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Picking the brain of a turnaround artist

Allen Questrom, who has saved several retail giants, lends his insight to a symposium in Orlando.

By MARK ALBRIGHT
Published June 24, 2005

ORLANDO - Perhaps the most prolific turnaround artist in U.S. retailing history, Allen Questrom steered Federated Department Stores, Barney's, Neiman Marcus and J.C. Penney Co. from financial straits to new heights.

And that is only in the past 15 years.

Now retired at 65, Questrom on Thursday offered some sharp insights, career advice and encouragement to students and executives gathered at an annual symposium staged here by the University of Florida retailing program.

His observations, including an explanation for why he led J.C. Penney to sell in pieces its Largo-based Eckerd Corp. drugstore chain, covered a range of topics:

ON TECHNOLOGY: Technology has revolutionized retailing and will continue to roil through its ranks, but it's not what drives success, Questrom said.

"The successful companies are the ones that make technology work for them. That was one of the real benefits of Y2K. People made the techies match the computer to the actual needs of their businesses. Companies get in trouble when they ignore the fundamentals. It's really more about your people being committed to a focused strategy and working to make it happen. "One problem all the companies I ran had when I arrived was they had lost focus. They drifted off, did a lot of things wrong over a long period and got bogged down in all sorts of side issues. They forgot what they stood for."

ON RETAIL: What's retailing really about? It's really about selling stuff.

"It's a platform to satisfy people's wants and needs. To do that you have to know what their wants and needs are. Do you read two or three newspapers every day? Do you go to the theater, follow art, watch their favorite TV programs? Do you go to restaurants, sports events and religious activities partly to see what people are wearing? You spot trends. You try to figure out what makes people tick.

"Retailing is fun and stimulating because it is about constant change. They give you a report card in the stores every day to tell you how you are doing. But if you are not out in the stores to actually see what's going on and not talking with your customers about what they want . . . You cannot run a retailing business just looking at a computer."

ON MISSION STATEMENTS: Mission statements are often too broad or unrecognized at every level of the company.

"The mission statement cannot be some book. It has to be four or five short points. If it gets to be 10, I lose count. At Penney I had a list of five goals and hammered people with them hundreds of times. I even canceled any meeting that did not address one of those five points."

ON ECKERD PURCHASE: J.C. Penney bought Eckerd to balance its business risk during lean years for its department stores, but the strategy was flawed.

"My predecessors lost their focus. It's why the conglomerates, which are mainly a financial vehicle, have fallen from favor. It's difficult to manage both a department store business and a drugstore business.

"But when the other big drugstore competitors only have a drugstore business to manage, over time they will prevail."

Mark Albright can be reached at albright@sptimes.com or 727 893-8252.

[Last modified June 24, 2005, 00:46:17]