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Tim Wade
  • By Tim Wade
  • Jun 09 2016

What next for Sports Direct?

Thoughts on business culture

As Mike Ashley stood before MPs this week to defend his business, it was clear that he didn’t have a handle on everything that was happening within his own company, and the Sports Direct boss went on to admit as much.

“But to put things right, the directorate, including Mr. Ashley, will need to ask themselves what the purpose of their business is, and if that purpose includes creating a culture of excellence for staff and customers alike” Tim Wade

Now, I’m no great fan of Sports Direct, but there’s no denying that as a ‘business’ it’s been incredibly successful, growing rapidly by getting the value equation perfect for their customers. When it comes to intentionally creating an internal culture for staff to thrive and grow, however, Sports Direct and Mr Ashley have been left more than wanting. I mean, if you were going to choose a place to go into labour, the toilets at a Sports Direct factory is probably not most people’s first choice!

Now it’s easy to criticise but much harder to put things right. The fact that Mr Ashley has lost control is not the issue, nobody with any experience of running a business would expect him to have control of every aspect of the business, the fundamental issue is that the Sports Direct leadership team have allowed this toxic culture to thrive.

But to put things right, the directorate, including Mr. Ashley, will need to ask themselves what the purpose of their business is, and if that purpose includes creating a culture of excellence for staff and customers alike. From the brands I’ve consulted and worked alongside over the years, a lack of purpose has often been an Achilles heel for bosses. And if a company’s sole purpose is profit, the real problems rarely come in the form of graphs and charts, but in the lives of those who carry the business everyday.

Ashley, like many CEOs, has probably got the loose/tight methodology the wrong way round. If the leader is tight about the purpose, promise and values, he/she can afford to be looser about the operation and trust that the workforce will operate in accordance with it. But from what we’ve seen and heard about the culture of Sports Direct at present, it appears that the bosses are tight about getting the most from the least, but loose about what matters to staff - protection, provision and purpose.

A company built on a purposeful and intentional culture will always be able to stand strong when things ‘grow out of control’. This doesn’t just mean getting HR to draft up a few sessions on how to be a polite staff member at the checkout, but developing a core sense of purpose that you build your employee experience around. If this is in place, when the tough times come, the culture will continue to serve and protect both the employee and customer experience. If things are left to chance, toxic cultures spring up like weeds, and disillusionment spreads like wildfire.

One Asian proverb states that ‘the fish rots from the head’ so, the leader creates the culture he deserves. And this may come as a shock for Mr. Ashley, but most employees do not leap out of bed in the morning excited by the prospect of making more profit for his organisation that day. Profits may serve to motivate the senior executives but they rarely do so for the front-line staff unless they also happen to be shareholders, as in the case of the John Lewis Partnership.

Is there any hope for Sports Direct internally? Absolutely. But the directorate will need to be clear about their purpose and intentional about the employee experience they wish to create. And if they don’t, it’ll be another relegation for Mike Ashley to deal with.

For more cases studies from leading brands who build healthy work cultures around a strong sense of purpose, check out On Purpose.