New Technology Demos in Retail

Some interesting Technology Developments that I have come across in the recent days and which is likely to boost Customer Services like wow, if successfully deployed & implemented:

• Check this video out on "Unveiling the Sixth Sense - a Game-Changing Wearable Technology": http://www.youtube.com/watch?v=421jDx4ROZg
• Metro"Future Retail Store": http://www.youtube.com/watch?v=gUcuqhduWao
• Metro "Smart Dressing Room": http://www.youtube.com/watch?v=0VII-xdg5Ak&NR=1

Very impressive developments these.

Organizational Best Practices

I am just penning down some "Organizational Best Pratices" that I would love to implement in any Organization I am involved with - someday - when I do have the Power to do so:

• Work from Home – based on Role, Feasibility, Convenience etc. - This is such a time, energy & motivation-saver that I am really amused that this trend has not caught on like bushfire, across the corporate world. In an increasingly Internet, Mobile & Videoconferenced world, it is really easy to replicate the physical workplace and have Quality output - even when working from home. (In fact, I think the Quality would be higher because one is so much more relaxed.) And the likes of IBM have already proved this time & again. I don't why others haven't caught onto this.
• 5-day Week - I would give Saturdays off, even if I may extend working hours between Monday-Friday. Everybody I know agrees to this concept, yet some organizations simply won't change their Saturday-working routine - even when they know that employees don't do much on Saturdays except waste their resources.
• Flexi Hours - With traffic & travel becoming increasingly cumbersome, I cannot imagine why companies won't extend the "Flexi Hours" concept to their employees. Set a simple mandate of, say, working 8 hours a day irrespective of the time you clock-in and clock-out. This not only relieves the pressure of late arrivals & absenteeism, it also gives the employee the time to make the most of his day.

While I have experienced all the 3 Options I have noted above during my Work Experience so far, I am even really impressed and inspired from Best Buy's ROWE (Results Only Work Environment) Practice: http://www.businessweek.com/magazine/content/06_50/b4013001.htm

Wow, if a $40-Billion Retail Company like Best Buy can make it work, why can't others?

• Ask New Joinees What They Think is Wrong with the Company - within a Month - I can't help noting that it is Human Nature to gauge quickly (and probably instinctively) what is wrong in some place (or in some body). This trait must be captured for an Organization's benefit, as New Joinees are likely to come up with insightful observations on improvements which the Old-timers probably miss on a daily basis.
• Track Work - Daily, Weekly, Monthly, Macro - "To Do" Lists, Status Reports, Notes, etc. must be shared within a Team on a regular basis - to gauge the efficacy of the work that is being done and develop new perspectives. Wasn't it said by someday - what gets measured, is what gets done.
• Clear Job Descriptions, KRAs - Nothing is more irritating to an employee than to not know his Job Deliverables & KRAs. Organizations often do not outline and communicate these items to their employees - with the idea that they can then dump any work on the said employee, at different points in time. However, I have noted that this actually is counter-productive because the employees then begin to set boundaries on their own and wash their hands off on tricky assignments, playing on the role ambiguity. Not only does the organization suffer, but it gives the employee also a chance to get away with rewards (and without punishment) for a performance that wasn't measured.
• Empower, Treat as Equals - I would assume and trust that every employee in an Organization works for its betterment, because it eventually helps his cause in the long run. Hence, I would empower every one of them "to do the right thing" all the time.
• Share General Information Regularly - They say Knowledge is Power. So, exploit it. I don't see any point in one employee not sharing data with other employees. In fact, in the highly dynamic business environment today, it is imperative to let everybody know what's working or not working for the Organization. The quicker people adapt to the new information, the better it is for the Organization.
• Lunch Together, Once in a While (Say, Friday) - It really helps build a Team Spirit, like no other. In fact, some of the best conversations and learnings in my corporate life have come through such Informal sessions at Pizza Huts. I guess, everybody will agree that there is more to be learnt in a group of people hanging out together, than from the confines of a cubicle.
• Visit Individual Seats and Chat Up - A variation of the above point, I think there is much to be learnt about business & life (in general) through a 1-1 dialogue over coffee, at somebody's cubicle.
• Variable Pay Disbursements > Quarterly - There are companies who give out the Variable Pay Component (based on Performance) on a Yearly basis! When your business results are being tracked and reported to the world on a Quarterly basis, why should the Variable Pay be made at the end of the year? Quarterly payments are not only a morale-booster for the employees, but it also relieves the company of a huge payout at the end of the year by breaking these down in 4 sets. Also, it is easy to track and comment on Quarterly basis, than it is to summarize performance for the entire year.
• Give Free Time - Google pioneered this concept, by allowing its employees 20% of their corporate time to pursue their individual experiments - which could aid the company in the long run when they institutionalize any particular successful concepts, under the Google umbrella. Variations of this practice, can be extended in every company. For example, a Retail Company can probably ask its employees to go Mall-Hopping once a week and check out what other retailers are doing. A Financial Services firm can sponsor refresher courses for its staff. And so on.
• Track ‘Best Companies’ Annual Reports - Annual Reports of companies provide with fantastic insights on Growth Strategies, Business Environment, Risk Management, Philosophy & Objectives, etc. So, these reports should be actively read and takeaways be summarized for your own business.
• Benchmark Key Operational and Financial Ratios Openly - These should not only help you keep a watch on the Market and Best Practices of other companies, but also act as an inspiration for improving performance at one's own company. For Retail, these could include Footfalls, Revenue/Sq.Ft., Inventory Turnover, GMROI, Average Ticket Value, etc. and these ought to be benchmarked against figures from the likes of Walmart & Tesco or Pantaloon (in India). Communicate the 'Target' figures to every employee and highlight them on a periodic basis, to enable a Organization-wide focus on a goal.

