There’s a new management philosophy being promoted and exulted called "Upside Down Management". The theory is that Head Office should set a few standards, then the 'front line' (in other words 'customer facing staff'), should run the business unhindered by HO interference.
It’s a bit similar to the introduction of tenancies in 1742 when Whitbread created them, in as much as the Whitbread Brewery brewed the ale, and the tenants interacted with the customers by selling it to them! Pretty simple model really. Here we are 271 years later seeing it being adopted by other retailers.
John Timpson, chairman of the shoe empire, is a leading advocate of trusting the front line staff to deliver the goods, and what a fine man he seems to be and what fine results his philosophy is achieving for his business.
Not only has he taken away the "Trust me I’m from head office" hierarchal approach and turned it upside down, he has removed all of the modern supply chain information obtained from data bases and computers, relying on motivated staff to forecast what is needed / when for their local store. Much more reliable in his experience! (perhaps a step too far for some retailers?).
Just to demonstrate his total belief in trusting staff, he even employs ex prisoners (about 10% of his staff). And what do you know, they perform brilliantly. Statistics prove that giving an ex prisoner a job, motivation and trust reduces recidivism from 61% to 19%. So, a great social contribution, as well as good business!
Here are some of the messages he offers around making this Upside Down system work:
• You need to recruit the best people, but (kindly) get rid of those who cannot respond to the trust placed upon them, or when they cannot deliver the business performance and growth others can.
• You need area mangers who understand that they are not there to 'tell' front line operators how and what to do; they are there to help grow each business by offering advice and support.
• You need to reduce the companies marketing spend and rely on local initiatives and word of mouth to do the job.
• You must pass power down to the front line for all operational matters.
• You must avoid putting in huge prescriptive regulations and rules just because 2% of the staff let you down (not always the ex prisoners by the way!). Instead, you need to trust the other 98% to deliver compensatory overall growth results.
• You need also to have a method of monitoring customer feedback.
Hang on, its 1742 all over again! And isn’t a lot of this just what we do in the tenancy world today?
We provide a low-entry-cost business opportunity, we set out a few standards (called an agreement), we then let the tenants run their businesses with support from an area manager. All we have to do as an industry is to find ways of Pub Cos/Brewers and Tenants to both get a fair return from their investment and efforts. Ah, there’s the rub … but it is not impossible!
By the way, I like to think that in Inn-Dispensable, we were 20 years ahead of Mr T, because this is exactly how our business model works which our chairman Phil Davison introduced all of those years ago, and I as MD have progressed and developed ever since. We trust our tutors to deliver a great experience to all of our customers, and at HO we monitor customer feedback very closely.
Martin Read CMBII
Managing Director of Inn-Dispensable Personal Licence Courses
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