CHAPTER THREE
“Turn around and go back to that Starbuck’s, Poobah. They’ve got Wi-Fi and I want to use my laptop.”
The old man took the next exit, looped under the overpass and headed back the way they had come. “Do you want me to start the deep dive now or wait for your scuba tanks?”
The younger man never looked up from his cell phone. “I’d like to show you the information I’m looking at and I can’t do that while you’re driving.”
“I’m going to stop at Walgreen’s before we go to Starbuck’s.”
“Are you taking medicine?”
“No, Sunshine, you are.” He smiled. “And frankly, you’re doing it rather well.”
The old man walked out of Walgreen’s, opened the car door and tossed a bag of jumbo marshmallows into the lap of the younger man who pretended not to notice. The old man smiled as he closed the car door. Putting the car into reverse, he said, “The first of the four pillars is customer centricity. Bezos says, ‘If you’re truly obsessed about your customers, it will cover a lot of your other mistakes.'”
The younger man looked up from his cell phone. “But Jeff Bezos didn’t invent customer centricity, Poobah. Sam Walton was customer centric before Jeff Bezos was even born.”
“And Cornelius Vanderbilt was customer centric before Sam Walton’s grandfather was born.”
“Talk to me about that.”
“Vanderbilt noticed that all the little boats hauling passengers and freight between Staten Island and Manhattan were making their customers wait until they had a full load before they would make the trip across New York Bay. So he borrowed a hundred dollars from his Mom to buy a little boat, then he posted a schedule of his departure and arrival times on both sides of the river. Vanderbilt stuck to that schedule no matter whether he was carrying one passenger or a boatload of freight and people. It didn’t take long before Vanderbilt had everyone on board.”
“Is he the one they called ‘Commodore’ Vanderbilt?”
“They started calling him ‘Commodore’ when he began hauling passengers and freight up and down the east coast on steamships. Commodore Vanderbilt made his name and his fortune by leaving on time, arriving on time, and not losing your luggage.”
“Isn’t that how Herb Kelleher built Southwest Airlines?”
“You read his book?”
“Didn’t know he had one.”
“It’s called Nuts. Vanderbilt and Kelleher were the same guy. They just had different haircuts. ”
“I thought the Vanderbilt fortune was built on railroads.”
“No, the Vanderbilt fortune was built on customer centricity.”
“But didn’t he buy a bunch of railroads?”
“Sure. When all the railroads were going broke, Vanderbilt spotted their problem, bought several of them with his steamship money, and then did what he always did.”
“Leave on time, arrive on time, and don’t lose the customer’s luggage?”
“Badda-bing, Badda-bang…”
“Badda-boom. Same guy with a different haircut.”
“By the way,” said the old man, “when Vanderbilt died in 1877, he was worth a hundred million dollars. That was a lot of money back then.”
“It’s a lot of money now, Poobah.”
“Is it?”
Minutes passed as the old man drove. The car was silent as the younger man’s fingers flickered across the screen of his cell phone. The old man spoke, “A little while ago you said, ‘Sam Walton was customer centric before Jeff Bezos was even born.’ How did you know that?”
“When you were in Walgreen’s I read where Sam Walton said, ‘There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.'”
“Were you able to identify Sam’s unifying principles?”
“That was easy. He called them his Ten Commandments.”
“Read them to me.”
“Sam Walton’s 10 Commandments:
1. Commit to your business.
2. Share your profits with your associates and treat them like your partners.
3. Energize your colleagues.
4. Communicate everything you possibly can to your partners.
5. Appreciate everything your associates do for the business.
6. Celebrate your success.
7. Listen to everyone in your company.
8. Exceed your customers’ expectations.
9. Control your expenses better than your competition.
10. Blaze your own path.”
“Has the company remained true to those principles since Ol’ Sam passed away?”
“Well, Poobah, it looks to me like they’re all about #1 and #9, but everything else has sort of fallen by the wayside.”
“And now you know why I don’t own any Wal-Mart stock.”
“But they’re still America’s largest retailer.”
“Before them, Sears was America’s largest retailer. And as long as Sears remained committed to the principles of Julius Rosenwald, they were the financial juggernaut of America. But Rosenwald died in 1932. And battleships like Sears and Wal-Mart can coast for only so long before they start to sag and creak and groan.”
“What made Rosenwald special?”
“Rosenwald was quick to help when he saw good people struggling.”
“So he was a lot like Sam Walton.”
“Same guy, different haircut. Except one was a Protestant from Oklahoma and the other was a Jew from Chicago.”
“Sam Walton was Jewish?”
