Macy’s Pushes Execs In The Wrong Direction

Macy’s announced that it will be tying executive compensation to the performance of the company’s stock price over the next three years. That’s an interesting approach given this recent advice from Jack Welch:

On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy… Your main constituencies are your employees, your customers and your products.

If I were one of Macy’s shareholders, I’d rather have the execs focused a little less on the stock price and a little more on employees and customers. Maybe they should tie executive compensation to Forrester’s Customer Experience Index. Macy’s ended up tied for 15th place out of the 25 retailers we examined; well behind other department stores like Kohl’s and JCPenney.

Rather than following an outdated management approach, I suggest that Macy’s execs download my free book: “The 6 New Management Imperatives: Leadership Skills For A Radically Changed Business Environment.” In it they will find 6 alternative places to focus their energy:

  1. Invest in culture as a corporate asset
  2. Make listening an enterprisewide skill
  3. Turn innovation into a continuous process
  4. Provide a clear and compelling purpose
  5. Extend and enhance the digital fabric
  6. Practice good social citizenship

The bottom line: Isn’t it time for new management thinking?

Written by 

I am an experience management transformist, helping organizations improve business results by engaging the hearts and minds of their customers, employees, and partners. My "job" is Head of the Qualtrics XM Institute. The Institute is still being established, but our goal is to help organizations around the world thrive by mastering Experience Management (XM). As part of this focus, I examine strategy, culture, interaction design, customer service, branding and leadership practices. And, as many people know, I love to speak about these topics in almost any forum. Prior to joining Qualtrics, I was managing partner of Temkin Group (leading CX research, advisory, and training firm), co-founder and chair of the Customer Experience Professionals Association (CXPA.org), and a VP at Forrester Research. I'm a fanatical student of business, so this blog provides an outlet for sharing insights from my ongoing educational journey. Check out my LinkedIn profile: www.linkedin.com/in/brucetemkin

4 thoughts on “Macy’s Pushes Execs In The Wrong Direction”

  1. Bruce,

    This gets at the heart of the trend over the last few decades to focus on outputs rather than inputs. It’s interesting to watch leaders examine the revenue and the stock price almost daily and rarely address the things that are driving it, or not, like culture, customer focus, and employee engagement. I often ask executives after they tell me about their strategic plan, to tell me about their culture plan. As you can imagine, those don’t routinely exist. Great post.

  2. It is amazing to me that in 2009, with so many tragic examples of the stock price tail wagging the corporate dog into oblivion, a corporation could actually proliferate such a policy.

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