Why Is Retail So Bad At Picking Great Leaders?

Why Is Retail So Bad At Picking Great Leaders?

60 Chief Executives were surveyed and virtually all of them said that recruiting and promoting leadership with true long-term/high-level leadership potential was the key ingredient to their organization’s long-term success. However, the CEOs were then quick to admit that this task is much easier said than done.

Retail is great at hiring people who have experience inside similar organizations and finding those “bodies” through an ATS  that sifts through submitted resumes to weed out those that don’t have the desired retail brands in their work history. But what does past experience with a specific brand really tell us about how that person can drive results? What their value is to the business? Can THEY hire truly marvelous talent to deliver results? Can they inspire and motivate a team to deliver excellence, consistently, in every area of the business? If you ask them – I am sure they will all say “of course” but there is more to a great hire than that.

At best, a “track record of accomplishments” only tells part of the story. In a new position, the candidate will have to face new obstacles, quickly assess and get to know a new team, be able to quickly galvanize them into collective action, introduce new products, processes, and perspectives, and do it all without a clear road map. The ability to identify what qualities and competencies are shared by your top performers throughout the organization is paramount to inviting in to your organization truly great talent.  One thing is certain: It’s time to get it right and fast. Nothing short of your organization’s success is at stake. Seriously – just take a look at the sheer quantity of retailers who are struggling. Great organizations with great people at all levels who value agility, adaptability, and enthusiasm for all processes and who are passionate about their business, their team members, and their customer are winning. Those that don’t possess these things…aren’t and can’t.

In previous posts I have written about identifying your organization’s Top Performer’s “Critical Success Factors” [you can also read more about that in my post “Avoiding Bad Hires In Retail“]. This can be a tremendous help in finding the truly best candidates to drive results and deliver excellence in all areas of the business that are specific and critical to your company. The softer skills are the ones that make a difference – not, necessarily, the people who have worked with soft-lines, hard-lines, or people who have worked in SKU intensive environments. Trust me, great leadership can pick up on things easily but poor retail managers can hurt the business – even if they can support visuals or operations – by just the way they lead their team. If they don’t have that – they will be mediocre leaders, if we’re lucky.

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Look at your organization’s retail leaders: Store Managers, District Managers, and even the Regional Managers – those who consistently sit at the middle and the bottom of your weekly, monthly, and quarterly reports. In my experience those that sit in the middle and bottom of the ranking reports far outweigh those that are truly driving the business. These average and under-performers may have aesthetically pleasing stores – maybe – but if they lack some of the softer qualities necessary to drive results they are, essentially, taking up space that could potentially belong to someone who can and will deliver results to the business – not be a drain on it. Great retail leaders protect the brand image and promise consistently.

Time and time again, I speak with retail organizations and look at their rankings and work through strategy with them to elevate results. But when I see that they have only 30%-35% strong performers and the remaining 65% are either abysmal or mediocre – a new strategy that is only embraced by the top performers will be minimally effective.  If they aren’t willing to take action on their middle and bottom performers – a new direction is unlikely to gain momentum that is sustainable.

Here are some of the most common qualities found in retail leaders that are likely to deliver consistently strong results regardless of their area of responsibility inside the organization:

  • Integrity: It all starts with integrity. Integrity is the core foundation for leadership effectiveness. It is a blend of honesty, transparency, consistency, trustworthiness, and ethics. Once integrity is squandered or even thrown into question, it is very hard for a leader to regain the trust of his or her team.

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  • Passion: Integrity alone doesn’t matter without several other key qualities/competencies. Passion, for example, enables a leader to keep moving forward even in tough times and uncover the solutions to any and all challenges they may face. They have passion because it gives them a strong sense of personal accomplishment when they exceed expectations of their superiors, their team, their customer, and their organization.
  • Vision: An alignment of organizational and personal vision and values makes for an amazing working relationship. If you aren’t identifying alignment during the interview process, it’s a mistake. Without a compelling purpose or destination, how can a retail leader effectively persuade people to embark upon a new direction to achieve the goals and objectives of the business? Visionary leaders inspire employees to imagine a better future and work hard to achieve it.

