The year was 1978. Jimmy Carter was President of the United States. The Bee Gees topped the charts with Stayin’ Alive. The Dallas Cowboys defeated the Denver Broncos in the Super Bowl. And on July 1, The Container Store opened its doors in a small, 1,600 square-foot retail space in Dallas.
Kip Tindell (Chairman and CEO), Garrett Boone (Chairman Emeritus), and architect John Mullen opened a store offering an exceptional and eclectic mix of products devoted to helping people organize and simplify their lives. In doing so, they originated a completely new category of retailing, that of storage and organization. Initial cash capital was provided by Garrett, his father, and John Mullen, who were founding directors, officers and shareholders of the company.
Kip has been at the helm of The Container Store since it first opened its doors. As the company celebrates more than 35 years with stores nationwide and a thriving Web website, he continues his commitment to being a trailblazing retailer. But for him, the goal never has been growth for growth’s sake. Rather, it’s to adhere to the company’s values-based Foundation Principles and the tenets of Conscious Capitalism in order to build a business where everyone associated with it can thrive – it’s employees, customers, vendors, communities and shareholders. Kip continues to embody the unique corporate culture he created, and has nurtured a fierce employee loyalty that has landed the company on Fortune magazine’s list of “100 Best Companies to Work For” 15 years in a row.
He wrote Uncontainable: How Passion, Commitment, and Conscious Capitalism Built a Business Where Everyone Thrives with Paul Keegan and Casey Shilling. It was published by Grand Central Publishing (2014).
Note: Kip’s close friend, John Mackey, co-authored with Rajendra Sisodia a book based on these principles: Conscious Capitalism: Liberating the Heroic Spirit of Business. It was published by Harvard Business Review Press (2013).
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Morris: Of all the films that you have seen, which – in your opinion – best dramatizes important business principles? Please explain.
Tindell: It’s actually my all-time favorite movie, It’s a Wonderful Life, because it’s all about showing one guy – George Bailey – the power of his wake. Wake – like a boat’s wake – is the idea that everything you do and everything you don’t do affect the people around you and your business, far, far more than you realize. When Clarence the angel lets George see how miserable life would have been without him, you really feel the huge impact of how George’s approach to business affects so many people in his community. The reason that movie is a classic is because we all instinctively understand this.
When each and every person in your organization understands the power of their wake, you have an unassailable competitive advantage. Just think – if all of your employees are mindful of how they support and develop their colleagues, how they work with a customer or a vendor, and how they contribute to the community – and they truly understand how much each of these efforts matter – well that’s just about the most powerful thing I can think of.
Morris: Here are several of my favorite quotations to which I ask you to respond. First, from Lao-Tzu’s Tao Te Ching:
“Learn from the people
Plan with the people
Begin with what they have
Build on what they know
Of the best leaders
When the task is accomplished
The people will remark
We have done it ourselves.”
Tindell: This makes me think of our Foundation Principle: Communication Is Leadership. We believe communication and leadership are the same thing – you can’t have one without the other. “Learn from the people, plan with the people,” – well that’s exactly right. Nothing makes an employee feel more a part of the team than does open, honest, transparent communication from a leader. Business is like a football team. If all the players don’t know the score in the game, how can they contribute when it’s their turn to play?
Conscious leaders believe in valuing employees, valuing one another, making sure everyone feels appreciated, included, and empowered and that they have the training necessary to be successful in their jobs. And conscious leaders keep their egos in check and remain sensitive to the needs of others. Instead of being driven by deep-seated insecurities, emotionally intelligent leaders are comfortable surrounding themselves with people who are better than they are in certain areas. They lead based on love, not fear – inspiring others to follow them along the path.
Morris: From William L. McKnight (in 1924) when he served as CEO of 3M: “If you put fences around people, you get sheep. Give people the room they need.”
Tindell: I agree with this 100%. Especially in our industry, retail is far, far too situational to be able to expect employees to follow a phone-book size manual to do their jobs. Instead, we empower our employees to use their intuition – which someone very wise once said is the sum of your life experiences – to anticipate the needs of our customers and recommend the appropriate solutions. But we know that to help our employees do this, we must first provide all the necessary information and training, so they know how to best apply that intuition. That’s why all full-time employees receive about 263 hours of training in their first year with us, and part-time employees get nearly 200. Sure, we all need to use logic and analysis in our lives, but you’ll be so much smarter if you use both logic and then trust your intuition – your left brain and right brain.
Morris: Most change initiatives either fail or fall far short of original (perhaps unrealistic) expectations. More often than not, resistance is cultural in nature, the result of what James O’Toole so aptly characterizes as “the ideology of comfort and the tyranny of custom.”
Here’s my question: How best to avoid or overcome such resistance?
Tindell: It’s all about great communication. As a leader, if you’re being completely transparent, sharing everything with everyone, then there are no surprises. People resist when they don’t understand the purpose behind a change. But if you let them in on the reasoning, and the perceived benefit of the change, they nearly always get on board.
A great example for us was the Great Recession in 2008. That’s the first time The Container Store ever saw a decrease in sales, and in order to survive without doing lay-offs, we had to look under every rock and creatively determine ways to cut costs, so we had to ask a lot of people who were used to doing things a certain way to re-examine their “usual” activities. Every single employee was completely supportive and helpful in this, because they understood it was all in an effort to avoid lay-offs – we breathlessly communicated to every employee the state of our financials and what we needed to do in order to keep everyone’s jobs.
Morris: Now please shift your attention to Uncontainable. When and why did you decide to write it, with substantial assistance from Paul Keegan and Casey Shilling?
