Here is a simple take away cheat sheet that I use when presenting the six concepts of “Good to Great” by Jim Collins and how they relate to the Retail Industry. It is not meant to be a deep dive into the book (some of my upcoming blogs will dig deeper into each concept), but rather a quick reference on the six concepts and a few important points.
Remember the Fly Wheel Effect – all of the concepts work together to achieve the results – there is no miracle moment – it is an evolution. We implemented these concepts at OrotonGroup prior to the major turnaround in the business 10 years ago.
Level 5 Leadership
Personal humility and professional will. They channel ambition into the organisation, not the self. Not a high flyer or larger than life. They look in the mirror when something goes wrong and look out the window when giving credit. Comfortable that they may not get credit for success. Many Australian Retailers achieve Level 4, but few achieve level 5.
First who, then what!
Get the right people on the bus and the wrong people off the bus. Begin with who, rather than what and the transformation will be easier. Great vision without great people is irrelevant. When you need to make a change, make it quickly. Retailers need to have the correct structure with the right people. Nepotism has created issues within several Australian retailers. Only hire friends or relatives if you can separate business with personal.
Confront the Brutal facts (The Stockdale Paradox)
Admiral James Stockdale survived 7 years in a Viet Cong POW camp by hanging onto two contrary beliefs – His Life couldn’t be worse at the moment (the brutal fact) and his life would someday be better than ever (unwavering faith). Be brutally honest about your current situation, but never give up. There are several retail examples in the past few years that demonstrate what happens when you wait too long to confront the brutal facts.
You need to be the best at your clearly defined niche. You cannot be all things to all people. The intersection between – what you are passionate about, what drives your economic engine and what you can be best at. A Fox knows a little about many things. A Fox is complex. A hedgehog knows only one thing very well. A hedgehog is simple. Department stores struggle with this whereas specialty stores often find this niche and thrive.
Culture of Discipline
Companies build rules to manage a small % of the wrong people which in turns frustrates the right people. A great organisation is high in entrepreneurship and high in discipline (a blend of magic and science). Get everyone going in the same direction with the same goals – communicate.
Technology is not a fix to problems. It helps you achieve a great strategy, but it isn’t a strategy in itself. Use technology to truly differentiate yourself with competitors if warranted. Get the basics right with technology, but don’t get caught up in the hype. Aussie retailers love the concept of technology, but few do it well. If you choose to spend on new technology, make sure that you use it completely – if you collect data – analyse it and adapt your behaviour.