IF Tim Davie has the worst job in Britain, who has the second? It must be Dame Sharon White, boss of John Lewis. In a way they’re linked, the BBC and the department store and Waitrose group. They both hark back to a bygone age of honest toil and solid values. The BBC had its Reithian mission to inform, educate and entertain which it delivered over tea to countless wireless sets on sideboards behind lace curtains, all from John Lewis, tea set included.
They’ve both got ownership models that smack more of idealism rather than harsh pragmatism. As a result, they have employees unafraid to criticise management and a public who think they have a right to attack something they regard as one of their own. The John Lewis Gazette, the staff newsletter, could sustain a regular show on BBC Radio 4, such is the level of complaint but also the accounts of dealing with the middle classes and their never-ending foibles.
Now White is facing a watershed moment. The John Lewis shops are struggling, so is Waitrose, she’s being hammered by competition, the group has reported a thumping loss and will not be paying bonuses this year. White desperately needs to raise new funding, of the order of £2 billion, to make improvements across technology and data analysis. She can’t go to the employee shareholders; the mutual already has £1.7 billion of debt; White has no choice than to sell a minority stake, thus diluting its famous partnership structure.
It was not that long ago that John Lewis was the talk of government, held up as possessing the perfect ownership model. Nick Clegg, as Deputy Prime Minister, went so far in 2012 as to suggest it should be the template for the whole economy. Everyone wanted to be like John Lewis, where all the workers had a stake in the business. This flat structure, with all the staff pulling together for the common good, was the one that others should aspire to.
The claim was fundamentally flawed: mutuality only works in the good times. During the bad, tough decisions must be made — those aren’t employees you’re having to lose but partners just like you. Rancour takes charge with no “owners” to blame; you are the owners, it’s your fault.
It was always claimed that because they had a stake in the business John Lewis and Waitrose staff went the extra mile, that the level of service they provided was exceptional. Really? Personally, there was little to choose between them and Marks & Spencer. Perhaps it was more about the sort of person they hired — a bit older, wiser, more polite, definably middle-class, like them.
Now there are gripes they’re not what they were, that John Lewis and Waitrose assistants are less in evidence, they’re not as helpful and nowhere near as knowledgeable. Goods that were once always in stock these days require a wait. The online waiting time is longer. Some of the own-label products lack the same quality.
To which I say, everything is relative. They’re still fine, reliable places to shop. Nevertheless, standards are slipping.
White has ditched one albatross — the claim to be “never knowingly undersold” — and now is targeting another, the partnership structure.
She should stick to her guns. But if White is going to throw even part of the ownership open to the public, then why not offer the shares to members of the public, to the store group’s loyal customers? Turn John Lewis into a movement, akin to the National Trust, the country’s biggest membership organisation and as it happens, in terms of its members, at one with John Lewis and Waitrose.
What she ought to avoid, though, is the temptation to take John Lewis into other areas, such as city centre apartments and wellbeing. Don’t go there. Instead focus on the basics that John Lewis did so well, so restore the level of service, re-energise and enthuse the staff, speed up and boost online. If needs be, use part of the £2 billion to pay bonuses, compensate them for losing their shares. Focus on household goods, furniture, electricals, hosiery, fabrics and baby equipment. Ditch sections that are superfluous. Employ great designers, inject excitement and colour. Provide value.
One thing. White should not allow John Lewis to draw too much comparison with House of Fraser and Debenhams. They were traditional department store chains, primarily selling clothing and they were hammered for it. John Lewis was never the same as them; it was different and should remain so.
It could be worse: White could employ Gary Lineker. There again, she could build an advertising campaign around middle Britain’s blokey but well-meaning, clean-living pin-up, Mr John Lewis.
Chris Blackhurst is the author of Too Big To Jail: Inside HSBC, the Mexican drug cartels and the greatest banking scandal of the century (Macmillan)
