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L.L. BEAN
The Making of an American Icon
By Leon Gorman
Harvard Business School Press
$26.95, hardcover, 304 pages; ISBN 13: 978-1-20191-183-9 (2006).
Anyone who has grown up in Maine has grown up with L.L. Bean. Living here all my life, I was well aware of the success story of this legendary Maine retailer. I was genuinely interested in reading this book by Leon Gorman, Chairman, former President, and grandson of Leon L. Bean. After all, Gorman took over the business in 1967 and ran it for more than 30 years. During his tenure, the company experienced tremendous growth. In 1967, sales were $4.75 million – in 1975, sales were $30 million. Just 5 years later, this figure surged to $121.5 million. The year before Gorman stepped down as President in 2001, sales had reached an astonishing $1.169 billion. (I was pleased to read in the January 2007 issue of Down East magazine that net sales in 2005 were 1.47 billion, up 4% from the previous year.)
I had lots of questions: what was Leon L. Bean really like? How does a company gladly accept returns – no matter how long you've owned the product – without question? And above all, how did Gorman lead this company through such astronomical growth and still maintain its appealing corporate identity? I'm pleased to report that Gorman answers all these questions and many more in this informative book.
For those less interested in the business side of things, Gorman offers a behind-the-scenes look at his grandfather, L.L., while working at L.L. Bean from 1960 to 1967, the year L.L. passed away. In 1962, when L.L. was ninety years old and Gorman was still in his twenties, he described his grandfather as one who "rarely delegated any responsibilities. It was clear what he wanted done because he made all the decisions. He fully enjoyed his company and his reputation as a Down East merchant."
Gorman writes:
Because L.L. was outgoing, energetic, and personable, people enjoyed working for him. But he never was and never pretended to be a manager in the conventional sense. He had little interest in planning and budgeting, in organizational issues, in training or developing people, or in performance management. Team building was something he left to the manager of his beloved Boston Red Sox.
Gorman explains the famous L.L. Bean guarantee of satisfaction had gone by the wayside when he took over the company. Despite the many stories touting L.L.'s personal guarantee on everything he sold, the guarantee hadn't been in print since 1919 and wasn't being practiced when he joined the company. In 1968 he changed all that by including the guarantee in the Spring Catalog. The unqualified, broadest guarantee in the industry was printed in boldface in 1970.
It read:
"Guarantee" Our products are guaranteed to be 100 percent satisfactory. Return anything purchased from us that proves otherwise. We will replace it or refund your money, as you wish, and return your postage costs. Please attach letter of instruction and our packing slip, if available, with returned merchandise.
Gorman writes that the feared influx of frivolous and fraudulent returns never materialized. He writes that the vast majority of customers could be trusted to be fair in returning unsatisfactory products – and that those returning products they weren't happy with often became loyal customers in the future. This helped to further the company's reputation for trust and became an L.L. Bean hallmark.
I'm happy to report that Gorman's description of leading the business through massive growth is presented in a clear chronological way with no effort made to gloss over difficult business times. He gives credit to hiring many professionals in the 1970s and 80s – starting with Bill End as his second-in-command in 1975. At that time, End was a bright and energetic twenty-six year old with an MBA from Harvard. In the following years, many other professionals were hired to help Gorman run the company.
Gorman's strengths were in keeping L.L. Bean focused on it core values, balancing growth and tradition, and preserving it's corporate identity. His team of professional managers was given latitude to expand the business through specialty catalogs, retail stores and overseas. They also were instrumental in reorganizing the business and focusing on Total Quality as a strategy to make the company more productive, increase performance and retain the L.L. Bean core values.
It's refreshing that Gorman doesn't hide the fact that employees often described him as careful, quiet and reserved. Reading between the lines, it's easy to see that his greatest skills were not in communicating with his managers and workers. A good friend of mine (who was one of the professional managers at L.L. Bean in the 1980s and has since moved on) told me he very much enjoyed reading the book. "Finally," he said, "I was able for the first time to understand what Leon was thinking."
Purchase the book from Amazon here.
This post supported by Injury Claims Lawyers.