November 14, 2024 • 50 mins
Join us for an inspiring journey with Theo Killion, a remarkable leader who transformed his life from a coal mining town in West Virginia to the pinnacle of retail success as a public company CEO. Theo’s story is a testament to resilience and adaptability, shaped by the profound influence of his grandparents and his early challenges at a prestigious New York private school. You'll uncover his rise through the ranks at Macy's, from a trainee to head of human resources, and his bold leap into new opportunities that defined his career. Immerse yourself in Theo’s world of retail wisdom, grounded in humility and the courage to embrace change.
Explore retail excellence and discover the foundational pillars that drive success: the customer experience, employee empowerment, and innovative product development. We reflect on Theo's shift from public school teaching to the retail industry, sharing transformative strategies that prioritize customer satisfaction and inclusivity. Delve into the integration of technology and AI in retail, reshaping supply chains and enhancing data recovery. Our discussion highlights inspiring leaders who've championed customer-centric approaches, showcasing how empathy and collaboration build high-performing teams.
Find inspiration through personal anecdotes and memorable experiences that illustrate quick decision-making and resilience. We celebrate transformative figures like Abraham Lincoln, Sam Walton, and others, drawing parallels between their humble beginnings and today’s retail success stories. Tune in to learn how these narratives shape the evolving landscape of retail, honoring modern-day leaders whose innovative visions have led to remarkable achievements.
Theo Killion's Biography
Theo Killion's career spans nearly five decades in the retail industry having served as a director for both public and private company boards of directors and in a variety of executive leadership roles for some of the most iconic retail brands in North America. Mr. Killion currently serves on the board of directors of Torrid Holdings Inc., a direct-to-consumer apparel and intimates brand, as well as Claire’s Stores, a jewelry and accessories retailer. He also previously served on the boards of directors of Tailored Brands, Inc., Libbey, Inc., Express, Inc. and The Zale Corporation. During his time as a retail executive, Mr. Killion served as Chief Executive Officer for The Zale Corporation and in a variety of other leadership positions for Tommy Hilfiger, Limited Brands, The Home Shopping Network and Macy’s.
Mr. Killion currently serves as a managing partner of the Sierra Institute, a Dallas based human resources consortium. In addition to his retail industry and corporate governance experience, Mr. Killion has deep expertise in all matters relating to human capital, including CEO succession planning, talent identification and leadership development, organizational design and effectiveness, building high-performance teams, and executive compensation and benefits. Mr. Killion is a member of the National Association of Corporate Directors. He is a Vice-Chairman of the non-profit A Better Chance program and a member of the Advisory Board of his alma mater, Tufts University.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Paula (00:00):
Theo Killian's career spans nearly five decades in the
retail industry, having servedas a director for both public
and private company boards ofdirectors and in a variety of
executive leadership roles forsome of the most iconic retail
brands in North America.
Mr Killian currently serves onthe board of directors of Torrid
Holdings Inc.
A direct-to-consumer appareland intimates brand, as well as
(00:21):
Claire's Stores, a jewelry andaccessories retailer, and if
you're like me, you absolutelyknow what Claire's is inside of
the mall.
He also previously served onthe board of directors of
Tailored Brands Inc, libby Inc,express Inc and the Zale
Corporation.
You know the diamond people.
During his time as a retailexecutive, mr Killian served as
(00:42):
chief executive officer for theZale Corporation and a variety
of other leadership positionsfor Tommy Hilfiger, limited
Brands, the Home ShoppingNetwork and Macy's.
Mr Killian currently serves asa managing partner of the Sierra
Institute, a Dallas-based humanresources consortium.
In addition to his retailindustry and corporate
(01:03):
governance experience, mrKillian has deep expertise in
all matters relating to humancapital, including CEO
succession planning, talentidentification and leadership
development, organizationaldesign and effectiveness,
building high-performance teamsand executive benefits.
Mr Killian is a member of theNational Association of
Corporate Directors.
(01:23):
He is a vice chairman of thenonprofit A Better Chance
Program and a member of theadvisory board of his alma mater
, tufts University.
Theo, thank you so much forbeing on the show.
You have a very interestingbackground that most people
would not associate with beingthe CEO of major retail
companies, which we absolutelylove, because it's these unique
(01:43):
perspectives and voices that wewant to highlight more, and
yours is about as unique as theycome.
In your opinion, what were yourthree pivotal points in your
career or in your life thatbrought you to where you are
today?
Theo (01:56):
Sure, first of all, thank you for inviting me to the
podcast.
It's terrific to talk aboutsomething that I love, which is
the retail industry and allforms of commerce that serve
customers, so this is absolutelya joy to do this.
The first and foremost, mostimportant thing that was
(02:17):
transformative for me was beingborn and raised by my
grandparents in West Virginia.
From them I learned humility.
I learned that listening andseeing were much more valuable
than speaking.
I learned that people who knowdon't talk and people who talk
don't know.
Many of those lessons I learnedwith a switch, but I quickly
(02:41):
adapted, and so that wasundoubtedly one of the
foundational things thathappened in my life that I would
have never changed.
My grandfather was a coal miner.
It was an amazing, amazingjourney to begin my early career
(03:02):
in retailing as a traineestacking glasses and housewares
in New Rochelle and Queen Storein Macy's, being an assistant
buyer in tabletop and housewares, and having a career that
lasted 19 and a half years inboth human resources and also in
(03:26):
operations.
I had the opportunity there tobecome an associate buyer.
I had the opportunity there tobecome a buyer of department 618
and 685, moderate women'sactive wear and coordinates, and
I ultimately became the head ofhuman resources and went
(03:48):
through a leveraged buyout.
I went through a growth periodat Macy's from, call it, 1977 to
1987.
Once we did the LBO I wentthrough a bankruptcy.
So I had this incrediblejourney to see business in all
of its cycles.
I think then the next mosttransformative was leaving
(04:09):
Macy's.
When I left Macy's and franklyI thought I would be there for
my whole career it was because Iwas being asked to go into a
job that I thought wassubstantially less important
than the job that I was in, andI sort of stepped into the
wilderness and decided that Iwanted to go and do a turnaround
and I left Macy's, which was afairly comfortable business at
(04:32):
the time, but it was being takenover by Federated and my
attitude was if I'm going tojoin a new company, I want to
join a new company that'sexcited to have me.
I don't have to learn how theydo things and I'm going to go
someplace that's wildlydifferent.
That was a transformative movein my life.
Gautham (04:49):
What was it like coming from a coal mining town to get
yourself to be a CEO of a publiccompany?
What were the challenges andthe opportunities you faced to
get yourself?
It was a journey, the idea of Ihad been accepted into a
program for kids who showed someacademic promise and had the
(05:12):
opportunity to get a scholarshipto go to private school.
The first thing was I left mylittle bitty town in Montgomery,
west Virginia, and I took a busride to New York City.
So my town hit about 4,000people.
I'm going to New York City, I'mgoing to Port Authority and
they said look for somebody whohas a flower in their lapel.
(05:35):
This is a late 60s.
Everybody has flowers in theirlapel, they have it in their
hair.
And I'm walking around lookinglike Jethro Bodine on the
Beverly Hillbillies with thesetwo pieces of luggage didn't
have a piece of natural fiber inthem my suit that I bought for
$29.99, that had a reversiblevest and two pairs of pants.
(05:55):
I ultimately fell my way to thepeople I was supposed to be with
and I went to private school.
Private school was like landingon another planet.
Sons, it was all boys.
There were general sons, therewere people who were captains of
industries, sons who were there.
There was a whole differentrhythm and talk to the business.
(06:16):
What that did was it put me intoabsolute shock.
From an academic standpoint, Iwas able to catch up after a
year.
But what it also did?
It gave me the confidence tosay I can compete academically
with anybody.
Once I made that academic leapand understood that being
(06:37):
impressed by who you were andwhere you came from wasn't as
important as how you appliedyourself, how you learned, how
you use hard work and discipline.
Once I understood those things,you know, my undergraduate
career was relatively easy.
I finished in three years, Iwent to graduate school and then
(06:57):
I started after graduate schooland, as Paula mentioned, my
undergraduate majors werehistory and English, my graduate
degrees in education.
Each one of those threedisciplines were hugely
important in everything that Idid after that I'm going to ask
one follow-up question.
A town of 4,000, you chose to leave that to go to one
(07:20):
of the biggest cities in theworld.
What was the motivation?
What was the drive?
And you don't need to tell yourage biggest cities in the world
.
What was the motivation Like?
What is the drive?
And you don't need to tell yourage, but you're young.
I left India to come to the US.
I'm trying to think about whatdrove you to leave, where you
probably knew every person inthe street.
Theo (07:36):
Yeah, if you left India to come to the US, you had some
either thing that was in you orsome group of people who believe
that education was going totransform your life and
potentially their lives.
So my grandmother, who went asfar as the fourth grade, my
grandfather, who went as far asthe seventh grade, had this
fundamental belief thateducation was going to be my
(07:58):
ticket out of the circumstancesthat we were in.
They believed that was going totransform my life,
circumstances that we were in.
They believed that was going totransform my life.
Imagine these people who are inWest Virginia who are letting
their little boy go it was justme with them into this
incredibly foreign world thatthey could absolutely not even
imagine.
I'm going to private school,I'm going where.
(08:20):
I'm going to do what?
So they took an enormous leapof faith.
The amount of love andcommitment that they showed to
me gave me the strength and theenergy I can remember being in
college.
One of the things that happenedduring my freshman year which
I'm sure never happens with anyother students is I kind of lost
my mind that first semester.
(08:41):
I can remember getting a grade.
It was like a 1.8.
And I saw that and it slappedme into reality because I said
to myself this is going to breakmy grandparents' heart and I
wound up graduating in threeyears with honors and really
spending time focusing on thereason why I was there, which
(09:02):
was to do the thing that theywanted.
That was their dream.
I was there the manifestationof their hopes, dreams and
aspirations and had thisopportunity to do this, so there
was really never a questionabout it, I think probably, you
know, when I came back talkingfunny without my Southern accent
and growing an Afro, when Icould actually do that, they
(09:23):
probably thought I lost my mind,but they were just incredibly,
incredibly proud of me.
Paula (09:29):
I want to go back to something you said which I think
is very important and a lot ofpeople can't make that
connection.
How exactly did history,english and education help you
further on in your career?
