Jeanne Lewis at Steples, INC free essay sample

Six months from now, on February 1, 1998, Jeanne Lewis (HBS ’92) would become the senior vice president of marketing at Staples, Inc. (Staples), a nationwide office supplies superstore. After 10 months working side by side with Todd Krasnow, the current executive vice president of marketing, Lewis was becoming familiar with the department. Her initial assessment led her to wonder if the department’s operating style was suited to evolving competitive realities. As Krasnow’s heir apparent, Lewis wanted to be involved in shaping the department’s priorities for the upcoming year. The strategic planning process traditionally began around this time in August, and Lewis wondered if the time to start taking action had arrived. Thus far, 1997 had been a trying year for the company: the Federal Trade Commission had challenged Staples’ proposed merger with Office Depot, and the two companies had recently abandoned 10 months of merger efforts. At that time, Chairman and CEO Tom Stemberg reaffirmed his commitment that Staples would grow from a $5 billion company to a $10 billion company by the turn of the century. We will write a custom essay sample on Jeanne Lewis at Steples, INC or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Staples not only had to grow bigger, it also had to grow better, as analysts had become accustomed to the company’s 14 consecutive quarters of earnings-per-share growth in excess of 30%. The theme of the upcoming year was twofold: strong growth and more effective execution. tC Lewis believed that Stemberg’s pronouncement to look for the â€Å"silver lining† in the failed merger and to take to heart the lessons of the merger could serve as a call to action for the marketing department. Marketing, which served as both an architect and driver of the brand, would play a critical role in Staples’ continued success. Lewis knew that Staples could survive only if it was prepared to get rid of outmoded ideas and replace them with new ones—a philosophy shared by Krasnow. But Lewis also knew that it could be frightening to give up the ideas that had made the company successful. Furthermore, the marketing staff was understandably apprehensive about Krasnow’s planned departure, and many were already mourning his loss. Lewis explained: No While the merger distractions were going on, things that maybe should have been dealt with, weren’t. Now, I wanted to make it clear that a new person was coming on board in this area, and figure out how we could get back to business. We needed to refocus on building our business, because it was as competitive as ever, and we had lost a couple of beats in a few marketing areas while busy with the merger. We were at a turning point in the marketing department, as opposed to being long past it. Because of the confluence of external events as well as our own internal complexity, if we didn’t change, then I was concerned it would start to show eventually in sales. Do Research Associate Jennifer M. Suesse prepared this case under the supervision of Professor Linda A. Hill as the basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation. It is an abridged version of an earlier case, â€Å"Jeanne Lewis at Staples, Inc. (A),† HBS No. 499-041, prepared by Research Associate Kristin C. Doughty under the supervision of Professor Linda A. Hill. Some names have been disguised. Copyright  © 2000 by the President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www. hbsp. harvard. edu. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of Harvard Business School. 1 This document is authorized for use only by Harutyun Gevorgyan at HE OTHER until November 2014. Copying or posting is an infringement of copyright. [emailprotected] harvard. edu or 617. 783. 7860. 400-065 Jeanne Lewis at Staples, Inc. (A) (Abridged) rP os t Lewis knew the marketing department’s role in ensuring success was twofold: maintaining the delicate balance between meeting short-term financial objectives with appropriate promotional tactics and building customer loyalty and retention with an effective marketing strategy; and investigating ways to leverage Staples’ brand and broaden its franchise. She also had specific questions about some of the department’s structures, systems, and staffing. She was eager to get started, but recognized the risks of doing too much, too fast: op yo My style is that I want things to happen quickly. When I see things—either a new problem someone has never had to figure out before, or where they’ve just had a different sense of timing—I jump in and say, â€Å"here’s the way to do it,† and that makes change happen quickly. But that could limit my ability to work across and with the organization. I could end up spending too much time managing down and not enough time making broader, more expansive impact by managing across the organization as well. Staples’ Background (1985-1991)1 tC In 1985, Tom Stemberg (HBS ’73), known for his marketing savvy and innovations in the staid supermarket industry (as vice president of sales at Star Market, and president of First National Supermarket), pioneered the concept of the office supplies superstore. A â€Å"Toys ‘R’ Us† of office supplies, â€Å"Staples, the Office Superstore† would â€Å"provide completeness, convenience, informed assistance as well as attractive prices†¦ covering everything from coffee to computer software† for the small-business customer. 