Indian Retail Naysayers & Specialty Retail

I am really tired of Indian Retail Naysayers, these days.
Their typical 2 comments are on these lines below:

1. X, Y & Z companies had announced that they will open 500 stores each. Ha! They've opened just 50 each. And, they're shutting down 5 of them. (What Losers!)
2. Food & Grocery Retailers are struggling - Despite all their investments, Ha! They are not able to offer the same or superior proposition (Fresh Food, Credit, Home Delivery) as compared to the Vegetable Hawkers & Kirana Shops littering the streets of India. And this is true for all types of Retailers.

I have these thoughts to convey:

1. Yes - X, Y & Z companies majorly erred in projecting their business plans. When the likes of Walmart & Tesco, with all their retail experience & resources, speak about opening only tens of stores a year, it was really silly for Indian Retailers to talk about 100s of stores every year. But, as I have noted and quite a few peers & seniors of mine have confirmed - these figures were always supported by the Top Management & Consultants across the Retail industry. It was almost a case of "Emperor's New Clothes" - where everybody was afraid to call the Emperor's Bluff. These people were recruited to guide and execute the business plan, but they did not deliver. Everybody just played along with fantastic numbers and experimented expensively, as long as the Promoters pumped in money like there is no tomorrow. It was only when the Promoters started looking at Returns and efficiency of their Operations, did everybody start screaming that this current business model is unsustainable. And now, everybody's applying full brakes, because they do not have an estimate on "real" demand. I have this to say - forget comparing the retailer's achievements with respect to their business plans, but look instead at their achievements from Zero. One might have achieved only 10% of the grandiose business plan of 500 stores, but 10% still means 50 stores out of nowhere in 2 years. And they are generating revenue, if not the bottomline just yet. So, big deal. It only means that the plan is delayed and the proposition flawed. Reworking it should help stabilize and grown the industry again.
2. Because Food & Grocery Retail constitutes the majority chunk of the Indian Retail scenario today and was the focus of most Indian Retailers who wanted an easy win (and probably even wanted to make a difference) - notable failures in this section are used to paint brush the entire Retail industry as a failure. However, note that there is something called as "Specialty Retail". I think specialty retailers (Electronics, Apparel, Books & Music, Footwear and so on) are doing pretty well and the growth of "organized specialty retail" figures (extracted from IRF 2009 Report) below highlight my reading:

• Apparel Retail - 13.6% (2004) to 22.7% (2007)
• Footwear - 25% (2004) to 48.4% (2007)
• Health & Beauty - 6% (2004) to 14.3% (2007)
• Consumer Durables - 7.8% (2004) to 12.3% (2007)
• And so on.
• (Food & Grocery Retail is the smallest lot with only 1.1% as Organized).