Theo (09:41):
So first let me talk about history, charlie Munger, who
recently passed away, who'sfamously the person who was a
partner with Warren Buffett,berkshire Hathaway.
What Charlie said was I make ahabit of making friends of
imminent dead people, and whathe meant by that.
If I study the past, if I learnfrom the people who are
(10:06):
successful, and I curate,cultivate and think about what
those lessons are for theproblems that I'm trying to
solve today, I'm going to bemuch better at what I do
Throughout my professionalcareer, throughout my personal
life.
My books are filled withstories of people in history.
(10:26):
I have read the story of SamWalton.
I have read the story of JeffBezos.
I have read the story of JosiahWedgwood.
I have read the story ofMichael Dell.
I have read the story of all ofthese amazing people.
I've lived the story with LesWexner and Ed Finkelstein Les
(10:47):
famously being at the Limited,ed Finkelstein being at Macy's
and I was able to pull throughlines from what they talked
about and what they did intowhat I did, so I didn't have to
make those same mistakes.
One of my favorite quotes iswhat we learn from history is
that we don't learn from history.
That will never, ever besomething that I can be accused
(11:10):
of, because I had that groundingand understanding that while
history doesn't repeat itself,it rhymes, so there are things
that are happening along the waythat are instructive to what
you do today.
English, if you are in business,being able to put together
thoughts in an organized way,being able to think with a
(11:33):
critical mind, being able toaccumulate information and be
able to translate that messageso that you're giving articulate
messages, is hugely important.
That's an English discipline.
The idea of storytelling, whichI think is so critically
important to being able to getan organization to join you on a
(11:54):
journey, comes from being anEnglish major and understanding
all of those stories and all ofthe ways that they're put
together and how you can bringthem forward.
When I was the CEO of Zales andwe were losing money like crazy
and it was about to go out ofbusiness, I talked about making
a journey to the profit promisedland and getting through the
(12:14):
Red Sea of debt and use thosebiblical stories to be able to
get people to think aboutsomething that's fairly
universal in their references,but to then move with us to
think about it.
So English, hugely important.
Being an educator each of ourobligations as leaders is to
take the things that we havelearned and impart them to the
(12:37):
people who are with us.
So I've never left education.
Education has never left me.
I push books into my mind andpodcasts all the time.
I won't live long enough toread or listen to everything
that I'm interested in.
I can't imagine a world withouteducation.
I can't imagine being a leaderof any people without learning
(13:00):
how to be an educator, andeducator meaning the lessons
that you teach are lessons thatthey can take and they can apply
and they can make their livesbetter.
So I thoroughly enjoy.
When I thought about myself asa chief executive officer, I
thought about myself as the headprofessor in the class, and my
(13:22):
job was to be able to helppeople to get to where I was and
be able to articulate the samethings that we're trying to do
on our mission to turn abusiness around.
Rich (13:32):
So I want to follow up with that.
Our paths have fortunatelycrossed on several occasions and
I've always held you in thehighest regard as a retailer and
as an individual.
And listening now at the wayyou connect the dots so
thoughtfully, at what point didyou connect the dot and decided
retail?
Theo (13:52):
All the way back to when I finished graduate school.
I tested the water as a publicschool teacher and I had a wife
and a child and I thought Ireally enjoy this.
I was coaching, I was doing abunch of other stuff, but I'm
kind of getting back to beingpoor again.
As much as I love what I didwith those incredibly fantastic
(14:17):
students, I thought you know, ifI'm successful, I can continue
to do that later on in life.
So I started to interview withany number of organizations.
I interviewed with banks, Iinterviewed with insurance
companies.
I interviewed with retailers.
The people in retail were a lotlike me.
They were people who came from,in many cases, humble
(14:39):
beginnings.
They were people who succeededbased on their creativity, their
intellect and their hard work,and they were successful.
They were people I could, basedon their creativity, their
intellect and their hard work,and they were successful.
They were people I could relateto.
There was a humor to thebusiness.
There was this opportunity at avery young age to manage a
profit and loss statement and Ithought this is amazing.
This is absolutely magical.
(14:59):
So going in and think aboutactuarial tables and the people
that you would have to associatewith wasn't really interesting.
Banking was modestlyinteresting, but wasn't
necessarily the kind of people.
That club wasn't a club that Ifit naturally in, a club of
people who were working theirway into middle class, who were
(15:22):
working their way up sort of theladder, where people I could
relate to.
So I fell in love with it, rich, at a really young age, and
that love affair continues tothis day.
Paula (15:35):
That's beautiful.
I think Rich fell in love withit too, given his background
that we know.
Let's move on to the lessonpart, because we have a lot to
learn from you here.
So let's move on to the lessonpart, because we have a lot to
learn from you here.
Something that we've heard yousay is there are three important
points and pillars of successfor retail and commerce.
What are those pillars?
Can you talk us through that?
Theo (15:54):
Sure, I think customer, I think people and I think product
.
There are a lot of other things, and how you mix that together
in order to get to profit isyour ultimate goal.
It starts with having anappreciation of, and a love for,
the people who pay the bills,no matter what form of commerce
(16:17):
you're in.
If you cannot put those peopleon a pedestal, then you will not
do your business well.
When I became a CEO, one of thefirst things I said to the
first gathering we had of all ofthe people was we're going to
do this, we're going to invertthe pyramid.
I'm going to be on the bottom,customer's going to be on top
(16:38):
and the people who serve thecustomers are going to be the
second most important people inour business.
So what we did was we changedsome of the terminology.
Our customers stopped beingcustomers.
We promoted them to beingguests.
Our sales associates stoppedbeing sales associates.
They started becoming customers, jewelry consultants.
Our headquarters stopped beingheadquarters.
(17:00):
It became the store supportcenter and we culturally started
talking about what does thatlook like?
To put the customer on top, tothink about how we relate it to
him or her in a different way,how we get into their thoughts,
their hopes, their dreams, theiraspirations.
How do we get into that in adeep and meaningful way?
(17:22):
And then how do we follow themon their journey so we're always
relevant to who they are andwhat they do.
In studying history, one of theabsolute through lines of many
of the people that we'vementioned is their love,
appreciation and understandingof how important customers are.
Jeff Bezos famously used tokeep an empty chair in his
(17:45):
office when they had meetingsthat was for the customer, so
that they never, ever, forgotthe customer.
Marshall Field's book isentitled Give the Lady what she
Wants.
Throughout all of these, theyhad an understanding and an
importance of the people thatthey work for.
Les Wexner, who was the CEO ofthe Limited, used to say never
(18:07):
sell down to the customer,always sell up, Always give them
something that elevates themand, whether or not they are
buying $5 or $500, make themwalk out of the store with an
elevated experience.
One of my many favoriteexpressions is what they walk
out of the store with in the bagis the product.
(18:29):
What they walk out with intheir mind and their heart is
the experience of the brand.
That bridges over to this ideaof the people.
If you're going to elevate yourcustomers, then the people who
are most directly involved withthose customers are the people
on the front lines, the peoplewho are managing your electronic
(18:51):
commerce, and you have toelevate them.
Howard Schultz talks about thehumanity of work and talked
about surprising the people whoworked in that business.
He famously gave part-timebenefits to people.
He gave equity and stock tothem before they went public.
But he talks about being ableto surprise them and make them
(19:14):
feel good so they would do thesame thing for their customers.
So those things connect closely.
And then you have to buildsystems and processes that hold
up those two things.
That celebrates those twothings.
We used to have celebrationstwice a year where we brought in
our store's leadership, who wechanged from being district
(19:38):
managers to district leaders,store managers to store leaders
changed from being districtmanagers to district leaders,
store managers to store leaders.
We anointed them and saidyou're no longer renters, you're
owners of your business.
We're going to give you yourP&L and we're going to tell you
how to use it to drive yourbusiness forward.
But we used to bring in thepeople who sold a million
dollars worth of jewelry everyyear.
When we started out we hadabout 15 of those people by the
(19:58):
time we started to fix thebusiness.
There were 40 of them.
It was like going to graduateschool, because I'd sit down
with them and I'd ask them forinformation about how they ran
the business, the things that wedid that helped transform the
business that I was in.
I would say easily 70%.
I learned from somebody in astore.
You go to Canada.
They say you know, we reallywould love to have Canadian
(20:19):
diamonds up here because peoplein Canada take, oh well,
Canadian diamonds in Canada.
That sounds like a really goodidea.
So you know, you go out thereand you get these unbelievable
pearls of wisdom from the peoplewho were there and you lift
them up In a company that hadbeen suffering for a long time.
You try to get to a point wherethey're proud of the place they
(20:40):
work again, where they can gohome and they can talk to their
friends and their loved ones andsay I work for this company and
I'm really proud of it.
Every one of them is anambassador and if they're going
home and their loved ones aresaying get out of there, it's a
terrible place to work.
They're fighting for justgiving them a paycheck, but
you've lost their hearts andtheir minds.
(21:02):
The third thing is product, andI know that Rich can certainly
relate to this.
The expression in retail iswhen the product is right,
everything else matters.
When the product is wrong,nothing else matters.
It's absolutely true.
The interesting thing aboutproduct, though, when you have
really great people, is, evenwhen we went into a business
(21:23):
that was about to go bankrupt,there were about 50 to 100
stores that were having positivecomps.
It's like, oh, that'sinteresting and they had the
same bad marketing.
They had the same bad product.
They had the same lack ofinvestments in their stores.
They were dirty, the case linesweren't great, so part of my
first diligence was to go tothose stores and figure out what
(21:45):
was going on.
It reinforced this idea thatgreat leaders of stores can lift
people up and create a culturewithin that four wall space.
And then, if you start to listen, if you have old inventory that
hasn't been replaced, if youdon't get the product
architecture of the businessright good, better, best and be
(22:08):
able to start to listen and givethem great product, Most
products are very similar toeach other.
If you're in the diamondbusiness, Technically a diamond
is a diamond.
What they do functionally isabsolutely the same.
How it makes you feelemotionally is where the
difference lies.
When I was at the limited andwe were selling, you know,
(22:30):
Victoria's Secret, you could goanywhere and get what we sold.
So technically same stuff,Functionally it did the same
stuff.
But the margin lives in emotion, how that product makes you
feel.
And that's when you link onceyou get the product assortment
right, marry it with greatmarketing, great storytelling,
(22:52):
and you start to elevate it sothat when people walk in your
store they're getting greatexperience from the jewelry
consultant, they're beingtreated like a guest right?
