7-11 Lessons from Under-Cover Boss

from CBS News 12/10 enhanced by Peter/CXO Wiz4biz

7-Eleven – As the largest convenience store chain in the world, we think of it as those bright little stores with drinks & snacks, not a place to gain management insight. Well, with 36,000 stores in 18 countries and over 30,000 employees to support them, the operational and organizational challenges of this unique company are extraordinary.

Talk about Culture mix. The company’s owned by a Japanese holding company, it’s headquartered in Dallas, and it’s run by a West Point graduate originally from Chicago. What a diverse mix !!!

Leadership Principles. The parent company, Seven 11 Holdings Co, gives Chief Executive Joe DePinto (CEO) remarkably free reign. Since taking over the top job in 2005, DePinto has introduced and deployed a company-wide cultural shift based on the principals of “Servant Leadership” and “The 7-Eleven Was.” Whatever that means, it seems to be working. As evidence, here are 10 Management Lessons from this week’s Undercover Boss:

1. Think Synergy. In 1927, Joe C. Thompson, an employee of Southland Ice Company, came up with the idea to sell milk, bread, & eggs from an ice dock he managed. The ice preserved the food and, well, the rest is history. Synergy* is fundamental to the 7-Eleven story. *In case you’re a little rusty, Synergy is the interaction or cooperation of two or more organizations to produce a combined effect greater than the sum of their separate effects.

2. Continuous Improvement is key. DePinto tells his leadership team, “I’ll be focusing on spending time in the field, where the rubber meets the road. I’m going to see what we’re doing well & not doing well to make us better in the long run.” I’m sure Joe knows the Japanese word “kaizen,” which refers to the management principal of continuous improvement by small steps.

3. A fresh set of Eyes can see missed opportunities. In the UC Boss TV show, one of the chain’s highest grossing stores had lights that had been out for some time – a potential safety hazard. Maintenance support said it could take up to a month to fix. Question: shouldn’t higher-producing stores get higher priority support?

4. Employees can inspire Management. Through his hard work, can-do attitude, and passion for the job, Igor, an immigrant from Kazakhstan – who drives a distribution truck – actually inspires Joe to be a better executive, because he has such a good attitude.

5. Many great Leaders started at the bottom. DePinto comes from a blue-collar family. After West Point, he worked his way up at PepsiCo. My path was similar. You always hear people complaining about lack of opportunities. I think that’s a load of bull. Look for, then take advantage of opportunities.

6. Communications is always a challenge. Far-flung operations & thousands of franchisees compound the challenge of communicating programs & messages across a vast network of stores. During the Show, one store routinely trashed day-old bakery items (against company policy) that were supposed to go to charity – which would have given them a good community image.

7. Replicate what works. One store on Long Island sells more coffee – 2500 cups a day – than any other location. Danny, (Joe’s undercover alter ego), learns that the store manager, Delores, knows virtually all her customers by name. So they enjoy exchanging pleasantries with her each morning. She gets them off to a good start in the morning.

8. An Army runs on Infra-structure & Logistics. At West Point, DePinto was trained to ensure that equipment is always working and “mission ready.” Behind the scenes, 7-Eleven’s sprawling distribution and support centers and plants that make enormous amounts of perishable foods are a testament to his operational training.

9. There are tricks to doing just about anything. On a donut production line, “Danny” (Joe’s undercover alter ego), couldn’t keep up with the pace of a conveyor belt until trainer Phil showed him a trick to doing it more efficiently. That’s the case with every task in business, no matter how big & strategic or small & menial. There’s usually a shortcut to make it go faster and/or better.

10. Engineers make great Executives. DePinto, Larry O’Donnell from Waste Management, Inc and a healthy percentage of executives from the technology industry all started as engineers, as did I. Sure, I’ve known quite a few dysfunctional ones, but by and large, they make competent executives. Why? Engineers are logical and usually do thorough analysis of situations to come up with the best solution. They also must consider the emotional aspects to make the best decision.

Other famous CEOs that started as Engineers: Tim Cook, Apple, Mary Barra General Motors, Mike Bloomberg [Report] & former Mayor of NYC, Cindy Crawford, Model, Ashton Kircher, Actor, Carlos Slim – ranked 2nd or 3rd Richest in World, Margaret Thatcher, former UK Prime Minister, Larry Page & Sergy Brin, Google (Stanford)

Comments: Have you learned any lessons from Undercover Boss?