Diversity Success Factors for Retail

By: Jim Langemo

Black Friday has come and gone. You and your team have worked all year for this weekend. You have tallied the numbers (revenue, margin, comparable sales, traffic counts, etc.) and you have asked yourself the big question, "Did we make plan?" This weekend sets the tone for the rest of the holiday season, and the holiday season makes or breaks your year. You know the game. You play it every year and you love it.

You will spend the next few weeks keeping a close eye on performance. You will keep your team fired up and focused on customers. But as a leader, you are already looking ahead to next year. What do you need to do over the next year to make sure next year's Black Friday is the most profitable ever?

What do we know about retail in the next twelve months? Overall, this Black Friday was a success for retail and it shows that the economy is beginning to get better. Sales were up from last year as shoppers took advantage of bargains and free shipping. It's encouraging to know that shoppers were back to buying items for themselves as well as gifts for others. In addition, they were buying higher-priced and higher-quality items compared with last year when they were just buying the basics. Customers were still cost conscious, but they were buying! Online sales were up 9% the day after Black Friday as well. All this points to a better season than last year, but it isn't enough to wipe out concerns for next year.

There are still over 15 million people out of work. The time it takes before new products become commoditized continues to shrink, slashing margins and opportunities for profit. New technology is consolidating products, which means fewer products to offer and fewer products to cover the square footage of the retail floor. For instance, cell phones, MP3 players, GPS, digital cameras, digital camcorders are all converging into one product. Who knows the influence iPads will have in the area of consolidation? An increased amount of retail web presence means that more people are shopping online and shopping less in stores, which crowds competition and makes creating the right customer experience more difficult.

You need to find new ways to grow your business and the days of riding the wave of new technology or moving into a new market are over.

So what do you do?

Consider diversity as a prominent element of your strategy.

Why diversity?

The face of the United States is changing. Your new customer base is primarily coming from three areas:

1. Women - Even though they aren't growing as a percentage of the population, they continue to increase their influence as they move into higher areas of leadership and start their own businesses in greater numbers. Retailers are also recognizing how much they influence purchasing decisions in the home.

2. Minority Ethnic and Racial Groups - In Los Angeles and other cities you can't even use the word minority anymore. Latinos are the fastest growing segment in the USA. 26% of children younger than 5 were Latino in 2009. That means by 2020, over ¼ of the people looking for jobs for your company will be Latino. ¼ of your possible customer base will be Latino. How much do you know about attracting and retaining Latinos as customers and employees?

3. Baby Boomers - The number of people over the age of 65 will jump to 54 million in just nine years (from 35 million in 2000). This will create a customer base often ignored in retail - the retiree. It will also impact the employee base as more people leave the workforce than ever before.

So how do you succeed in an environment that is changing right before your eyes? As you build your strategy and execute your plans, follow the Four R's of Diversity Business Development: Be Real, Be Relevant, Show Respect and Build Relationships.

Be Real - Your potential multicultural customers want to know if you really care about them as people or if you just want to make money off them. Do you care as much as they do about their children's education, about developing their small business, about helping them have fun with their hard-earned money? They will know your intentions by their shopping experience in the store and online.

Be Relevant - Most of your multicultural and diverse customers want what other customers want. They want the newest technology. They want clothes that are in fashion. However, they also want products that are culturally specific, as well as services and financing options that meet their unique needs and are written in a language they understand.

Show Respect - Show respect for the culture and for the individual. Understand where your diverse customers are similar to your other customers and where they are they different. Showing respect doesn't mean treating people the same nor does it mean to give some people preferential treatment. Showing respect means to give uniqueness equal value.

Build Relationships - It's essential to build real relationships with people in diverse communities. It's more than having a booth at your local Cinco de Mayo festival or putting an ad in a multicultural newspaper. Your multicultural community wants you to get to know them. Participate in their community by hiring them as employees, getting to know the issues that affect them and be seen as a true partner.

How do you practice the 4 R's of Diversity Business Management? Primarily, there are four items to focus on:

Change Management - To be successful in this space is to recognize that diversity is primarily a change management effort. It's not enough to just do skill training or have bilingual signs.

