Container Store CEO Pitches ‘Conscious Capitalism’
When Kip Tindell says, “Fill the other guy’s basket to the brim,” he’s not talking about a basket at the Container Store, the retailer that he heads as CEO and that specializes in selling storage products for the organizationally challenged.
He’s referring to a quote attributed to Andrew Carnegie: “Fill the other guy’s basket to the brim. Making money then becomes an easy proposition,” – the Container Store’s guiding principle for doing business, shaping relationships with customers, employees and vendors.
Tindell spoke last week about “Conscious Capitalism at the Container Store” at the Andrew R. Cecil Lecture Series, held at the Naveen Jindal School of Management.
Tindell told an audience of about 150 that he believes profits come from balancing the needs of all stakeholders – employees, suppliers, customers, investors and the community. A business should have a purpose other than profits to achieve profitability, Tindell said.
“Filling the guy’s basket to the brim is like creatively crafting a mutually beneficial relationship with the people you do business with,” said Tindell.
“Milton Friedman said that the only reason a corporation exists is to maximize the return for the shareholder. Well excuse me Milton, but at the Container Store, what we do is actually put the employee first,” Tindell said. “We put the employee first because we think that if you take better care of employees than anybody else, she’s going to take better care of the customer than anybody else. If those two people are ecstatic, then wonderfully enough, your shareholder’s going to be ecstatic too.”
“I’m not an advocate of paying mediocre people well. I’m an advocate of paying great people well.”
The key to the company’s success, Tindell said, is taking great care in hiring employees who are excited about making a difference in their jobs. Guiding the efforts of all employees is the company’s corporate culture, which is made up of simple, yet powerful concepts that help shape the attitudes and daily behaviors of all employees, he said.
The Container Store, like other conscious capitalist companies such as Whole Foods and Southwest Airlines, offers its approach to help mend today’s rampant mistrust of business, he said. Conscious capitalist companies have employee-first cultures and most pay their employees better than average salaries.
Tindell says hiring the best employees and paying well above industry average improves productivity. The Container Store pays full-time sales people nearly $50,000 annually, which is 50 to 100 percent above industry average, he said.
“I’m not an advocate of paying mediocre people well. I’m an advocate of paying great people well,” Tindell said.
And it’s that employee-first corporate culture that had made the Container Store so successful, he said.
The company has been on the top of Fortune magazine’s 100 Best Companies to Work for in America for the past 12 years. Since opening its first store in 1978, the company has seen its annual growth rate right at 25 percent, one of the highest growth rates in retail, Tindell said. The Container Store has 53 stores across the country with 2011 fiscal year sales projected to approach $650 million.
Dr. Hasan Pirkul, dean of the Jindal School of Management and Caruth Chair of Management, introduced Tindell . The event was presided over by Dr. Gregory Dess, the Andrew R. Cecil Endowed Chair in Applied Ethics.
Container Store CEO Kip Tindell told an audience of about 150 that he believes profits come from balancing the needs of all stakeholders – employees, suppliers, customers, investors and the community.
Media Contact: The Office of Media Relations, UT Dallas, (972) 883-2155, [email protected].