Retail leadership: Has retail become the new football?

From Leicester’s shock dismissal of manager Ranieri to Manchester United’s controversial hiring of Jose Mourinho, the football industry is no stranger to abrupt shifts in leadership. However, it seems the major football teams could have competition for the title of highest management turnover. According to reports, the number of retail chief executives leaving their positions has reached a 5-year peak! The question is: what impact does this upheaval in retail leadership have on the wider business?

The 2017/2018 football season has already seen a number of high profile management appointments. Inevitabley, with new leadership, comes new direction. While a new style of leadership can be an exciting moment for an organisation, this is not always the case. You only have to look at Birmingham City’s management track record to appreciate that change at the top is not always positive! Given the number of new appointments in retail, it is important that new retail leaders avoid the management pitfalls made by so many football clubs. With this in mind, what can new managerial recruits learn from other businesses with a track record of effective retail leadership?

The game-changing impact of new retail leadership

As highlighted in the retail Gazette: “chopping and changing leadership directly affects the performance of Britain’s retailers.” With so many changes in retail leadership, many businesses now find themselves in a state of uncertainty; a position which many top football teams will be all too familiar with!

Given that retailers are increasingly embarking upon ever-more ambitious transformation projects, this emerging trend in retail leadership is having a hugely detrimental impact on both customer satisfaction and market competitiveness. As new C-level managers join the business, they bring their own ideas and vision. Yet, with ever-shorter terms in charge, many of the transformation projects they implement are simply never seen through to completion.

With operations and supply chain departments often left suffering the brunt of shifts in retail leadership, the impact of new management can very quickly be felt by the wider business and even customers. So what can new leaders take from the UK’s most successful football clubs and retail brands in order to ensure they make a real positive difference?

A winning formation for retail leadership

There are plenty of examples of retail leaders who have taken bold steps to ensure their business succeeds. But how do these leaders focus their time, energy and attention to ensure success?

With over 15 years of experience, I have had the pleasure of working alongside many different industry characters. However, the most effective retail leaders always exhibit 3 key leadership qualities:

1. A commitment to developing up and coming talent
2. The ability to lay the foundations in place into to enable the whole team to thrive
3.  A forward-thinking mindset

Investing in up and coming talent is always a solid game plan

Football clubs often receive heavy criticism for spending obscene amounts of money on players. However, every football manager knows you can’t just buy success: you have to develop it as well. Given the complexity of retail, talent development is just as crucial. After all, in any retail leadership position, building a team with the right people and experience is key!

When it comes to retail supply chain management, knowledge really sets businesses apart. Take for instance the health and beauty retailer, Savers. According to the Sunday Times, the high street retailer now offers all management and head office staff an app to advance their skills. Given that the retailer is ranked 10^th in the Sunday Times Top 30 Best Big Companies, this investment in personal development has evidently paid off. Helping the retailer to realise a £55m turnover increase whilst providing a huge boost to team morale, the training and development success at Savers is something all new retail leaders should observe!

There is no substitution for a balanced assortment

Every successful football team has a stand out player. Whereas former champions Leicester City rely on goals from Vardy, De Bruyne is the weapon of choice for the current table-leaders, Manchester City. Regardless of a player’s individual talent, the performance of the team is influenced by every player on the pitch. After all, even if the top player scores a hat trick every week, the team will never win the league if all the defenders take turns at scoring own goals.

Retailers face a similar paradigm when it comes to assortment management. Every retailer has a best-selling category or product, yet the worst performing products can still hamper the performance of the entire assortment!

When you consider that customers expect retailers to constantly invest in their product range, this is an important area in which to gain some customer loyalty points. If the assortment is managed effectively, this, in turn, can result in a huge boost in profitability. Take, for instance, the specialist frozen food retailer, Iceland. Following a £2 million investment in a state of the art development kitchen, the retailer has gone from strength to strength . Through constantly innovating their assortment, the food retailer has consequently won numerous awards including the highly converted Retail Industry’s Award for outstanding achievement.

While improving products and introducing new lines is important, effective retail leaders also know when it is time to walk away from a product. You only have to look at the best-performing discounters to see how rationalising the product assortment can go a long way in relieving the financial burden of trying to offer massive assortments.

From a retail leadership perspective, effective assortment management is all about putting the foundations in place into to enable buyers and merchandisers to make tough decisions in incredibly dynamic environments.

Effective retail leaders are always on the ball

If you look at the top football managers of all time, it’s clear that every manager on this list has two things in common: Vision and direction. However, these personality traits alone do not guarantee success. Take, for instance Arsenal’s manager, Wenger. Despite his focus, the longest-serving premiership manager has come under increasing scrutiny from fans for the clubs seemingly “mediocre” results.

Retail customers are far more fickle than football fans. Thus, when it comes to retail leadership, effective managers not only have to have focus and vision, they must also be incredibly dynamic.

The problem for many retailers, however, is that there are many strategic distractions to pursue. From exciting new store roll out programs to building entire new channels, the potential routes to success can be numerous. Yet, what sets the most effective leaders apart is their ability to focus their attention where they can make the biggest difference.

Aldi and Lidl are both great examples of the businesses that have these retail leadership qualities. Despite their rapid growth in the UK, the leaders of these businesses have stayed loyal to what has proved time and time again to be a winning retail formula. Yet, neither business has allowed their operation to stagnate. Through continual investment and refinement, the operation of both retailers is as slick as ever. Ultimately, when it comes to retail leadership, both of these businesses set the standard.

When it comes to retailer leadership, everyone is a pundit

While these are traits I have witnessed from my time working with retailers, there are many schools of thought on how best to lead a retail business. With this in mind, what characteristics do you think are most important to ensure effective retail leadership?