Why Circuit City Failed, and Why B&H Thrives

[Cajungaltx]

Originally Posted by David Whatley

Hobby Lobby is also closed on Sundays and just gave al employees a raise.

Closet Dave Ramsey worshiper.... *grin*

I specifically made a point to go to Hobby Lobby the other day, BECAUSE they did that. Companies that make a point to take care of their employees, will make a point of taking care of their customers.

Think about customer service in places that you go - there are always the really crappy people who should be gravediggers versus customer service reps... but I see a difference in companies where the EMPLOYEES know that they are a KEY part of their companies success. They FEEL valued.... they FEEL as if what they do MATTERS.

Money, is NEVER enough incentive to do something that doesn't matter.

[kenw]

"Money, is NEVER enough incentive to do something that doesn't matter."

it depends. Do you have enough money to cover what REALLY matters?

(Maslow's Hierarchy of Needs)

and what REALLY matters can vary person to person....as we see daily.

[Cajungaltx]

Originally Posted by kenw

"Money, is NEVER enough incentive to do something that doesn't matter."

it depends. Do you have enough money to cover what REALLY matters?

(Maslow's Hierarchy of Needs)

and what REALLY matters can vary person to person....as we see daily.

Ken,
While I know personally I would dig ditches to make sure that I have all the 'needs' of my family covered.... I think in a retail industry... it's a huge issue.

But there have been studies that show that what a person does - MATTERS.

They hired a bunch of college students and paid them $7/hour to dig a ditch. They dug from 8-12... took lunch, and then the guy in charge told them to take the dirt they had just shoveled out... and fill the ditch back in.

They asked why... and he said it doesn't matter... they were being paid to do it.

At the end of the day - the guy in charge told them that tomorrow, they'd make $14/an hour.

40% of them didn't bother to show up.... for 2x the price.

Same thing... dig a ditch til noon, fill it back up for the rest of the day....

At the end of the day - the guy in charge told them that tomorrow, they'd make $21/hour.... for just digging a ditch, and filling it back up....

40% didn't bother to show up.

What you do, matters. And money will fix 'some' things... and for somethings, no amount of money WILL fix it...

[kenw]

My point, Donna, using your college student example, is that the students didn't need the money that bad. Or that they FELT they didn't need it that bad. Because unlike his response, you are correct: it DOES matter to them once you understand Maslow's theory a bit.

Had he tried it with hungry day laborers, his results would have been a lot different. And as such, he is "proving" Maslow's theory all over again.

The college students had moved beyond the lower levels of Maslow's heirarchy, their material needs (money) having been already met by other means (maybe mom and dad...), they were now able to fulfill 'higher' needs such as esteem and self-fulfilment; the pointlessness of digging and re-filling the hole didn't meet those higher needs.

If you are a starving day laborer, those higher needs won't see the light of day.

Maslow's was one thing I took away from my business mgmt, psychology and industrial relations classes....that I can remember 33 years later....

wiki has a few things to say, I cannot claim it is totally correct (it bein' wiki...) but it gets the basics across:
http://en.wikipedia.org/wiki/Maslow%...archy_of_needs

In your retail scenario, someone FEELS they need the extra money (or power, several 'needs' may apply) bad enough to warrant the tactics you (and most of us) loathe.

[GW2]

The demise of the publically traded company should be no surprise to anyone. The higher ups chase bonuses based on numbers and make decisions based on those numbers that are often of very short term benefit. Why? Because these company officers won't be around long.

Circuit City also fell into the trap of expanding too fast, adding too may stores and stand alone structures (huge capital expenditures on big loans) to make itself look prosperous. You can only rob Peter to pay Paul for so long.

Add to that aggressive salespeople, horrendous customer service and disclaimers on their weekly adds, and you have a disaster. But, some people got really rich and walked away. They don't care.

The article has merit in promoting good service retains customers when times get tough. However, this was more a matter of Peter running out of money to steal. Then Paulie whacked the SOB who couldn't pay.