Employee empowerment sounds like a good thing, but we don’t always know the business value of giving front-line employees more authority. Best Buy Inc. is providing evidence of the link between empowerment and business results. The company is finding success by allowing store managers to make local merchandising decisions. As part of its “customer centricity” strategy, it is empowering employees in each of its 900-plus stores to adapt merchandising to local markets. One example of the benefits of this policy is the story of what happened at a store in North Carolina. See BusinessWeek, May 26, 2008.
After the chairman of a local retiree club called the Golden Boys bought a high-def TV at the Mooresville (N.C.) Best Buy, store manager Walt Goney invited the club's members to come by at 8 a.m., two hours before opening time. Eighty-five members showed up for a hand-holding session on switching to digital television. They bought $350,000 worth of TVs and equipment that morning. The cost to Goney? Just $99 in labor, plus coffee and doughnuts.
While many large chains and franchisers are tightening the reigns on local stores during these uncertain economic times, Best Buy is giving its employees more latitude in terms of each store’s situation. This is a great example of how a company can push down responsibility and authority (within limits) to the people who interface most with customers. For Best Buy, empowerment is a business strategy that appears to be working. I don’t know if Best Buy has studied the impact on employee learning, engagement, and retention yet, but I assume this policy will have a profound effect on these factors.