For years the training ground for young, ambitious NAMs, with a typical two year tenure 'to understand how it works', anyone claiming 100% insight at the end of the induction-period was promptly sent back for another two years, to appreciate the extent of their naivety in presuming to make sense of this unique business model, ever...
In practice, it took a crisis that would have destroyed normal PLCs to demonstrate the inner strengths of an organisation that for years aimed at breaking even, and obviously came in with a 3% loss at year end, in contrast with 'normal' retailers that aim for a 5% Net Profit that inevitably results in 2.5%...
Having bitten this particular bullet - aiming for and delivering a moderate profit, and even mentioning ROCE in despatches - the organisation last year addressed the cumbersome governance structure and made it more merit-based, and even more democratic via a 1 man, 1 vote modification.
This made it more tolerable to adopt other normal retailer moves aimed at cutting waste and improving profitability. In fact this morning's Independent lists the jettisoning of non-core businesses, such as the pharmacy chain and the much-loved farming business, using some of the savings to fund an 8.5% pay rise for staff.
Even the 'Divi' appears to have been replaced by the immediacy of discount vouchers at point of sale...
In fact, anyone that has heard Richard Pennycook's IGD presentation of the turnaround, realises that the Co-op is truly on the way back, in part evidenced by their ability to survive the current price wars in UK retail, better than most...
All that said, perhaps it is time for Co-op NAMs to step back a little from the fire-fighting, and consider using the ROCE, Net Margin and Capital Rotation tools that provide an effective working platform for their Big Four colleagues, all adapted to the realities of a Co-op attempting to morph into responsible capitalism.
At the very least, this approach will provide practical career-move training in how to optimise one of the mults a few years later. However, in the meantime, this change in MO will pay dividends in terms of job satisfaction...
In practice, it took a crisis that would have destroyed normal PLCs to demonstrate the inner strengths of an organisation that for years aimed at breaking even, and obviously came in with a 3% loss at year end, in contrast with 'normal' retailers that aim for a 5% Net Profit that inevitably results in 2.5%...
Having bitten this particular bullet - aiming for and delivering a moderate profit, and even mentioning ROCE in despatches - the organisation last year addressed the cumbersome governance structure and made it more merit-based, and even more democratic via a 1 man, 1 vote modification.
This made it more tolerable to adopt other normal retailer moves aimed at cutting waste and improving profitability. In fact this morning's Independent lists the jettisoning of non-core businesses, such as the pharmacy chain and the much-loved farming business, using some of the savings to fund an 8.5% pay rise for staff.
Even the 'Divi' appears to have been replaced by the immediacy of discount vouchers at point of sale...
In fact, anyone that has heard Richard Pennycook's IGD presentation of the turnaround, realises that the Co-op is truly on the way back, in part evidenced by their ability to survive the current price wars in UK retail, better than most...
All that said, perhaps it is time for Co-op NAMs to step back a little from the fire-fighting, and consider using the ROCE, Net Margin and Capital Rotation tools that provide an effective working platform for their Big Four colleagues, all adapted to the realities of a Co-op attempting to morph into responsible capitalism.
At the very least, this approach will provide practical career-move training in how to optimise one of the mults a few years later. However, in the meantime, this change in MO will pay dividends in terms of job satisfaction...
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