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Embracing
Stewardship: Part 2
continued...
Hemachandra:
What do empowerment and interdependence mean in terms of decision-making
structures in a store?
Block:
They mean you meet every once in a while to discuss basic decisions.
As an owner, you constantly are worrying about merchandising. You
constantly are deciding about how to sustain the business; what to offer
customers; and what kind of customer experience you are trying to
create. You are trying to read the market and determine what is going to
be hot, because you are making decisions months ahead of time about what
to sell.
Why not make these things conversations you have with everybody in the
business, instead of it being about a singular kind of wisdom or genius
that you, the owner, supposedly brings?
Figure out the four or five critical things you worry about most. Then
say, “Let’s make them topics we all talk about.” It doesn’t mean you are
totally giving up control. It still is your business. But you are trying
to engage people in decisions about merchandising, buying, and finance
as if they are owners. You want them to act while they are there — even
if they only are working there for five minutes — as if they own your
store emotionally, spiritually, and operationally.
How does this apply to finance? Well, how transparent do you want to be
with your people? Most people who work in small businesses have no idea
about the economics of the business. They don’t know what the margins
are, so they cannot make good decisions about how to make exceptions for
customers, for example. Financially, this work means being transparent.
You don’t have to tell your employees everything, but you want them to
see what the economics of the business are, so they can see what creates
success and failure — how fragile success is and what it hinges on.
Hemachandra:
So they gain a greater sense of partnership in the business?
Block:
A sense of partnership, yes, but also so they can make better decisions.
Anybody who works in a business makes small decisions minute by minute
that have enormous impact over time on the business. You want to help
them make good decisions, balancing what the customer wants — because
the customer always wants more and wants this and that — and what the
business needs to sustain itself.
Hemachandra:
In the book
The Answer to How Is Yes,
you suggest confronting people with their freedom. What does this mean
for store owners with their employees?
Block:
Retailers confront people with their freedom by giving people choice; by
not making promises of caretaking they can’t deliver on; and by having
adult-to-adult or partner-to-partner conversations. All the things I am
talking about are intended to create a culture of accountability by
treating employees as if they are capable of acting as equals of ours,
even though an employee may be 18 years old and never have had a job
before.
It also means if your employees treat you as a parent, you say no. If
employees want you to take care of them, and they complain, “I’m sorry,
I just couldn’t get here on time,” you say, “That’s not good enough. I
need someone who is going to show up. You have to be here a half-hour
before the store opens, and that’s it. If you don’t want to do that,
then you don’t have a job here.”
When we control people, we think we have to take care of them in a
thousand ways. But when you confront people with their freedom, you stop
colluding with people in their sense of entitlement. When employees say,
“What’s in it for me?” you say, “I don’t know. The answer to that
question is something
you
have to figure out.”
If an employee is depressed every day, it is not a problem you have to
solve. All you have to do is say, “Hey, look. Your despair is affecting
all of us. Cheer up!” So there’s a hard part to this, too. What do you
say to your partner if your partner is moody and pouting? You say, “Stop
being so moody and pouty.” That’s a great conversation to have. The
person may still be moody and pouty, but now you can get on with your
day.
Hemachandra:
You write about service guarantees in
Stewardship.
What is an example of a service guarantee for an independent retail
store?
Block:
It depends: What is the promise you are willing to make to your
customers? If they don’t like a product, they can bring it back? I don’t
know, but it’s a wonderful thing to think about. In a lot of small
businesses the guarantee isn’t as strong as it is in large businesses,
because large businesses can better absorb the costs of things they
can’t resell. In a small business, because you feel vulnerable, service
tends to be a little more hard-nosed and stringent.
So, you have to think carefully: What is a customer worth?
To get a new customer costs a huge amount of effort and money. Customers
are unbelievably valuable. What kind of strategy do you have for keeping
customers? You need to ask, “What’s our recovery strategy when we make a
mistake?” Or think about what the strategy is when a customer blows it,
because customers make mistakes half the time, anyway. Business owners
should be conscious about these choices.
If you own a service business, what is the promise? If people buy New
Age gifts and books and music and knowledge, they really are looking for
their own transformation. How are you supporting their wish to change
their lives? Even when someone gives New Age gifts to another person,
they are thinking, “Maybe if they get it together, I’ ll get it
together.”
So you ask, “How do we work with customers to support what they have in
mind when they purchase from us?” They are entering your New Age store
wishing for transformation, and you need to be thinking about what kind
of service supports that transformation. Maybe if customers are
taking advantage of you, just telling them they are doing that would be
the greatest gift you could give them. Give them their money back and
say, “Hey, look, what are you doing this for? I thought you came here to
find the New Age, but you are acting like you are stuck in the Old Age,
which is about competition and dominance.”
>Continues
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