“A person might think so by the way he treated his people. When Sam Walton was alive, Wal-Mart was customer centric and Sam’s Ten Commandments about partnering with your employees could almost have been taken from the Talmud.”
“Tell me more about Rosenwald.”
“Google ‘Julius Rosenwald’. Look for the reference that comes up from the Sears Archives.”
“Got it.”
“Click it.”
“Julius Rosenwald was born, blah, blah, blah…” The younger man went silent, then spoke again. “Rosenwald insisted that the company’s primary goal must be responsibility to the customer. He established the ‘satisfaction guaranteed or your money back’ pledge and conducted his business dealings by the creed ‘Sell honest merchandise for less money and more people will buy.’ Under Rosenwald’s direction, the business positioned itself as a direct extension of the farmer’s eyes, ears and wallet, making purchasing decisions in the best interests of the farmer. After Rosenwald stepped down as Sears president in 1924, he devoted most of his time to philanthropy. Over the course of his life, he donated millions of dollars to public schools, colleges and universities, museums, Jewish charities and black institutions. Of all his philanthropic efforts, Rosenwald was most famous for the more than 5,000 ‘Rosenwald schools’ he established throughout the South for poor, rural black youth, and the 4,000 libraries he added to existing schools. The network of new public schools subsequently employed more than 14,000 teachers. In 1927, Rosenwald received a special gold medal for Distinguished Achievement in Race Relations for his contributions to the education of black youth.”
“That was Julius Rosenwald, Sunshine. He cared about his customers. He cared about his suppliers. He cared about helping people so much that he occasionally had to borrow money to pay his own living expenses.”
“Why did he have to do that?”
“He would literally give everything he had. You see, Rosenwald was so spectacularly wealthy that he was often worried that his children would never experience the joy of pushing, working, struggling to reach a goal. And he was a huge promoter of the YMCA back in the days when it was a major force for helping lift people from difficult circumstances.”
“The Young Men’s Christian Association? Are you sure this guy was Jewish?”
“Jews have always been like that, Sunshine. Have you ever looked at the percentage of Nobel Prizes that are awarded to Jews?”
“I’ve always wondered why so many of your friends are Jewish.”
“They’re customer centric and they don’t eat the marshmallow.”
“You’re not going to start talking religion now, are you?”
“We’re talking about people – customers and employees – and we’re talking about making the world a better place, Sunshine. We’re talking about business.”
“Okay, tie all that together for me.”
“Moses ben Maimon was a Rabbi who lived about a thousand years ago. He’s usually called Maimonides, or Rambam. Anyway, he said there were 8 different ways to help people and all of those ways were good, but some were better than others.”
“Okay, I’m starting to see a little bit of a business application. Keep going.”
“He said the least effective way to help someone is to hand them the cash they need.”
“Why did he consider that to be ineffective?”
“Two reasons. Number one, it’s not sustainable. Number two, a person needs money because there is a problem. If you really care about them, you won’t just hand them the cash and walk away. You’ll get involved and try to find a long-term solution. Traditional Jewish thinking is all about sustainability. Always has been. That’s why they’re such amazing business people.”
“Okay, what did this Rabbi Moses-whatever say was the best way to help?”
“Take a guess.”
“Give them a job? Or maybe help them start a company, so they can also give jobs to other people?”
“You’re more Jewish than you realize, Sunshine. Now tell me how that connects to what Bezos has been saying.”
“Well, Bezos said, ‘We believe that focusing our energy on the controllable inputs to our business is the most effective way to maximize financial outputs over time.’ In other words, he believes in making investments that will yield long-term results, year after year. Julius Rosenwald believed in the long-term benefits of a ‘no questions asked’ return policy and the long-term benefits of education. Neither one is a TLB.”
“Okay, what else?”
“Bezos is all about taking action, doing experiments, and looking toward the future. He said, ‘I very frequently get the question: ‘What’s going to change in the next 10 years?’ but I almost never get the question, ‘What’s not going to change in the next 10 years?’ Bezos said the second question is the more important of the two. He’s all about things that don’t change. Rosenwald was all about things that don’t change. They’re navigators, staring at a star that never moves, constantly turning the rudder and adjusting the sails to stay on course and accelerate the journey.”
The car pulled into the parking lot at Starbuck’s. The old man opened the bag of marshmallows, put one in his coat pocket and said, “Can you handle another Venti?”
“Let me grab my laptop.”
© 2017, Roy H. Williams - www.mondaymorningmemo.com
Jeffrey and Bryan Eisenberg - buyerlegends.com