So the mentality of having aguest in your home is you clean
up differently, you servedifferently.
You want them going out with apositive impression.
(23:13):
So if your job is to get readyto serve the guest, and when
they're there, you don't rushthem out, you spend time with
them.
You listen to what is theproblem that you're trying to
serve the guests, and whenthey're there, you don't rush
them out, you spend time withthem.
You listen to what is theproblem that you're trying to
serve with the product that wehave, and then you try to give
them something that makes themfeel great for themselves or for
someone else that they love intheir life.
(23:34):
That's where the magic happensElevating that guest experience
so that it's special withunbelievable product, so that
you feel like you have anaffordable luxury when you walk
out of there.
We were in the diamond business.
We'd forgotten we were in adiamond business.
Diamonds sit at the corner oflove and happiness.
What could be better than thatas your selling proposition?
(23:54):
Everybody was looking to makesomebody happy for themselves or
somebody in life.
So if you're starting with thatselling proposition, it's like
how in the world did we screwthis up through the years?
And then you start to makepeople feel good about who they
are and what they do.
Things start to happen.
I mean really, really specialthings start to happen.
Gautham (24:13):
Theo, if we stop the interview now, it'll be great,
but I want to ask you,specifically of those four years
, 2010 to 2014,.
Sales price was sales where Ithink was a dollar or a buck or
something, and when okay, $1.39.
And I think when you were doneit was like $22 or something
like that.
You turn it from $120 millionto about $19 million in profits.
(24:35):
You talked about customers, youtalked about people and you
talked about product.
In my opinion, the people, youremployees, are critical to
making that experience.
When morale is down, whenpeople are beaten down, how do
you manage that turnaround toget them to walk around with
their heads held high, go homesaying I'm proud to work here?
(24:55):
Can you talk about that?
Give some secrets for ourstudents who are learning those
leadership skills.
Theo (25:02):
You have to do a number of things.
You have to make sure that youhave the right people in the
right jobs and when you have abusiness that hasn't done well
for a very long period of time,you have people who really want
to do well but don't know whatto do.
There are people who are kindof hiding and you have people
who have just checked out andthey're getting a paycheck.
(25:22):
You tell them what theexpectations are.
You're very clear about whatthey need to do and then for the
people who shouldn't be in thebusiness, you help them to not
be in the business.
That had to happen literally atevery level of the company.
We did assessments in our fieldorganization of the top 100
stores and the bottom 100performing stores.
(25:44):
We started to understand whatthe capabilities were like human
resources background, what thecapabilities were of the high
performers and we startedmanaging to hiring only people
who showed those skills andabilities, hiring only people
who showed those skills andabilities.
What that meant was that manyof those people came from a
different industry and we had tofund 40 hours of training for
(26:10):
every single person who came inin a leadership job so that they
learned the easiest part, whichis the jewelry business.
The hard part is how do youlearn empathy, how do you learn
passion for the guest?
How do you learn how to getpeople to dream big when they've
been to your point, beaten downover a period of time?
If you hire people like that,then you teach them the
technical stuff right.
(26:31):
The old saying the hard stuffis easy, the soft stuff is hard.
If you hire the right peoplewith the right soft stuff, train
them on the technical stuff.
So now we got a group of peoplewho are ready to march into the
future.
We will take you on the journeyif you have the right attitude.
What I will not tolerate is anegative attitude.
What I will not tolerate isbackbiting.
(26:52):
What I will not tolerate peoplewho are on this team going
after other people on the team.
If you aren't ready to go onthe journey, we will help you to
make a journey someplace else.
If you want to go with us, youare going to be included.
You are an equal partner in allof the decision-making as we go
forward, understanding that theboard has a bull's eye on me.
(27:14):
That's a lot larger than thebull's eye on you guys, but
we're going to go forward in thejourney together.
And then I think the otherthing that's pretty tactical is
that first year we didn't giveraises.
Going to the second year weweren't probably going to give
raises.
The only thing that I couldgive them was hope.
The only thing that I couldgive them was accessibility.
(27:35):
I sent messages to the fieldevery single week.
I was in stores every singleweekend.
I told hero story on all of mystore calls.
So I just went to Oklahoma Cityand the jewelry consultant
there told me a story about howthere was a customer who was a
mall walker, who had walked thismall for years they have
(27:56):
overalls, looked a little dirty,clearly a farmer in Oklahoma.
But I asked him one day.
I said you know, you're aroundhere all the time.
You've never come in to buyanything.
And he said to me I actuallyhave a 50th anniversary.
I've never been able to buy mywife a ring and I'd like to buy
her a ring.
And he said would you help me?
He came into the store with abox full of money True story Box
(28:24):
full of money.
True story Box full of money.
And they picked out a ring andmade him a hero.
So the lesson that was taught isdon't assume that the person
who's walking in the mall, don'tassume the person who's come
down, who's dressed a littledifferently, isn't a person,
because this jewelry consultantin this store did it and every
single week there'd be anotherhero story.
These are the people who arethe most important people in the
(28:46):
business.
So giving them hero stories.
Every single district managerhad my phone.
Every single million dollarjewelry consultant had my phone.
So I okay, what do you need?
Let's talk.
But it's demystifying If I'm onthe bottom and they're flowing
information to me and thatinformation is help us, helping
us to run a business, and I cantalk about changes that are
(29:09):
significant changes in thebusiness and I could say I
learned this idea from and put aname to it.
People go, wow, this isdifferent, this is really
different.
And then when we startedstarting changing the assortment
in the first year and ourbridal business started comping
positively in the first year andthe business had its first
(29:29):
comps in three years and then wehad 14 straight quarters of
positive comps and everybodystarted to get paid Like it was
really easy to keep them.
At that point we didn't loseanybody on a team that we wanted
to lose.
They were equal partners in thejourney.
The communication was there, sothey understood that this isn't
a me, this is a we and a us.
Rich (29:51):
So you've mentioned the love of history and one of my
favorite books is the Romance ofCommerce by Harry Selfridge, so
I wanted to ask a questionabout artificial intelligence,
technology and what retail lookslike today.
Where do you think retailerstoday are getting it right and
where do you think they'regetting it wrong when it comes
(30:14):
to incorporating technology intothe retail experience?
Theo (30:18):
Yeah, it's a little bit of a difficult question to answer
only because different peopleare doing different things.
I don't think that there's oneanswer to that question.
The people who have shown thegreatest amount of success early
are using AI in supply chain.
People who are using AI in datarecovery are getting really
(30:40):
good information to informdecisions that were largely
based on instinct before.
Instinct still has to be a partof it, but I think people are
treading slowly on it to try tofigure it out a little bit.
There are lots of things thatare being called AI that aren't
necessarily AI, so I think we'restill very much in the early
stages of learning.
(31:01):
Rich.
You'll remember, in the earlydays of the internet, there were
a lot of resistors.
There were people who didn'tbelieve in not only the internet
, but they didn't believe inthis thing called electronic
commerce.
Nobody wanted to be the earlyadapter because it was an animal
(31:24):
they'd never seen before, sothey don't know how to talk
about it, describe it.
I'm all for change.
You first was kind of theattitude that went into it.
I think that's a little bitwhere we are in AI.
I think it's enormouslyinteresting.
I think the opportunities couldbe vast.
It's a little bit of go slow togo fast for most of the people
(31:46):
that I work with or have somefamiliarity with.
Rich (31:49):
I will share a very quick anecdote that you'll appreciate,
given your history.
So I was at Joe Bank early inmy career, right around the time
that you were seeing the firstinklings of e-commerce.
Right around the time that youwere seeing the first inklings
of e-commerce, and I'm the onethat actually registered the
josebankcom name because Ithought it might be something
when the company didn't want to,and a year later it was hey, we
(32:10):
think we want that A littleproud moment.
That'll never go on my resume.
But you are right, I rememberthose days where I distinctly
remember executives saying thisthing will never work.
Theo (32:22):
It's not so long ago that people in other jewelry
businesses didn't believe ine-commerce.
Not so long ago, like when Iwas a CEO, I was like don't tell
anybody about this and all wedid was mint money.
And, as you know, you know,among the many wonderful things
(32:44):
about it is you get to testitems there a lot more cheaply
than you can test them anywhereelse.
We used to call it the longtail.
What are people looking at?
What search words are theyputting in that we don't have?
Let's buy a little bit of it,let's put it on the site.
It was and is absolutelyphenomenal.
When you blend that intoartificial intelligence, it can
(33:05):
give you even more of aninstinct in terms of what people
are looking for and wherethey're going after they walk
into your site.
It can be extremely, extremelypowerful.
Paula (33:15):
We've gleaned a lot of great advice from you, so I want
to ask you, as someone thatalways had to work harder I'm
also a minority, oh, no kidding.
I don't know if this was yourexperience, but from what I
heard you say, you had to workharder, not necessarily
differently, you just had towork harder in some occasions,
(33:38):
right, either it was to fit inor to understand the culture or
to understand the environmentthat you're in, because we
didn't grow up in that there wasalways some element that we had
to work that wasn't there forother people.
In all of that, what do youthink your biggest failure that
stands out to you is, and whatdo you take away from that?
What lesson is there?
Theo (33:59):
There's a fair amount of failures along the way.
I think, as I look at them inthe rear view mirror, they were
lessons and I was able to putthem into the right place at the
right time.
When I left Macy's, I went to aplace called the Home Shopping
Network.
That, at the time, was the nextbig thing.
(34:21):
E-commerce really wasn't athing at all.
But, boy, this televisionshopping thing that gave you
instant information, where youcould have the sales that were
going on in the studioregistered on your computer in
real time and you could look atit against gross margins.
It was unbelievable.
(34:42):
So when I left, I wanted to gointo a turnaround.
I wanted to do something wildlydifferent.
That was the future of thebusiness.
So I left and I joined HomeShopping Network.
I joined in April.
I was fired in December.
At the time, particularly comingoff of 19 and a half years of
being someplace where I washugely disappointed that I
(35:03):
didn't have the opportunity tostay, even though it was at my
own volition and then beingfired, you start to question
yourself a little bit and youstart to question your
decision-making.
What that did for me was abunch of things.
At Home Shopping Network, theCEO was fired.
So I started in April.
Ceo was fired in September.
