Who’s Operating your Stores – Managers or Leaders?
Do you consider your store operators managers or leaders? What’s the difference you say? A manager achieves results through an operating model based on command, control and compliance. A leader, on the other hand, achieves results by influencing, guiding and serving as a positive role model to his or her employees. Managers are disciplinarians; leaders are coaches; manager’s focus on budgets, projects, and reports; leaders focus on attracting, retaining and developing the best employees. Managers direct, control and micromanage their employees, while leaders encourage, support, cheerlead and celebrate the success of their employees.
Managers create a low energy, risk adverse, stifling work environment; leaders help their employees reach their potential by creating a supportive and engaging work environment. Managers have employees who simply show up and go through the motions, and are only loyal to themselves; leaders have employees who are actively engaged in their jobs, behave like owners and are loyal to their leader; not loyal to the company, their leader. Managers have customers; leaders have customer zealots. Managers operate stores that are underperformers; leaders operate stores that are best-in-class and serve as the crown jewel for their organization. So let me ask you again – who do you have operating your stores? If you answered managers, then the more important question is – what is your strategy for creating more leaders?
On a scale of 1-10, where ten means achieving full potential and one means greatly underperforming, how would you rate your stores? Odds are that those stores you rated as achieving high potential are operated by leaders. And if I were to apply Pareto’s analysis, otherwise known as the 80/20 rule, you probably rated your organization as having 20% leaders and 80% managers operating your stores. Now here’s the interesting part. How much money are you leaving on the table because you have managers and not leaders in charge of your multi-million dollar stores? Here’s a few key performance indicators (KPI’s), in which to evaluate your store operators. Score on a scale of 1-5, where 5-Excellent, 4-Good, 3-Average, 2-Needs Improvement, and 1-Poor. This evaluation is completely unscientific. It does however identity key job performance categories that drive the business, and how your store operators are performing their jobs in these categories.
- Hires employees that represent our company in a positive light to our customers and communities
- Low employee turnover (factor in the positive effect the recession has had on turnover)
- Employees are highly engaged in their jobs
- Employees engage their customers: know their names, purchase habits, point out monthly specials
- Able to differentiate their store from the competition based on customer service and relationships
- Teamwork and morale
- Able to consistently execute our company’s strategic plan
- Cash shortages and shrink are well below other stores within the company
- Develops store employees into future store leaders
- Human capital ROI exceeds the 31% of gross profit attributed to wages, workers comp and insurance
Imagine the impact on your company’s bottom-line if you can move the “Good” ratings up to “Excellent” and the “Average” ratings up to “Good.” It’s only when you quantify leadership into hard dollars and cents that you come to realize the direct and immediate impact leadership has on store performance.
Leaders Are Developed Not Born:
Most store managers were promoted into the position because they were successful cashiers. A successful cashier does not necessarily qualify someone to lead people. Placing people into positions of greater responsibility and authority without the proper knowledge, skills and support to succeed is immoral. I realize the use of the word immoral is a bit strong in order to make a point, but I’m comfortable using the word immoral based on what I’ve seen over the past fourteen years. Too many store operators have been setup for failure, not success, because they were never afforded the opportunity to develop into a highly effective leader in a supportive and nurturing work environment. If now is not the time for leadership then when?