Archive for November, 2009

The Men’s Wearhouse: Success in a Declining Industry

They have what it takes to be a great customer service industry.  They start by treating their employees how they want their employees to treat their customers.  This kind of philosophy will go a long way in not only the business world but with basically everything in this world.  I mean if you want to get down to history, one can quote the bible where it says treat your neighbor as you would want to be treated.  Among all this there is still a high decline in demand for tailored clothes.  Let’s face it, in the olden days it was the norm for every man to own a suit.  Now if you ask a younger man if he owns a suit he will laugh he might even tell you he has never worn one in his life.

 

The men’s wearhouse has taken this to the next level.  George Zimmer believes in his employees.  He believes that they all have this “untapped” potential in themselves.  This is one of his strongest points is that he believes in his employee’s and his employees can see this and work harder and are happier as a result.  He instills the idea in his employees that the customers that they are serving are their specific customers and not the Wearhouse customers.  Zimmer claims that he is one of the first companies to start a program where the employees own stock in the company.  Instead of the word training he uses the word mentoring when talking about how he teaches his new employees.  This idea shows that the company has interest in the employee and that the employee has some sort of stake in the company as opposed to just being a normal employee that is expendable.

 

The pay system drove the behavior of the employees.  They were paid on a bas hourly and commission basis.  This creates a drive in the employees to sale.  Interesting to note, unlike Nordstrom’s, they paid the managers a bonus for not allowing the non-sell items such as stocking and the stores shrink to decline and they set it up to keep things tidy and up to date.  Overall they paid a little higher than the industry average and employed slightly more people than the average.  This creates a happy employee and drives other people in the business to want to work for men’s wearhouse.  They also do not overpay the chief executive officers when compared to like industries.  They pretty much, with the exception of a few, promote from within the company.  This also creates a high drive for the employees to perform well in light that they might be promoted to a better position.

 

When hiring and firing they train the people doing it how to do it properly.  They teach them what to look for and what to avoid in hiring.  They look for personality and skills rather than experience as being high priority.  This allows the company to hire people that can and are willing to do the job as opposed to people that think they “deserve” the job based only on experience.  It doesn’t say much about their performance reviews as to what they do with them except for that they do them.  After reviewing them they are basically no different than any other performance review.  They support and encourage the employees to socialize with the other employees.  They do this by supporting teams and by paying for all their social events held.  They spend a lot of time, money, and effort in training all the way down through the ranks.  This allows for constant improvement of the employees and will help the company keep up with rising trends.  The company is receiving a high rate of success and to keep this success they need to keep monitoring what is going on in the industry and around their industry.  The main idea is to keep up what the company is doing but to be aware and ready to change everything

The Treadway Tire Company

They clearly have a high turnover problem.  And they also have a problem staring them right in the face with skyrocketing costs.  The question is what to do with all these problems.  Another problem that I see is that Wall is trying to solve all of these problems on her own.  It is never healthy to try to take all this on by herself especially when she has staff under her to help her make decisions.  She has great ideas of cutting employee costs by her hourly scheduling that does help improve the cost issue, but does it actually help her high turnover rate?  She does try to address this problem though.  She believes that by hiring more college graduates this will produce a better quality employee and the turnover will decrease.  She still has created a problem with her high hours in that the moral of the employees wasn’t too high.  They call in sick more and request more time off.  There is a clear tension between the foremen and the workers.  The foremen don’t think the work they are doing is helping.  Maybe all they need is some sort of compensation plan to help motivate them more.  If the foremen are happy it will trickle all the way down to all the employees and this in turn will help the company in all aspects.    It seems to me that they have a solid hiring process.  They are definitely lacking in the training area.  They do not take the proper amount of time in training their employees which is directly affecting the plant.  The new employees are put into it without the proper knowledge of what they are supposed to be doing.  There needs to definitely be a way better training session.  All in all Wall needs to take some of this data a put some new ideas into action and the company has the potential, like she says, to be the best plant.