Management Development - It is essential to make your managers effective change agents and provide training and coaching so they have the skills to run a diversity-friendly business.

Rewards - Reward managers who grow their business by creating loyal, diverse customers.

Employee Training - Your employees need to know how to engage with diverse customers by adapting your company's desired customer experience to their needs.

Attracting a new customer base takes time, but if you begin to plan now you can experience some wins before next year's holiday season commences. It's a great opportunity to grow your business by showing a whole new population that you care.

Jim Langemo is the managing director of Enso Diversity Group and a proud friend of Monarch Leadership. The Four R's of Diversity Business Development are the copyright of Enso Diversity Group.

Three Tips for New Leaders

By: Gina Kellogg-Soleil

Kate finally made it!  She’s moving up the ladder and feeling like her career is moving forward.  This is her time to shine, make a difference and create a name for herself.  She has put in her time, proven herself, and now she’s being recognized her for all her hard work.  Kate is being promoted to store manager!

Six months later frustration has set in.  Kate is repeatedly saying there’s not enough time in the day. She’s following all the company’s policies and standard operating processes, and making sure the team is performing its roles and responsibilities.  Emails are checked, deadlines are being met and Kate’s store location couldn’t be more organized.  She’s doing everything “right”, so why are sales down, her store employees disengaged, and customers moderately satisfied at best?  Kate’s spinning, and she needs to see results fast.

Ah, the proverbial new manager’s trap of being so focused on systematic perfection that we forget about what real leadership is and what truly generates results—people.  Sure, when asked what it means to be a leader, Kate, like all of us, can verbally provide the “correct” answer:  great leaders inspire a shared vision, model the way, leverage the strengths of others, yada, yada, yada.  Let’s admit it, although we all know what it means to be a great leader, leadership is hard work, and it takes time and practice. The reality is that great leaders are great because they’ve learned from the many mistakes they’ve made throughout their career.  Kate is experiencing one of the first lesson’s  every great leader learns—results come when you put energy into the people on your team, the people who are customers in your store and the people who are within your network; not from solely following systems and processes.

Like Kate, most new leaders tend to veer away from putting energy toward people, and  they gravitate to a systematic management approach because it’s tangible, easy to measure, and being able to cross off “to do’s” from a list gives a feeling  of success and recognition.  And many times they’re good at it! Yes, it’s important to have these systematic management skills, but they need to be balanced with basic leadership.  If Kate’s your employee, here are three leadership tips that can help shorten the new leadership learning curve:

1.  Trust:  The best thing a new leader can do in their new role is spend their first 90 days focused on building trust.  Yes, that’s correct – trust.  New leaders should spend their first 90 days beginning to build trust with their team by simply observing, talking with employees, and most importantly listening to what their team and customers are sharing.  Building trust requires new leaders to patiently soak in the environment and build relationships.  When trust is built, both employee engagement and customer loyalty increases—a combination that equates to increased revenue for all.  Building trust doesn’t stop after being in a new role for 90 days, though.  The 90 days gives the new leader time to begin establishing behaviors that will allow them to integrate the necessary management tactics.  Once employees trust a new leader, they become engaged, welcome leadership guidance, and will actually want the leader to succeed.

2.  Self-Reflection:  New leaders should immediately get in the habit of looking first at themselves before putting blame onto their employees.  Many new leaders fall into the employee blame game all too easy, making statements such as: “It’s like they don’t even listen,”  “She’s so frustrating,”  “Why can’t they figure out how to do something so simple,” “We’d be so much further ahead if they could only….” Alight new leaders, listen up.  A leader is a direct reflection of his/her team, and a team is a direct reflection of their leader.  What does this exactly mean? When frustration with employees rears its ugly head, it’s often times because a leader’s behavior is triggering a cause and effect reaction.  The solution?  When a new leader finds frustration surfacing, self-reflection is a must.  Here is a series of questions that can help new leaders troubleshoot perceived employee dilemmas:

     1) Is it possible that others have the same frustration with you?
     2) What about your behavior could be causing their frustration?
     3) How can you change your behavior to eliminate the frustration?
     4) How can you apply the same rational to the frustration you're having with your own employees?

