Lifetime loyalty

I've been reading Terry Leahy's book - 'Management in 10 words'...and very good it is too. Terry Leahy was Chief Executive of Tesco for 14 years up to 2011. He presided over a period of the company's greatest growth and expansion, overtaking Sainsbury's and Marks and Spencer as the UK's largest retailers and expanding internationally on a massive scale. I was at Tesco for 16 years up to 2003 as a middle ranking finance executive so it's interesting to read about how the big decisions were made during some of my time at the company.

Terry is a marketing man and his success was built around listening to and looking after customers. A key decision was to introduce Tesco Clubcard, Almost all the big retailers have loyalty cards now but Tesco gained a major advantage by being first. Clubcard data enabled Tesco to understand customer shopping habits better and customers liked being thanked and collecting points for money off their shopping bill. Other examples of listening to customers were leading on the lobby for Sunday trading, the introduction of 'Value' lines, customer panels and store design.

Perhaps Terry's biggest legacy is introducing Tesco's 'Values'. These are a few short statements covering how Tesco looks after its customers and how people in the company work together to achieve this. The values were developed by staff at all levels and are complementary to Tesco's core purpose, 'To create value for customers to earn their lifetime loyalty'. Lifetime loyalty...now that's powerful.

The thing about the values is that they reinforced and also developed the culture at Tesco. Terry says it helped make Tesco a gentler environment. A move on from the masculine, macho culture of the 60s and 70s. The values helped guide decision making from senior management to the shop floor. If an employee was unsure how to deal with a customer query or complaint, the values steered them to 'follow the customer'

I left Tesco in 2003 and since then have run my own accountancy practice. I now deal with accounts and tax for a number of my ex Tesco colleagues, most of whom have gone on to run highly successful consultancy businesses. So why did they come to me for help? Well it may be that they think I'm a great accountant. More likely, it's the Tesco culture of loyalty to an ex colleague and they know that as an ex Tesco man I will always do my best for them as my customers.

So although retailing is a million miles away from accountancy, something of the Tesco culture and values has stayed with me and has shaped my current business. If that helps me to focus on gaining lifetime loyalty from our customers, that's no bad thing.

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