A CEO of a multi-billion-dollar retailer texts store managers directly to hear what's really happening on the ground. When a sales drop looked bad in the data, the actual cause—a local government shutdown—only emerged from talking to frontline staff. Direct relationships beat metrics.
So there's a multi-billion-dollar retailer that I know of, and the CEO of the retailer is the owner, kind of a pretty famous, well-known, super well-regarded operator of the business. And the business is a juggernaut, does incredibly well, worth billions of dollars, totally deserves to be regarded as well as it is. And I heard a pretty interesting anecdote. I was talking to somebody familiar with the business and I asked like, you know, who are kind of the stars inside of this business? And it's a retailer, so there's store managers and there's people that run each individual store. And basically like those are the people that are kind of the stars of the company. And part of the reason they're the stars of the company is the owner who's a multi-billionaire in charge of tens of thousands of people and CEO has relationships with a good number of those store managers, like texts with them and talks with them about what's going on. In other words, like his relationship skips like 7 or 8 levels of that organization, given it's so big, to have relationships with those store managers. So this is all kind of confusing, right? Like, why is the CEO of this very large company like basically skipping all of these levels of management and executives and all this stuff stuff to talk to these store managers and have relationships with them. I reflected on this a lot because it's kind of confusing, right? When you're a leader and you're in a hierarchical organization, one of the things they teach you is chain of command. You're supposed to respect that, you know, the senior people talk to the second senior people down, down, and work their way down. You as a big boss, like, if you're giving an order, an instruction to somebody down at a lower level, like, you're not doing your job right because that creates chaos in your organization, all that kind of stuff. So I asked a bit, I was like, okay, well, what is the CEO actually doing when he talks to these store managers? And the reality is he's not giving them instructions, which is good, but he has relationships with them because he wants to know what's really going on inside of his organization. And again, this is a big retailer, it's a bunch of stores, and the people that know that are the people that are managing each individual one of those stores. And so I kind of stored away this anecdote because it's gonna have some use for me in the future. And all of us, of course, are trying to run our businesses in a very data-driven manner. Creating KPIs or creating charts, all that kind of stuff. And the reality was it made me realize, oh, like the data and all this stuff, they're often not telling you the stuff you really wanna know as an owner and a CEO of a business. This actually came up for me when I was involved in a business years ago. And after I'd heard this anecdote about this big retailer and I was like, hmm, this is a data point to hear. But basically I got word from our sales team looking at the data that our sales numbers had plummeted. You know, our number of leads, our number of qualified calls, all this kind of stuff was down more than 50% just in a couple weeks. And we went and started to look at the data, like what's going on? Are we not, you know, is our SEO not working? Are we not getting the lead list? Has the quality gone down there? Like what's happening that's causing this kind of drop-off? And in 3 minutes, just via like some phone calls and some emails, we got back understanding what was happening with our customers. There was some stuff globally happening with the local government in these places and like it was shutting, you know, down demand. People were pausing what they were doing and that's why they weren't buying and that's why we weren't seeing stuff. What we saw was the anecdotes told us the answer when in reality, like, the data was fine, but it didn't give us the whole picture. So look, we all as CEOs want to run towards the data. That's what we're being told. But in reality, when we can't explain something, like, the data tends not to be the best source of truth for us. What we need to do is go run to the people that are close to the situation, who are ideally smart and getting it and talking to customers and are the ones that can tell us what's really going on. And lastly, I think the lesson is, as a CEO, you want to have these relationships with the people that are close to the customers on the ground, seeing what's really going on. Because by the time it gets filtered up through all the layers of management that come up to you, the reality is, at best, you only have a part of the whole picture. At worst, you don't really know what's going on. And I've seen that happen. So you can't just be gathering data just from what you're being told in the boardroom. You got to talk to the people that are on the front lines and hear what they have to say. This is a channel for people that own one or more businesses and want to be involved as a CEO or an owner of those things, and that's what this content's about. So if you like that, uh, give me a subscribe or a follow. I'd love to have you see more of what I do from this here dreamy stitch where I go for walks and talk about this type of content. See you soon.
