Office Depot executive vice president Kevin Moffitt shares tips on how to scale your business without alienating your current customer base.
If you thought getting your business up and running was a difficult task, wait till you see what it takes to get it to the next level. Launching a business from scratch is a huge undertaking that takes countless hours of meticulous planning and hard work. However, what comes next – scaling your business – can be even more laborious.
Deciding when it is time to expand, figuring out how fast to grow and doing so in a way that doesn't alienate your customer base is a strenuous affair. As the executive vice president and chief retail officer for Office Depot, Kevin Moffitt has unique insight into the thought process of taking your business to the next level. In his current role, Moffitt is responsible for the company's retail business unit, which includes more than 1,400 locations throughout the U.S.
Moffitt has also served as Office Depot's chief digital officer, senior vice president of e-commerce and direct business unit leader, and vice president of e-commerce product management and customer experience. Prior to joining Office Depot in 2012, he served as director of e-commerce for Dillard's, vice president of strategy and customer experience for CrossView, and director of e-commerce operations and development for Circuit City.
We recently had the chance to speak with Moffitt about scaling your business and the steps you should take to ensure you don't damage your customer relationships in doing so. In addition, we were able to ask him some rapid-fire questions about technology, his career and advice he has received over the years.
Q: How do you know when it is time to start scaling your business?
A: When you have so many clients that you find yourself spending most of your time on operational overhead [rather] than your primary value proposition to those clients, it is time to seek assistance. That help usually takes the form of professional partners in the beginning, but eventually requires part-time or full-time employees to maintain focus on client experience and efficiency.
Many small business owners struggle to make this transition, and that's why we started our Workonomy business services – to give these entrepreneurs the ability to focus on their product while we provide the day-to-day infrastructure they need to grow their business.
Q: What should you do if you notice that your growth is hurting your customer relationships?
A: Once you start developing your own team of employees, you need to clearly assess your personal strengths as the company's leader, as well as areas you either aren't especially skilled in or simply don't enjoy (often the same areas).
Finding new team members who will complement your strengths is critical, especially in the early stages of growth. So, if you really enjoy and are skilled at building client relationships, hire someone who is a talented administrator or operational expert who will allow you to remain focused on maintaining your customer experience.
In my experience, many small business owners don't want to spend their time in areas like IT support, human resources or bookkeeping. Fortunately, these skill sets are easily outsourced to business services partners like Office Depot.
Q: When scaling your business, how should you train your new employees to ensure they have the same passion for customer relationships that you do?
A: I believe everyone needs to be passionate about serving a company's customers, but not everyone needs to be equally skilled in actively managing their relationships. It takes many types of people to create a successful team. Ensuring you have the right mix of personalities and skill sets to support both business operations and maintaining healthy client relationships is the key.
Q: How should you communicate with current customers that your company may be going through some changes as you scale up?
A: No customer wants to feel like they are a low priority. Ensuring consistency in the client experience, both for existing customers and new acquisitions, should be the No. 1 goal of any growth plan.
The main changes should be that perhaps they will be served by a different person, but reducing service levels as a whole is rarely beneficial for long-term growth.
Q: When scaling your business, is it more important to keep your positive relationships with past customers or build relationships with new ones? Should you be prioritizing efforts one way or another?
A: It may prove more difficult to keep the first cohort of clients happy, but that doesn't mean it isn't important. In fact, these 'early adopters' of your company's service can be a valuable source of feedback as you scale up and grow.
Treat them like the founding members of your business community, like VIPs, and include them in key decisions. This approach can create very deep loyalty and a strong group of clients who not only were part of your key decisions but will be much more understanding when inevitable challenges arise during the process.
Q: What piece of technology could you not live without?
A: Clearly, it's my mobile phone. I now get notifications every week telling me how many times I access it, and it's a bit scary. Our lives are in a state of constant communication, and the challenge isn't staying connected – it's being able to prioritize, as well as being able to shut off at times to focus and work through more strategic challenges that are often much more important.
Q: What is the best piece of career advice you have ever been given?
A: When I started my career, I met with my team's leader one-on-one for the first time. I was very fortunate that she was one of the strongest professionals I've ever seen in action, and her advice to me in that meeting was to always stay focused on the long-term potential of each customer – not just what the customer bought or didn't buy today, but what that person might or might not be buying from you 10 or 20 years from now. This was a very simple but incredibly powerful insight, and I have tried to stay true to it every day since.
In fact, this has been one of the fundamental characteristics of our Workonomy business services platform. We want to create long-term relationships with our small business customers and help them scale and grow.
Retail is a very transactional business. With Workonomy, we're much more focused on customer retention and loyalty. Businesses are often neglectful of customer needs in general, but even more frequently lack a focus on long-term client relationship management, and I believe it can be a powerful competitive advantage.
Q: What's the best book or blog you've read this year?
A: I was a history major in college, and I still believe the past holds many important lessons for us. My favorite read this year was William Manchester's biography of Winston Churchill, titled The Last Lion. As someone who faced one of the most serious leadership challenges in modern history, Churchill is someone we can all learn a lot from. I also loved Gary Oldman's portrayal of Churchill in the recent film Darkest Hour.
Q: What quality do you most seek in an employee?
A: A passion for success. I look for a positive attitude, a desire to work on a multitalented team, a sense of curiosity, and a desire to innovate and improve. I also seek to surround myself with people from different backgrounds and with very different skill sets. Teams that encourage diverse thinking have a big advantage.
One of the biggest benefits of coworking spaces, like our Los Gatos Workonomy Hub, is that the small business owner – a team of one – no longer has to toil in isolation in a home office. They're surrounded by other entrepreneurs and remote workers in totally different industries but who may be dealing with the same problems. This environment creates lots of collision opportunities where people from diverse backgrounds can collaborate with each other.
Q: As a leader, what's the biggest challenge you face?
A: The biggest and most important challenge is to create a positive culture with shared objectives and outstanding execution on those objectives. People do their best work and achieve strongest results when they are empowered, respected, challenged, and feel they are having a real impact.
That's the culture I strive to support, but it's never easy. Staying focused on the human side of business, both the internal team and the customers, is what makes the difference between a manager/operator and a true leader.