2 Initial customer research indicated that most small businesses did not track their total expenditures for office products closely, nor were they aware that they were paying on average 40% more for them than large corporations. To communicate the savings and increased convenience of its new way of procuring office supplies, Staples’ management was prepared to invest heavily in marketing. Staples’ message would emphasize discounts and convenience, leaving customers â€Å"free from the hassles† of dealing with long lines, order forms, and multiple suppliers. No For the pivotal role of director of marketing, Stemberg hired Todd Krasnow, a 28-year-old HBS graduate who had worked in marketing at Star Market with Stemberg’s new VP of operations. In the early days, Stemberg’s team of five (himself, Krasnow, CFO, VP of operations, VP of merchandising) each had their own primary spheres of responsibility, but they all worked very closely together, doing whatever it took to get the job done. They began the mornings with a 7:00 o’clock meeting, reconvened for a working lunch, and generally worked through the evening until 10:00 o’clock. They hashed out virtually every decision together, early on developing the discipline to back up their â€Å"intuitions† with hard data. Krasnow’s optimism, exceptional dedication, and â€Å"big picture† perspective often helped keep even the most heated debates substantive, rather than personal. Do The business plan committed the Staples team to opening 26 stores in five years. The first new store opened on May 1, 1986, in Brighton, Massachusetts, and was followed by a second in nearby Woburn in November. The office superstore concept quickly caught on with both customers and other entrepreneurs. The Staples team focused their efforts on building a Northeast franchise to discourage competitors and make it cost-effective to advertise in that very high-cost region; 1 Staples background was compiled from these sources: â€Å"Staples in 1995,† HBS No. 795-158; â€Å"Staples, Inc. ,† HBS No. 593-034; â€Å"Staples (A), (B), and (C),† HBS Nos. 898-157, 898-158, 898-159; Thomas G. Stemberg, Staples for Success: From Business Plan to Billion-Dollar Business in Just a Decade (Santa Monica, CA: Knowledge Exchange, 1996). 2 The â€Å"Staples: the Office Superstore† business plan was published in part as â€Å"Staples (B),† HBS No. 898-158. 2 This document is authorized for use only by Harutyun Gevorgyan at HE OTHER until November 2014. Copying or posting is an infringement of copyright. [emailprotected] harvard. edu or 617. 783. 7860. Jeanne Lewis at Staples, Inc. (A) (Abridged) 400-065 rP os t copycatting was common practice in retailing, and second movers often received better terms from investors and suppliers than leaders. Office Depot opened its first store in Florida in October, and within 18 months, 19 other competitors had emerged. For the next several years, Staples and its two main rivals, Office Depot and Office Max, concentrated their efforts in geographically distinct territories. But soon Staples had to contend with a much wider competitive set, including savvy retailers who were not traditional office suppliers, such as Wal-Mart, Best Buy, and CVS. These competitors often had significantly more capital to invest and some offered lower prices than Staples. op yo Krasnow’s contribution to Staples’ marketing success was universally acknowledged. One executive described it thus: â€Å"With his vast experience, Todd ran the marketing department out of his head and his gut. † On more than one occasion, Krasnow and his team had been able to â€Å"save the company. † For example, when only 20 customers came in to Staples on their first day of business, Krasnow came up with the idea of paying 25 small-business managers $20 to shop in the store and tell him what they thought. A week later, though all had taken the money, none of them had come to the store—undeterred, Krasnow, persisted in contacting them, and those that eventually came in were very impressed with what they saw. This was the beginning of Staples’ inventive marketing style and frequent reliance on direct market outreach. The team later instituted a free Staples membership program that allowed them to measure if they were getting a good return on their promotional efforts. At the time, such database marketing was almost unheard of in retailing. tC Stemberg pushed his team hard, reminding them that they were waging a battle for market dominance. Employees were encouraged to continually reexamine their strategy, to scrutinize other retailers’ activities and â€Å"borrow† their best ideas, and to capitalize on all available opportunities. The corporate and field team from these early years recalled that there was a great deal of â€Å"fire-fighting† and â€Å"band-aiding. † In April 1989, Staples received a much-needed infusion of capital with its initial public offering in which over two million shares sold at an opening price of $19 per share. In coming years, the company further complemented organic growth with a series of acquisitions and joint ventures that allowed it to gain market share, expand into new markets (including the West Coast, Canada, and Europe), and learn from others’ successes. No By the end of 1991, Staples had 123 stores. As Staples grew, the senior management team continued to devote time and attention to recruiting and developing talent. They sought out people with a â€Å"can-do† attitude, competitive drive, and an eagerness to learn and stretch themselves. Staples’ employees had to be flexible and willing to move laterally through the company, as Stemberg contended that these periodic rotations helped the company avoid complacency and maintain its entrepreneurial spirit. They also had to be comfortable taking risks on behalf of the company and being held accountable for them. It was not easy to find people who could thrive in this fast-paced, often stressful