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Culture as a business accelerator

Culture is not a fluffy subject - even when you're selling teddy bears

Our hero: Sharon Price John. CEO of Build-A-Bear Workshop

Sharon Price John. CEO of Build-A-Bear Workshop

She turned the company around from a 49 million dollar loss in 2013, to three consecutive years of revenue and profit growth – in large part, by focusing on culture.

And they’re listed in this year’s Fortune 100 Best Companies to Work For for the eighth year in a row.

Concentrating on culture is clearly working – for shareholders and employees alike.

Their story: A turnaround built on culture

The first Build-A-Bear Workshop opened in Missouri in 1997, after 10-year-old Maxine Clark had the idea of a shop where children could make their own stuffed toys.i

But in recent years, sales had been struggling. The share price hit an all-time low and the company was making a heavy loss.

Then in 2013, Sharon Price John, who has a history of turning around unprofitable businesses, took over as CEOii. She found an organisation that, while suffering financially, still had a very strong brand and culture.

Sharon made big changes right across the company, including a new leadership team, reformatting some branches and closing others, and updating the brand logo.

But significantly, she kept in place what had made it special in the first place – its culture. Now sales are rising and the company’s profitable again.

As well as their listing in Fortune’s 100 Best Companies to Work Foriii , they’ve also been recognised as a Best Workplace by Great Place to Work in 2016 . A staggering 98% of its 832-strong US workforce say that the company has a great atmosphere and they have great pride in working there.

How did she do it?

Communication formed a key part of Sharon’s strategy, and 97% of Build-A-Bear’s employees describe it as being ‘great’.

She communicated the power of the brand by focusing on a unique aspect of customers’ experience – when a child puts the heart in the bear they’ve created and it ‘breathes its first breath’.

Whatever else she had to change, this special culture she had to keep

Sharon focused on celebrating this powerful moment, not just for the child, but for the employee too. It conjures up emotions of trust and love, and memories of childhood innocence.

Sharon knew that, whatever else she had to change, this special culture she had to keep.

By sparking change

Sharon drove change with a strategy called SPARK.

The S stands for ‘See it’. Sharon helped employees see the future for the company if changes were made, and if they weren’t.

P stands for ‘Plan it’. Sharon showed employees a positive plan based on the changes she wanted to make. This included making retail the company’s only revenue stream, and closing underperforming branches.

A stands for ‘Action it’. In 2013, Sharon set a goal to make USD 1 million profit. They exceeded this target and awarded bonuses. This built trust between management and employees.

R stands for ‘Run it’, and Sharon organised a day based around the American animated children’s character Gumby to remind employees to stay flexible and stretch to reach their goals.

And the K stands for ‘Keep the faith’. Sharon reminded the company that change never ends and once Build-A-Bear had reached profitability again it should strive for further growth.

And by rewarding staff

Sharon kept her people engaged by giving them good rewards.

Build-A-Bear offers flexible schedules, paid time off for full and part-time staff, health insurance, and onsite health facilities. They even give staff free lunches and other treats during the busy Christmas period.

Overall, 95% of employees say that Build-A-Bear has a caring culture. So it’s not surprising that it’s continually included in the Best Workplaces list.

The wider issue: Cultivating culture can make you a top employer

The Top Employers Institutev independently surveys organisations around the world on the conditions they create for their workforces.

Organisations have to complete an in-depth HR Best Practices Survey, answering 98 questions about their employee conditions and culture. The Institute validates the survey findings with employees, and then gets Grant Thornton to audit the company’s HR practices.

Dimension Data entered the Global Top Employer Programme in 2015, and for the last three years running, they’ve been able to demonstrate that they have one of the best working environments in the world.

The company grew from humble roots in South Africa in 1983 to become a worldwide ICT services provider worth over USD 7.5 billion, with over 6,000 clients in 58 countries.

None of this success would have been possible without cultivating a culture of talented, motivated, and loyal employees.

Our opinion: What’s involved in being a top employer?

The Top Employers Institute concluded that, ‘Dimension Data provides exceptional employee conditions, nurtures and develops talent throughout all levels of the organisation, and has demonstrated its leadership status in the HR environment, always striving to optimise its employment practices and develop its employees.’

They’ve done this by using learning and development programmes and career planning and succession management to attract, engage, develop, and retain talented employees.

Marilyn Chapman

Dimension Data’s Fast Track Programme nurtures high performing graduates to become future leaders of the company. All potential leaders have a development plan, and in 2015 Dimension Data retained 83% of them.

The Leadership Forum provides a multi-layered approach to support the ongoing development of leaders and matches high potential employees with mentors who have worked for Dimension Data for a long time. And it’s working – employee satisfaction with leadership is currently at 72%.

Development isn’t just for leaders and potential leaders, though. Dimension Data University is an e-learning platform for any employee to improve their skills in areas from sales techniques to project management skills, vendor certification to personal effectiveness.

Our people are consistently delivering more to our shareholders and clients

All client-facing employees beginning work at Dimension Data go on a sales career path in which they get sales-specific training through the Sales Academy at Dimension Data.

