The One Thing You Need to Know by Marcus Buckingham

Author:Marcus Buckingham
Language: eng
Format: epub
Publisher: Free Press
Published: 2005-07-15T00:00:00+00:00

The Points of Clarity

“Where are your followers crying out for clarity?”

1: Who Do We Serve?

Recently I interviewed a man named Terry Leahy. Actually, the proper way to refer to him is Sir Terry Leahy—such are his contributions to British business that in 2002 he was honored with a knighthood. Sir Terry is the chief executive of the British retailer Tesco. Although Wal-Mart is the largest retailer in the world, an argument can be made that Tesco, with its 326,000 employees worldwide and its hugely successful operations in Europe and the Far East, is the best.

It wasn’t always this way. For most of its fifty-year lifespan, Tesco struggled to differentiate itself from such competitors as Sainsbury’s, Safeway, and the Wal-Mart–owned ASDA stores. Today, however, Tesco is number one and pulling away. As an example, for every hundred pounds spent by U.K. consumers, Tesco gets more than twelve of them.

I started our interview with a broad question: “More than half of Tesco’s square footage is outside of the U.K. With such a far-flung organization, how have you managed to keep people focused on the same priorities?”

“Well,” he replied. “I began by making sure that we all knew who Tesco was trying to serve.”

“Who were you trying to serve?”

“In the eighties we had lost some of our focus on who we were trying to serve. We had gone more upmarket, trying to serve the aspirational customer, and in the recession of the nineties this strategy wasn’t working. So instead we returned to our heritage and to our focus on serving the working man and woman, the ordinary Joe.”

“How did you decide on this?”

“Well, we interviewed upwards of two hundred thousand customers in focus groups, surveys, and the like, in the hopes of finding out what our customers wanted from Tesco.”

“And did your answer emerge from this research?” I asked.

“Some of it did, I suppose, but some of it was instinct. I have a similar background to many of our core customers, a working-class background, and so I can identify with our customers’ lives more readily than some. I felt that what these customers wanted from Tesco was a place that wouldn’t patronize them, but that would respect them, genuinely respect them.”

“What did you do to show them this respect?”

“Well, the first thing I did was dramatically increase the number of checkout lines in a Tesco. It used to be that your basic Tesco store would have limited checkout lines, and as a result there was lots of waiting around in queues. Today we’ve removed the queueing by installing many more checkout lines. I figured that the best way to show someone that you respect them is to respect their time. All these new checkout lines represented, as you can imagine, a huge capital investment for us, but I decided that, given who we should be trying to serve, it was the right thing to do.”

Was Sir Terry right in allocating resources in this way? Was he right in focusing Tesco on serving the

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