Earlier this spring, I had a chance to sit down with Hubert Joly, chairman and former CEO of Best Buy, and hear his story on the Disrupt Yourself podcast. On the show, Joly talked about the importance of purpose, both in life and in business.
"My purpose has never changed," Joly told me. "It’s always the same: to try to make a positive difference on people around me."
Joly’s unique outlook on business and purpose began when he agreed to help monks from a local religious congregation with some of their administrative tasks and operations.
"I took a biblical index," Joly said. "I looked at every passage in the Bible that talks about work." And contrary to common wisdom, Joly found that "work is described as a good thing in the Bible. Social influences are what tell us to think of work as a bad thing, but it can be a good thing—even a way for making the world a better place."
Joly used this thinking when he was appointed CEO of Best Buy in 2012. At the time, the company was struggling: Analysts and other industry experts recommended that he fire employees and close stores to stay afloat. But Joly did the opposite, and ultimately led a turnaround that transformed Best Buy into a retail giant with a quadrupled stock price.
Joly’s time spent among monks wasn’t the only positive influence in his career. From his previous tenure as a partner at McKinsey & Company, Joly learned that the best way to order the priorities of a business are as follows: First, your employees, then your customers, then the financials.
"I actually told our shareholders that our purpose was not to make money, but to enrich lives through technology, by addressing key human needs," Joly said.
So instead of firing people, he put Best Buy’s employees first, and began conducting a review of the company’s people and management. The goal? To learn about the problems and experience of Best Buy’s customer-facing employees and find helpful solutions for them. In some instances, these solutions required making changes to teams. But instead of laying off the lower-level employees who interacted with customers, he made changes at the management level.
"My approach to change management in a turnaround was to change management," explained Joly.
Next, Joly concentrated on the company’s customers. Amid rising fears that the popularity of online retail would cause brick-and-mortar stores like Best Buy to decline, Joly chose to adapt by matching prices with online competitors and making product improvements—like higher-quality TVs—to produce less waste due to breakage.
Best Buy also made investments in customer experience and began looking for ways to erase inefficiencies in the company’s customer service—both when visiting physical stores and their website online. Now, explained Hubert, "the company ships as far as Amazon."
Finally, Joly focused on the company’s financials—but not too much.
"Too much attention on profit is very dangerous," Joly says. "Because if you only think about results, you forget to focus on the drivers."
For Best Buy, the drivers for increased sales volumes were higher employee motivation and customer satisfaction. By focusing on employees and customers first, the company’s financial performance naturally improved.
More recently, in the midst of the COVID-19 crisis, adapting to new challenges with a people-first perspective still seems to be the norm at Best Buy. Joly stepped down as CEO before the coronavirus hit, but he reports that the company has actually been reopening stores since they switched to contactless curbside pickup.
During COVID-19, customers have been able to make appointments online to come and pick up their purchases in store. Led by the company’s new CEO Corie Barry, this system was set up in three days' time and has helped Best Buy reopen 200 stores.
"A mistake I made for a long time," Joly told me, "was to confuse performance with perfection. But business requires teamwork, teams are made up of people, and people are never perfect. Perfectionism is an obstacle to anything that is productive—or, dare I say, magical."
For more advice for leaders on how companies can adapt to the workplace disruption caused by the COVID-19 pandemic and succeed despite it, check out Ira Wolfe’s recent interview with Cornerstone’s CMO Heidi Spirgi.