3.  Servant Leadership:  It’s all about the people.  In the grand scheme of things, it’s the people on your team and the people who are your customers who achieve the business results.  New leaders can lose sight of how important it is to put down the PDA and put their energy towards their employees and customers.  The misconceived notion of new leaders is that they have been put in a position of authority and granted a title of control.  Great leaders know it’s the employees and customers who are the ones with the real authority and control, and an instrumental part of being a leader is about serving your employees and customers by helping to ensure they have the resources, knowledge and attention necessary to thrive.  Not surprisingly, the concept of serving your people circles directly back to the need for trust.  If a new leader wants results, help them put down the PDA and pick up the habit of servant leadership.

How the Chief Narcissism Officer Decides

By: Nick Tasler

Is one of the secrets of your success your willingness to seize opportunities others shy away from? Do you believe your company’s performance depends largely on your personal gifts? If so, you could be a great leader … or a dangerously overconfident one. The difference depends on how those beliefs about yourself translate into the choices you make.

As if a stunted economy weren’t enough, sweeping government reforms such as the Dodd-Frank Wall Street Reform Act have sufficiently shaken the confidence of even the most tough-minded and self-assured executives. In a recent Accenture survey, nearly two-thirds of executives from financial service firms believed that Dodd-Frank will require them to rethink their business models completely and revise their long-term business strategies, and almost half believed it will decrease their profits. The study’s authors, Chris Thompson and Samantha Regan, conclude that there will be “clear winners and losers,” and only those firms that seek out hidden opportunities in the reforms will emerge on top.

When it comes to spotting and then acting on potential opportunities, all executives are not created equal. For example, let’s say I give you a choice between two options. If you choose option A, you get an one-week, all-expenses-paid trip anywhere in the world. If you choose option B, I will flip a coin. If the coin turns up heads, you get a three-week, all-expenses-paid trip anywhere in the world. If it’s tails, you get nothing.

Are You a Gambler or Not?

If you’re like most people, you’ll choose the guaranteed one-week trip. One out of four people, however, will predictably choose the higher-risk, higher-reward option. These two groups of people don’t just make different choices; they actually see the decision itself quite differently. Virtually everyone views decisions as a calculation between cost-benefit or risk-reward. Not everyone, however, weighs each side equally. The majority of people pay the risk part of the equation two to three times more attention than they do the reward part. That’s why we describe most decision-makers as Risk Managers. In contrast, about 25 percent of people are Potential Seekers who zoom in on the reward part of the equation. So for Risk Managers, the answer to the little riddle above is a no-brainer: Option A presents a guaranteed trip with zero risk. It’s equally simple for Potential Seekers, since Option B presents the potential for the highest reward … never mind the greater risk.

The law of averages means that half the time, the coin will turn up heads, and the Potential Seeker will be seen as the daredevil who defied the odds and won big. The other half of the time, the coin will turn up tails, and the Potential Seeker will be seen as reckless and be chided for brazen overconfidence and narcissism that blinded him or her to the “obvious” risk.

According to research I conducted with my team of industrial psychologists at TalentSmart, the average Risk Manager and the average Potential Seeker score about the same on every important outcome, from quality of life and job satisfaction to job performance and annual income. This seems to hold true not just for individuals but also for organizations.

Narcissism and Overconfidence

A few years ago, Don Hambrick and Arijit Chatterjee at Penn State University decided to determine how the ego and opportunism of chief executives affected their company’s performance. The two researchers figured that if those traits were helpful anywhere, they almost certainly would benefit CEOs in the fast-paced, innovation-driven high-tech industry. So they analyzed 111 high-tech CEOs and their companies’ performance. On average, companies led by the most narcissistic CEOs (as judged by such things as the number of times the CEO was quoted, pictured, or referenced in the annual report) performed no better and no worse than companies with more humble chief execs. Companies led by the most overconfident leaders, however, did experience greater volatility, constantly riding a wave of very high highs and equally low lows.