Tindell: For years, people have asked me, “Kip, when are you going to write a book about The Container Store?” I’ve always been flattered that people find our story inspiring enough to suggest such a thing, but I’ve always resisted the idea. It seemed presumptuous somehow. But I just finally felt that the time was right, after 36 years, to share more about our story with the world.
One of my greatest hopes is that the practice of simultaneously taking care of everyone connected to a business, operating from a purpose beyond profits and leading with consciousness becomes the preferred and most accepted way of doing business. And I can only hope that this book will help get us just a tiny bit closer to making that a reality.
And then thank goodness for Paul and Casey – two incredibly brilliant writers. Without them I have no doubt that this book would not be in existence!
Morris: For those who have not as yet read the book, please explain the frequent references to a “yummy culture.”
Tindell: We use the word “yummy” to describe The Container Store’s employee-first culture. What does it mean to be yummy? Well, it’s the opposite of yucky. We know our employee first mantra defies conventional business wisdom, most famously expressed by the late American economist Milton Friedman. Milton said the only reason a corporation exists is to maximize the return of the shareholder. Well, with all due respect to Milton, at The Container Store we have found that if you take better care of the employees than anybody else, they really will take better care of the customers than anybody else. It’s actually about creating this one-of-a kind experience, where we operate our business with a focus on all of our stakeholders—but with our employees first.
This results in a “yummy” culture where employees get out of bed and actually look forward to coming to work—to work alongside other great people. It’s a purpose to improve our customers’ lives through the gracious gift of organization, to help our vendors’ businesses become all they hope and dream they can be, and to make our communities a better place to live. And in doing this, all by staying true to our seven Foundation Principles, which I’ll tell you even more about later, we know that the lives of everyone associated with our business will be enriched, filled with opportunity and EVERYONE—all of our stakeholders—can thrive.
Morris: A basic principle of physics is that a liquid assumes the shape of its container. Perhaps I risk abusing the container metaphor when asking you this: Does a worker assume the values of the culture of her or his workplace?
Tindell: Our employees come from incredibly varied backgrounds with tremendous depth and ability, as The Container Store values diversity on all levels. Our unique culture embraces and celebrates the talents and perspectives of a variety of ages, interests, beliefs and backgrounds. It’s an environment that “lets me be me.” So we use our seven Foundation Principles as the “ends” that we all agree upon…and then let each employee determine the means of how to get there. This encourages each employee to use his or her own creative genius to get to the agreed-upon ends – and not be bound by a phone-book size rulebook governing every process and decision.
And then, we do find that many people choose to adopt The Container Store’s values in their personal lives as well as at work. I’ve always believed in the importance of having the same values in your business and personal life. Why would you act one way at work, and then a completely different way at home? I hear all the time from our employees that working at The Container Store has made them a better parent, spouse and sibling, and that it even makes their kids turn out better. And that they share our employees seven Foundation Principles with their families, and talk about them daily around the dinner table. If you’re coming to work each day happy, working harder than you ever have before, and going home at night so proud of what you’ve accomplished, well, of course that has a positive effect on all aspects of your life!
Morris: As I indicate in my review of the book for various Amazon websites, there are dozens of passages throughout your narrative that caught my eye. Here are a few, accompanied by a question.
First, The Seven Foundation Principles (Pages 18-27): Which seems to be the most difficult to establish? Why?
Tindell: Our first Foundation Principle is the most important and it’s also the most difficult to establish: 1 Great Person = 3 Good People. It takes an enormous amount of time, resources and effort to find, hire and keep great people. At The Container Store, we hire only about 3% of all who apply. Since we want the best of the best, our interview process is quite thorough. There’s an online application, then a phone interview, then a group interview with homework assignments, and then various personal interviews (the number of personal interviews varies based on the position). But honestly, there’s nothing more important to creating a great workplace than having people on your team who are fabulous at what they do. It’s inspiring! I mean, if you were on a golf team, wouldn’t you like to have Jordan Spieth on your team? And if you did, I bet it would inspire you to work a little harder on your swing, to get up early and practice more often. That’s who we’re constantly on the lookout for – amazing employees who elevate the game of everyone around them to a new level. There’s just nothing more exciting than that genuine feeling of truly admiring the people you work around.
Morris: Competition (108-110): My own opinion is that The Container Store’s greatest competitor tomorrow is who it is, what it does, and how well it does it today.
Tindell: We like to say that everyone’s our competition and no one’s our competition. Sure, there are other retailers who sell storage and organization products, but none that focus on it as their sole concept, like we do. And the real differentiator for us is our commitment to a truly solutions-based form of retail that requires hiring great people and training them to offer unheard-of levels of service. When customers come into our stores, they’re more likely to share a problem with our employees – their kids’ toy storage area is a mess – than ask for a specific product. Because they know we’re the experts and can astonish them with a solution they didn’t even know existed, but that perfectly solves the problem.
Because of this we feel like the sky’s the limit for us in the future. It’s about how well we continue to build our business, elevate our training and inspire our employees. And it’s also about ensuring that we’re enabling our customers to shop with us however they’d like to with consistent, seamless and high service online and mobile solutions as well.
Morris: Of all the great business leaders during the last 75-100 years, with which one would you most want to share an evening of conversation if it were possible? Why?
Tindell: Well, this is going back just a bit further than 100 years, but I would just LOVE to have the opportunity to spend a few hours with Benjamin Franklin. He was a true Renaissance man, known for doing great things for many people – from his role as one of the Founding Fathers of the United States, to inventing bifocals to discovering new theories about electricity. It’s incredible to think of the breadth of his influence and the positive “wake” his actions had on the world. He was a humorist and known for his love of great food and wine, so I imagine he would be a joyful dinner date!
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Kip cordially invites you to check out these websites:
The Container Store website link
The Container Store blog link
Uncontainable‘s Amazon link
The Conscious Capitalism organization’s website link