Dysfunctional organizations do dysfunctional things.
You don’t have to look too hard to find examples of such dysfunction.
Let’s look at an NFL team like the Cleveland Browns.
Some refer to the team by saying “The Browns is the Browns” because of the sheer volume of their inept decisions.
The Browns epitomize dysfunction: meddling ownership, wasting draft picks and plunging into salary cap hell for a mediocre, now-injured quarterback. Just when you think they learned their lesson, they go ahead and add two veteran QBs and draft two more rookie QB’s during this offseason.
Woody Johnson and the New York Jets are apparently no better – although I do hope Aaron Glenn gets a fair chance to work his magic.
Of course, you didn’t come here for football commentary, you came for retail.
We go to Wisconsin for the source of retail dysfunction – Kohl’s.
It’s been clear for some time that the folks running the retailer are not doing a very good job.
The dysfunction made headlines recently when it was announced that CEO Ashley Buchanan was kicked to the curb because he’s a shady fellow. An investigation determined that he directed the company to enter in a peculiar vendor relationship – with a woman he was romantically involved with. Buchanan did not disclose the nature of the relationship or any details of what he was doing.
The board’s no better. Ex-board member Christine Day says chairman Michael Bender hoards information, dictates decisions, and keeps everyone else clueless.
Don’t be surprised if further news of dysfunction emerges from Kohl’s.
Target is another retailer that is showing signs of its dysfunction. It’s probably been low-key dysfunctional for some time, but eventually the lipstick on the pig wears off.
An internal memo from the CEO has been flagged by many as A-grade, corporate word-salad. A bunch of rambling about various topics with minimal substance.
The content indicates that the corporate office is disconnected from the shop floor. And that’s the major problem.
Dysfunction in the corporate office eventually shows itself in front of customers.
Merchandising strategy doesn’t match the in store execution. Employees are not as engaged as they could be. The shop floor is disorganized. Different functions fiercely protecting their own turf. Then as revenue and profits start to hurt, the organization starts to cut costs either through layoffs or stiffing vendors.
Hudson’s Bay here in Canada went under, which is not a surprise.
The customer experience has been declining for years with the shop floor being a hot mess. Upon the bankruptcy announcement, many drew a comparison of HBC CEO Richard Baker to Ed Lampert of Sears.
They are both in good company: Ron Johnson (J.C. Penney), Mike Jeffries (Abercrombie), and Ashley Merrill (Outdoor Voices) all let corporate dysfunction drip onto the sales floor. The companies paid a steep price for it.
It’s fair to say that we’re all a little bit dysfunctional. The mature ones have the self-awareness to identify it, own it and keep it check.
It’s another thing to be in complete denial and carry on while whistling dixie.
In the meantime, Kohl’s should quit retail and star in its own reality TV series called “Corporate Dysfunction.”
The Cleveland Browns can have a guest spot.
