AymzarpDec 29, 2022
Aram Zucker-Scharff

I've seen a bunch of people sharing this and repeating the conclusion: that the success is because the CEO loves books t/f you need passionate leaders and... while I think that's true, I don't think that's the conclusion to draw here. The winning strategy wasn't love, it was delegation and local, on the ground, knowledge.

This win comes from a leader who acknowledges people in the stores know their communities and can see and react faster to sales trends in store...

https://tedgioia.substack.com/p/what-can-we-learn-from-barnes-and

What Can We Learn from Barnes & Noble's Surprising Turnaround?

Digital platforms are struggling, meanwhile a 136-year-old book retailer is growing again. But why?

The Honest Broker
Dec 29, 2022 at 2:27pmWeb
Show threadAram Zucker-ScharffDec 29, 2022

It's a mistake to assign the value being created here to the CEO, all he did was realize upper management needed to step out of the way & remove the bad incentive structure that stopped local stores from making their own decisions.

It's the realization the people in the bookstore are going to know what sells faster than execs waiting for a report in HQ and it's acknowledging that people who work in bookstores live in their communities and understand how those communities work & what they like

Show threadAram Zucker-ScharffDec 29, 2022
The lesson you should take from this parable as a manager isn't about passion, it's about what your job is: unblock your employees, trust the people you hired for their capability to manage your front lines, and a million analysts can't beat on the ground real-time knowledge. Especially when it comes to community businesses like bookstores, the most detailed knowledge and complex models aren't going to create a better plan to work with the community than the people in the community.
Show threadAram Zucker-ScharffDec 29, 2022

This story is basically an indictment of enormous corporate structures, huge national and international companies, centralized corporate power, and overloaded management. For B&N they clearly don't work. Not for pricing, stocking, shelving or marketing.

The win here is a CEO who realizes his most valuable action is to get out of the way.

It should be shocking to read that the winning revelation for B&N was: let employees do their jobs.

Now you gotta pay them more.

Show threadAram Zucker-ScharffDec 29, 2022

It is shocking that a huge bookstore company would rather try to open an entirely new off brand line of business like a restaurant then take the basic action of listening to their employees.

B&N almost went bankrupt rather than let its employees do the jobs it hired them for.

Wild that this win is assigned to management rather than the people who made it happen: the bookstore employees.

Hopefully the current CEO will continue to know better than those heaping praise on the executive class.

Show threadaethervision Dec 29, 2022
@Chronotope B&N mostly died when they laid off booksellers like Pat Bostleman, Karen Perrea and Marcella Smith in 2010. The last straw was Jim Killian. Best sci-fi buyer in the industry. From then on, it’s been a matter of time.
Show threadCharles RoperDec 29, 2022

@Chronotope I work for a large charity founded in 1945 with many centres around the UK. Decentralisation worked to a certain extent and the centres ran themselves well enough. But without a unifying leadership, it became a mess. Like a team of elite athletes without a coach. There must be balance. It’s wrong to assume there is no role for leadership. But touch should be light if the org is working well. Tight grip is a bad sign. Good leaders have Fingerspitzengefühl.

https://en.m.wikipedia.org/wiki/Fingerspitzengefühl

Fingerspitzengefühl - Wikipedia

Show threadelle mundyDec 29, 2022
@Chronotope incredible. now that the ceo is out of the way, what do we need him for again?
Show threadAram Zucker-ScharffDec 29, 2022
@exchgr an excellent question.
Show threadJake MillerDec 29, 2022
@exchgr @Chronotope Two things. First, he made good decisions here. He is likely to continue to do so. This is leadership to the entire company, and he will have credibility to make other good decisions that defy conventional financial wisdom. In his absence, the company would relapse. Second, he’s likely to understand better than others that workers aren’t just there for minimum wage but bring value to the company and should be treated as valued contributors.
Show threadelle mundyDec 29, 2022

@jakemiller @Chronotope seems paradoxical to me.