So, while Food & Grocery Retailers may be struggling, I see a silent & steady move by customers towards Organized Specialty Retail Players.

The neighbourhood J.K.Textiles & Gohil Tailors are being steadily run out of business by the likes of Shoppers Stop & Pantaloons. The neighbourhood Adarsh Chappals is being steadily run out of business by the likes of Bata & Metro. The neighbourhood J.K.Electronics is steadily run out of business by the likes of Croma & Vijay Sales. And you are telling me that organized retail is failing in India. I don't think so.

In fact, going by the above reading, I actually think all the Indian Promoters should really look to spruce up their presence in Specialty Retail rather than chase volumes in the Food & Grocery (and where anyways the requirements of people change every 1 km). Specialty Retail not only gives better numbers, but growth trends above also show that it is the place to be in.

Pace of An Organization

"I am fast, but my car isn't" - Narain Karthikeyan, Formula 1 Driver. Most of us F1 aficionados had laughed dis-believingly when we had heard this statement sometime in 2006 when Narain raced for Jordan. We laughed at the inherent conflict that existed within the same statement. Our common sense logic retorted that: If you are not fast, your car won't be fast. Or, if your car is fast, you would be fast. So, you cannot really have a mis-match situation like the one above. At least in F1. And we all knew how Michael Schumacher could take out at least 2 seconds out from the same car.

But yes, I think that scenario does exist in the Corporate World today. Everybody I know seems to think that "my Company moves too slow for its own good and for my own liking". Yes, it is a phenomenon of my generation (yes, I am party to these sentiments myself - at sporadic intervals) to get frustrated at work within a year - thinking not much is happening ever since I've joined in - and we laugh coyly about how our parents spent decades with the same organization without much of a fuss. We tend to jump jobs, thinking the next company is likely to be 'more' fast-paced than this one - only to find out that it's the same 'slow & steady' everywhere.

Curiously, no matter how slow we think our organization is, it has been around for a while and seems to be making good money and making a difference somewhere. And it didn't matter much to the previous organizations when we quit in despair, as it lived to see another beautiful day. Where then are we missing the point? I am making an attempt to figure out this dilemma of our lives with this note.

First up, the likely causes of our disillusionment:
1) Great Expectations: Anybody who joins an organization after multiple rounds of interviews - where a lot of his ideas impressed the panelists - and with a significant pay package - is bound to feel important. He comes to the organization almost thinking they've recruited him to 'save the organization from doom' and that great initiatives are expected of him. Only to find out that the seniors have their plans (and resources) in place alright and you are expected to only aid the execution exercise. It doesn't matter what you think and there are no KRAs for your "strategic inputs". Your KRAs only evaluate your execution skills. Whoa! I was supposed to be a "Thinker" and not a "Labourer". Depressing.

2) The Need for Speed: "I feel the need... the need for speed (movie quote from Topgun)" could very well summarize our state of mind, as soon as we join an organization. We want to do a Marketing Assignment in Month 1, Sales & Distribution in Month 2, Finance Assignment in Month 3 (probably a M&A), Strategy & Planning in Month 4, Earn a Bonus in Month 5 and Play Golf by Month 6. Armed with an MBA, we know it all (don't we?) and are really surprised when organizations don't seem keen to tap into our Multiple Skillsets. What we don't realize is that real life business execution doesn't get over in a 1-hour presentation that we typically made in B-schools. I remember how in most of our Marketing Case Studies & Projects, we made the same lame recommendations again and again: increase distribution, advertise, brand, reduce costs, introduce new products & services, beat competition, and so on. All these recommendations took just an hour to present and earn an easy A+. In real life however, each of those single initiatives takes a 6-month effort. So, the 6-7 items which I took an hour to execute earlier in B-school, now takes me 3 years to execute. So, much for speed.