Like hmm, things aren't goingthat great.
(35:26):
So the COO and I startedlooking at the business and what
could I do and what could he do?
So I had the stores, I had thecall center.
I had this much bigger job thanI would have had anywhere else
if I weren't in a turnaround.
I was starting to rewritestrategy documents and so forth.
Then my boss got called in inthe morning I think it was eight
(35:48):
o'clock he got fired.
The head merchant got fired at8.15 and I got called in and got
fired at 8.30.
And what I took away from thatwas it was disappointing.
It was really difficult from anemotional standpoint.
You go through all those stagesof grief, anxiety, fear was
disappointing.
It was really difficult from anemotional standpoint.
You go through all those stagesof grief, anxiety, fear, hate.
And then I thought wait aminute, let me take some time to
Take e-commerce courses.
(36:10):
Seems like it's the next newinteresting thing.
Let me take some time to spendtime with my daughters because I
was divorced at that point.
So we took an incredibly longcruise.
We still laugh about it today.
But if I go into turnaround,they give you a lot of stuff to
do.
You know, if you're reasonablysmart, if you're calm and cool
(36:33):
headed and you have thisambition to learn and grow, boy,
you get a lot of stuff to do.
So I mean, the good thing aboutit was I had the ability there
to go to the University ofChicago and take finance courses
, because I understood the P&Ldown to the gross margin level,
but not below, and again I knewthat that was something.
If I was going to be anAmerican business, I had to
(36:54):
speak the universal language ofbusiness, which is finance.
I did that and then I got acall from the guy with whom I'd
worked at Home Shopping Network,who was a Tommy Hilfiger, and
said hey, I want to see you whenyou're in New York.
Why don't you come in and see me?
He showed me the strategydocument and said do you want to
do another turnaround?
I said, dave, is it going toend better than the one we just
(37:15):
did?
He gave me a ton to do in thebusiness.
Helping him with strategy,helping him with part of the
wholesale business Gave me great, great latitude.
We had fun in the hiringprocess.
He trusted me so that when Isaid, this is the right person
to hire as a VP.
They would come up and see him.
They would come down to see meand I'd give them up.
(37:37):
That happens in the turnaround.
That doesn't happen in some ofthe businesses that they believe
they have it all figured out.
Gautham (37:43):
Maybe I'll ask a question on advice.
You've given a lot of adviceright and in your illustrious
career, what stands out as anunderrated value, like you
talked about that innatecuriosity and so forth?
You talked about yourgrandparents saying like talk
less, do more.
I'm paraphrasing there, ofcourse.
What is the value that youwould like to see instilled in
(38:05):
your employees today that willmake them stand out in a world
of AI, in a world ofever-changing needs.
Theo (38:13):
Part of the answer would be the idea that was instilled
in me by my grandmother, whichwas God gave you two ears and
two eyes for a reason, and onemouth.
So it all starts with having anability to do more than look
but to see, do more than hearbut to listen, to be able to
(38:37):
understand what it is that'shappening around you that then
drives the decisions that youmake and that leads to good
questions.
One of the things that Ibelieve great merchants do and
designers is they look at theworld with childlike eyes.
They look at the same stuffthat we see and they see
(38:58):
something different.
They see possibilities.
So I think understanding thatlistening and looking is
critically important.
One of the most importantskills for me as a leader was
reading the emotions on people'sfaces, trying to figure out
what was on their minds, whetherthey were with me or they
weren't with me, listening towhatever feedback that they
(39:20):
would give me.
Totally undervalued is thisidea of listening and seeing
Several of the people who Iadmire greatly.
A woman named Grace Nichols,who used to run Victoria's
Secret, is someone who, when wewere in board meetings together,
she would sit there relativelyquietly while everybody else is
(39:40):
talking about stuff orstruggling with something, and
she would offer this incrediblepearl of wisdom that would just
cut through everything becauseshe's seeing and she's listening
.
I was in a meeting once with theCEO of the Limited and we were
in a Christmas meeting and therewas a huge debate that was
(40:01):
going on with the marketingperson, the strategy person, the
merchant, about what theChristmas promotion would be.
This is in January and wealways looked at our Christmas
promotions at least 11, 12months early.
They would look to Les Flexnerfor the answer.
Right, like you do with yourdad, like we're arguing, I'm
making all these great pointslooking at Les, and he never
(40:24):
responded.
And I had the opportunity afterthat meeting to sit with him
and a group of executives andsomebody said why didn't you say
anything?
He said well, my firstresponsibility is to hire really
smart people that I respect.
If they're arguing aboutsomething and if they're having
difficult and it's a strategicdecision the best thing I can do
(40:46):
is listen and think about itand not react in the moment,
because this is a decisionthat's going to affect our
business for the next year,because Christmas sets the table
for the next year.
The best thing I can do is hearwhat they were saying, what
their tension points were, andthen think about it.
I need to go away and digest itbecause they're really really
(41:08):
smart, that listening skill,that ability to separate am I in
a tactical meeting wheredecisions are made, or a
strategic meeting where maybeyou ought to listen and drawing
out the people who are quiet,right, still waters run deep.
There's some really reallysmart people.
(41:28):
You know, you get confused bythe people who have the biggest
microphones, who are the mostarticulate, and you have to be
able to separate what I used tocall fibs, facts, inference and
BS Again, just to put a pin onit.
I think listening, I thinkseeing and understanding when to
do those things, even when youare in a position of authority.
Bringing out peopleunderstanding that there are
(41:49):
people who are maybe on yourfront lines who know a heck of
authority.
Bringing out peopleunderstanding that there are
people who are maybe on yourfront lines who know a heck of a
lot more than you is hugelyimportant.
Rich (41:58):
What do you do personally to find inspiration today?
Theo (42:02):
Spend time with my grandkids.
They're amazing.
They're amazing.
It's looking at the worldthrough childlike eyes.
It's what you do, rich, whenyou listen to your daughter and
she teaches you about the worldthat she lives in.
That's different than the worldyou live in.
I don't have to go to tiktok.
All I have to do is askquestions to my granddaughters,
who are amazing.
I walk the mall and I ask themwhat they think about certain
(42:26):
stores.
They know all of thebest-selling products at
lululemon, at sephora, and it'sremarkable.
I ask, ask them what do theythink about how they're treated
when they walk in there?
Are they treated with respect?
So my store visits now are withthese little ladies who are
wicked smart and who can dothings that they don't know,
(42:48):
that they're doing, and teach anold dog a couple of new tricks.
So talk about inspiration.
Nothing like it.
Paula (42:56):
Fantastic.
All right, theo, are you ready?
This is the most exciting partof the conversation.
It has to be the first thingthat comes to mind.
We're each going to ask one Areyou ready to start?
All right, you've been in somereally great commerce in retail
companies.
What's the most unusual itemyou've ever bought or sold?
Theo (43:16):
I didn't prep for this.
So, whatever it is, yeah, Ithink it was an item, that was a
piece of jewelry that was theuniversal symbol for pedophilia
that we didn't discover untilwell into the selling cycle.
(43:37):
Not only was it unusual, itcould have brought the business
to its knees.
So how we reacted and the waythat we reacted was critically,
critically important and therelationship obviously with the
person who sold us that jewelrychanged quickly, but everything
around that was unusual.
Paula (43:58):
Yeah, that's a whole Harvard business case study
right there.
Rich (44:02):
So I'm going to ask the next one Do you have a specific
walk-on song or a style of musicthat hypes you up when you're
getting ready to speak?
Style of music that hypes youup when you're getting ready to
speak.
Theo (44:23):
It changes, Rich.
It changes with kind of what'sgoing on in the zeitgeist, but
what I would say is the one andit's a wonderful sort of sonnet
to James Earl Jones, the onethat I like a lot is the
Imperial March by I think it'sJames Collins.
I absolutely love that song andif you play that before you
(44:47):
walk out on stage it getspeople's attention.
I go, this guy's nuts, what ishe doing, Darth Vader?
It's phenomenal.
I also like where is the loveby the black IPs?
You know, a question thateverybody should be asking.
So there's several, but let'sgo with the Imperial March.
Rich (45:07):
I will absolutely take that answer and I'm going to
take that back to a active dutycommander that I work with who
will absolutely love that answerbecause she used it in the most
appropriate situation.
Gautham (45:18):
No, wow, since you said you're a history buff, I'm
going to ask the historyquestion.
If you could invite threepeople to dinner, who would
those three people?
Theo (45:28):
be and why.
So there's going to be a threadhere.
One will be my grandmother tobe able to thank her and to be
able to do something that Ididn't do when I had her, which
is to ask about her journey, herlife, how she got to where she
was, what her influences were,how she became such an amazing
inspiration.
(45:48):
That's one that I really wish Ihad a do-over.
I think a second one would beSaul Price, who was.
If you pull the thread throughCostco and you go all the way
back to FedMart, saul Pricestarted FedMart, which became
Price Club, which ultimatelybecame Costco.
(46:08):
And if you ask Jim Senegal, whoran Costco, where did he learn
everything from?
He'd say Saul Price.
If you ask Jim Senegal, who ranCostco, where did he learn
everything from?
He'd say Saul Price.
If you ask Jeff Bezos, where helearned a lot of his lessons,
he would say Saul Price.
If you ask Sam Walton, if hewere still around In fact it's
in his book that he stole a lotof ideas from Saul Price.
(46:28):
And if you think about Costco,which is one of the retailers, I
have this huge admiration forthat.
Stuff started with Saul Priceand, like so many people who I
loved in retail, which is thereason why I joined retail.
Saul had an amazing sense ofhumor.
I think if I were to think of athird, it would be probably
(46:50):
Abraham Lincoln, because it wassuch a transformation that took
place in who he was.
There was such a deepunderstanding of what was
necessary to try to keep thecountry together, the
compromises that needed to bemade, the absolute intellect.
Talk about a man who could tellstories for hours, those
(47:10):
debates that he used to havewith Douglas that lasted for
three and four and five hours.
And when I think about myhumble beginnings, I grew up
like the fresh Prince of Bel-Air, compared to Abraham Lincoln,
who only had, I think, one yearof formal learning and who was a
voracious reader.
So yeah, those probably thethree people.
Rich (47:30):
Well, before Paula closes it out, I'm going to say that
you're actually a retail hero ofmine Since the first time we
had the chance to meet in anoffice in New York.