“he made good decisions” sure, but the decision was to stop making decisions and get out of the way. what if he was always out of the way?

“defy conventional financial wisdom” i don’t think so, making more money is usually welcome.

“he’s likely to understand better than others” better than who? the workers who know they need more and will work for it?

Show threadJake MillerDec 29, 2022
@exchgr @Chronotope Oh, it is paradoxical. They are doing better by turning down free, guaranteed money (from publishers).
Someone was making decisions about which books to promote, and how to operate stores. He took power *away* from them. He reduced the power of people at HQ. He empowered the lowest-paid people in the company. These are deliberate and sweeping decisions. A centralized structure’s reward systems create incentives to suck more power into its core.
Show threadJake MillerDec 29, 2022
@exchgr @Chronotope Does the company seek to earn more? Yes. But not in this way!
The “others” I mean are the next CEO, or Board Chair, or whoever else we would imagine would make corporate structure and power allocation decisions. Very few candidates would reach this conclusion - as evidenced by the fact that this is news!
Show threadelle mundyDec 29, 2022
@jakemiller @Chronotope exactly. what i know from experience is that the bread and butter of every company is concretely empowering workers and being responsive to customer needs, which is a circular dependency. central command hierarchies thwart this at every turn and guarantee failure, even if the short term looks better. so why not cement worker power?
Show threadelle mundyDec 29, 2022
@jakemiller @Chronotope a ceo is a decision-making bottleneck at best, and a malevolent tyrant at worst. and yet they make the most money in most companies!
Show threadJake MillerDec 29, 2022
@exchgr @Chronotope Daunt is doing something interesting, and subtle. The ultimate decentralization is to spin off stores. He’s decentralizing many merchandising, selling, purchasing decisions. But size and centralized finance give purchase power vs publishers. It provides capital to open new stores. He’s been deliberate in his choices. Based on Ted’s blog, it sounds like Daunt has added value by knowing what should be centralized or not, and implementing.
Show threadelle mundyDec 29, 2022
@jakemiller @Chronotope there are certainly short term gains to be had by concentrating power and using it well, but i think ultimately it ossifies and weakens the organization. it’s difficult to respond with agility to an inevitable change in market demands if your main revenue stream comes from one or a few sources like that, even with the best of intentions
Show threadJake MillerDec 29, 2022

@Chronotope @exchgr One of the important roles of a corporate leader is to resist things that are short term gains with higher long term costs.

How the leaders think about business is key. Daunt prob sees books as highly differentiated, thus needing nuance to sell. The other model treats them as interchangeable commodities. Old industrial thinking: obviously, disempower front line!

New stores will always take $$, so size is critical to secure that and to grow.

Show threadChris AldrichJan 1, 2023
@exchgr @jakemiller @Chronotope David Graeber has something useful to say with respect to this in Bullshit Jobs (Simon & Schuster, 2018).
Show threadDan SinkerDec 29, 2022
@Chronotope YES YES YES YES YES
Show threadstochasticDec 29, 2022
@Chronotope My number one goal as a manager has been hiring good people, giving them the support and structure they need, and otherwise staying out of their way. This extends to supporting them when they make mistakes: no errors means there probably isn't enough experimentation going on.
Show threadmconnorDec 29, 2022

@Chronotope it’s also a mistake to assume that incompetent leadership had hired competent leaders to run their stores. Let alone that those folks actually had the knowledge and expertise to run an actual bookstore (and hadn’t left to run their own).

Stories like this are about successful collaboration between employees and management. It’s not enough to be passive, management has to continually improve the structure and incentives in partnership with the front lines.