3) Media: With tens of Business Channels on TV, tens of Business Newspapers and tens of Business Magazines and of course the Internet - reporting business developments all around the world - mostly in real-time - we tend to believe that the entire world is indeed moving really quickly and we are missing out. The point that we miss is - these are developments of Scale. There are thousands of 'big' businesses (not even counting the smallers ones) out there in the world and with millions of people employed by these companies, there are likely to be 100 significant business moves on a daily basis. We tend to forget that these 100 moves are not a result of speed, but rather a natural outcome of business Scale. If we really looked at an individual's role of a 'moving organization above' under a microscope, he is also probably working on things just as slowly as we are. But, we tend to worry about our Lack of Speed, as if were really missing out something in our lives.

4) Lack of a Noble Mission: This is easy. I don't think any of us who joins any organization today really does it with a "Noble Mission" in mind. We don't really want to change anybody's lives - except our own. Ratan Tata launched the Tata Nano, out of sheer nobility of upgrading the 2-wheeler family to a 4-wheeler family. Of course, he does this keeping business metrics under control, but there was a mission alright. I don't think any of us today really has a mission when we join an organization today.

5) Work Defines Me: For so many people of our generation, "Work is what defines them". I am an I-banker, I am a Manager, I am a Analyst... somehow there are no other dimensions to one's self outside of the Work Place. And, when the work place is not 'satisfying' enough, it almost makes you lose your definition of self. Life loses its meaning...? One is miserable...

Pursuit of Happiness
In such a scenario, it is therefore imperative to gauge and adapt the "Pace of An Organization". Unless, it is really not a workable environment in tune with your speed, the following pointers might help in adjusting to the Pace of An Organization and make the current Work Place itself - a more Satisfying Experience:
1) Flexible Great Expectations: Whenever we join an Organization, we tend to have a list of 5-10 things that we would like to contribute and achieve. Here, we tend to pursue them in a strict sequence: 1, 2, 3, 4 and 5 - my Professional Objectives must be fulfilled in this sequence. First, I must do Marketing, then Operations, then M&A and so on. I say - Forget Sequencing, Just Achieve. How does it matter if you fulfilled your objectives in this sequence (as dictated by Organizational Pace) - 3, 1, 5, 2, 4. First, Operations, then Business Analysis and then Marketing. At the end of 5 years, you will have managed to do them all anyways. We need to build this little Flexibility in our approach alright, rather than blame the Elephant that is the Organization. And let's not forget than an Elephant - with all it's might and slowness - is still a symbol of longevity and prosperity.

2) Enjoy the Roses: Most of the people of our generation want to complete their corporate careers by the time they are 35-40. My question is: what are you going to do between Ages 40-70? And how can we forget the old maxim - life is a journey, not a destination. Within an organization - instead of achieving 10 things at Quality Level 5, I would rather achieve 5 things at Quality Level 10. It is about enjoying the Roses (figuratively speaking)...as you ride along. Cherish & celebrate little successes and gain pride in the fact that you probably helped strengthen the foundation of your organization even if you could not help it run quicker.

3) Rationalize Media Information: I have an observation - So many "big-bang" announcements about a new project or a new initiative by some company or the other usually fizzles out into a non-activity some months down the line. I'd like to quote the example of a very glamourous corporate activity that must of us MBAs dream of doing one day - M&A. M&A's always look so good in the media - it feels like Alexander conquering the world - big numbers, big talk, high-end hotels, strategy talk, synergy, golf-course decisions, public high-fives...Wow. All of us want to do this once in our lives. However, most of these initiatives have failed miserably. Check out:

• http://www.management-issues.com/2007/3/26/research/nine-out-of-10-mas-fail-to-deliver.asp
• http://jurisonline.in/2008/11/failure-mergers/

So, the point here is to "rationalize media information" and remember "all that glitters is not gold". The grass may seem greener on the other side, but it is not always so. Focus instead on the good that your organization is.