I've followed you since thatpoint and held you in the
highest regard, and I sharedwith Paula and Gautam that when
(47:51):
I interviewed withales I was soimpressed that I did buy the
stock under $2.
Oh no, you really, oh heck.
Yes, I know a good leader whenI meet one.
I bought it under two and mydaughter thanks you.
Theo (48:05):
So you know I wear the title of hero very uncomfortably
.
Let there be no doubt and I saythis in all sincerity that the
greatest satisfaction that Ihave in being able to have that
Zales story is saving 13,000jobs for 13,000 people and
working with people in eachfunctional area marketing,
(48:27):
merchandising stores, financewho are much, much smarter than
me and who hired the opportunityto bring together around a
strategy and a focus and adiscipline so that we can make
it all come together and work.
I love the people that I workedwith during that journey, and
(48:48):
it starts with the people on thefront lines.
But thank you, rich, Iappreciate that the people on
the front lines.
Paula (48:53):
But thank you, rich, I appreciate that.
Well, theo, thank you.
We can't thank you enough foryour time and your expertise,
and thank you for everything.
Thanks for the lessons and forstaying over with us.
Theo Killian's career spans nearly five decades in the
retail industry, having servedas a director for both public
and private company boards ofdirectors and in a variety of
executive leadership roles forsome of the most iconic retail
brands in North America.
Mr Killian currently serves onthe board of directors of Torrid
Holdings Inc.
A direct-to-consumer appareland intimates brand, as well as
(00:21):
Claire's Stores, a jewelry andaccessories retailer, and if
you're like me, you absolutelyknow what Claire's is inside of
the mall.
He also previously served onthe board of directors of
Tailored Brands Inc, libby Inc,express Inc and the Zale
Corporation.
You know the diamond people.
During his time as a retailexecutive, mr Killian served as
(00:42):
chief executive officer for theZale Corporation and a variety
of other leadership positionsfor Tommy Hilfiger, limited
Brands, the Home ShoppingNetwork and Macy's.
Mr Killian currently serves asa managing partner of the Sierra
Institute, a Dallas-based humanresources consortium.
In addition to his retailindustry and corporate
(01:03):
governance experience, mrKillian has deep expertise in
all matters relating to humancapital, including CEO
succession planning, talentidentification and leadership
development, organizationaldesign and effectiveness,
building high-performance teamsand executive benefits.
Mr Killian is a member of theNational Association of
Corporate Directors.
(01:23):
He is a vice chairman of thenonprofit A Better Chance
Program and a member of theadvisory board of his alma mater
, tufts University.
Theo, thank you so much forbeing on the show.
You have a very interestingbackground that most people
would not associate with beingthe CEO of major retail
companies, which we absolutelylove, because it's these unique
(01:43):
perspectives and voices that wewant to highlight more, and
yours is about as unique as theycome.
In your opinion, what were yourthree pivotal points in your
career or in your life thatbrought you to where you are
today?
Theo (01:56):
Sure, first of all, thank you for inviting me to the
podcast.
It's terrific to talk aboutsomething that I love, which is
the retail industry and allforms of commerce that serve
customers, so this is absolutelya joy to do this.
The first and foremost, mostimportant thing that was
(02:17):
transformative for me was beingborn and raised by my
grandparents in West Virginia.
From them I learned humility.
I learned that listening andseeing were much more valuable
than speaking.
I learned that people who knowdon't talk and people who talk
don't know.
Many of those lessons I learnedwith a switch, but I quickly
(02:41):
adapted, and so that wasundoubtedly one of the
foundational things thathappened in my life that I would
have never changed.
My grandfather was a coal miner.
It was an amazing, amazingjourney to begin my early career
(03:02):
in retailing as a traineestacking glasses and housewares
in New Rochelle and Queen Storein Macy's, being an assistant
buyer in tabletop and housewares, and having a career that
lasted 19 and a half years inboth human resources and also in
(03:26):
operations.
I had the opportunity there tobecome an associate buyer.
I had the opportunity there tobecome a buyer of department 618
and 685, moderate women'sactive wear and coordinates, and
I ultimately became the head ofhuman resources and went
(03:48):
through a leveraged buyout.
I went through a growth periodat Macy's from, call it, 1977 to
1987.
Once we did the LBO I wentthrough a bankruptcy.
So I had this incrediblejourney to see business in all
of its cycles.
I think then the next mosttransformative was leaving
(04:09):
Macy's.
When I left Macy's and franklyI thought I would be there for
my whole career it was because Iwas being asked to go into a
job that I thought wassubstantially less important
than the job that I was in, andI sort of stepped into the
wilderness and decided that Iwanted to go and do a turnaround
and I left Macy's, which was afairly comfortable business at
(04:32):
the time, but it was being takenover by Federated and my
attitude was if I'm going tojoin a new company, I want to
join a new company that'sexcited to have me.
I don't have to learn how theydo things and I'm going to go
someplace that's wildlydifferent.
That was a transformative movein my life.
Gautham (04:49):
What was it like coming from a coal mining town to get
yourself to be a CEO of a publiccompany?
What were the challenges andthe opportunities you faced to
get yourself?
It was a journey, the idea of Ihad been accepted into a
program for kids who showed someacademic promise and had the
(05:12):
opportunity to get a scholarshipto go to private school.
The first thing was I left mylittle bitty town in Montgomery,
west Virginia, and I took a busride to New York City.
So my town hit about 4,000people.
I'm going to New York City, I'mgoing to Port Authority and
they said look for somebody whohas a flower in their lapel.
(05:35):
This is a late 60s.
Everybody has flowers in theirlapel, they have it in their
hair.
And I'm walking around lookinglike Jethro Bodine on the
Beverly Hillbillies with thesetwo pieces of luggage didn't
have a piece of natural fiber inthem my suit that I bought for
$29.99, that had a reversiblevest and two pairs of pants.
(05:55):
I ultimately fell my way to thepeople I was supposed to be with
and I went to private school.
Private school was like landingon another planet.
Sons, it was all boys.
There were general sons, therewere people who were captains of
industries, sons who were there.
There was a whole differentrhythm and talk to the business.
(06:16):
What that did was it put me intoabsolute shock.
From an academic standpoint, Iwas able to catch up after a
year.
But what it also did?
It gave me the confidence tosay I can compete academically
with anybody.
Once I made that academic leapand understood that being
(06:37):
impressed by who you were andwhere you came from wasn't as
important as how you appliedyourself, how you learned, how
you use hard work and discipline.
Once I understood those things,you know, my undergraduate
career was relatively easy.
I finished in three years, Iwent to graduate school and then
(06:57):
I started after graduate schooland, as Paula mentioned, my
undergraduate majors werehistory and English, my graduate
degrees in education.
Each one of those threedisciplines were hugely
important in everything that Idid after that I'm going to ask
one follow-up question.
A town of 4,000, you chose to leave that to go to one
(07:20):
of the biggest cities in theworld.
What was the motivation?
What was the drive?
And you don't need to tell yourage biggest cities in the world
.
What was the motivation Like?
What is the drive?
And you don't need to tell yourage, but you're young.
I left India to come to the US.
I'm trying to think about whatdrove you to leave, where you
probably knew every person inthe street.
Theo (07:36):
Yeah, if you left India to come to the US, you had some
either thing that was in you orsome group of people who believe
that education was going totransform your life and
potentially their lives.
So my grandmother, who went asfar as the fourth grade, my
grandfather, who went as far asthe seventh grade, had this
fundamental belief thateducation was going to be my
(07:58):
ticket out of the circumstancesthat we were in.
They believed that was going totransform my life,
circumstances that we were in.
They believed that was going totransform my life.
Imagine these people who are inWest Virginia who are letting
their little boy go it was justme with them into this
incredibly foreign world thatthey could absolutely not even
imagine.
I'm going to private school,I'm going where.
(08:20):
I'm going to do what?
So they took an enormous leapof faith.
The amount of love andcommitment that they showed to
me gave me the strength and theenergy I can remember being in
college.
One of the things that happenedduring my freshman year which
I'm sure never happens with anyother students is I kind of lost
my mind that first semester.
(08:41):
I can remember getting a grade.
It was like a 1.8.
And I saw that and it slappedme into reality because I said
to myself this is going to breakmy grandparents' heart and I
wound up graduating in threeyears with honors and really
spending time focusing on thereason why I was there, which
(09:02):
was to do the thing that theywanted.
That was their dream.
I was there the manifestationof their hopes, dreams and
aspirations and had thisopportunity to do this, so there
was really never a questionabout it, I think probably, you
know, when I came back talkingfunny without my Southern accent
and growing an Afro, when Icould actually do that, they
(09:23):
probably thought I lost my mind,but they were just incredibly,
incredibly proud of me.
Paula (09:29):
I want to go back to something you said which I think
is very important and a lot ofpeople can't make that
connection.
How exactly did history,english and education help you
further on in your career?
Theo (09:41):
So first let me talk about history, charlie Munger, who
recently passed away, who'sfamously the person who was a
partner with Warren Buffett,berkshire Hathaway.
What Charlie said was I make ahabit of making friends of
imminent dead people, and whathe meant by that.
If I study the past, if I learnfrom the people who are
(10:06):
successful, and I curate,cultivate and think about what
those lessons are for theproblems that I'm trying to
solve today, I'm going to bemuch better at what I do
Throughout my professionalcareer, throughout my personal
life.
My books are filled withstories of people in history.
(10:26):
I have read the story of SamWalton.
I have read the story of JeffBezos.
I have read the story of JosiahWedgwood.
I have read the story ofMichael Dell.
I have read the story of all ofthese amazing people.
I've lived the story with LesWexner and Ed Finkelstein Les
(10:47):
famously being at the Limited,ed Finkelstein being at Macy's
and I was able to pull throughlines from what they talked
about and what they did intowhat I did, so I didn't have to
make those same mistakes.
One of my favorite quotes iswhat we learn from history is
that we don't learn from history.
That will never, ever besomething that I can be accused
(11:10):
of, because I had that groundingand understanding that while
history doesn't repeat itself,it rhymes, so there are things
that are happening along the waythat are instructive to what
you do today.
English, if you are in business,being able to put together
thoughts in an organized way,being able to think with a
(11:33):
critical mind, being able toaccumulate information and be
able to translate that messageso that you're giving articulate
messages, is hugely important.
That's an English discipline.