In challenging times like these, a willingness to see and seek opportunities where others see only risk and doom might be just what you need to come out a winner. Seizing the right opportunities, however, requires balanced potential-seeking. Too much caution poses a serious risk to your ability to adapt. Too much unrestricted risk-taking, particularly in a more regulated environment, could bury your company in legal battles and compliance issues. Here are some guidelines for achieving that balance.

1. Be bold, except in your financial reporting.

A leader’s confident actions are vital to keeping the company moving forward. But that same confidence can be a ticking time bomb if applied in such areas as financial reporting or legal matters. A new study published recently in The Journal of Experimental Psychology found that we can reliably predict which college students cheat by identifying the narcissists. And last year, researchers Catherine Schrand at Penn’s Wharton School and Sarah Zeckman at the University of Chicago’s Booth School of Business found that these overconfident behavior patterns are likely to lead executives eventually to commit fraud.

Schrand and Zechman identify what they call “the slippery slope to fraud.” They discovered that fraudulent managers often take advantage of gray areas in reporting guidelines by slightly over-reporting earnings in a given quarter—overconfident that they would make up for the gap in the following quarter’s earnings. When the next quarter brings more of the same, they now have to cover their tracks for two quarters, which is when it becomes outright fraud. What’s worse is that sometimes this over-reporting strategy works, which only reinforces the behavior. With new federal regulations mandating that compensation be directly tied to a company’s stock performance, the temptation for a manager to fudge earnings will likely be even greater. Best not even to step foot on the slippery slope in the first place.

2. Consult the Anti-You to reveal your blind spots.

Effective Potential Seekers also increase their odds for success by making certain they always have a trusted Risk Manager to consult. As we learned above, Potential Seekers appear to be carelessly overconfident mostly because they aren’t hard-wired to assess risks the way most other people are. If you are a Potential Seeker, before you make any strategic decisions, seek the help of a Risk Manager to frame the problem and possibly uncover risks lurking in your blind spots. Ultimately, the final decision will still be yours, and you may decide to take the risk. But it will be a more informed decision, with the risks more clearly identified.

3. Reflect and Redirect.

Potential Seekers live by the credo, “It’s easier to ask for forgiveness than to ask for permission.” Their willingness to try something new—and then change course if it doesn’t work—can be an enormous advantage in a fast-paced environment. The trick is in recognizing when your idea isn’t working. A narcissist’s Achilles’ heel is the tendency to protect his ego at all costs, which makes it difficult to admit mistakes. Think about it this way instead: You’re too smart to follow the wrong course when circumstances don’t cooperate with your plan.

GOOD OLD FASHION VISION

By: Gina Kellogg-Soleil

In the past couple of years many retailers, regardless of size, have been frantically trying to figure out how to keep their retail operation successful. How to keep consumers buying, employees motivated and the bottom-line in the black. Executives are in the boardroom strategizing, layoffs are skyrocketing and employees continue asking “What are we doing” as the new flavor of the month is introduced - AGAIN. Sound familiar?

The nature of the retail beast is high-paced and ever-changing—which is the exact reason why most of us have stayed in the industry as long as we have. We tend to pride ourselves on having an entrepreneurial spirit and pulling out all the stops to make “it” happen. Although fantastically fun and rewarding from a management perspective, as we continue to blaze-the-trail making “it” happen, our employees and consumers can’t figure out what “it” is. In many cases, this “making it happen” tendency is causing retailers to commit bottom-line suicide.

The solution? Define “it” with a good old fashion vision. When retailers know where the company is going, their employees get excited about being part of the journey. Having a clearly defined vision motivates employees to get “it” done. Having a vision won’t solve all the economic challenges retailers have been faced with over the past couple years, but it will better position the company to meet these challenges head on and continue to grow and thrive when the going gets tough.

If you’re a retailer without a vision, don’t worry you’re not alone. No time like the present! Here are a few steps to get your company or department moving forward in the right direction:

Clarity: Clearly define “it” with a vision! A vision is NOT the mission/purpose of your company. A mission/purpose is why your company or department exists, a vision is specifically where your company or department is going. Most retailers have a clear mission/purpose (which is great), but have no common vision for employees to rally around. Vision creates momentum. Vision helps employees see how their role, behaviors and choices are helping to move the company forward.