environment. As one manager observed, â€Å"Within weeks you could tell if a new hire could withstand the pace and pressure. † Jeanne Lewis (1991-1995) Do Marketing and operations Lewis first came to Staples in 1991 as an MBA summer intern in the marketing department (see Exhibit 1 for a timeline of key events). At the time, Staples was small enough that, as she reflected, â€Å"you could literally fit the entire management team in one room. † As an intern, Lewis evaluated marketing plan effectiveness for the company’s 105 stores in 12 states. She passed Stemberg’s office each day and had the opportunity to sit in on meetings occasionally with the CEO and president. In 1993, one year after her HBS graduation, she returned as a marketing manager responsible for sales forecasting and field marketing. In 1994, she became director of operations for New England with $250 million profit and loss (PL) responsibility for 50 stores. Lewis had 7 direct reports and over 1,000 indirect reports. The stores were underperforming, which she concluded was because of a lack of strong leadership throughout the area: 3 This document is authorized for use only by Harutyun Gevorgyan at HE OTHER until November 2014. Copying or posting is an infringement of copyright. [emailprotected] harvard. edu or 617. 783. 7860. 400-065 Jeanne Lewis at Staples, Inc. (A) (Abridged) rP os t Going into operations was a real change. I was put in charge of managing people who had all â€Å"been there, done that† for years. They’d started out as merchandise managers making $18,000 and moved up the silo. And then I came in: I’d never run a store, never rung a register, never done any of the things that they valued expertise in. And yet we had a situation where the stores weren’t performing that well, and I had to tell them to make money and grow sales. Lewis went straight to work, made tough choices, and replaced 25 store associates in a 12month period. Her new team set aggressive store standards, launched training programs, and rejuvenated performance. A year later, Lewis became the director of sales for 150 stores on the East Coast. One of her direct reports described his time working with Lewis as a time of professional growth: â€Å"Jeanne’s charm could be disarming. She worked really hard, and her personality motivated you. She tended to manage tightly at first, then loosened the reins. She challenged us a lot, and invited us to challenge each other. † op yo Merchandising Within a year, Lewis was asked to move again, this time into merchandising as vice president and divisional merchandising manager for furniture and decorative supplies, a potentially profitable category. Merchandising was the department responsible for deciding what product to buy, how much to buy, what price to charge, and how to display it in stores and catalog. She now had product-level PL responsibility for $350 million and both direct (three) and indirect (nine) reports. Again, she was an outsider entering a department of people who had a deep experience base and shared background. As one merchant explained, â€Å"We are a different breed, with our own style of rough and tumble. Because we spend so much time negotiating, we are always a bit distrustful, and wary of being cheated. † Lewis explained: No tC The same thing occurred in merchandising as operations. I came into the department that is the heartbeat of a retailer having never bought product, but suddenly I had to manage a group of buyers, somehow create a merchandising strategy, and make this sick category a winner [the division’s sales had been flat in a company where double-digit growth was both common and expected]. And again, there was a vendor community looking at me saying, â€Å"What do you know about buying and negotiating? † And I had a group of buyers who typically had been led by people who had come up through the ranks, while I had none of the technical expertise they placed a premium on. Often when you move to a new functional area, the onus is on the group you’ve just inherited to teach the new manager the ropes. For me, though, it was â€Å"you’ve got to fix it, and fix it fast. † There was no time for the people who reported to me to teach me. Do In short order, Lewis and her team developed a strategy for turning around the department. They replaced over 75% of the product assortment and tripled direct product profitability (DPP). 3 Lewis soon won the respect of her colleagues thanks to her strategic talents and penetrating mind. Her direct reports and peers learned that to influence her, they had to be prepared to get to the heart of a matter and support their position with relevant analyses. One reported that at first impression, he worried that Lewis might be a micro-manager, but he soon realized that she liked to inspire dialogue and debate to ensure that they dug deeply in their decision making. Many found these exchanges intense and more productive in one-on-one interactions, as opposed to group settings. According to her boss, Richard Gentry, executive vice president of merchandising: 3 Although it was common in food retailing, Staples had only recently adopted DPP. With DPP, Staples used computer modeling to calculate the costs and revenues in the distribution system directly attributable to a given product and could thereby measure each stock-keeping unit’s (SKU) contribution to profit. This information could then be used for new product selection, shelf space allocation, and pricing decisions. 4 This document is authorized for use only by Harutyun Gevorgyan at HE OTHER until November 2014. Copying or posting is an infringement of copyright. [emailprotected] harvard. edu or 617. 783. 