4) Making a Difference - One of Ratan Tata's quotes that has been etched in my memory goes something like this - "You could play the game that others play, and you would probably grow faster and you would probably be more profitable. But, you would be just like everyone else." It isn't really about achieving corporate goals quickly enough, but it really is about "Making a Difference" - to one's own self and to the society, if you can.

5) Fulfillment outside Work - I know, I would want to be known as a Pianist, Quotes Collector, Badminton & Table Tennis Champ, Pilot, Skier, Teacher, Husband & Lover, Good Son, Traveller, Philosopher, Astronomer, Salsa Dancer, Painter and so on. You get the idea. Rather than worry only about the likelihood that you are not doing enough in your corporate life (and that life is slow), I think we even ought to worry more about us doing enough outside our corporate life. And, I am sure we are not. In fact, I have had this conversation with my friends often that how come we are never perturbed when we procrastinate working on our interests month after month, but we are intolerant about achieving corporate objectives by the day. This has to change, I guess.

There's a quote, you know, saying that - no man on his deathbed ever wished that he'd spent more time in office. Why are we then so disturbed about the Pace at which an Organization works? In fact, I can't help thinking that the slower it is, the better. Because, it then gives you the time to do so much more. Additionally, you can always aim to do a Michael Schumacher even - that is, get your extra 2 seconds juice out of the same car (read: organization) rather than yearning for a new car... Hmmm...

Electronics Retail Characteristics - 2

This is the 2nd part of the same Assignment earlier.

A) Typical System Challenges Are:
I. Master Data Management (MDM)
§ Article Maintenance
§ Price Maintenance
§ Classification and Article Linkages
II. Promotion Configuration, Testing and Deployment
III. Managing Returns in the System
§ From Customer to Store to DC
§ From DC to Vendor
IV. Inventory Handling, for Replacements/Returns/Exchanges
V. New Store Configuration
VI. SAP/Retalix (POS) – Synchronization
VII. SAP/DSS (Analytics Tools) – Synchronization
VIII. Discount Management – in sync with Accounting

B) Key Business Processes:
I. Sales/Store Operations
§ Sales Order Creation – Store Delivery and Home Delivery Items
§ Billing – Store Delivery and Home Delivery Items
§ Physical Inventory Checking and Reconciliation with System Stock
§ End-of-Line Product Sales
§ Handling of Cheque Payments
§ Handling of Manual Invoices
§ Handling Customer Returns/Exchanges
§ Training
§ Promotions Management
II. Services
§ Managing Service Plans, for Different Products
§ Warranty Replacements
§ Managing Customer Repairs
§ Vendor Claims Management
§ Spare Parts Management
§ (Customer) Call Management
§ Sale of “More Sell” Items
III. DC Operations
§ Goods Receipt and Goods Issue
§ Home Delivery Process
§ Returns from Store
§ Return to Vendor
§ Damaged/Return Products Clearance/Sale
§ Transportation
§ Replenishment

Electronics Retail Characteristics - 1

In this post I am outlining a few observations that I had made on ELECTRONICS Retail Characteristics, as part of a Client Consulting Project about 2 years back. As ELECTRONICS Retail gathers steam in India and is expected to be one of the Leading 'Organized' Specialty formats, it think this little summary is relevant. I have updated the items a bit as well.

Here goes:
The concept of “Retailing 9P’s” has been used to compile these Pointers unique to the Electronics format. (As expected of any exploratory exercise, the list would only be “indicative” and not completely exhaustive). The 9P’s of Retail are: Product, Place, Price, Promotion, People, Process, Positioning, Pulse and Parking.

