Friday, October 16, 2008 was a very cool day!
Ron Johnson, Sr. VP, Apple Retail & John Hersey
Beverly and I had the opportunity to travel to Cupertino, California to spend the day at Apple. More specifically, we met with Ron Johnson, Senior Vice President, Apple Retail. For the past ten years Ron has been the architect of Apple’s retail strategy, a truly remarkable success story.
In May, 2001, Ron and other executives from Apple traveled east to Tyson Corner, Maryland to present plans for Apple’s entree into retail to a large group of financial analysts and representatives from the media. According to Ron, not a single person thought the idea had any merit at all. One attendee was quoted as saying “I give them two years…”
Well, here they are, 7 years later, 250+ stores worldwide, and with an absolute smash hit on their hands. What happened?
Apple defied conventional retail wisdom, launched a retail initiative when others suggested it was foolhardy, shifted thinking about what it is to be in retail, gave us more proof that mission trumps tactics every time, and everyday shows us the massive results that accrue to companies that dedicate themselves to serving customers, rather than selling stuff.
The Apple Retail mission is to ENRICH LIVES. It is very clearly not about selling stuff, although they do plenty of that. And, they do it because they instill an unyielding dedication to the mission in every employee. As we speak, they are developing an employee retention strategy. The goal is to increase the average tenure of store employees by 1 year. We expected Ron Johnson to discuss how that would reduce turnover costs. Nope! The strategy is all about having a more experienced staff in order to enrich the lives of customers. Not once did he mention costs efficiencies or increasing sales margins. In fact, every decision, from location to store design to employee training and retention strategies appears to be held up against the overriding mission of Enriching Lives, customer lives and employee lives.
Ron Johnson, Apple Sr. VP and Beverly Belury
The Apple mission appears quite simple, not easy necessarily, but simple. Apple believes if they can design inviting stores around the life enriching Apple products, engage truly qualified and caring employees who come from a place of serving customers rather than ringing cash registers success will follow. What a concept!
The statistics supporting Apple’s success in retail are jaw-dropping. From sales per employee, to sales per square foot, to increases in year-over-year sales to sales trajectory, the numbers are staggering.
Several months ago we wrote a column for the Phoenix Business Journal titled Leadership: Live your company’s brand out loud . In January we had the opportunity to speak in Cairo for 300 top line managers for Vodafone, Egypt. Never before had we been witness to an organization that was so clear on its mission and, more importantly, drove that mission deep into the organization. The clarity and dedication was evident everywhere we looked at Vodafone. The same is true for Apple.
When the rest of the business world appears to be operating out of total, complete and paralyzing fear and uncertainty Apple has clarity, commitment, and confidence. And, it is not just an ad slogan. As we walked throughout the “Campus” the culture was palpable. We could almost reach out and touch it. Happy, engaged and challenged employees were everywhere. There is an unmistakable pride on the faces of employees that we have rarely seen, outside of Cupertino and Cairo.
According to Ron Johnson there are two things that distinguish Apple. They have become masters at “getting the Big Idea” and they have a “passion for details”. The Big Idea is an uncompromising dedication to enriching lives and a passion for every employee delivering on this mission in every way possible.
The ultimate job of a leader or leadership team is to develop a clear mission and vision, translate that into every decision and then communicate it with an unbending commitment as frequently as humanly possible. As we say, it becomes contagious. It works for Apple (and Vodafone) so why not give it a shot. After all, the fear strategy does not appear to be working.
This was truly an unforgettable day.
John & Bev
Entries (RSS)