Show threadSandy HiltonDec 29, 2022
@Chronotope I want bookstores to flourish and authors to be paid well.
Show threadBjaardkerDec 29, 2022
@Chronotope exactly. This is like that talk that David Marquet gives about being a submarine captain and empowering the people on the ship. Leadership with intent.
Giving psychological ownership to the people with the knowledge to make the best choices.
Show threadBellison22Dec 29, 2022
@Chronotope great points
Show threadirwinDec 29, 2022
@Chronotope Here's my theory about why B&N is still alive: I bet if you looked at the amount of shelf space devoted to board games (and the sales figures for games at B&N) you could argue that the game renaissance helped keep B&N afloat in the past 3 years.
Show threadMark GardnerDec 29, 2022
@Chronotope Two things can be true?
Show threadIsaac RabinovitchDec 29, 2022
@Chronotope My take: in an era when you can buy every non-perishable thing online, there's only one reason for a brick-and-mortar store to exist: to curate the product. Independent booksellers figured this out a long time ago. Took B&N a bit longer.
Show threadAram Zucker-ScharffDec 29, 2022
@isaac32767 Bingo.
Show threadIsaac RabinovitchDec 29, 2022
@Chronotope I have to say that I find Gioia's dismissal of the cafe-in-a-bookstore concept to be glib and ignorant. Those used to be extremely popular, including the ones in B&N. But management neglected them, with predictable results.
Show threadCharles RoperDec 29, 2022
@isaac32767 @Chronotope I see it more as a dismissal of poor cafes, which most are in large chains. If they were to get in *good* restaurateurs and let them do their thing, then that could work.
Show threadlaurie bDec 29, 2022
@Chronotope Well, now I know how to spell chachkas! Good read, thanks for the share
Show threadAymzarpDec 29, 2022
@Chronotope if you care about your product and care about your customers and you will be successful. Something that is overlooked in many business schools sadly.
Show threadCharles RoperDec 29, 2022

@Chronotope The power of decentralised, empowered teams has been much written about in recent years. Just some of the books I have found useful

- Team of Teams by Stanley McCrystal
- Digital Transformation at Scale by Mike Bracken, @benterrett and Andrew Greenaway
- Happy Manifesto by Henry Stewart
- Turn the Ship Around by David Marquet
- Better Value Sooner Safer Happier by Jonathan Smart

It is bafflingly hard to get people to take notice of these ideas I find, despite demonstrable success.

Show threadJosh AdellDec 29, 2022

@Chronotope

Exactly this. The model works much better as franchising the branding & backroom support while allowing front of house to operate as a local independent. Let the employees be in charge of promotion and sales. For those asking "then what do we need the CEO/B&N corp for?" the answer there is economies of scale for things like inventory mgmt, logistics for shipping/ordering/online sales, and savings associated with centralizing HR/payroll and other admin not related to book sales.

Show threadBenoît MarchalDec 29, 2022
@Chronotope although we are always looking for the silver bullet, there's seldom just ONE single quality in a successful leader 😉
Show threadCamille Bacon-SmithDec 29, 2022
@Chronotope B&N did local ordering 20-25 (?) years ago. They switched to centralized purchasing so that they could hire less knowledgeable employees for lower hourly rates. But then there was nobody left to actually hand-sell the books.
Show threadhuman4humanityDec 30, 2022
@Chronotope A good CEO is one who delegate responsibility to people with the know-how to make the right choices. Many CEO don't want to give up "power". This is a shared accomplishment.
Show threadraphaelDec 31, 2022

@Chronotope yes!

and maybe we can even say that the b&n ceo having gone through a pipeline with passion at its first stop helped. in this instance. but not by necessity.

i found it somewhat puzzling to read the crucial insight “There is no substitute for good decisions at the top—and no remedy for stupid ones.” about half way in, and then get presented with ‘anyways, i hope you like the thing enough to become a competent leader. toodles! <3’ at the end.

if anything, it’s the combination of respect and knowing how to materialise the respect competently that saved the bacon, not the passion. blaming the success on passion is ‘hire fans’ all over again.

Show threadChris AldrichJan 1, 2023
@Chronotope Also heavily at play here in their decentralization of control is regression toward the mean (Galton, 1886) by spreading out buying decisions over a more diverse group which is more likely to reflect the buying population than one or two corporate buyers whose individual bad decisions can destroy a company.