In this blog, Curium Director and Co-founder Andy Dawson looks Down Under to find parallels between cricket and retail performances.
What a week it has been for the Aussies! Their cricketers have dominated events over the ball tampering scandal, where blame has been lain at the door of the ‘leadership group’ (still not 100% sure who that is). Tears flowed and individuals have taken their punishment.
What struck me is that a proud sporting nation has been impacted by poor leadership, collectively and individually. It is sad to see.
However, the Aussie-linked story that caught my eye this week was in the business world.
I’ve written about challenges in the retail sector on several occasions. It is a sector that offers plenty of opportunity as it continues to experience turbulence and turmoil. So far this year, as many as 21,000 roles in retail have been lost or put at risk, as businesses like Jamie’s Italian, Prezzo, Toys R Us and New Look falter.
Many of these businesses can point to changing consumer behaviours – as we become increasingly cautious – high rents and increased costs due to Brexit fears, and living wage increases. Even Boohoo.com the millennial-friendly online retailer has seen its share price fall to a 13-month low due to fears over slower growth (still stellar) and insufficient investment to support future growth.
Change impacts us all, but retail is really feeling its force. Back to Australia.
Let’s rewind to 2016, when Australian conglomerate Wesfarmers bought Homebase, and its 250 stores and 12,000 employees, from Argos plc for £340m. Buoyed by the success of the Bunnings business in Australia, it saw the opportunity to replicate that success with Homebase.
However, reports suggest that the acquisition has been a fiasco, and that Wesfarmers has written off its Homebase investment ($A1Bn) and is considering how best to exit the Homebase business.
What’s gone wrong?
Well, just like the cricket team, it seems that the leadership team got it wrong. Here’s why I think it happened:
- Wesfarmers removed the UK Exec team upon arrival, replacing them with trusted Aussie chiefs; possibly a poor fit culturally. We know that culture is key to how a business thrives, especially when going through significant change
- According to the Financial Times, Wesfarmers CEO and former Olympic rower Rob Scott blamed the UK management team for bungling the transformation in the UK. (It’s never great to point the finger, whether a retailer or a cricketer!)
- Wesfarmers assumed the UK consumer / market would be enthused about Bunnings’ arrival, but we weren’t. In any case, only 15 Bunnings stores have been opened so, even if the strategy was right in the first place, it hasn’t been well executed
The Homebase acquisition has been high profile in the Aussie business world, as has the plight of its cricketers. When you step back, there are some commonalities:
- Culture is key. You need to work hard to create the right culture, supported by the right values and behaviours, if you are to succeed and thrive. Understanding each other’s behavioural preferences through tools like TetraMap gives you insights into team dynamics and how to best lead
- Having a plan is the starting point, but success is all about the effective execution of that plan. Sticking tape down your trousers or selling barbecues in February is not indicative of successful delivery! At Curium, when we support our customers on key transformational initiatives, we talk about turning strategy into reality
- Resilience is a key attribute. The cricketers will be really tested now, as all eyes are on them. Likewise, the Wesfarmers team made mistakes with product lines and axing concession stores but, by only opening 15 Bunnings stores, did they really test themselves in the marketplace or did they quickly get cold feet? Great leaders and teams are resilient
There are always bumps in the road, it is how you deal with them that defines the winners.