Marilyn Chaplin, Group Executive, People and Culture, explains, ‘Dimension Data has a simple but powerful philosophy: to put our clients at the centre of everything that we do. Our Global Top Employer accreditation is a measure of this dedication to service. In a thriving, stable work environment, our people are consistently delivering more to our shareholders and clients, building strong partnerships and relationships through a shared vision and teamwork.’ vii

Top employers concentrate on culture

Commenting on Dimension Data’s certification as a global top employer for the third consecutive year, Marilyn says: ‘I’m often asked what it takes to earn such an accolade, and why’s it something we set our sights on.

‘The programme is rigorous; this certainly isn’t a certification you can ‘buy’. The stringent criteria on which companies are evaluated include talent management, leadership, training and development, and initiatives to attract, retain, and engage employee talent. And the results are audited by an external company

‘So the standards are high – and that was one reason I was drawn to this programme.

‘Dimension Data is a company that likes to set ambitious goals. One of our ambitions, as a global organisation with a strong and cohesive culture, is to measure how consistent we are around the world. We also want to make sure that we’re setting the bar high ─ and continually raising it ─ so that we can attract and retain the talent we need to execute our strategy.

‘The detailed feedback we get from the Top Employer’s Institute every year helps us to keep on making improvements.’

Good culture is good for shareholders too

There’s widespread agreement that people are an organisation’s most valuable asset, so creating an excellent culture makes good business sense. Engaged employees are more productive and more loyal, both of which drive business results.

Organisations with excellent HR practices and cultures have better business performance in the form of higher stock prices, faster revenue growth, and a more favourable perception of their employer brands.

In fact, stock prices of organisations certified to be Top Employers outperformed the stock indices in their respective countries by 51% between 2011 and 2015, the Top Employers Institute and HR Certification Institute have found.

Organisations with excellent HR practices and cultures have better business performance

‘Exceptional human resource management – from applying HR best practices to the competencies of HR professionals who design and implement them – can demonstrably and positively contribute to the bottom line,’ says Top Employers Institute CEO, David Plink.xi

Back to our hero: What’s next for Build-A-Bear?

A current employee of Build-A-Bear in the UK recently described their job on a review site as ‘Most. Fun. Ever.’

‘Working at Build-A-Bear is brilliant! I have worked there 6 months now and absolutely adore it.

‘The management in my store are amazing, all really supportive and easy to talk to. They are understanding of personal life and shift problems.’ xii

Once upon a time, in 2012, before Sharon Price John took over, Build-A-Bear stocks weren’t worth much more than USD 3. Now, in July 2016, they’re trading at around USD 14, and their board’s decided to look for a buyer.

In a recent earnings release Sharon said, ‘The disciplined execution of our strategy has led to three consecutive years of positive consolidated comparable sales and profit growth.

‘The authorization by our board to explore strategic alternatives will enable us to accelerate our key growth initiatives while enhancing total shareholder value.’xiii

Clearly, a cuddly culture can make shareholders, as well as employees, happy ever after.


i Build-A-Bear website, accessed July 2016, www.buildabear.com
ii Haley Carroll, Build-A-Bear CEO Shares Her Secret to Turnaround Success, LinkedIn, 13 April 2016, https://www.linkedin.com/pulse/build-a-bear-ceo-shares-her-secret-turnaround-success-haley-carroll?articleId=7223828085600167922#comments-7223828085600167922&trk=sushi_topic_posts
iii Sarah Lewis-Kulin and Peter Barnes, These 20 Companies Inspire Employees to be Productive and Proud, Fortune, 24 November 2015, http://fortune.com/2015/11/24/productive-proud-best-employers-retail
iv Great Place to Work, accessed July 2016, http://reviews.greatplacetowork.com/build-a-bear-workshop
v Top Employers Institute website, accessed July 2016, www.top-employers.com
vi Global Top Employer for the second year running, Dimension Data, 22 February 2016, https://www.youtube.com/watch?v=KuCYT6H588M
vii Marilyn Chaplin, Global Top Employer 2015: What does it mean to be one of the world’s best employers?,Dimension Data, 13 March 2015, http://blog.dimensiondata.com/2015/03/global-top-employer-2015-what-does-it-mean-to-be-one-of-the-worlds-best-employers/
viii Howard Parks of JTI quoted on Top Employers website, accessed July 2016, http://www.top-employers.com/landing-pages/top-employers-global-2016/
ix Ibid
x Ibid
xi Ibid
xii Anonymous Build-A-Bear employee quote on Indeed, accessed July 2016 http://www.indeed.co.uk/cmp/Build--a--bear-Workshop/reviews?fcountry=GB
xiii Build-A-Bear Workshop Is Exploring a Sale, Investopedia, 5 May 2015, http://www.investopedia.com/stock-analysis/050516/buildabear-workshop-exploring-sale-bbw.aspx?ad=dirN&qo=investopediaSiteSearch&qsrc=0&o=40186

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