Article

Lowe’s CEO shares insight on honing employees as a strategic advantage

Lowe's CEO Marvin Ellison made it his mission to create a successful team, which meant spending time with employees and establishing a personal rapport.

Marvin Ellison discusses retail leadership with Sarah Alter.

May 17, 2019 by Elliot Maras — Editor, Kiosk Marketplace & Vending Times

Everyone in retail knows that employees are a company's single greatest asset. But motivating employees to excel requires a leader who can relate to employees and make them feel that their contributions are important.

Lowe's CEO Marvin Ellison has made it his mission to listen to both employees and customers from the day he was named company leader. Ellison, who grew up in a small Tennessee town in a family of limited means, shared his insights about leadership during the recent ShopTalk conference in Las Vegas. Interviewed by Sarah Alter, president and CEO of Network of Executive Women, Ellison cited the importance of having a mission and being authentic with co-workers.

When he became CEO, Ellison said his mission was to create a team that believes it can succeed. He realized this required changing the company's culture, and his first step was to meet with employees in the company's different departments to hear their concerns and the causes of things that were not working. He believed it was important to give team members a clear idea of their purpose and expectations they believe they can meet.

If they are given expectations they don't believe they can meet, he said, employees will not aspire to succeed.

Establishing rapport

It is also important for a leader to create an emotional connection with the employees. To do this, Ellison said it was necessary to create reliable links of communication with the employees. He gives his employees his personal email, and he responds to all of their emails. He also has a weekly five-minute company podcast.

"I want them to hear it directly from me," he said.

Meeting customers' needs

Ellison realized that one of the biggest challenges the company faced was serving customers with different needs. He identified three distinct types of customers: do-it-yourselfers, those who needed services done for them, and the professional contractor. He recognized that each of these customers have to be served in a different way, and that a 110,00-square-foot store can do this without shortchanging the quality of service to any customer. There are separate teams at the company for each of these three customer groups.

"You have to serve customers the way they desire to be served," Ellison said.

The professional customer, which on average spends five times more than the other customers, needs help getting the quantity of products he needs in a timely manner and at a price he feels comfortable with, he said. The pro customer does not need much help selecting what he wants to buy.

Ellison echoed many other speakers during the conference in citing the importance of integrating e-commerce and physical stores, as 70 percent of online orders are picked up in a store or fulfilled by a store.

And while e-commerce has become a bigger part of the business, there continues to be major opportunity to expand in-store purchases, Ellison said. Nearly a third of the store customers (30 percent) buy something in addition to what they came to buy.

Authenticity versus commoditization

Ellison, whose first job was being a security guard, said being authentic with his co-workers enabled him to advance within the company. This was a lesson he learned from his parents, and he seeks to instill it in his employees.

Being authentic was not easy working in an environment in which he did not look like everyone around him, he said, especially when he went to work at the company's headquarters. He first tried to fit in by dressing to look more like other people in the company, but he quickly realized that in doing this, he was commoditizing himself rather than distinguishing himself.

By behaving in a more natural manner, Ellison said, he became more appreciated. "The real answer was standing out," he said. People were more interested in what he had to say when he was more authentic.

According to Lowe's, Ellison serves as the only African-American CEO of a Fortune 50 company and is one of three African American CEOs of a Fortune 500 company. With fiscal year 2018 sales of $71.3 billion, Lowe's and its related businesses operate or service more than 2,200 home improvement and hardware stores and employ approximately 300,000 associates. 
 

About Elliot Maras

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Elliot Maras is the editor of Kiosk Marketplace and Vending Times. He brings three decades covering unattended retail and commercial foodservice.