7860. Jeanne Lewis at Staples, Inc. (A) (Abridged) 400-065 rP os t Jeanne demonstrated that you can be a good merchant but you could also be strategic and think outside of the four walls. She showed us how to maximize DPP instead of just â€Å"here’s what I sell it at, here’s what I buy it for. † She was the first merchant to look at financials beyond gross margin, to look at what it actually cost to handle a product in the distribution centers, what it cost in terms of the space in the store. I think she was able to influence people and get respect because she had great insight, and she combined it with a great natural personality. Opportunity Knocks (1996) op yo By 1996, Staples was a $3 billion business with over 500 stores (see Exhibit 2 for a partial organizational chart). Although small business remained the core customer, the company had expanded its offerings to meet the needs of mid-sized and large businesses. It was organized into three strategic business units (SBUs): Retail, Contract and Commercial, and International. The Retail Unit consisted of all U. S. stores. The Contract and Commercial Unit consisted of three divisions: Staples Business Advantage, which handled regional mid-sized to large companies; Staples National Advantage, which provided complete, customized solutions for national, multi-location companies; and Staples Direct, a catalog division. The International Division managed all functional areas for all stores in Europe. This structure was designed to encourage ownership and accountability, and each SBU had its own strategic priorities and aggressive quarterly financial objectives. Although each unit relied to greater or lesser extents on the corporate marketing and merchandising departments, they also had their own dedicated marketing and merchandising areas. Newcomers to Staples often found the organizational structure cumbersome and difficult to cope with. As one manager recalled, â€Å"I soon discovered that the many (explicit and implicit) dotted-line reporting relationships were often more important than the solid-line reporting relationships. Thankfully, we are all stockholders, so at the end of the day we are all focused on the same goal. † No tC But it was not easy to maintain the focus across the now over 1,500 corporate and 12,000 store employees. After Staples’ tenth year, Stemberg raised the stakes. If the company was to reach its $10 billion objective by the year 2000, it had to adapt its strategy and culture to transform from being what some executives had called a â€Å"pure operating company†4 to one that was more customer service-oriented with the infrastructure necessary to deliver the scope and scale of services required. A task force was charged to draft a new mission statement to catalyze this transformation, which outlined four areas of continued focus: customers, employees, communication, and execution. In addition, the task force created a Point Team of key managers. Since the top team felt they could no longer rely on proximity to keep up with developments in the company, this Point Team was charged with ensuring the sharing of goals, key information, and alignment on policy issues and decisions. Do Potential merger Then, during the summer of 1996, Staples’ most formidable competitor, Office Depot, stumbled. Office Depot, which had taken under five years to reach $1 billion in sales, was currently out-grossing Staples’ stores by $2. 5 million per store. Until then, Office Depot had been the darling of Wall Street, routinely turning in 30%-40% gains; after a string of a few lesser—but far from bad—quarters, however, analysts began to refer to it as an â€Å"aging growth company. †5 Stemberg seized the opportunity to provide customers with additional savings through economies of scale, and in September 1996, the two companies announced that they would merge. â€Å"Staples, the Office Depot† would be the clear industry leader with $10 billion in annual revenues, 1,100 office supplies superstores, and combined mail-order and contract-stationer divisions. 4 Stemberg, Staples for Success, p. 143. 5 David Altaner, â€Å"Turning the Page on Office Depot; Investors Penciled in Bigger Future for Smaller Staples,† Sun Sentinel, 8 September 1996, p. 1G. 5 This document is authorized for use only by Harutyun Gevorgyan at HE OTHER until November 2014. Copying or posting is an infringement of copyright. [emailprotected] harvard. edu or 617. 783. 7860. 400-065 Jeanne Lewis at Staples, Inc. (A) (Abridged) rP os t Krasnow, now the only remaining member of the Staples’ founding team, agreed to lead the marketing effort and to play a pivotal role in working through the complicated companywide implementation that lay ahead. Throughout his tenure, Krasnow had taken many temporary assignments outside marketing. He had led new market entries and troubleshot in high stakes situations. He had always returned to marketing, but this time he announced that he would leave Staples in January 1998 to pursue his dream of creating his own entrepreneurial venture. People wondered aloud, â€Å"Who could fill Krasnow’s big shoes? † The company prided itself on promoting from within, and many speculated that Krasnow’s successor would come from within the marketing department; for instance, someone like Bridget Coles, the current vice president of advertising— another HBS graduate who had been with Staples for over seven years. op yo Promotion After careful deliberations, the Point Team concluded that Jeanne Lewis should be offered the position. Although she had spent only limited time in marketing, they were impressed with her track record in taking charge and mastering varied job assignments. She had