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  • Courage: Is producing results and developing a team easy? No way! Is it worth it to always deliver great results? Hell, yes! Courage, another make-it-or-break-it quality, is necessary to make the difficult decisions when facing conflicts and mediating adversity. Courage springs from a leader’s core values and commitment to their alignment with the values and vision of the organization.
  • Decision Making/Judgement: Good judgment allows the retail leader to make solid business decisions and choices. When assessing a leadership candidate, I want to see whether they can confront a complex new challenge and quickly zero in on the most important issues and priorities. Do they ask good questions? Can they prioritize and make difficult/unpopular tradeoffs? Do they know where to focus and where not to waste time and energy? Even when looking at an individual piece of the problem, do they keep the entire objective in mind, recognizing the potential unintended consequences of decisions on other areas? Judgment and sound decision making is needed to develop a strategy that will enable the organization to achieve its vision.
  • Empathy: This is a non-negotiable that all team members have of their leadership [along with involvement and the ability to inspire and motivate]. Each team member has a different personality, motivation, and agenda. Empathy is the attribute that allows a retail leader to effectively understand what makes others tick. Identifying the fundamental drivers of coworkers and colleagues is critical. Same goes for getting people aligned and motivated around their common goals. If a potential leadership candidate doesn’t have empathy, they have very little chance of getting these, and many other, important team members on their side. Lack of empathy is a key reason why some, otherwise analytically brilliant, leaders often come up short and cannot deliver results.

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  • Emotional Intelligence and Maturity: While empathy is externally focused on others, the key leadership quality of emotional intelligence and maturity, is internally focused. An emotionally intelligent leader habitually takes a hard, objective look at themselves and accurately discerns his strengths, weaknesses and opportunities to improve. Putting personal pride aside, they actively solicit the input of others at all levels and enthusiastically improve the team’s best ideas into the overall business plan. Without emotional intelligence, hubris sets in, and a leader will overestimate his or her own ability and deem their ideas the only way to win and, in doing so, will alienate others. Leaders that fail to involve their team in the process of planning and execution will come across selfish and self-serving and will not stay in good graces very long.

These seven core retail leadership attributes are all the foundation of truly great and winning retail leaders, regardless of geography or retail niche. By hiring candidates that possess these values and qualities and not using silly, surface assessments to gauge success, like only a sparkling personality, just a polished résumé or great interviewing skills — you will be one enormous step ahead of the rest of the retail crowd who are still scratching their heads wondering why they are so bad at identifying good retail leadership to take their teams to the top of the customer experience and business lever reports weekly.

Hopefully – as soon as retailers begin to realize that it is their people, all of them, who drive results [or not] and commit to filling their organizations with truly great talent at every single level of the business – retail will start to become healthy again. Until we realize that people drive success and the right people in the right places can make an organization great again – we will continue to see organizations struggle.

About

Founder and Editor in Chief of Excellence In Retail and 18 year retailer. I am passionate about and committed to inspiring thought, action, truth-telling, solution-seeking, and dialog around how to maximize talent through identifying and creating a process around critical success factors, workplace culture, signature leadership practices, productivity, profitability, alignment of employees and company vision & values, and workplace happiness inside all retail organizations.

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15 thoughts on “Why Is Retail So Bad At Picking Great Leaders?

  1. “Hire Character. Train skill.” Very well stated. Integrity is a key characteristic that cannot always be taught either. Thank you for being so great at articulating!!!

    1. Thanks, Clarice!! I am so happy you like this article. I am on a mission of improvement this is one of those opportunities, in most retail organizations, that needs attention. Hopefully organizations will look, objectively, at their business and see this is an issue that – with effort – we can totally elevate and see positive results from. Enjoy your weekend!

      1. I can not agree More Beth but here’s the thing.. it’s not just retail. The fact that determination far outweighs Talent is exactly to your point!

        1. You’re right, Shana – it isn’t just retail. I oftentimes have these conversation with my friends who are in production, restaurants, communications and their experiences aren’t too different than ours in retail.

  2. Wow this is one of the Best articles on retail yet. I can appreciate this because I am in retail , and daily I see all you spoke on besides the common qualities you spoke on. Thanks for putting this out there I feel companies need to be more involved cause as you stated the Managers set the stores image. One person nor two can ever be a team.

