Bruce Springsteen isn’t ALWAYS right

Many of Bruce Springsteen’s songs are little short stories. Well known ones, like Thunder Road. (From the moment that screen door slams and Mary’s dress waves, I’m along for the ride.) Lesser known songs like The Nothing Man. (Even after everything’s changed: “The sky's still, the same unbelievable blue.” One of my favorite Bruce lines. ) And even the fun ones like Sherry Darling.

And those little short stories often pack a lot of wisdom about life and love, work and family. About longing. About country. (Try actually giving a listen to Born in the USA.)

One of Springsteen’s songs I always like to hear is Badlands, a good old stomper that really gets the crowd involved when it’s played (and it often is) at a concert.

Poor man wanna be rich.
Rich man wanna be king.
And the kind ain’t satisfied.
’Til he rules everything.

Sometimes true. But not always, as I was reminded when I saw a piece in a recent Economist about the wonderfully named Julian Richer.

Richer is a British entrepreneur who opened his first hi-fi equipment store when he was 19. He’s now 60, and between 19 and 60, Richer got richer by building up a chain of 52 stores, the eponymous Richer Sounds.

When Richer decided to cash out, he did things a bit differently than your typical casher-outer. This became known last May:

…when he announed he was selling a majority stake in the company to a trust owned by the staff, and remitting around 40% of the proceeds in the form of a cash bonus to colleagues. For every year of service, they received £1,000 ($1,230). (Source: The Economist)

This gesture was the outcome of Richer’s long-time management philosophy, which was inspired by In Search of Excellence, by Tom Peters and Robert Waterman, one of the earliest business best sellers, published in 1982.

I’m sure I read In Search of somewhere along the way, and I do seem to remember that one of the excellent companies that Peters and Waterman found when they went in search of was Wang Labs. No comment.

(I do want to note that when I was a young blogger and cared about such things, Tom Peters had a very hot blog, and Pink Slip was on his blog roll, right next to writer Dan Pink.)

Anyway, Richer’s takeaways from the book were that “top-performing companies…had two common features…they treated both customers and their employees well.” (Nothing I noticed in either direction at Wang, but maybe that was just me.)

Apparently, Richer – who later wrote his own management books, including one called The Ethical Capitalist – took his takeaways very seriously when he built his business.

He focused on keeping turnover down – Richer Sounds’ turnover rate is less than half of his industry’s average – by doing things like promoting from within. And:

Each of the other nine board members has risen through the ranks.

He surveyed staff morale weekly – yes, weekly – which seems a bit excessive, but it’s one way to nip a problem in the bud. He also did a lot of management by driving around, regularly paying visits to his stores to meet with employees. For training, Richer Sounds provides ample time for staff:

…to learn about the latest equipment in stock. The shops open at noon so that there is time for staff training without dragging people out of bed unreasonably early. Nor is Mr Richer a fan of the long hours culture; if an employee has to take a telephone call on their day off, they get a £20 hassle bonus.

Telephone calls weren’t the coin of the realm in my world once email came into use, but if I had gotten a £20 – or even a $20 - hassle bonus for each time I had to respond to something on a day off, well…

Among the more idiosyncratic items on Richer’s perk list for employees:

Workers can stay at one of the group’s holiday homes; over 70% make use of this perk once a year. The only charge they face is £10 per night per adult, and £5 per child. The British authorities treats such holidays as a taxable benefit but the company covers this cost as well.

Not sure I wouldn’t be a tad bit creeped out by vacationing in a company vacation home. It was weird enough when, one year at Genuity, I got to go on the ultra-luxe trip to Hawaii that was the reward for all the sales people who made quota. (Not enough did, so they rewarded a few of us non-sales types to fill the slots that had already been paid for. I had a great time, but it did not improve anyone’s morale.)

Richer sees all this as translating into happier customers. (Employee bonuses are partially based on customer satisfaction.) Employees also:

…get a monthly profit share, based on each store’s performance, and an annual share of the group profit.

Revenues for Richard Sounds last year were £157m (nearly $200M in US dollar terms), so it’s not a huge company. But Richer consults to larger retail chains, like Asda and Marks & Spencer, helping them apply the same philosophy across their empires.

As for giving away so much of his stake.

Mr Richer says he was approaching the age when his father died and he did not want his wife to deal with the hassle caused by his own demise. As far as money was concerned, he says, “we have more than enough already”.

What? Rich man wanna be king? Guess Bruce isn’t always right.