The Nordstrom Way
A Culture of Service in 75 Words
For many years, new employees were given a copy of the famous Nordstrom’s Employee Handbook – a single 5-by-8-inch (130 × 200 mm) gray card containing 75 words:
Welcome to Nordstrom
We’re glad to have you with our Company. Our number one goal is to provide outstanding customer service. Set both your personal and professional goals high. We have great confidence in your ability to achieve them.
Nordstrom Rules: Rule #1: Use your best judgment in all situations. There will be no additional rules.
Please feel free to ask your department manager, store manager, or division general manager any question at any time.
However, new hire orientations now provide the card above along with a full handbook of other more specific rules and legal regulations, as the way Nordstrom operates has changed. During this time, Nordstrom had the highest sales per square foot performance in the retail industry – by almost double.
>> Source: http://en.wikipedia.org/wiki/Nordstrom#Employee_handbook
More on Nordstrom’s Culture
Customer Service Philosophy
- Nordstrom’s culture encourages entrepreneurial, motivated men and women to make the extra effort to give customer service that is unequaled in American retailing. “Not service like it used to be, but service that never was.”
- “A place where service is an act of faith.”
- Their system is embarrassingly simple, “we out-service, not outsmart, the competition”.
- “Our success is simply a matter of service, selection, fair pricing, hard work, and plain luck!”
- ‘It was never that we were so great, it was just that everyone else was so bad.’ We know that at this moment, someone somewhere is getting bad service at Nordstrom
- When you stop worrying about the money and concentrate on serving the customer, the money will follow. (People who succeed in sales understand this paradox.)
Employee Empowerment
- Nordstrom’s salespeople are empowered to make decisions and Nordstrom management is willing to live with these decisions – it’s like dealing with a one-person shop. Empowered employees are energized. “Giving away responsibility and authority is the ultimate expression of leadership.”
- “The customer is always right” is not a cliché at Nordstrom.
- Nordstrom’s employees are instructed to always make a decision that favors the customer before the company. They are never criticized for doing too much for a customer; they are criticized for doing too little.
- Nordstrom believes that too many rules, regulations, paperwork, and strict channels of communication erode employee incentive.
- Because Nordstrom doesn’t have many rules, employees don’t have to worry whether they are breaking any.
Hiring & Training
- Nordstrom feels that the best training courses come from parents. Previous retail experience or a college degree has never been a prerequisite for succeeding at Nordstrom.
- Nordstrom “hires the smile and trains the skill.”
- Nordstrom would rather hire nice people and teach them to sell, then hire salespeople and teach them to be nice.
- When the company expands to other regions, it dispatches an advanced force of veteran “Nordies” who carry the culture with them and imports it to new employees.
- Nordstrom never acquires other chains, because it is too difficult for those employees to break old habits.
The Nordstrom Selling Approach
- At Nordstrom, the priority is on Selling, and the key to successful selling is providing outstanding customer service.
- If you treat customers like royalty and let them know that you will take care of them, they will usually come back to you.
- When customers enter a department, salespeople always make sure they are acknowledged. They are relaxed and unhurried in order to help the customer feel the same way.
- The unconditional money-back guarantee is designed for the 98% of customers who are honest.
- Nordstrom’s standard of performance is “Sales per hour”.
- Outstanding sales performances are rewarded with prizes and praise, as are good ideas and suggestions.
“If I take care of the customer, the dollars will follow”
Organizational Structure & Store Design
- Nordstrom is informally organized as an “inverted pyramid” with the top positions occupied by customers and salespeople. Every tier of the pyramid supports the sales staff.
- Employees have access to sales figures from all departments and stores in the chain, so they can compare their performances.
- Part of good customer service is (Store Design) creating “a memorable experience”: Store presentation must be understood immediately. Nordstrom states that it only takes 15 seconds to impress their customers. That’s why Nordstrom has more seating, better lighting, larger fitting rooms, wider aisles, and a more residential feeling.
- Decision by consensus is how the Nordstrom brothers run their business. Disagreements are worked out behind closed doors and a united front is always presented to the public.
At its best, Nordstrom never forgets that it doesn’t have all the answers. They know that the customers have all the information that they need and that salespeople are the most valuable people in the company!
The underlying Nordstrom culture and philosophy is not difficult to pass on to the next generation because it’s simple: “give great customer Service.”
