Men’s Wearhouse Case Study

November 19, 2009

Men’s Wearhouse finds itself facing the problem that every successful company must deal with as it grows—how do you continue to expand your business without losing touch with the things that made your company successful and allowed you to carry out the expansion in the first place? Fortunately for Men’s Wearhouse, the structure of the organization and practices the company has employed are set up in such a way that, by and large, they should translate well to a larger organization. For example, the primary business unit for each area is the individual store. The organization has a well-defined structure for each store, with managers and then certain numbers of sales associates, wardrobe consultants, and other employees. On a store by store basis, there is no reason Men’s Wearhouse cannot continue to employ the practices and procedures that have made the company a success. It’s simply a matter of continuing to provide appropriate training to the managers and other staff.

Likewise, the training programs Men’s Wearhouse has set up such as Suit University, Suit High, and even the locally provided targeted training can continue to be used by the company to teach its managers, wardrobe consultants, and other employees the company’s sales techniques, methods, and traditions. Yes, there will be increased costs to bring new store managers and wardrobe consultants to the on-site training, but the new stores should translate into increased profits for the company, so hopefully those costs will reflect only a minimal dent in these new profits. As the company continues to grow larger with more employees from the new stores joining the organization, it may be advisable to add additional training sessions so that the company can continue to provide useful training without having classes that are so large that the individuals do not get as much out of the experience as they otherwise would. This too will add to the company’s costs, but I think it is a necessary step if Men’s Wearhouse wants to continue to utilize the educational programs that have helped make it so successful.

One thing Men’s Wearhouse will need to change is its district and region structure. Right now district and region managers visit each store in their area on a regular basis. With more expansion within each region and district, this will become more difficult, if not impossible. To solve this problem, Men’s Wearhouse will need to add additional regions and districts and hire more managers to supervise those areas. With more managers, the company will be able to retain its practice of having managers at the district and region level visit each store on a regular basis, so that there is a sense of connection between the managers and the employees at the stores.

While Men’s Wearhouse will need to make some changes as it continues to grow, the company has uniquely positioned itself for future success. The systems and structures the company has put in place are easily adaptable to dealing with a larger corporation, so the company should be able to modify these things to help it cope with the challenges it faces as it continues to grow.

After reading this case study, it is not surprising to me that the company is experiencing high turnover amongst its foremen. Based on the information provided, it seems that, once they are hired, foremen are tossed into the front lines with little to no training either on the processes they are supervising or dealing with issues related to managing the hourly employees they are tasked with supervising. To make matters worse, it seems like foremen have little to no actual authority over the hourly employees they supervise. Sure they can attempt disciplinary action, but those decisions are then reviewed by a grievance committee which takes no input from the foreman and, on top of that, when the committee rules, no effort is made to explain the reason behind the decision to the foreman, even if the committee had decided to reverse the disciplinary action taken by the foreman! No wonder these folks leave—they have no training, no real authority or power, and are provided no explanation when their disciplinary decisions are reversed. Who would want to work under those conditions?

Looking at the employee turnover data, a couple of things jump out. First, the external hires clearly are not working out, as the company turned over six of these eight individuals. Given these results, it seems like time and money spent on recruiting and hiring these folks is being wasted, so maybe the external hire program should be abandoned? Second, I note that only six out of forty internal hires left voluntarily. The remaining sixteen employees were involuntary turnover. I would be curious to know what the story was with these folks. Are they just bad managers, or is this something that some actual training and providing of authority would cure? And, if that many people are being let go involuntarily, maybe the hiring committee needs to do a better job of identifying and selecting the best candidates.

Another problem that will need to be dealt with is the attitudes of the general supervisors towards the foremen. It seems like they are the ones beyond the sink or swim, no training approach. I am guessing that their basic process here is that that system worked for them, so it should work for these folks too, and if it does not then these folks were not cut out to be foremen in the first place. This attitude seems to be a big sore spot for the foremen, so the company will have to find a way to convince these general supervisors that the old way of doing things is no longer working. One wonders if this will not have to entail getting rid of some of these folks and replacing them with folks who are more open to new ideas.