How a Marine Lost His Command in Race to Baghdad

So if I am understanding this article right, Col. Joe D. Dowdy basically got fired from his position in the military for choosing his men’s welfare over the mission.  This is a very debated argument when it comes to how the military personnel are suppose to handle themselves in battle.  In my opinion I see no shame in how he handled himself.  On the other hand in the military you are supposed to keep your emotions out of the battle and just follow orders.  This is a very idea way of how things are suppose to go.  I mean if I had a bullet flying by my head I cannot say how I would react or whose rules I would follow.  The article talks about different war strategies and whether it was the right one or not.  This is another one of those things where heinseight is always 20/20.  It is my opinion that no matter what action is taken there is always a better one that could have been taken.  This is called human nature.  We make decisions based on how we have been trained and based on how we feel towards that situation.  All we, as humans, can try to do is base our decisions on what makes the most logical since in our own head.  This is what Dowdy did and it just so happens that he lost his command over it.  All said and done, I’m sure, in his head he made the proper decisions and he can live with what he did.  This is how people should handle situations, make a decision and live with it and don’t regret anything.

To view article visit:

http://www.business.unr.edu/faculty/simmonsb/badm720/notes720.html and click on Wall Street Journal Article: Col. Dowdy

For Lt. Withers, Act of Mercy Has Unexpected Sequel

John Withers was no doubt a great man and commander.  He took and changed the lives of two young men during World War II.  He didn’t have to and further more taking them in was a major risk on his part.  It most definitely paid off in the end because he changed Peewee and Salomon’s lives forever.  If companies took this approach to business who knows where we would be.  Lt. Withers is a great example of unselfishness.  He took them under his wing knowing that the consequences of his actions could have been fatal.  Leaders in organizations need to take risks that could inevitable result in their own fall.  This kind of risk will most likely turn to be a risk that will result in returns; these returns will happen because the executive will be interested in not hurting themselves.  Who knows what Lt. Withers was thinking in allowing them to stay with him, but in the end it was all worth it to him and them.

To view article visit:

http://www.business.unr.edu/faculty/simmonsb/badm720/notes720.html and click on Wall Street Journal Article – Lt. Withers

New Wine, Old Bottles

This concept, of putting new wine in old bottles, applies directly to senior management in companies.  The new ideas of leadership and style cannot be forced on the old executives.  If it is all the executives do is pretend to be doing the new system and it actually disguises their old ways.  There is better ways to transform these executives.  They are, as the article shows:
•    First build a new relationship
•    Setting up win-win performance agreements
•    Being a source of help
The new relationship that needs to be formed needs to be formed on the grounds of equality.  This means that just because one person is the boss doesn’t mean that they should overrule the people under them.  They should put themselves on the same level as the employee and listen to them and work with them.

The next step is setting up an agreement between the parties.  They need to agree on the purpose and make specifics about what they want accomplished.  They need to set guidelines and what resources they can and will use.  And finally there needs to be consequences for both parties if they don’t do their part of the bargain.  Along with all this the managers need to be a source for their customers and actually make themselves available.  The main idea of all this is to get management and higher-ups to get this idea of “servant leadership.”  The idea that the leader of the organization is there for the company and to serve the company as oppose to himself.  In companies that run like this the results will speak for themselves.
To view article visit:

http://www.business.unr.edu/faculty/simmonsb/badm720/notes720.html and click on Steven Covey on Servant Leadership

Good Leadership Requires Executives To Put Themselves Last

Michael Leven is a leader that is willing to put the company and its shareholders before his own interests.  A great example is when he told his shareholders before it was too late that the company is not going to make its forecasts which have a direct affect on his company.  He did this knowing that he might not make it and could possible lose his job.  If more executives put the company before their own paycheck companies in today’s age might not go under so easily.  The problems that executives are constantly faced with are whether or not they are earning what they are paid.  They think that just because of their position that they deserve a high pay.  This is completely the wrong view and executives need to instead build the company up and earn their salary as oppose to just expect it.
To view article visit:

http://www.business.unr.edu/faculty/simmonsb/badm720/notes720.html
and click on Wall Street Journal Article: Good Leadership

The Layoff

This is always a very tough decision for a company.  When a company is thinking about laying off people, in my opinion, they should have exhausted all other options first.  In the case of Astrico Holdings, I do not think that they have considered and exhausted all of their options.  The statement that 10% of the workforce must go, Who goes, and who stays is a statement that was said without much thought.  It seems to me that it just makes since because it is an easy way to make the numbers work.  He jumped to the conclusion to fast that people need to be laid off.  After reading the article it sounds like the people surrounding him are all against a lay-off.  They all have ideas, other than lay-offs, that seem to be feasible; if anything they need to at least talk about it.