The ELECTRONICS retail characteristics are:
1) Product:
> Products are usually technical and moderately complex to use and an average customer needs to be educated, enlightened and trained about what it can do and how to use it.
> Regular “feature” upgrades and price changes, through technology breakthroughs and innovation, are the norm of the day – requiring a regular re-visit of the Sales Process and Product Learning.
> Vendor “Brand” Matters, so it is difficult to create Private Labels in this space. Vendor “Brand Proposition” needs to be consistent with the ELECTRONICS Store proposition.
> “Brand” Loyalty is very High.
> After-Sales Service/Guidance/Information/Training is necessary on Most products.
> Mix of Long and Short PLC Products.
> Products usually tend to be “High Involvement” items.

2) Place:
> Needs 5000+ sq.feet of retail space, varying from small to large formats – because display SKUs tend to be large in size.
> Also, store layout needs to be spacious since customers would spend a “considerable” time on a certain item – learning about and checking out the product features.
> “Destination” store rather than “Neighborhood” store, considering its Specialty retail.
> Multi-channel presence is being pursued by leading players: Catalog and E-Business – and it works well because the products are essentially – “What you see is what you get” Packages. ELECTRONICS is one of the leading categories in the E-Commerce and Catalog space.

3) Price:
> Average Sales Ticket Prices are High.
> Personal Finance options are the norm these days and quite popular among customers.
> Generally speaking, product prices in this format keep declining over time as compared to the prices they were first launched at. But new products keep coming in at the same price points. So, while individual SKU prices may fall, the Average Selling Price (ASP) of the said category remains more or less the same.

4) Promotion:
> Promotion plays a very important differentiator vis-à-vis competition – as ELECTRONICS sales tend to be “Push” rather than “Pull”.
> Vendor “Brand” Products/Ranges are more or less the same across all retailers, so Promotion has to act as a driver to Push sales – usually through bundling of Freebies/Accessories/Complementary Products along with the Main items.
> Heavy “vendor advertising” means the retailer must ensure the availability of any new products and/or pricing schemes – just to maintain a status quo.
> The Trade-in Offer – exchange your old item for a new discounted one – is one of the unique schemes typical to this format.

5) People:
> Personal skills and Tech-savvy are much needed requirements.
> Continuous Training and Learning/Information on New Products is needed, so retailers usually have a well-structured and well-organized Training Program in place.

6) Process:
> “Home Delivery” (and Returns) Process is key to the success of this format.
> This format needs an Efficient “Cheque” Payment Process in place.
> Capturing complete customer requirements for “Home Delivery” items and “After-Sales Service” is essential to the business and this data can be then be mined for Analytics’ purposes (not yet begun in India though). Best Buy, however, uses this very data to customize every store based on 7 demographic types they have identified in customers.

7) Positioning:
> Retail positioning tends to be on any of these 4 variables – alone or in combination: Price, Range, Service and Experience.
> This sector is quite “organized” already with a host of small-time players having a “decent-shop” existence. A pan-country player has not yet emerged, though there are quite a few regional biggies.

8) Pulse (of Customer & Employees):
> ELECTRONICS stores must be at least on par, if not ahead, in gauging the aspirations of customers and product trends – since ELECTRONICS is an area where they tend to spend their disposable income first (after Food) and they would want the latest “version” of an item they are planning to purchase.
> Often, ELECTRONICS must be a driver of customer tastes and product trends rather than the other way around. Like Akio Morita had said about the Walkman – no amount of customer research would have told me that a Walkman is needed by customers and that its demand will explode like the way it has.
> It is moderately difficult to replace “tech-savvy” store personnel. Also, considering that the format tends to operate on “push” sales, the store staff is usually incentivized for sales performance.

9) Parking:
> Suitable to the store traffic requirements, while knowing that store is a “destination” store where people would not just walk-in and rush out.

Cheers.