The Layoff

November 5, 2009

Wow, talk about some tough decisions. With his company struggling and missing its profit projections, Robin Astrigo has a host of unappealing options available to him as he tries to cut costs. Obviously the easiest of these options is to dip into the company’s savings reserve. That will keep the employees happy if it helps him avoid or minimize any layoffs, but it probably is not the best decision for Astrigo to make. First of all, emptying the company’s savings will go over like a lead balloon with the board. And, more importantly, what happens if things keep getting worse or the company finds itself facing an emergency situation where it needs cash in a hurry? If that savings reserve is gone, the company has nothing to fall back on to deal with any unexpected emergencies or changes in market conditions that may occur, which could result in even worse results, cause the company to take a loss, or even cause the company to fail.

The question then becomes, if you are going to have to do layoffs, how do you do it? It seems likely that, outside of the cost savings, none of these options is going to be good for the company unless Astrigo can figure out a way to use the layoffs to get rid of poor performers. So, what I think Astrigo needs to do is figure out which of the layoff options will be the least damaging to the company, and that is the option he should go with. Assuming that it is financially feasible, to me, the best option is to first try and offer early retirement packages to those who are the closest to retirement. This does two things—it offers folks who may be counting the days until retirement an incentive to take off early and it eliminates those who are earning some of the highest salaries based on seniority. If, after this round of cuts is made, the company still needs to downsize I would then go based on performance. I realize last in first out is easier and is probably the standard, but, as one of the higher ups in the article points out, it can be really damaging to the company as you may be eliminating future stars and it certainly makes recruiting new talent once the economy recovers much more difficult.

Regardless of what option he ultimately chooses, Astrigo has a tough job ahead of him. No matter how they are conducted, layoffs are never good for morale, and he is going to have to put an appropriate spin on this to make sure that it does not hurt customer service, which has been something that the company has prided itself on. If this is handled the wrong way, it will set off a sense of panic in the company that things are about to get really bad, which could ultimately become a self-fulfilling prophecy if those attitudes start to impact employee performance and customer service.

The Level 5 Leadership concept seems like interesting idea for defining the characteristics an individual should have as they transition for being a successful individual employee to being a successful leader, and, ultimately, to being an executive. I especially like the personal humility and professional will aspects that this approach contends is needed for an executive to be successful, as these are qualities that all leaders should aspire too. Of course, as we see both in and outside of the business world, these qualities are often lacking in the people who wind up in leadership positions.

I wonder though, can anyone truly reach the fifth level of leadership? As people, we all have flaws and we all find ourselves in situations where we react poorly to the events unfolding around us. It is only natural that we will, at times, blame others for problems—especially if that problem is actually their fault—and that we will want to take credit when our efforts have been a big factor in the success of our organizations. To me, these qualities seem like what we, as leaders, should strive for, but with an understanding that it is not going to be possible to be all of these things all of the time.

The primary theme of this article seems simple enough—to be a good leader, you have to put aside self-interest and do what is best for the company. Of course, as simple as this may seem, getting leaders to actually buy into this idea is a whole other ball of wax. We live in a world where executives make huge salaries and are offered option packages which, as previously discussed in some of the articles we have read, only encourage executives to take steps to maximize their return on these options.

That being said, I think most people in leadership roles genuinely want to do a good job and to be considered good leaders. But, we are all human, and thus, by nature there is a certain level of self interest involved in any leadership decisions we make. Generally speaking, the success of the leader will be tied to the success of the organization and thus doing what is best for the organization will ultimately be what is best for you, as the leader. But, as Michael Leven’s experiences indicate, sometimes, what is best for the organization can throw a real roadblock in your career path. And that can be a scary proposition, especially with the economy in the state it is today.