The idea of storytelling, whichI think is so critically
important to being able to getan organization to join you on a
(11:54):
journey, comes from being anEnglish major and understanding
all of those stories and all ofthe ways that they're put
together and how you can bringthem forward.
When I was the CEO of Zales andwe were losing money like crazy
and it was about to go out ofbusiness, I talked about making
a journey to the profit promisedland and getting through the
(12:14):
Red Sea of debt and use thosebiblical stories to be able to
get people to think aboutsomething that's fairly
universal in their references,but to then move with us to
think about it.
So English, hugely important.
Being an educator each of ourobligations as leaders is to
take the things that we havelearned and impart them to the
(12:37):
people who are with us.
So I've never left education.
Education has never left me.
I push books into my mind andpodcasts all the time.
I won't live long enough toread or listen to everything
that I'm interested in.
I can't imagine a world withouteducation.
I can't imagine being a leaderof any people without learning
(13:00):
how to be an educator, andeducator meaning the lessons
that you teach are lessons thatthey can take and they can apply
and they can make their livesbetter.
So I thoroughly enjoy.
When I thought about myself asa chief executive officer, I
thought about myself as the headprofessor in the class, and my
(13:22):
job was to be able to helppeople to get to where I was and
be able to articulate the samethings that we're trying to do
on our mission to turn abusiness around.
Rich (13:32):
So I want to follow up with that.
Our paths have fortunatelycrossed on several occasions and
I've always held you in thehighest regard as a retailer and
as an individual.
And listening now at the wayyou connect the dots so
thoughtfully, at what point didyou connect the dot and decided
retail?
Theo (13:52):
All the way back to when I finished graduate school.
I tested the water as a publicschool teacher and I had a wife
and a child and I thought Ireally enjoy this.
I was coaching, I was doing abunch of other stuff, but I'm
kind of getting back to beingpoor again.
As much as I love what I didwith those incredibly fantastic
(14:17):
students, I thought you know, ifI'm successful, I can continue
to do that later on in life.
So I started to interview withany number of organizations.
I interviewed with banks, Iinterviewed with insurance
companies.
I interviewed with retailers.
The people in retail were a lotlike me.
They were people who came from,in many cases, humble
(14:39):
beginnings.
They were people who succeededbased on their creativity, their
intellect and their hard work,and they were successful.
They were people I could, basedon their creativity, their
intellect and their hard work,and they were successful.
They were people I could relateto.
There was a humor to thebusiness.
There was this opportunity at avery young age to manage a
profit and loss statement and Ithought this is amazing.
This is absolutely magical.
(14:59):
So going in and think aboutactuarial tables and the people
that you would have to associatewith wasn't really interesting.
Banking was modestlyinteresting, but wasn't
necessarily the kind of people.
That club wasn't a club that Ifit naturally in, a club of
people who were working theirway into middle class, who were
(15:22):
working their way up sort of theladder, where people I could
relate to.
So I fell in love with it, rich, at a really young age, and
that love affair continues tothis day.
Paula (15:35):
That's beautiful.
I think Rich fell in love withit too, given his background
that we know.
Let's move on to the lessonpart, because we have a lot to
learn from you here.
So let's move on to the lessonpart, because we have a lot to
learn from you here.
Something that we've heard yousay is there are three important
points and pillars of successfor retail and commerce.
What are those pillars?
Can you talk us through that?
Theo (15:54):
Sure, I think customer, I think people and I think product
.
There are a lot of other things, and how you mix that together
in order to get to profit isyour ultimate goal.
It starts with having anappreciation of, and a love for,
the people who pay the bills,no matter what form of commerce
(16:17):
you're in.
If you cannot put those peopleon a pedestal, then you will not
do your business well.
When I became a CEO, one of thefirst things I said to the
first gathering we had of all ofthe people was we're going to
do this, we're going to invertthe pyramid.
I'm going to be on the bottom,customer's going to be on top
(16:38):
and the people who serve thecustomers are going to be the
second most important people inour business.
So what we did was we changedsome of the terminology.
Our customers stopped beingcustomers.
We promoted them to beingguests.
Our sales associates stoppedbeing sales associates.
They started becoming customers, jewelry consultants.
Our headquarters stopped beingheadquarters.
(17:00):
It became the store supportcenter and we culturally started
talking about what does thatlook like?
To put the customer on top, tothink about how we relate it to
him or her in a different way,how we get into their thoughts,
their hopes, their dreams, theiraspirations.
How do we get into that in adeep and meaningful way?
(17:22):
And then how do we follow themon their journey so we're always
relevant to who they are andwhat they do.
In studying history, one of theabsolute through lines of many
of the people that we'vementioned is their love,
appreciation and understandingof how important customers are.
Jeff Bezos famously used tokeep an empty chair in his
(17:45):
office when they had meetingsthat was for the customer, so
that they never, ever, forgotthe customer.
Marshall Field's book isentitled Give the Lady what she
Wants.
Throughout all of these, theyhad an understanding and an
importance of the people thatthey work for.
Les Wexner, who was the CEO ofthe Limited, used to say never
(18:07):
sell down to the customer,always sell up, Always give them
something that elevates themand, whether or not they are
buying $5 or $500, make themwalk out of the store with an
elevated experience.
One of my many favoriteexpressions is what they walk
out of the store with in the bagis the product.
(18:29):
What they walk out with intheir mind and their heart is
the experience of the brand.
That bridges over to this ideaof the people.
If you're going to elevate yourcustomers, then the people who
are most directly involved withthose customers are the people
on the front lines, the peoplewho are managing your electronic
(18:51):
commerce, and you have toelevate them.
Howard Schultz talks about thehumanity of work and talked
about surprising the people whoworked in that business.
He famously gave part-timebenefits to people.
He gave equity and stock tothem before they went public.
But he talks about being ableto surprise them and make them
(19:14):
feel good so they would do thesame thing for their customers.
So those things connect closely.
And then you have to buildsystems and processes that hold
up those two things.
That celebrates those twothings.
We used to have celebrationstwice a year where we brought in
our store's leadership, who wechanged from being district
(19:38):
managers to district leaders,store managers to store leaders
changed from being districtmanagers to district leaders,
store managers to store leaders.
We anointed them and saidyou're no longer renters, you're
owners of your business.
We're going to give you yourP&L and we're going to tell you
how to use it to drive yourbusiness forward.
But we used to bring in thepeople who sold a million
dollars worth of jewelry everyyear.
When we started out we hadabout 15 of those people by the
(19:58):
time we started to fix thebusiness.
There were 40 of them.
It was like going to graduateschool, because I'd sit down
with them and I'd ask them forinformation about how they ran
the business, the things that wedid that helped transform the
business that I was in.
I would say easily 70%.
I learned from somebody in astore.
You go to Canada.
They say you know, we reallywould love to have Canadian
(20:19):
diamonds up here because peoplein Canada take, oh well,
Canadian diamonds in Canada.
That sounds like a really goodidea.
So you know, you go out thereand you get these unbelievable
pearls of wisdom from the peoplewho were there and you lift
them up In a company that hadbeen suffering for a long time.
You try to get to a point wherethey're proud of the place they
(20:40):
work again, where they can gohome and they can talk to their
friends and their loved ones andsay I work for this company and
I'm really proud of it.
Every one of them is anambassador and if they're going
home and their loved ones aresaying get out of there, it's a
terrible place to work.
They're fighting for justgiving them a paycheck, but
you've lost their hearts andtheir minds.
(21:02):
The third thing is product, andI know that Rich can certainly
relate to this.
The expression in retail iswhen the product is right,
everything else matters.
When the product is wrong,nothing else matters.
It's absolutely true.
The interesting thing aboutproduct, though, when you have
really great people, is, evenwhen we went into a business
(21:23):
that was about to go bankrupt,there were about 50 to 100
stores that were having positivecomps.
It's like, oh, that'sinteresting and they had the
same bad marketing.
They had the same bad product.
They had the same lack ofinvestments in their stores.
They were dirty, the case linesweren't great, so part of my
first diligence was to go tothose stores and figure out what
(21:45):
was going on.
It reinforced this idea thatgreat leaders of stores can lift
people up and create a culturewithin that four wall space.
And then, if you start to listen, if you have old inventory that
hasn't been replaced, if youdon't get the product
architecture of the businessright good, better, best and be
(22:08):
able to start to listen and givethem great product, Most
products are very similar toeach other.
If you're in the diamondbusiness, Technically a diamond
is a diamond.
What they do functionally isabsolutely the same.
How it makes you feelemotionally is where the
difference lies.
When I was at the limited andwe were selling, you know,
(22:30):
Victoria's Secret, you could goanywhere and get what we sold.
So technically same stuff,Functionally it did the same
stuff.
But the margin lives in emotion, how that product makes you
feel.
And that's when you link onceyou get the product assortment
right, marry it with greatmarketing, great storytelling,
(22:52):
and you start to elevate it sothat when people walk in your
store they're getting greatexperience from the jewelry
consultant, they're beingtreated like a guest right?
So the mentality of having aguest in your home is you clean
up differently, you servedifferently.
You want them going out with apositive impression.
(23:13):
So if your job is to get readyto serve the guest, and when
they're there, you don't rushthem out, you spend time with
them.
You listen to what is theproblem that you're trying to
serve the guests, and whenthey're there, you don't rush
them out, you spend time withthem.
You listen to what is theproblem that you're trying to
serve with the product that wehave, and then you try to give
them something that makes themfeel great for themselves or for
someone else that they love intheir life.
(23:34):
That's where the magic happensElevating that guest experience
so that it's special withunbelievable product, so that
you feel like you have anaffordable luxury when you walk
out of there.
We were in the diamond business.
We'd forgotten we were in adiamond business.
Diamonds sit at the corner oflove and happiness.
What could be better than thatas your selling proposition?
(23:54):
Everybody was looking to makesomebody happy for themselves or
somebody in life.
So if you're starting with thatselling proposition, it's like
how in the world did we screwthis up through the years?
And then you start to makepeople feel good about who they
are and what they do.
Things start to happen.
I mean really, really specialthings start to happen.
Gautham (24:13):
Theo, if we stop the interview now, it'll be great,
but I want to ask you,specifically of those four years
, 2010 to 2014,.
Sales price was sales where Ithink was a dollar or a buck or
something, and when okay, $1.39.
And I think when you were doneit was like $22 or something
like that.