Connect: Help employees connect themselves to the vision. Every employee should be able to clearly understand how their role, behaviors and choices connect to the company vision. When employees feel their choices directly impact where the company is headed, consumers reap the benefit of highly engaged employees. The result—Increased revenue.

Communicate: 360 degree communication! Every employee should hear, read, discuss and see the vision. It’s not enough to have the vision posted in the employee breakroom. You need to ask employees their opinion about where the company is going and ask them to communicate how their role, behaviors and choices connect to the vision. Ask employees how they live the vision!

Be Consistent: The hardest piece of the puzzle. LIVE the vision consistently. Do not launch a vision as the flavor of the month. If you’re a typical retailer it’s going to take at least 90 days of consistent behavior from management, and visual communication, for employees to even begin trusting that the vision is a mainstay in the company. Consistency takes discipline, and does not just happen because it was a directive during the latest district or regional sales call. As you craft the vision, make sure you craft a plan that will help management keep the vision alive.

THE SECRET TO MAKING HARD DECISIONS EASY: FIND YOUR PULSE

By: Nick Tasler

In a moment of self-pity during his infamous reign as the leader who kicked off the Great Depression, Herbert Hoover once confided to friends: “I’m tired of making decisions–one after another all day long. My view of heaven is a place where no one ever has to make a decision.”

Ever felt like Hoover? Most of us have. Especially in times like these when circumstances force us to wallow in economic uncertainty. Psychologists find that while deliberating over a decision we feel about as chipper as we do in the waiting room at the dentist’s office. Our self-esteem and optimism dip, while our anxiety climbs.

Choosing Between Right and Right
Making decisions is so mentally exhausting because we often face multiple attractive (or unattractive) options. Ethics professor at the Harvard Business School, Joseph Badaracco wisely points out that the hardest decisions are not those pitting right against wrong. In reality, the toughest choices are between right and also right. In the case of Right vs. Right, your best option is to pre-determine the verdict by checking your Decision Pulse.

Your Decision Pulse is that one special attribute that makes your team or organization unique. It is the super-criterion that carries ultimate veto power over every other criterion. For example, when it was founded The Home Depot’s Decision Pulse was “whatever it takes to serve the customer.” That meant store employees were expected to do counterintuitive things like forego making a bigger sale if they could better serve the customer with a less expensive item. It also meant that when Timothy McVeigh bombed the Federal Building in Oklahoma City in 1993, district store manager Rich Lloyd could-- without hesitation--decide to overlook his stores’ profit margins for that quarter, and immediately round up over $70,000 worth of garbage cans, garbage bags, shovels and masks, and then truck it all to the bomb site just 45 minutes after the explosion. Only after he donated the merchandise did Lloyd call the corporate office in Atlanta to tell them about the choice he already made.

The Home Depot’s whatever-it-takes Decision Pulse is not just some fluffy customer service platitude. It was a very calculated strategic maneuver. To get their low-margin big box hardware concept off of the ground, co-founders Bernie Marcus and Arthur Blank knew they couldn’t just be a player in their markets. Instead, they had to achieve “market dominance.” Marcus once explained to a friendly competitor in Florida that if each geographic region in which they operated was like a backyard swimming pool, then The Home Depot intended to be Jaws.

How to Find Your Pulse
You could argue that the every essence of leadership is ensuring that your people make great judgments even when you aren’t there to tell them what to do. Whether you’re leading a small team, a large department, or an entire organization, by identifying and communicating your Decision Pulse will dramatically improve the choices your people make. Here’s how to do it:

1. List all of the reasons why a customer would choose you over a competitor.
What is it that your team does exceptionally well that your target market truly cares about? For example, Southwest Airlines defines their Pulse by price. According to a story told by James Carville and Paul Begalla, company co-founder Herb Kelleher says that above all else, Southwest is “The low fare airline.” That drives every decision they make from which airports to use down to what kind of food to serve passengers (Spoiler Alert: it’s a small bag of peanuts). Of course they also do many other things extremely well. They routinely outperform the competition on timeliness of arrivals and departures. Their flight attendants and gate agents are some of the funniest in the industry. But you won’t catch Southwest blowing cash on frivolous luxuries…like food. They know that low fares are what their customers value most. Everything else is just icing on the peanuts.

