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Best Buy: customer-centric innovation.

Article Excerpt
When he presented the Best Buy innovation story at the HRPS Corporate Sponsor Forum in October of 2004, John Walden was executive vice president, Human Capital and Leadership. In December that same year, he was appointed executive vice president, Customer Business Group. Previously, he led Best Buy's Internet subsidiary, and prior to joining Best Buy he was the chief operating officer of Peapod, Inc., an Internet retailer of groceries.

Best Buy is the largest technology and entertainment retailer in the United States. When John Walden talked about peak performance, he meant having 790 stores in North America and net earnings of $705 million on revenue of $24.5 billion. Two years later, there are 940 stores and net earnings of $1,140 million on revenue of $30.9 billion. That is pretty good for a company with a light and breezy vision statement: "Making Life Fun & Easy." The values supporting that vision show what it takes to be competitive in a fast-moving, dynamic industry:

* Have fun while being the best.

* Learn from challenge and change.

* Show respect, humility, and integrity.

* Unleash the power of our people.

Innovation can be built on values like these because they embody listening to others and being open to the new.

Best Buy started small. In 1966 it was a Sound of Music store, selling audio, video, and car stereo equipment. It grew in the 1980s with the name change to Best Buy and a penchant for understanding what customers wanted, carrying multiple brands, and concentrating on product displays. In 1985 Best Buy went public and, like many competitors, competed on price. In 1989, however, the company decided to compete using a different sales concept: Customers are in charge; sales is there to help. In other words, customers do not want to be sold; they want to buy after they see all the choices and prices. Best Buy took its sales staff off commission and built bigger and brighter stores to display all the products.

The concept worked well on the sales side. In 1995, revenue was $3 billion--but the company was not profitable, and the infrastructure and its processes...

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