I have mixed feelings about this article. First, the author talks about reimagining the roles of managers and workers and seeing them as being equal but different. That’s all well and good, but, as a practical matter, how does it really work? Sure you should treat your employees with respect and not lord your managerial power over them, but at the end of the day, they know you are evaluating them and that you, as the leader, are ultimately in charge of whether they remain in their job. No matter how hard you try to redefine the perception of these differing roles I really do not think employees buy into this type of stuff. For me, the key is to treat your employees with respect and be honest, fair, and upfront with them.

I did like the emphasis on mutually determined performance objectives—what the author calls a performance agreement—and the push towards encouraging leaders to become a source of help for their employees. But, I am not sure that the creation of such performance agreements will always be enough to allow leaders to take a more hands off approach. I think that will work with some employees, but what do you do with those who need a more hands on approach? In those cases, I think you have to be more director and less coach, even if you have worked out performance objectives in advance. Some people just need that extra little push.

I think this article presents something of a cautionary tale for those whose managerial roles lies outside the top of the organizational structure. The message here is clear—if you have two conflicting choices, one which involves doing what is best for those under your command and one that is what the boss wants, if you want to keep your job, you better go with what the boss wants. Here, Colonel Dowdy was concerned about the safety and well being of his men and took actions that were based in large part on those concerns. The end result of this decision, however, was that Dowdy did not complete his mission with what Major General Mattis considered to be appropriate haste and that resulted in Dowdy losing his command, and, ultimately, his career in the military.

Dowdy made what, to him, was the best decision possible—to not push through the city—and he did so in the face of conflicting information on whether he should push through or withdraw. And, even though his unit completed its mission with ample time to spare, he takes the fall because he did not achieve that goal in the way that his boss, Major General Mattis, wanted it achieved. The article does note that there were a handful of other concerns that the higher ups had with some of the things going on under Dowdy’s watch, but the way the article presents this information makes it appear that these were, at best, secondary concerns. The primary problem was Dowdy did not achieve the goal with the speed Mattis wanted, even though Dowdy was successful in getting his unit where they needed to be with time to spare.

I found what happened to Colonel Dowdy to be very disheartening. While I realize that there was a specific strategy in place for this portion of the Iraq mission, it seemed like the approach Dowdy took allowed him to both keep his men safe and achieve his mission on time. Despite that achievement, however, Dowdy’s career with the Marines is brought to an abrupt halt because his mission is not completed with what Mattis determines to be the appropriate speed. Although the article states that the decision of how to proceed through the city was left up to Dowdy, it clearly was not truly up to him. The message here is—you can make the decision, as long as the decision you make is the one the boss would have made. Given the circumstances Dowdy was dealing with, it seems like if how the task was achieved was just as important as if the task was achieved, Mattis should have simply instructed Dowdy as to how he wanted him to proceed in the first place.

Wow, what an amazing article. Reading about the relationship between Lt. Withers and Peewee and how the bond that formed between them after Peewee was rescued from the concentration camps lasted for decades even though the two of them were out of touch for many years was truly inspiring. It was really amazing to me that although Peewee had been unable to open up to his family regarding his experiences in the concentration camps in the past, when he was reunited with Lt. Withers he felt comfortable enough opening up about his experiences and letting his family hear what he had gone through that he could finally share those intimate and terrible details with them. It really is a great story that truly demonstrates the impact one person can have on another person’s life.

I also think that, in addition to showing the impact one person can make on others’ lives, there is another important message for leaders in this article. Here, Lt. Withers made sure that Peewee and Salomon were taken care of once they were freed from the concentration camps despite the great personal risk his actions posed to his future and career. As the article notes, Withers had big educational dreams that he hoped to pursue once he got back home and he was willing to risk losing all of it so that Peewee and Salomon could remain amongst his unit. To me, this is an important point that is often lost on many leaders—sometimes, you have to be willing to take a risk and make the right decision, even if doing so could create difficulties for you personally. You have to be willing to take a stand and do what is right, even if it may make your life more difficult.