The Home Depot stands out through quality of service. Domino’s Pizza was built on speed of service. Southwest Airlines differentiates on price. What about you? Are you affordable; convenient; reliable; reputable? List all of the ways in which you might be special.

2. Put a “B” for “Best” next to each area in which you can truly excel.
You don’t have to currently be the best in those areas, but you should already have many of the pieces you need in order to eventually become the best. If you have to completely overhaul your team or start a bunch of brand new divisions or factories, then this probably isn’t the place for you. The point is to identify in which areas you already possess the raw materials to be #1. (HINT: Be sure to consider not only your strengths, but also competitors’ weaknesses.)

3. Rank your B's.
Rank each of the “B” items based on how effectively each area can differentiate your team. Whichever principle you rank first is your Decision Pulse.

4. Get everyone’s finger on the pulse.
The last step is about getting your people to clearly understand how this Pulse guides their daily decisions. One of the most proven methods for doing this is by employing a process called “diverse analogical training.” This ugly academic phrase consists simply of telling two or three different stories that illustrate one general principle. One of my clients accidentally came up with the perfect training stories for his team by trying to explain to me specifically what his team did that was different than the competition. Thanks to those accidental case studies, his team can now quickly and easily apply the Decision Pulse to completely novel decisions.

I won’t promise that finding your Decision Pulse will take you and your people to some Hooverian Heaven. Indeed you will still be required to make decisions each day. But if you find your Pulse, and check it regularly, you will be a lot further from Hoover’s Hell.

WHAT IS YOUR DECISION-MAKING STYLE?

By: Nick Tasler

Best-selling author, Nick Tasler, reveals how to start making winning decisions about your career, your people and your strategy.

Great decisions require two things: a map and a G.P.S. Most organizations understand the power of good decisions so they train their people to use a standard decision-making process, problem-solving or critical thinking model. That model is your map.

But have you ever identified from which direction you’re coming from? If I were leaving from Minneapolis and you were leaving from Atlanta we’d both need to take two very different paths to get to Chicago, wouldn’t we? That’s true even if we were using identical, company-issued maps. That’s why shopping mall directories always tell us “You are here.” That’s also why a Global Positioning System is quickly replacing the road atlas as the must-have navigation tool.

So does your organization’s problem-solving model come equipped with G.P.S.? If not, many of your people might be getting lost, even if you’ve taught them how to use a perfectly good map.

Factoring You into Your Decisions
Everyone comes from one of two basic directions when approaching a decision. In other words some of us come from the east and others of us come from the west. That direction depends on your innate decision-making style. Take the brief quiz below to give you a ballpark estimate of your style.

1. a) I do my best work when I have to make quick decisions
b) I do my best work when I have plenty of time to think through my options

2. a) I would choose a 100% chance of winning $1,000
b) I would choose a 50% chance of winning $2,000

3. a) I thoroughly analyze before making a decision
b) I make quick decisions even if I don’t have all the facts

4. a) I thoroughly examine the consequences before trying something new
b) I’m usually one of the first people to try something new

5. a) I choose my words carefully
b) I say what’s on my mind without much thought

6. a) I usually go for it when I see something I want
b) I closely examine the risks before making a choice

7. a) I am quicker to jump on new opportunities than most people
b) I prefer to think things through before pursuing new opportunities

8. a) I rely more on gut instinct
b) I rely more on research and evidence

If you answered mostly “a” then you probably have a Risk Managing style of decision making. Three out of four people like to consider every option closely and will almost always choose the safer bird-in-the-hand option.

On the other hand, if you answered mostly “b” then you might be the one out of four people who are Potential Seekers. You pay attention to risk, but it’s not nearly as important to you as the potential for reward.

You can be a great decision maker with either style. The first step is understanding from which direction you’re coming from, and whether you naturally pay more attention to risk or to reward. Because that style is literally shaping the decisions that shape your future.

Find Nick's book "The Impulse Factor" @:
http://www.amazon.com/Impulse-Factor-Innovative-Approach-Decision/dp/1439157278