Business School Thinking Gone Bad

“Tornados don’t target trailer parks. Trailer parks are enormously frail and vulnerable when they do get hit.”

What’s the ROI of your mother? - Gary Vaynerchuk

Bit ironic I’m even writing this. As the first born son of college professors, I announced to Dad first- then Mom, (pro move) that I would be retiring from academia following my first year in college. I had started what was my first business the semester prior, but that’s a story for another day.

I never returned, and I never went to business school. I opted for practical experience where I was in control, with an “I’ll figure it out!” attitude- reflective of the hubris of most nineteen year olds. A strong mentor would have added 10x value, but I suppose I was fortunate to have virtually zero college debt that suffocates the majority of my generation. I digress...

Back to the topic of Retail.

‍

In a world where we have more data than ever before: data points here, data points there, data points everywhere; what possible good is all this data if people aren’t able to actually extrapolate it beyond basic calculations?

The slippery slope.

Mounds of data. Murky correlation and therefore causation; we know we need to continually invest in new initiatives, but the wrong investment at even the right time can be costly.

And whether one is an internal stakeholder or an external “vendor”, we are consistently tasked with answering the shoulder-twitching question: what will be the ROI?

ROI (Reality-Obfuscated-Immediately)

‍

ROI (Return-On-Investment) has been on steroids the past 12 years. E-commerce (and other digital peepholes) have enabled a tunnel-vision view of ROI. Automated reports, real-time funnels, and metrics spitting out ROI forecasts and actuals like an Instagram feed.

Quick Maths: “I spend X on Google Ads, drove Y traffic, which drove Z acquisition.”

Clean, clear, easy.

If only.

As the lines of commerce have melted, so has our ability to define cleanly, clearly, and easily ROI. And to demonstrate that in the human sense, ask yourself the following questions:

‍

If you’re a retail sales associate, and you know the schedule and shifts you’re working for the next three weeks, what’s the ROI?

If you’re a retail sales associate who’s underperforming, and your manager compassionately develops you to achieve target, and doesn’t treat you as a renewable resource, what’s the ROI?

If your area or district manager mentors and spends time with you (store manager) on the floor- not in the food court- what's the ROI?

If you provide a subsidy or full reimbursement for your employee’s parking in the shopping center, what’s the ROI?

If your new hires begin each shift with a manager-on-duty, what’s the ROI?

If your store managers sit down with each member of the team to effectively discuss performance weekly/monthly/quarterly, what’s the ROI?

If you attract stronger talent for sales associate and store manager roles, what’s the ROI?

If you develop future multi-site talent from within, instead of continually hiring the external flavor of the week- what’s the ROI?

If you provide meaningful learning and development to all layers of the retail front-line and support center- what’s the ROI?

So in closing, I’m reminded of a quote that describes the nonsense of the “retail apocalypse”, and the risks of being overly ROI-focused.

“Tornados don’t target trailer parks. Trailer parks are enormously frail and vulnerable when they do get hit.”

So in your retail business- whether you have five stores or five thousand, are you building a trailer park or a fortress?

On February 19th, 2020 this article was published on LinkedIn.