It’s easy to be a genius in a runaway economy. But when you have to break out those recession chops, superstar executives tend to fall with their sales numbers. That’s why you have to respect a CEO like Macy’s Terry Lundgren. He’s an executive that has talked straight, played some tough cards, and has kept his company true its customer-centric mission.
Lundgren was the focus of The Corner Office column in Sunday’s New York Times business section where his business approach was once again on display. He has always been a voice of calm stable strategy even in the thick of this current downturn. His most recent interview, combined with past actions at Macy’s shows four things that executives at any company can take and use today.
He seeks the customer point of view: Not enough executives get down and dirty with their front line sales people or with their customers. There are some notable exceptions. Jeff Bezos, according to a 2007 Harvard Business Review interview, still works an eight hour shift at the Amazon contact center once a quarter. But nearly half of consumers (47%) say they don't believe company executives understand their experiences, citing problems such as rude customer service staff or employees who provide the wrong information or never solve the customer's problem, according to a March 10 Convergys study. More than one-third (41%) of the customers who take the time to complain don't think companies listen to or act on their feedback. Enter Terry Lundgren. According to the Times interview his mobile phone has 95 percent of all Macy’s store managers on it. He calls them when he’s in town and visits the store. This way he is “seeing exactly what our customer is seeing.”
He avoids shock tactics: Lundgren calls ahead of time for his store visits, but doesn’t give enough time for managers to prep the store. He’s not a head hunter. He says he wants to make the store visit a good experience for his managers, his customers, and for his own learning. Before last year’s holiday season he sent the entire a company a memo urging employees to focus on the customer, not the economy. You have to believe that kind of support goes a long way for employees and it extends to the customer.
He involves employees. Retail is the most transient business in terms of employee retention. But Lundgren doesn’t treat it that way. Every month he does an internal strategy and Q&A webcast with 55,000 of the company’s 170,000 employees. “I think that just knowing how to manage people for the situation and individually, managing them differently — what I would call situational management — is really important. You really have to have some instincts there to adjust to get the most out of people and the most out of different situations,” he says.
He balances data and instinct: Just as he uses instinct in people management skills, he also espouses a balance between fact-based decision making and trusting the gut. “I don’t think you should actually have to have a calculator for every decision that you make that has numbers attached to it,” he told The Times. “Some of that should just come to you quickly, and you should be able to quickly move to your instincts about that being a good or not good decision.”