    1. I appreciate the comment, Sherri. Absolutely – most retailers are in the this position and rarely will executive leadership acknowledge or have a plan of action to either improve the bottom and mediocre performers or exit the “leaders” who are actually hurting the business. The top performers don’t get the acknowledgment they deserve because executives and seniors leader look at the aggregate and see the organization either is, maybe, meeting expectations in metrics or they aren’t making it at all. The top performers are driven to contribute excellent results but since there are so few of them and so many of the poor and under-performers – they can’t carry the business [though they are usually compelled to help make up some lost revenue from the poorest performers].

  3. Hire for behaviour, train for skill is what drives my vision. I relie on a 21, 49 and 70 day checkin, post hire, then manage them out of the business if they don’t “fit” and surpass the mutually understood metrics of the job.

    1. Agreed, John. We, too, have an onboarding plan that is built around multiple learning methods, involvement, and dialog to ensure that the new hire and our organization are keeping pace with the learning needs of the other and that there is ample opportunity to identify any inconsistencies in “fit” either role or culture. Since I started focusing on hiring for cultural fit and reinventing this process several times to shape it correctly for the variety of roles in 2014 – we achieved 100% retention of our Store Leaders and District Leader’s in 2014 and 2015 and a very low 22% turn of our junior leadership and selling teams. We also check actual references [not just title and dates of employment] and along with hiring and interview dialogs with our candidates, administer assessments that measure the “soft skills” to ensure that what they candidate articulates and how they measure themselves in a variety of areas are aligned and that there are no inconsistencies. It makes all the difference! 🙂

      Thanks so much for taking the time to read this article and leaving a comment!

  4. Great article; you hit the nail on the head. Most companies are hiring executives that can build strategies but are missing out on the executives that can get their strategies executed to deliver results. More executives need to be in their stores and on the front lines to see where the are succeeding and where they are missing opportunities. Having been in retail over 25 years I am out on the front lines about 40-50% of the time with my people. That is how to to deliver results; not in an office analyzing reports on how to get the results.

  5. Beth-
    Excellent piece! I’ve been in Retail virtually my entire adult life, and was at one time an executive at a successful retail company. Since those days, I have pondered your question many times, and although there are no hard-and-fast answers to the fundamental question, there are many factors that play into the leadership quandary.

    Consider these factors that might make strong leaders shy away from the Retail industry:

    1. Retail companies favor “retail” – especially “store” – experience above all else. If they find one, they’ll know – this is a company that makes its decisions based on past operational know-how. But what makes a good merchant and what makes a good CEO are often very different things. One will seek to protect the legacy model, while the other may need to challenge it.

    2. The legacy operating model is broken – but retail leaders are still trying to internalize what that means. The business was built on a profoundly simple “truth”: all selling activities happen in the store. That is demonstrably not true any longer, and even sales that are generated in the store are often based on consumer decisions made outside of the store, in the digital realm. We say, “for the first time in history, customers carry ‘the store’ around in their purses and pockets.” That change is the proverbial elephant in the room, and retail leaders (often who have spent their lives in the legacy model) are really struggling.

    3. Retail leaders are just realizing the strategic value of “information”, and the technologies that deliver it. We say, “the information asset is just as strategic to your success as the products you sell or the brick’n’mortar where you sell them”. Few retailers believe that.

    4. Retail cultures are very strong, and mightily resistant to change. It takes an incredibly strong personality with a compelling vision of the horizon and a unique ability to get people to follow, to stand up to the status quo in Retail.

    These are just some things to think about when it comes to leadership in Retail. It’s a very high hill to climb to be a transformative and successful Retail leader, and very few people are up to the task.

  6. Beth, great insights as always. I also question organizations with unclear or conflicting goals. Many companies allow their attention to wander away from bottom-line results in favor of shiny objects like marketing initiatives, visual standards, or policies and procedures. Managers who drive or maintain these self-limiting “special interests” are often favored and promoted over pragmatic, big-picture leaders who deliver financial results. Retailers need courage in hiring people that don’t always agree with them, aren’t afraid to offer as well as accept ideas, and have enough empathy and humanity to engage their teams (and, hey, maybe their customers) with a vision instead of simply issuing directives.

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