You turn it from $120 millionto about $19 million in profits.
(24:35):
You talked about customers, youtalked about people and you
talked about product.
In my opinion, the people, youremployees, are critical to
making that experience.
When morale is down, whenpeople are beaten down, how do
you manage that turnaround toget them to walk around with
their heads held high, go homesaying I'm proud to work here?
(24:55):
Can you talk about that?
Give some secrets for ourstudents who are learning those
leadership skills.
Theo (25:02):
You have to do a number of things.
You have to make sure that youhave the right people in the
right jobs and when you have abusiness that hasn't done well
for a very long period of time,you have people who really want
to do well but don't know whatto do.
There are people who are kindof hiding and you have people
who have just checked out andthey're getting a paycheck.
(25:22):
You tell them what theexpectations are.
You're very clear about whatthey need to do and then for the
people who shouldn't be in thebusiness, you help them to not
be in the business.
That had to happen literally atevery level of the company.
We did assessments in our fieldorganization of the top 100
stores and the bottom 100performing stores.
(25:44):
We started to understand whatthe capabilities were like human
resources background, what thecapabilities were of the high
performers and we startedmanaging to hiring only people
who showed those skills andabilities, hiring only people
who showed those skills andabilities.
What that meant was that manyof those people came from a
different industry and we had tofund 40 hours of training for
(26:10):
every single person who came inin a leadership job so that they
learned the easiest part, whichis the jewelry business.
The hard part is how do youlearn empathy, how do you learn
passion for the guest?
How do you learn how to getpeople to dream big when they've
been to your point, beaten downover a period of time?
If you hire people like that,then you teach them the
technical stuff right.
(26:31):
The old saying the hard stuffis easy, the soft stuff is hard.
If you hire the right peoplewith the right soft stuff, train
them on the technical stuff.
So now we got a group of peoplewho are ready to march into the
future.
We will take you on the journeyif you have the right attitude.
What I will not tolerate is anegative attitude.
What I will not tolerate isbackbiting.
(26:52):
What I will not tolerate peoplewho are on this team going
after other people on the team.
If you aren't ready to go onthe journey, we will help you to
make a journey someplace else.
If you want to go with us, youare going to be included.
You are an equal partner in allof the decision-making as we go
forward, understanding that theboard has a bull's eye on me.
(27:14):
That's a lot larger than thebull's eye on you guys, but
we're going to go forward in thejourney together.
And then I think the otherthing that's pretty tactical is
that first year we didn't giveraises.
Going to the second year weweren't probably going to give
raises.
The only thing that I couldgive them was hope.
The only thing that I couldgive them was accessibility.
(27:35):
I sent messages to the fieldevery single week.
I was in stores every singleweekend.
I told hero story on all of mystore calls.
So I just went to Oklahoma Cityand the jewelry consultant
there told me a story about howthere was a customer who was a
mall walker, who had walked thismall for years they have
(27:56):
overalls, looked a little dirty,clearly a farmer in Oklahoma.
But I asked him one day.
I said you know, you're aroundhere all the time.
You've never come in to buyanything.
And he said to me I actuallyhave a 50th anniversary.
I've never been able to buy mywife a ring and I'd like to buy
her a ring.
And he said would you help me?
He came into the store with abox full of money True story Box
(28:24):
full of money.
True story Box full of money.
And they picked out a ring andmade him a hero.
So the lesson that was taught isdon't assume that the person
who's walking in the mall, don'tassume the person who's come
down, who's dressed a littledifferently, isn't a person,
because this jewelry consultantin this store did it and every
single week there'd be anotherhero story.
These are the people who arethe most important people in the
(28:46):
business.
So giving them hero stories.
Every single district managerhad my phone.
Every single million dollarjewelry consultant had my phone.
So I okay, what do you need?
Let's talk.
But it's demystifying If I'm onthe bottom and they're flowing
information to me and thatinformation is help us, helping
us to run a business, and I cantalk about changes that are
(29:09):
significant changes in thebusiness and I could say I
learned this idea from and put aname to it.
People go, wow, this isdifferent, this is really
different.
And then when we startedstarting changing the assortment
in the first year and ourbridal business started comping
positively in the first year andthe business had its first
(29:29):
comps in three years and then wehad 14 straight quarters of
positive comps and everybodystarted to get paid Like it was
really easy to keep them.
At that point we didn't loseanybody on a team that we wanted
to lose.
They were equal partners in thejourney.
The communication was there, sothey understood that this isn't
a me, this is a we and a us.
Rich (29:51):
So you've mentioned the love of history and one of my
favorite books is the Romance ofCommerce by Harry Selfridge, so
I wanted to ask a questionabout artificial intelligence,
technology and what retail lookslike today.
Where do you think retailerstoday are getting it right and
where do you think they'regetting it wrong when it comes
(30:14):
to incorporating technology intothe retail experience?
Theo (30:18):
Yeah, it's a little bit of a difficult question to answer
only because different peopleare doing different things.
I don't think that there's oneanswer to that question.
The people who have shown thegreatest amount of success early
are using AI in supply chain.
People who are using AI in datarecovery are getting really
(30:40):
good information to informdecisions that were largely
based on instinct before.
Instinct still has to be a partof it, but I think people are
treading slowly on it to try tofigure it out a little bit.
There are lots of things thatare being called AI that aren't
necessarily AI, so I think we'restill very much in the early
stages of learning.
(31:01):
Rich.
You'll remember, in the earlydays of the internet, there were
a lot of resistors.
There were people who didn'tbelieve in not only the internet
, but they didn't believe inthis thing called electronic
commerce.
Nobody wanted to be the earlyadapter because it was an animal
(31:24):
they'd never seen before, sothey don't know how to talk
about it, describe it.
I'm all for change.
You first was kind of theattitude that went into it.
I think that's a little bitwhere we are in AI.
I think it's enormouslyinteresting.
I think the opportunities couldbe vast.
It's a little bit of go slow togo fast for most of the people
(31:46):
that I work with or have somefamiliarity with.
Rich (31:49):
I will share a very quick anecdote that you'll appreciate,
given your history.
So I was at Joe Bank early inmy career, right around the time
that you were seeing the firstinklings of e-commerce.
Right around the time that youwere seeing the first inklings
of e-commerce, and I'm the onethat actually registered the
josebankcom name because Ithought it might be something
when the company didn't want to,and a year later it was hey, we
(32:10):
think we want that A littleproud moment.
That'll never go on my resume.
But you are right, I rememberthose days where I distinctly
remember executives saying thisthing will never work.
Theo (32:22):
It's not so long ago that people in other jewelry
businesses didn't believe ine-commerce.
Not so long ago, like when Iwas a CEO, I was like don't tell
anybody about this and all wedid was mint money.
And, as you know, you know,among the many wonderful things
(32:44):
about it is you get to testitems there a lot more cheaply
than you can test them anywhereelse.
We used to call it the longtail.
What are people looking at?
What search words are theyputting in that we don't have?
Let's buy a little bit of it,let's put it on the site.
It was and is absolutelyphenomenal.
When you blend that intoartificial intelligence, it can
(33:05):
give you even more of aninstinct in terms of what people
are looking for and wherethey're going after they walk
into your site.
It can be extremely, extremelypowerful.
Paula (33:15):
We've gleaned a lot of great advice from you, so I want
to ask you, as someone thatalways had to work harder I'm
also a minority, oh, no kidding.
I don't know if this was yourexperience, but from what I
heard you say, you had to workharder, not necessarily
differently, you just had towork harder in some occasions,
(33:38):
right, either it was to fit inor to understand the culture or
to understand the environmentthat you're in, because we
didn't grow up in that there wasalways some element that we had
to work that wasn't there forother people.
In all of that, what do youthink your biggest failure that
stands out to you is, and whatdo you take away from that?
What lesson is there?
Theo (33:59):
There's a fair amount of failures along the way.
I think, as I look at them inthe rear view mirror, they were
lessons and I was able to putthem into the right place at the
right time.
When I left Macy's, I went to aplace called the Home Shopping
Network.
That, at the time, was the nextbig thing.
(34:21):
E-commerce really wasn't athing at all.
But, boy, this televisionshopping thing that gave you
instant information, where youcould have the sales that were
going on in the studioregistered on your computer in
real time and you could look atit against gross margins.
It was unbelievable.
(34:42):
So when I left, I wanted to gointo a turnaround.
I wanted to do something wildlydifferent.
That was the future of thebusiness.
So I left and I joined HomeShopping Network.
I joined in April.
I was fired in December.
At the time, particularly comingoff of 19 and a half years of
being someplace where I washugely disappointed that I
(35:03):
didn't have the opportunity tostay, even though it was at my
own volition and then beingfired, you start to question
yourself a little bit and youstart to question your
decision-making.
What that did for me was abunch of things.
At Home Shopping Network, theCEO was fired.
So I started in April.
Ceo was fired in September.
Like hmm, things aren't goingthat great.
(35:26):
So the COO and I startedlooking at the business and what
could I do and what could he do?
So I had the stores, I had thecall center.
I had this much bigger job thanI would have had anywhere else
if I weren't in a turnaround.
I was starting to rewritestrategy documents and so forth.
Then my boss got called in inthe morning I think it was eight
(35:48):
o'clock he got fired.
The head merchant got fired at8.15 and I got called in and got
fired at 8.30.
And what I took away from thatwas it was disappointing.
It was really difficult from anemotional standpoint.
You go through all those stagesof grief, anxiety, fear was
disappointing.
It was really difficult from anemotional standpoint.
You go through all those stagesof grief, anxiety, fear, hate.
And then I thought wait aminute, let me take some time to
Take e-commerce courses.
(36:10):
Seems like it's the next newinteresting thing.
Let me take some time to spendtime with my daughters because I
was divorced at that point.
So we took an incredibly longcruise.
We still laugh about it today.
But if I go into turnaround,they give you a lot of stuff to
do.
You know, if you're reasonablysmart, if you're calm and cool
(36:33):
headed and you have thisambition to learn and grow, boy,
you get a lot of stuff to do.
So I mean, the good thing aboutit was I had the ability there
to go to the University ofChicago and take finance courses
, because I understood the P&Ldown to the gross margin level,
but not below, and again I knewthat that was something.
If I was going to be anAmerican business, I had to
(36:54):
speak the universal language ofbusiness, which is finance.
