Home' Trinidad and Tobago Guardian : July 14th 2016 Contents JULY 14 • 2016 www.guardian.co.tt BUSINESS GUARDIAN
COMMENTARY | BG19
Back in the 1990s, I was
appointed a store manager in
a large retail organisation.
Times were bad as we were
still reeling from the effects
of a decade old recession
caused by prolonged low oil prices. Customers
weren t spending and they had low confidence
levels. The management mantra at the time
was keeping costs low or cut it.
Thinking inside the box
The Chaguanas store I ran was losing money
for six years and it was oversized. The managers
of the past tried their best, but the retail oper-
ation still lost money. When I was assigned,
I was told it was impossible to make money
just keep losses at a minimum. I looked around
and there was little to cut. The rent (the largest
expense) was just reduced and the landlord
made it clear he would not budge further.
When I compared our bottom line to the
other stores, we were losing the most money.
So, if the company had to close a store, we
would be first.
This concerned me as some employees
would be sent home. They were a very pro-
Also, how could I make my mark as a man-
ager if I could not make any money?
I analysed the financial statements, the cost
could not be lowered, sales would be difficult
to increase in a recession and gross profit
Thinking out of the box
One day, human resources transferred one
of the bakers from another branch to my
branch. I asked him what he could do and he
said he could make more than 50 types of
donuts. I enquired what he did at the branch
he came from and he replied that he baked
bread all day.
I had just graduated in the US and I used
to eat donuts regularly. Could donuts be big
in a supermarket bakery? Remember this was
1990 and bakeries were stocked with the usual:
currants rolls, coconut drops and the like.
Donut Boys did not exist and bakeries were
stale with less innovative products.
I asked the staff and they said they tried it
and "Central people only liked doubles and
pies." This was an assumption I had to test.
I asked the baker to prepare several types of
donuts and give them out as samples.
He was stunned that we would be giving
away things for free as the organisation was
on a cost-cutting drive.
The next day I looked for the feedback form
the baker was supposed to fill out. It was clean
except for some margarine stains. I was so
upset as the baker had ruined my experiment
but he later explained that the response was
so positive he did not have time to write them
After we tested a number of innovative
products and rolled out donuts as a new prod-
uct, our bakery sales shot up. We moved from
last to first position in less than two years.
One day we ran out of donuts and the Central
customers were so upset we did not have the
cake with the hole in it.
Another example came one day as I returned
from head office with the usual mantra of
lowering costs. I spoke with a department
manager who had an innovative idea to sell
seasoned meats. The staff was not as excited
as me and, unfortunately, we had to hire an
external person to prepare the meats. The aim
was to target working women who had to pre-
pare meals at the end of the day. At first I hid
this from the district manager intent on cost-
One day in 1991, the district manager came
to the store and asked about the green-looking
meat. He thought it was spoilt. I responded
by saying we were experimenting with sea-
soned meats. Even today, I remember his
response: "Next thing you will be frying chick-
en and delivering it."
The two examples of donuts and seasoned
meats have some similarities.
These ideas did not come from head office
but from workers and we found a low-cost
way to test them. Today, seasoned meats and
donuts are common in the supermarket indus-
try. You can thank Hilo (Massy Stores) for
Thinking there is no box
With all the small innovations, we were los-
ing less money but still not making a profit.
Our biggest cost was rent and the landlord
had no intentions of lowering it.
One day I had a eureka moment. The con-
glomerate had a chain of stationery stores,
but none located in Chaguanas. Would they
be interested in our location? I raised this idea
with the operations director. My boss at the
time thought it was a crazy idea. He thought
I was reading too many Harvard Business
Reviews and commented that it would be dif-
ficult ands costly to move the infrastruture
such as freezers. As it turned out, the stationery
was looking to move to Chaguanas. The super-
market moved out to a cheaper location which
meant a 37 per cent reduction in the rent.
Finally, we were on the road to profitability.
After two years, we were making a profit
and benefited from increased store traffic from
our new neighbour. We also had the highest
gross profit in the chain. Our bakery sales
contributed to our growing profit. All this in
a recession and in a business that operates on
razor-thin profit margins.
At the time I was not aware that this is
what it meant to be an entrepreneurial man-
ager. I thought I was being a good marketer,
practicing turnaround management. The odds
against me---recession, high-cost structure,
little resources---somehow changed.
Entrepreneurial managers are a different
So, what are these characteristics?
Corporate entrepreneurs or intrapreneurs
are similar to entrepreneurs in that they love
to take risks (or calculated risk) and are not
afraid of being fired as the ordinary manager
would. They are highly motivated, they want
freedom, are courageous (giving away dough-
nuts), are willing to test ideas in a low-cost
way (attempting to sell seasoned meats in
small quantities). Intrapreneurs tend to get
into trouble with the hierarchy---as I frequently
did. Entrepreneurial managers dislike the sys-
tem, but know how to work around it or take
chances without permission.
If you are at the highest management level,
there is only one way to mobilise the collective
intelligence of your organisation and get every-
one to think entrepreneurially. It s called the
practice of corporate entrepreneurship.
Sajjad Hamid is an SME consultant.
he can be reached at: entrepreneurt-
firstname.lastname@example.org or entrepreneurtnt.com
with Sajjad Hamid
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