Think about these three retailers: WALMART, KMART and TARGET. All discount department stores. All ones that you have likely shopped in at some point. Now, see if you can match the company values with the retailer.
Retailer A
- Great shopping, anytime, anywhere
- Celebrating diversity and inclusion
- Design for all
- Community support and engagement
- A fun and rewarding place to work
Retailer B
- Creating lasting relationships with customers by empowering them to manage their lives
- Attaining best in class productivity and efficiency
- Building our brands
- Reinventing the company continuously through technology and innovation
Retailer C
- Service to our customers
- Respect for the individual
- Strive for excellence
- Act with integrity
Matching these three retailers to their values is tougher than you might think.
Here are the answers:
- Great shopping, anytime, anywhere
- Celebrating diversity and inclusion
- Design for all
- Community support and engagement
- A fun and rewarding place to work
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
- Creating lasting relationships with customers by empowering them to manage their lives
- Attaining best in class productivity and efficiency
- Building our brands
- Reinventing the company continuously through technology and innovation
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
- Service to our customers
- Respect for the individual
- Strive for excellence
- Act with integrity
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Target, for me, was very easy. I think of them as “affordable design”. I recall the banners showing how much they have contributed to the community. I experience their employees as positive and upbeat.
Walmart was a bit more challenging. Act with integrity flies in the face of their strong-arm tactics with suppliers and their history of employee and wage/hour problems. At a rate of 17 employee-generated lawsuits a day, respect for the individual appears hollow. It seems to me that the values that Walmart guides to are about efficiency, growth, and low price, at any cost.
And then there is Kmart. Reinventing the company through technology. Really? Lasting relationships with customers, when Kmart is losing customers and shedding stores in a fast race to the bottom? Building their brand as a value, when in reality their brand is muddled and losing value daily?
You see, there are stated values. The ones on the nice posters on the wall. The ones on your website. The ones that you talk about when you recruit.
Then there are lived values. The ones that are evident, no matter what is on the poster. The ones that show up every time a tough decision must be made. The ones that are a part of your culture, the ones that describe what it is like “around here”.
Organizations, like Target, who have a great deal of congruence between the posters on the wall and the action in the hall experience something the others do not. The have an internal GPS system that aligns decision making and guides strategy and execution. They attract customers and employees who hold similar values. They are intentional about standing for something, even when standing for something is not easy. And they perform better financially.
Case in point: Kresge, the parent/early incarnation of Kmart with five and dime stores, invented the category of discount department stores. They owned this space – but no more. Kmart has had a 67% sales plunge between 2000 and 2010, going from 2,165 stores to 979. During this same period, Target’s sales nearly doubled.
On just about any measure, Target is beating out Walmart and both of them are decimating Kmart. This includes growth in stores, same store sales, gross margin and adjusted operating margin. You can go here for details – as well as vivid photo commentary on the state of the Kmart stores.
There are many lessons here – but let’s focus in on stated values and lived values. In a nutshell:
- Every organization has values, whether they are articulated or not. Values are evident in the decisions you make and the actions you take, day in and day out.
- Organizations that are able to clearly describe their values, and build them into their organizational DNA will outperform those that don’t.
- And most importantly, don’t believe the poster on the wall. Watch what happens. Those are the true values. For as a leader once told me:
People hear what you say.
People see what you do.
Seeing is believing.
3 Responses
Don’t forget that Sears is part of the Kmart family of brands that they are trying to build.
So true. “Who you are speaks so loudly I can’t hear what you’re saying.”
Let me share something I heard somewhere. “There is strategy, there is structure and there is culture. And culture will beat out strategy and structure every time.”