October 26, 2007
United Supermarkets CEO: We’re Here to Serve
Dan Sanders, chief executive of United Supermarkets, has a best-selling book on his hands. He also has a big problem with what he sees as the misguided priorities of many business executives today.
“The global business culture that prevails today is broken,” Mr. Sanders told Maria Halkias of The Dallas Morning News. “People say the purpose of a business is to make a profit. I think that’s dead wrong. The purpose of a business is to serve.”
Mr. Sanders’ Built to Serve (McGraw Hill) stands at number two on the USA Today Money Best Sellers list and is number 13 on The New York Times list of advice books.
His interview with Ms. Halkias offers insights into the corporate culture at the 46-store chain headquartered in Lubbock, Texas.
On
the subject of employee relations: “We treat our employees like family. We’re here for you in good times and bad times. If you’re just focused on the numbers, you’ve already lost the game. That’s what’s so ironic. So many companies focus on the numbers and put very little focus on the people who create those numbers. So much is driven by analysts and investors and the performance three months from now.”
On
achieving high customer service levels: “If
you take care of the employees, they will take care of the customers. They’ll
go to the mat with you. We don’t have a manual. Our culture tends to promote
thinking. A person can have a fulfilling 35-year career stocking shelves or
at the register – if your corporate culture acknowledges that no job is unimportant.
Let’s
face it: The sacker spends more time with the customers than I do. The way
to do it is to regularly acknowledge our folks and do something for them. Once
we handed out $100 bills to everyone in the company. Each manager had to personally
hand it to each employee.”
On mission statements: “Everyone in America should change their mission statement to something that says, ‘We exist to enrich the lives of others.’ And it can be no more than six words. Ours is: ‘Ultimate service, superior performance, positive impact.’ ”
Discussion Question: What is your view of Dan Sanders’ business philosophy?
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When I go into United Supermarkets stores in Lubbock, I know instantly that something other than a corporate manual is creating the family feeling and retailing excellence therein. Dan Sanders’ philosophy is excellent. People want to belong, be respected and contribute to their “family.”
Similarly, when I was operating at Supervalu in the late 70s and 80s, we were all guided by Jack Crocker’s guiding philosophy that had everyone focused on “serving our customers better than anyone else could serve them.” We believed in that philosophy, we sincerely and willingly lived it, and our customers as well as Supervalu benefited substantially, both fraternally and financially. Thus, I think Dan Sanders has it right at United.
I have worked with Dan for many years and he is the genuine article. The difference in Dan’s approach and most of the rest operating retail today is his passion. He has an unparalleled passion for people, including his vendor/partners, and for the mission of United. It is quite a pleasure to experience after working with some publicly traded retailers for the past 25+ years. Many take advantage of their people and vendors and hide behind public ownership and competition as the cause, when the root cause for some I’ve personally worked with is that they are morally bankrupt. It is sad to experience and even more sad for the associates.
Yes, United only has 46 stores, but they are a breath of fresh air to work with. Great book Dan!
I’m glad to see that Built to Serve is generating conversation. Three thoughts to keep the dialog going.
First, no “flavor of the month” philosophy is going to sustain your organization for 91 consecutive years. We need to be less incredulous when it comes to human goodness and sincerity. I’m convinced we have too many companies built to sell and not enough that are built to serve.
Second, size is relative. If you ensure supervisory leadership over no more than ten stores at a given time, you can have 200 and still act as if you’re never more than ten stores big. But one supervisor can’t oversee 50 or 100 stores. I suppose they can “make stores,” but they’ll not “make a difference.” I know I’m in the minority here, but I’m convinced that when you engage your people in a meaningful way, economic success will follow. I’m an active CEO, and I know the importance of profit and growth, but they’re not my god. What’s needed today are more leaders dedicated to educating all of their stakeholders about the importance of an ROI on humanity. And, enough of this quarter to quarter stuff–isn’t a more compelling question, “How did you do relative to your potential?” There’s only one way to deal with that question–engage your team members in a meaningful way.
Finally, in my view there are only two kinds of people in business: those that create money and those that make money. The first group drives the train. Without them, the second group has nothing to hook onto to. Don’t let the power of the financial culture cloud your thinking. As the saying goes, “Frontline drives Bottomline.” I would add, contrary to what many believe these days, you can still effectively drive the bottom line with people-first practices.
Size matters. Managing the culture of a 46-store chain is much easier than doing the same for a 200-store chain. This is especially true when chains grow through acquisition, inheriting the incompatible cultures of the stores they buy. And customer-level culture notwithstanding, how often have we read of the failed attempts to integrate headquarters cultures after an acquisition?
Well, sure his philosophy works when you have a private company. But if you have a publicly held company, it’s all about the dollars and all about the stock price. If he took that philosophy to a publicly held company, he would be fired. Good thing Dan is at United.
I have worked with many retailers who define their goals in qualitative terms, and in every instance I fully embrace those goals. Those goals give life and energy to the organization.
That said, every enterprise is subject to basic financial realities. My experience has been that those retailers who have not balanced their qualitative goals with clear-eyed quantitative, financial goals end up having their ability to achieve their qualitative goals threatened by financial realities.
The key is balance. Every organization needs a mission that embraces core values that promote the well-being of employees, customers, and community. This is what gives a retailer it’s vibrancy and spark. But without a commitment to earning a profit and generating a cash flow to be re-invested in the future of the business, that very future, and the ability to to achieve those very important qualitative goals, is not possible.