Retail Wisdom from Sam Walton - 2

Some more interesting ideas, summarized from the same book, and some of my comments about what I have seen in Indian Retail in general, today:

6-Ways at Wal-Mart:
1. Think One Store at a Time. Nah, we will talk about 500 Stores, 10000 Crores Revenues, 100000 People Employment - in 3 Years, all the time.
2. Communicate, Communicate, Communicate. Zero Communication either ways, even when we've begun to carry out as serious an Activity as 'Layoffs'. I've already written about "Lack of Information Sharing even on Retail Operations" in my previous post.
3. Keep your Ear to the Ground. I don't see Head Office people moving around in the Market on a regular basis and forget keeping a Tab on Best Practices by other retailers.
4. Push Responsibility and Authority Down. Ha! Then what will I do at Head Office!
5. Stay Lean, Fight Bureaucracy. Nah, we have already set up an organization to take care of 500 Stores. So, work is well divided already and No single person can take Responsibility.
6. Force Ideas to Bubble Up. If there is no Communication either ways - as noted in point 2 - how are ideas to bubble up? Ideas don't even bubble down - for that matter.

10 Rules at Wal-Mart:
1. Commit to your Business.
2. Share your Profits.
3. Motivate your Partners.
4. Communicate.
5. Appreciate.
6. Celebrate your Successes.
7. Listen to Everyone in your Company.
8. Exceed your Customer’s Expectations.
9. Control your Expenses.
10. Swim Upstream.

Rules by Indian Retailers? There is only 1 Rule - There are No Rules!

Retail Wisdom from Sam Walton - 1

I recently finished re-reading Sam Walton's "Made in America" - capturing the classic story of Walmart seen through the founder's eyes. I'd read it earlier when I was in B-school and was impressed. I read it now as a Retailer and I am 'really' impressed. Impressed - with the way they have kept things simple and efficient.

While I do not agree with all their moves and ideas, I am noting down here some pearls of Retail wisdom, that we probably might miss on a regular day:

• On Advantages of Partnership: The best way to reduce paying estate taxes is to give your assets away before they appreciate.
• This is really the essence of Discounting: by cutting your price, you can boost your sales to a point where you earn far more at the cheaper retail price than you would have by selling the item at the higher price. In retailer language, you can lower your markup but earn more because of the increased volume.
• In retail, you are either operations driven – where your main thrust is toward reducing expenses and improving efficiency – or you are merchandise driven. The ones that are truly merchandise driven can always work on improving operations. But the ones that are operations driven tend to level off and begin to deteriorate.
• You see, no matter how you slice it in the retail business, payroll is one of the most important parts of the overhead, and overhead is one of the most crucial things you have to fight to maintain your profit margins.
• You’ve got to give folks responsibility, you’ve got to trust them, and then you’ve got to check on them.
• Sharing information and responsibility is a key to any partnership. It makes people feel responsible and involved, and as we’ve gotten bigger we’ve really had to accept sharing a lot of our numbers with the rest of the world as a consequence of sticking by our philosophy. Everything about us gets to the outside. In our individual stores, we show them their store’s profits, their store’s purchases, their store’s sales, and their store’s markdowns. We show them all that on a regular basis and I’m not talking about just the managers and the assistant managers. We share that information with every associate, every hourly, every part-time employee in the stores. Obviously, some of that information flows to the street. But I just believe the value of sharing it with our associates is much greater than any downside there may be to sharing it with folks on the outside.

I really like this one pearl. From what I have seen on Retailers today in India, I think the scenario is totally opposite - where companies Do Not share this data even among their own people at Head Office. Like he mentioned - there is an overwhelming scare that competitors would learn about our business. I share the sentiment that they would get to know anyways - directly or indirectly - sooner or later (Why, we ourselves do Competitor Store visits, Ask Suppliers about their Purchases & Sales, and so on). Also, estimate that they learn about your data after 5-7 days, if you are sharing everything with your Employees. This still gives you 5-7 days to execute something brilliant - if everybody knew what the Data was and what the Tactical objective was. It would nullify the usefulness of the Data that the market probably now has about your Operations. But, by not sharing data with your own Employees, the organization is effectively hampering its own Mobility and Execution.

• Here’s the point: the bigger Wal-Mart gets, the more essential it is that we think small. Because that’s exactly how we have become a huge corporation: by not acting like one.