3 Ways Leadership Has Kept Best Buy Standing Tall While Its Competitors Fell
For decades, big box retail stores were cornerstones for malls and shopping centers across the United States. Circuit City, RadioShack and Toys ‘R’ Us, among others, were popular with consumers. But slowly, all those mentioned above suffered economic downturns, ultimately joining a host of other retailers on the sidelines.
Best Buy, though, has bucked the trend.
Chief executive officer and chairman Hubert Joly, who took the CEO role in 2012, has led Best Buy back from the brink of closure. The company share price has increased 271 percent over the past five years, and sales grew 5.8 percent in 2018 alone. Joly started talking to company employees and taking their concerns to heart. His leadership style provides a model for entrepreneurs to embrace -- one that has decreased employee turnover and raised the level of leadership and profit.
Entrepreneurs could learn and apply three valuable lessons from Best Buy’s ability to rebound after nearly closing its doors during the 2008 recession.
1. Go the extra mile for the ones who are helping your company grow.
As an entrepreneur, you might have virtual assistants, collaborators, copywriters and graphic designers working with you. Looking down upon them as though they are mere servants isn’t good for morale, and they’re more than likely going to leave. Joly started listening to employees, their needs and concerns. Once he and others in leadership heard them, changes started to take place. Employee retention numbers went up. A sense of camaraderie grew in stores themselves and at the corporate level. When you take care of your people, they are more than likely going to help you succeed. It is a win-win situation.
2. See abundance, not scarcity, in all areas of the marketplace.
Creating scarcity is an old marketing tactic. When all you are doing is having people believe in scarcity, they will see more challenges than opportunities. Best Buy could have followed the route of other companies when looking at Amazon. They could have seen them as adversaries and, in a true sense, they are. Yet Joly understands there is enough room for everyone to succeed in business. Best Buy and Amazon now work together on different projects that support and help both companies. Entrepreneurs should wrap their minds around seeing a marketplace that’s full and rich, bucking that scarcity mindset. They should work with others and develop key collaborations.
3. Offer a greater sense of transparency.
Best Buy learned though Joly’s style of leadership about being transparent. He took on the challenge of transforming the consumer electronics retailer by leaning on his previous experiences in business. Joly allowed employees to have a say in how the company works. Joly goes right on store floors and simply listens to employees and customers alike, taking a ground-level approach. This level of vulnerability and transparency probably caught longtime Best Buy employees by surprise, but it helped turn the company around.
Entrepreneurs who are too stuck in trying to follow what worked for the big names might find it more comfortable to actually be themselves. Listen to what your clients are saying. Be willing to listen as they share what is working and what isn't. Transparency doesn’t always involve brutal honesty, either. It can be done from a place of kindness and compassion. Those two factors might separate you from other entrepreneurs every single day.
When Joly began making changes, it started to shift the way that Best Buy did business. It was slow at times, yet always moved forward. He looked at both the corporate and personal side of business, something he’s done at other places where he worked before coming to Best Buy. His obvious goal was to transform the business into a profitable one again. In order to maintain the progress, changes and adjustments needed to be made, and he did that along the way. It has turned out quite well.
Entrepreneurs would be wise to take these three lessons to heart, discover what works for them, and adjust their styles. If a major company like Best Buy can shift its course, then there’s no reason you can't do it, too.