conclusion: “Our problem isn’t the concept. It’s about people. What got me here isn’t going to get me where I want to go.” This is what he now calls “my transformational experience.” He created his own mission plan: To become a more authentic, transparent, collaborative and humble leader.

The first thing he did was to engage an outside consulting firm. He requested they make structured assessments on his existing managers, including himself. He decided that he would hire an executive team of all “A” players. He would break down what he called “silos”, protective barriers, that his mangers had built around themselves and create a real team.

To define the company’s mission and values, Tom and his managers were asked to answer the following questions:

Why do we exist?
Where are we going?
How will we get there?
What do we stand for?
Who are we taking with us?

The first question was easy. We exist to save our customers money. The second question determines the Vision: To become a top 50 home furnishings retail company in the United States.

To achieve this goal the team developed its own set of values:

Take personal responsibility for meeting customer needs
Not “I” but “We”. Teamwork will prevail
Be a high performance company
Be willing to grow personally and professionally
Practice total honesty in all relationships
Be committed to profitable growth for the security of our company and coworkers.

Tom says that capturing the hearts and minds of your employees is the most significant thing your company can do. The ideal we all seek is a more fulfilling work life with purpose and meaning. You can best achieve this by having a clear definition of everyone’s role, making sure each person knows what is expected of them and has been given measurable goals. This only works if you value, believe in and enjoy what you do. Each employee should know that they matter, are valued, and have opportunity for growth.

And guess what? When the culture in a company changes people’s interactions change. When people’s interactions change... results change! Engaged employees create engaged customers. There is only one factor that will compel customers to return to your store: the way they feel about you. Another way to express this is “we do business with people we like doing business with.”

Weekends Only has experienced a 78% sales increase in 2004. They accomplished this without adding any more stores. More people shop them than any other furniture store in St. Louis, including department store giant, Macys, and the Ashley Furniture stores.

When Tom looks back at what has occurred he realizes that what has made his stores successful is not the 3-day concept, it’s the people who make the difference. He calls his people “my real heroes.”

Tom and his employees now share a common goal, to make the world better -- one room at a time

JOE CARROLL
former Publisher of Furniture/Today, is co-founder of the International Alliance of Furnishings Publications. He is an international marketing consultant. He can be reached at joecarroll@ triad.rr.com