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Your CEO is NOT the Top of the Pyramid

By on Jun 18, 2014 2 Comments

Who is the most important person in your organization? The natural inclination is to point toward the CEO. But if that’s how you’re thinking about it, you’re not putting yourselves in the shoes of your customers — and it could be hurting your brand and your bottom-line.

The most important person in your organization? It’s your customer. And if this is the right hierarchy, who is closest to your customers?

Your frontline employees.

This is the mindset that has built market share and an unmatched reputation for a name you’re likely to recognize: Nordstrom.

Nordstrom’s legendary reputation for great customer experience is based in how its frontline employees go above and beyond for customers — and how they’re encouraged to get creative in the ways they make them happy. It’s a large part of how they’ve been able to weather financial downturns and constant change in the retail industry and still come out on top.

But how have they actually become the ultimate service-drives-sales company? It’s one thing to set it as a goal and another thing entirely to actually execute on it. There’s a deep chasm between training a sales associate how to use a cash register and training them how to go above and beyond for a customer given an infinite number of possible situations. You’d probably need a very thick employee handbook, right? Well, here’s Nordstrom’s:

Nordstrom-Employee-Handbook

Shorter than you expected? Well, it could be distilled even further, to just one word: Empowerment.

Nordstrom’s customer-centric culture and reputation is predicated on the way it empowers frontline employees to soar. To do what they think is right for customers. It’s best illustrated by its organizational chart, which they call The Inverted Pyramid. Tacked to the wall in the backroom of every store, the “Inverted Pyramid” puts the frontline — those who interact with the customer every day — at the “top” of the organizational hierarchy. Everyone at Nordstrom starts at the “top,” including its executives. Even if you’re a Nordstrom family member or a VP brought in with a particular expertise, you start on the floor, interacting with customers. Period. No exceptions.

 inverted-pyramid-1rtligc

This chart isn’t just a great way of visualizing the Nordstrom philosophy — it also represents, quite literally, the freedom each level has to make important decisions. For example, sales associates (those employees that come in closest contact with customers) have the most latitude when it comes to doing their job. The one “rule,” as their “handbook” reads, “Use good judgment in all situations.” That’s it. Just pure empowerment.

Well, not entirely. Lore and word-of-mouth are key in reinforcing Nordstrom’s frontline culture. At every meeting, store, regional, national, and in every newsletter, backroom, or store opening, Nordstrom frontline employees tell their stories. Whether a story approaches the mythological, like the famous “tire story” — or is more tactical, like an associate advising a buyer (“lower in the organizational pyramid”) about what styles are selling best — the Nordstrom sales associates learn from other associates. That’s it.

Sounds simple? It’s not. This thinking is a part of everything they do, from recruiting to promotions to strategy. Their hierarchical pyramid never flips around. The only compromises Nordstrom makes are for the customer, and that’s how they’ve made a fortune off of customer experience.

And while they aren’t an easy company to emulate, there are steps you can be taking right now to become the Nordstrom of your industry. In fact, we’re hosting a webinar tomorrow with the author of The Nordstrom Way, Robert Spector, to help you do just that. Robert has spent years engaging with the Nordstrom family and team, studying their culture and operations to get to the core of what’s made their customer experience such a success.

We hope to see you there. Sign up here.

(And if you are reading this after June 18th, sign up above, and we will send you a link to the recorded event.)

Photo credit: David Evers

Republished with author's permission from original post.

Categories: ! BlogEmployee EngagementLeadership
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2 Responses to Your CEO is NOT the Top of the Pyramid

  1. Naval Vaswani June 19, 2014 at 6:47 am #

    Good thought , practical point of view and sustaining

  2. Michelle deHaaff June 19, 2014 at 8:41 am #

    Thanks Naval….Nordstrom is truly a leader when it comes to customer centric thinking.

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