When I read Dan Sanders’s philosophy, I wanted to say “Yipee!” he gets it! There are many books about creating an environment of passion of common goals. People ask, how do you create passion in an organization? The answer is the most important elements of this plan are described in Dan Sanders’s philosophy. Certainly, good business practices, fiscally responsible decisions and others are everyday good business principles, but what separates a mediocre company from a great company is PASSION. It’s not one or the other, it’s in addition to sound business decisions.
There was another icon in retail that had this philosophy–Sam Walton. He treated his team as family, his goals were their goals. They started each day and meeting with a cheer. I agree with Dan Sanders and kudos for having the courage to execute a “passion plan” because even though it sounds easy, it’s much harder to execute than it sounds!
Every retailer claims to be customer-driven. Every retailer claims that her/his organization is a “family.” Very few folks are that gullible. And how many people are tired of cure-all business best sellers? The flavor of the month, they promise greatness through simplicity. I have a feeling that someone could write a software program called “Write your own business prescription bestseller in an hour.”
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When I go into United Supermarkets stores in Lubbock, I know instantly that something other than a corporate manual is creating the family feeling and retailing excellence therein. Dan Sanders’ philosophy is excellent. People want to belong, be respected and contribute to their “family.”
Similarly, when I was operating at Supervalu in the late 70s and 80s, we were all guided by Jack Crocker’s guiding philosophy that had everyone focused on “serving our customers better than anyone else could serve them.” We believed in that philosophy, we sincerely and willingly lived it, and our customers as well as Supervalu benefited substantially, both fraternally and financially. Thus, I think Dan Sanders has it right at United.
I have worked with Dan for many years and he is the genuine article. The difference in Dan’s approach and most of the rest operating retail today is his passion. He has an unparalleled passion for people, including his vendor/partners, and for the mission of United. It is quite a pleasure to experience after working with some publicly traded retailers for the past 25+ years. Many take advantage of their people and vendors and hide behind public ownership and competition as the cause, when the root cause for some I’ve personally worked with is that they are morally bankrupt. It is sad to experience and even more sad for the associates.
Yes, United only has 46 stores, but they are a breath of fresh air to work with. Great book Dan!
I’m glad to see that Built to Serve is generating conversation. Three thoughts to keep the dialog going.
First, no “flavor of the month” philosophy is going to sustain your organization for 91 consecutive years. We need to be less incredulous when it comes to human goodness and sincerity. I’m convinced we have too many companies built to sell and not enough that are built to serve.
Second, size is relative. If you ensure supervisory leadership over no more than ten stores at a given time, you can have 200 and still act as if you’re never more than ten stores big. But one supervisor can’t oversee 50 or 100 stores. I suppose they can “make stores,” but they’ll not “make a difference.” I know I’m in the minority here, but I’m convinced that when you engage your people in a meaningful way, economic success will follow. I’m an active CEO, and I know the importance of profit and growth, but they’re not my god. What’s needed today are more leaders dedicated to educating all of their stakeholders about the importance of an ROI on humanity. And, enough of this quarter to quarter stuff–isn’t a more compelling question, “How did you do relative to your potential?” There’s only one way to deal with that question–engage your team members in a meaningful way.
Finally, in my view there are only two kinds of people in business: those that create money and those that make money. The first group drives the train. Without them, the second group has nothing to hook onto to. Don’t let the power of the financial culture cloud your thinking. As the saying goes, “Frontline drives Bottomline.” I would add, contrary to what many believe these days, you can still effectively drive the bottom line with people-first practices.
Size matters. Managing the culture of a 46-store chain is much easier than doing the same for a 200-store chain. This is especially true when chains grow through acquisition, inheriting the incompatible cultures of the stores they buy. And customer-level culture notwithstanding, how often have we read of the failed attempts to integrate headquarters cultures after an acquisition?
Well, sure his philosophy works when you have a private company. But if you have a publicly held company, it’s all about the dollars and all about the stock price. If he took that philosophy to a publicly held company, he would be fired. Good thing Dan is at United.
I have worked with many retailers who define their goals in qualitative terms, and in every instance I fully embrace those goals. Those goals give life and energy to the organization.
That said, every enterprise is subject to basic financial realities. My experience has been that those retailers who have not balanced their qualitative goals with clear-eyed quantitative, financial goals end up having their ability to achieve their qualitative goals threatened by financial realities.
The key is balance. Every organization needs a mission that embraces core values that promote the well-being of employees, customers, and community. This is what gives a retailer it’s vibrancy and spark. But without a commitment to earning a profit and generating a cash flow to be re-invested in the future of the business, that very future, and the ability to to achieve those very important qualitative goals, is not possible.
When I read Dan Sanders’s philosophy, I wanted to say “Yipee!” he gets it! There are many books about creating an environment of passion of common goals. People ask, how do you create passion in an organization? The answer is the most important elements of this plan are described in Dan Sanders’s philosophy. Certainly, good business practices, fiscally responsible decisions and others are everyday good business principles, but what separates a mediocre company from a great company is PASSION. It’s not one or the other, it’s in addition to sound business decisions.
There was another icon in retail that had this philosophy–Sam Walton. He treated his team as family, his goals were their goals. They started each day and meeting with a cheer. I agree with Dan Sanders and kudos for having the courage to execute a “passion plan” because even though it sounds easy, it’s much harder to execute than it sounds!
Every retailer claims to be customer-driven. Every retailer claims that her/his organization is a “family.” Very few folks are that gullible. And how many people are tired of cure-all business best sellers? The flavor of the month, they promise greatness through simplicity. I have a feeling that someone could write a software program called “Write your own business prescription bestseller in an hour.”