I did that and then I got acall from the guy with whom I'd
worked at Home Shopping Network,who was a Tommy Hilfiger, and
said hey, I want to see you whenyou're in New York.
Why don't you come in and see me?
He showed me the strategydocument and said do you want to
do another turnaround?
I said, dave, is it going toend better than the one we just
(37:15):
did?
He gave me a ton to do in thebusiness.
Helping him with strategy,helping him with part of the
wholesale business Gave me great, great latitude.
We had fun in the hiringprocess.
He trusted me so that when Isaid, this is the right person
to hire as a VP.
They would come up and see him.
They would come down to see meand I'd give them up.
(37:37):
That happens in the turnaround.
That doesn't happen in some ofthe businesses that they believe
they have it all figured out.
Gautham (37:43):
Maybe I'll ask a question on advice.
You've given a lot of adviceright and in your illustrious
career, what stands out as anunderrated value, like you
talked about that innatecuriosity and so forth?
You talked about yourgrandparents saying like talk
less, do more.
I'm paraphrasing there, ofcourse.
What is the value that youwould like to see instilled in
(38:05):
your employees today that willmake them stand out in a world
of AI, in a world ofever-changing needs.
Theo (38:13):
Part of the answer would be the idea that was instilled
in me by my grandmother, whichwas God gave you two ears and
two eyes for a reason, and onemouth.
So it all starts with having anability to do more than look
but to see, do more than hearbut to listen, to be able to
(38:37):
understand what it is that'shappening around you that then
drives the decisions that youmake and that leads to good
questions.
One of the things that Ibelieve great merchants do and
designers is they look at theworld with childlike eyes.
They look at the same stuffthat we see and they see
(38:58):
something different.
They see possibilities.
So I think understanding thatlistening and looking is
critically important.
One of the most importantskills for me as a leader was
reading the emotions on people'sfaces, trying to figure out
what was on their minds, whetherthey were with me or they
weren't with me, listening towhatever feedback that they
(39:20):
would give me.
Totally undervalued is thisidea of listening and seeing
Several of the people who Iadmire greatly.
A woman named Grace Nichols,who used to run Victoria's
Secret, is someone who, when wewere in board meetings together,
she would sit there relativelyquietly while everybody else is
(39:40):
talking about stuff orstruggling with something, and
she would offer this incrediblepearl of wisdom that would just
cut through everything becauseshe's seeing and she's listening
.
I was in a meeting once with theCEO of the Limited and we were
in a Christmas meeting and therewas a huge debate that was
(40:01):
going on with the marketingperson, the strategy person, the
merchant, about what theChristmas promotion would be.
This is in January and wealways looked at our Christmas
promotions at least 11, 12months early.
They would look to Les Flexnerfor the answer.
Right, like you do with yourdad, like we're arguing, I'm
making all these great pointslooking at Les, and he never
(40:24):
responded.
And I had the opportunity afterthat meeting to sit with him
and a group of executives andsomebody said why didn't you say
anything?
He said well, my firstresponsibility is to hire really
smart people that I respect.
If they're arguing aboutsomething and if they're having
difficult and it's a strategicdecision the best thing I can do
(40:46):
is listen and think about itand not react in the moment,
because this is a decisionthat's going to affect our
business for the next year,because Christmas sets the table
for the next year.
The best thing I can do is hearwhat they were saying, what
their tension points were, andthen think about it.
I need to go away and digest itbecause they're really really
(41:08):
smart, that listening skill,that ability to separate am I in
a tactical meeting wheredecisions are made, or a
strategic meeting where maybeyou ought to listen and drawing
out the people who are quiet,right, still waters run deep.
There's some really reallysmart people.
(41:28):
You know, you get confused bythe people who have the biggest
microphones, who are the mostarticulate, and you have to be
able to separate what I used tocall fibs, facts, inference and
BS Again, just to put a pin onit.
I think listening, I thinkseeing and understanding when to
do those things, even when youare in a position of authority.
Bringing out peopleunderstanding that there are
(41:49):
people who are maybe on yourfront lines who know a heck of
authority.
Bringing out peopleunderstanding that there are
people who are maybe on yourfront lines who know a heck of a
lot more than you is hugelyimportant.
Rich (41:58):
What do you do personally to find inspiration today?
Theo (42:02):
Spend time with my grandkids.
They're amazing.
They're amazing.
It's looking at the worldthrough childlike eyes.
It's what you do, rich, whenyou listen to your daughter and
she teaches you about the worldthat she lives in.
That's different than the worldyou live in.
I don't have to go to tiktok.
All I have to do is askquestions to my granddaughters,
who are amazing.
I walk the mall and I ask themwhat they think about certain
(42:26):
stores.
They know all of thebest-selling products at
lululemon, at sephora, and it'sremarkable.
I ask, ask them what do theythink about how they're treated
when they walk in there?
Are they treated with respect?
So my store visits now are withthese little ladies who are
wicked smart and who can dothings that they don't know,
(42:48):
that they're doing, and teach anold dog a couple of new tricks.
So talk about inspiration.
Nothing like it.
Paula (42:56):
Fantastic.
All right, theo, are you ready?
This is the most exciting partof the conversation.
It has to be the first thingthat comes to mind.
We're each going to ask one Areyou ready to start?
All right, you've been in somereally great commerce in retail
companies.
What's the most unusual itemyou've ever bought or sold?
Theo (43:16):
I didn't prep for this.
So, whatever it is, yeah, Ithink it was an item, that was a
piece of jewelry that was theuniversal symbol for pedophilia
that we didn't discover untilwell into the selling cycle.
(43:37):
Not only was it unusual, itcould have brought the business
to its knees.
So how we reacted and the waythat we reacted was critically,
critically important and therelationship obviously with the
person who sold us that jewelrychanged quickly, but everything
around that was unusual.
Paula (43:58):
Yeah, that's a whole Harvard business case study
right there.
Rich (44:02):
So I'm going to ask the next one Do you have a specific
walk-on song or a style of musicthat hypes you up when you're
getting ready to speak?
Style of music that hypes youup when you're getting ready to
speak.
Theo (44:23):
It changes, Rich.
It changes with kind of what'sgoing on in the zeitgeist, but
what I would say is the one andit's a wonderful sort of sonnet
to James Earl Jones, the onethat I like a lot is the
Imperial March by I think it'sJames Collins.
I absolutely love that song andif you play that before you
(44:47):
walk out on stage it getspeople's attention.
I go, this guy's nuts, what ishe doing, Darth Vader?
It's phenomenal.
I also like where is the loveby the black IPs?
You know, a question thateverybody should be asking.
So there's several, but let'sgo with the Imperial March.
Rich (45:07):
I will absolutely take that answer and I'm going to
take that back to a active dutycommander that I work with who
will absolutely love that answerbecause she used it in the most
appropriate situation.
Gautham (45:18):
No, wow, since you said you're a history buff, I'm
going to ask the historyquestion.
If you could invite threepeople to dinner, who would
those three people?
Theo (45:28):
be and why.
So there's going to be a threadhere.
One will be my grandmother tobe able to thank her and to be
able to do something that Ididn't do when I had her, which
is to ask about her journey, herlife, how she got to where she
was, what her influences were,how she became such an amazing
inspiration.
(45:48):
That's one that I really wish Ihad a do-over.
I think a second one would beSaul Price, who was.
If you pull the thread throughCostco and you go all the way
back to FedMart, saul Pricestarted FedMart, which became
Price Club, which ultimatelybecame Costco.
(46:08):
And if you ask Jim Senegal, whoran Costco, where did he learn
everything from?
He'd say Saul Price.
If you ask Jim Senegal, who ranCostco, where did he learn
everything from?
He'd say Saul Price.
If you ask Jeff Bezos, where helearned a lot of his lessons,
he would say Saul Price.
If you ask Sam Walton, if hewere still around In fact it's
in his book that he stole a lotof ideas from Saul Price.
(46:28):
And if you think about Costco,which is one of the retailers, I
have this huge admiration forthat.
Stuff started with Saul Priceand, like so many people who I
loved in retail, which is thereason why I joined retail.
Saul had an amazing sense ofhumor.
I think if I were to think of athird, it would be probably
(46:50):
Abraham Lincoln, because it wassuch a transformation that took
place in who he was.
There was such a deepunderstanding of what was
necessary to try to keep thecountry together, the
compromises that needed to bemade, the absolute intellect.
Talk about a man who could tellstories for hours, those
(47:10):
debates that he used to havewith Douglas that lasted for
three and four and five hours.
And when I think about myhumble beginnings, I grew up
like the fresh Prince of Bel-Air, compared to Abraham Lincoln,
who only had, I think, one yearof formal learning and who was a
voracious reader.
So yeah, those probably thethree people.
Rich (47:30):
Well, before Paula closes it out, I'm going to say that
you're actually a retail hero ofmine Since the first time we
had the chance to meet in anoffice in New York.
I've followed you since thatpoint and held you in the
highest regard, and I sharedwith Paula and Gautam that when
(47:51):
I interviewed withales I was soimpressed that I did buy the
stock under $2.
Oh no, you really, oh heck.
Yes, I know a good leader whenI meet one.
I bought it under two and mydaughter thanks you.
Theo (48:05):
So you know I wear the title of hero very uncomfortably
.
Let there be no doubt and I saythis in all sincerity that the
greatest satisfaction that Ihave in being able to have that
Zales story is saving 13,000jobs for 13,000 people and
working with people in eachfunctional area marketing,
(48:27):
merchandising stores, financewho are much, much smarter than
me and who hired the opportunityto bring together around a
strategy and a focus and adiscipline so that we can make
it all come together and work.
I love the people that I workedwith during that journey, and
(48:48):
it starts with the people on thefront lines.
But thank you, rich, Iappreciate that the people on
the front lines.
Paula (48:53):
But thank you, rich, I appreciate that.
Well, theo, thank you.
We can't thank you enough foryour time and your expertise,
and thank you for everything.
Thanks for the lessons and forstaying over with us.
Popular Podcasts
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.
Therapy Gecko
An unlicensed lizard psychologist travels the universe talking to strangers about absolutely nothing. TO CALL THE GECKO: follow me on https://www.twitch.tv/lyleforever to get a notification for when I am taking calls. I am usually live Mondays, Wednesdays, and Fridays but lately a lot of other times too. I am a gecko.
The Joe Rogan Experience
The official podcast of comedian Joe Rogan.