Creative Leisure News - Business-Wise

Mike's often irreverent, thought-provoking analysis of the industry.

Consistency vs. Creativity

One of our chains just made a major goof.

by Mike Hartnett (January 3, 2005)

Recently a chain held a meeting of area store teachers, event coordinators, and managers to announce that the company was eliminating the "teacher" position. From then on all classes were going to be designed and developed at the corporate headquarters and sent to the stores where the classes would be taught by the sales clerks.

All of the stores' class schedules would be the same. If a clerk had an idea for a class, she would have to submit it to the store manager for approval, then the manager would have to submit it to headquarters for approval, then it would be developed and sent to all stores.

Teachers could remain as hourly employees, but there would no longer be any extra compensation for teaching a class or commission on sales made to students. Oh, and teachers could no longer submit any projects to magazines or enter any scrapbook page layout contests.

How did the teachers respond? They all quit.

My first reaction was that this is the most pathologically stupid business idea I've heard in years. Whoever made this decision probably thinks there are still weapons of mass destruction in Iraq, too. Then I realized it was just the latest example of how chain execs at some point succumb to the temptation to make every thing in every store the same.

It doesn't matter which chain came up with this knucklehead policy. Every chain is tempted to go too far in exercising control.

In some cases they have good reason to want that control. Years ago, before Michael Rouleau became CEO at Michaels, the chain's store managers had a tremendous amount of individual freedom. They could order any products they wanted, and how much. One vendor called Michaels managers "the cowboys of the industry."

Of course that does make some sense. When Frank's Nursery was the Michaels of its day, I visited stores in Minneapolis and Boca Raton within a three-week period and discovered the yarn departments in each store were exactly the same. Gee, do you think customers in Florida might want to make lighter-weight sweaters than customers in Minnesota?

But the overall result of Michaels' managers having so much freedom was chaos. Michaels' corporate buyers had to call vendors and ask them how much Michaels had ordered from them. One vendor told me that he received a call from a panicked buyer who said she just realized how desperately short of the vendor's products Michaels was. She insisted that the vendor air freight a huge shipment (at the vendor's expense, of course).

The vendor had employees work overtime and air-freighted the order, only to receive a phone call a couple of days later. Oops, the buyer said. Turns out Michaels didn't need the order after all, so it was being shipped back to the vendor � again at the vendor's expense.

Clearly, that's no way to run a business. Still, this new chain-wide class plan is pathologically stupid for a variety of reasons.

1. This idea that anyone can teach anything is a fallacy all too common in U.S. society, not just in retail. All execs need do is remember the good and bad teachers in their schools and they should know good teaching is part gift, part training. Particularly when it comes to teaching, human beings are not robots.

2. Trends aren't consistent within an area. The same class would not succeed or fail equally throughout a region, let alone the country. Consumers in south suburban Chicago do not have the same interests as those in north suburban Chicago.

3. If trends aren't consistent within an area, they certainly aren't consistent throughout the country. Just ask any vendor of any industry product if his/her sales are the same everywhere. Every trend starts somewhere and therefore is at a different level of evolution depending on the region. Scrapbooking started in the Northwest, stenciling in the Northeast, and cross stitch in the Southeast. How could the demand and interest for a particular class be uniform across the country?

4. Implementation is not consistent. That's true of basic merchandising, let alone teaching. I can't count the number of times a frustrated vendor has called complaining with the same tale of woe: the vendor and a chain buyer create a wonderful program � a merchandising plan, an endcap, project sheets, or whatever. The vendor spends time and money fulfilling his part of the bargain, then visits stores only to discover that the plan was not implemented properly at store level.

One vendor told me a buyer loved his new line but thought a test was in order before adding the line to all of the stores. The buyer shipped the line to 12 stores, then later visited a number of the stores to see how it was doing. In half the stores he visited the line never made it out of the box in the back room. Guess what? The test was deemed a failure.

5. Local trends can be caused by a store. An enthusiastic teacher or clerk can create interest in a particular product or technique. The result is strong sales of that product or a high class enrollment. Meanwhile, the same product or class falls flat elsewhere because the staff is not so enthusiastic.

Recently an excellent scrapbook retailer posted a message on a TwoPeasinaBucket board that she was dropping a particular line because it wasn't selling. Surprised retailers in other parts of the country responded that the line sold very well for them. This was a classic example of how regions, consumers, and retailers differ � and why a uniform teaching program won't work.

The bottom line is that a chain needs to walk a narrow line between consistency and allowing employees' individual creativity and enthusiasm to flourish.

(Note: To read previous Business-Wise columns, click on the titles in the right-hand column. To comment (on or off the record) on any of the issues mentioned above, email Mike Hartnett at mike@clnonline.com.)

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