demonstrated considerable leadership talents, business acumen, and drive. Lewis weighed the pros and cons of this new opportunity. The move to marketing would represent a very different type of challenge, and she would now be responsible for a budget of several hundred million dollars and a staff of 100 people. Despite its strategic significance to the company, she would now occupy a staff position: In my other positions, I got a report card every day that would say I had screwed up and needed to fix it or, hey, we made a good decision and we executed it well. In this job, the report card would be very different. I wouldn’t have a PL, and while I would feel responsible for sales and creative output, it would be much more subjective, and the sales and performance more diffused. No tC I’m not a good example of how to manage your career—I’ve just been willing to raise my hand several times for new opportunities. I’ve taken a lot of what others would perceive to be career risks, which fortunately have worked out. I think Todd’s feeling was that I had proven myself in several different kinds of functional areas and I brought breadth, if not depth, of experience, coupled with the knowledge that I enjoyed operating in a high stress environment. From my perspective, this was the biggest job I’d had. It would require me to learn to deal with the top levels of the organization and across a broader span. Unlike my other jobs, here I think the challenge was replacing the guy who was here before the first store opened, and who had become a bit of a legend. And, in addition, walking into something that wasn’t totally screwed up, but which had lots of opportunity to be made just a little bit better. I would say my operations and merchandising jobs were bridging â€Å"performance† gaps, while this was going to entail bridging an â€Å"opportunity† gap. I was looking to take it to the next level, although what that exactly meant was not entirely clear at the time. Do In October 1996, Stemberg announced that Lewis would join the marketing department as senior vice president of retail marketing and small business. Stemberg and Krasnow explained to Lewis that she would assist Krasnow in the merger initiative and have a year to â€Å"learn the ropes and prepare to take over the marketing responsibility. † While taking her new responsibilities, she would simultaneously remain in her current position in merchandising until her replacement came from Office Depot. Stemberg also announced Coles’s promotion to senior vice president of advertising. Joining the marketing department Lewis began working with the marketing department in her new capacity immediately. Marketing served as both an architect and driver of Staples’ brand, which meant balancing between short- and long-term objectives. On the one hand, marketing â€Å"existed to optimize the agenda† of the three SBUs, which generally tended toward meeting short-term financial goals using promotional tactics. On the other hand, marketing played a pivotal leadership role as the integrator responsible for establishing a strong brand across Staples’ multiple markets and channels, and for building long-term customer loyalty and retention with effective marketing strategy. The 6 This document is authorized for use only by Harutyun Gevorgyan at HE OTHER until November 2014. Copying or posting is an infringement of copyright. [emailprotected] harvard. edu or 617. 783. 7860. Jeanne Lewis at Staples, Inc. (A) (Abridged) 400-065 rP os t department consisted of two areas: a marketing organization and an in-house advertising agency. The marketing organization developed the marketing strategy to differentiate and build the brand and made the tactical decisions regarding the overall marketing mix (e. g. , television, radio, print, direct mail). The advertising agency was responsible for both the creative and production sides for all of the company’s advertising. The agency also produced the Staples catalog, including creative design. Krasnow, who had brought together a branding review committee to create a brand around the integrated company, asked Lewis to lead the marketing and advertising merger team. Lewis found the work stimulating, but realized she had a steep learning curve to climb, both vis-a-vis her new department and Office Depot, who had what was often described as a â€Å"shoot-‘em-up-cowboy† culture. Lewis decided to take her time to thoroughly assess what she was inheriting: op yo Whenever I go into a leadership role, I want to figure out what is underneath the water I’m swimming in. So I dive down into the details in order to figure out what I’m really dealing with below the surface. I always think of it as kind of a long, slow dive into the detail: control freak, driving everyone crazy, learning about their business, understanding their business, understanding them, and hopefully articulating along the way that I don’t mean to be in the way. And then I come back to the surface which is really where I’m most comfortable. But I only do that when I felt like I know what I’ve got in the way of challenges and opportunities and how strong the team really is. She warned her new staff she would want to â€Å"ride shotgun† with them and ask a lot of questions in order to learn as much as she could from their expertise. She scheduled multiple meetings with each of her direct reports to make sure she understood their particular function and fit within the rest of the department. The director of marketing administration, who had been at Staples since its pre-IPO days, arranged to have her team meet with Lewis on a one-on-one basis as well. No tC As Lewis tried to continually â€Å"take the pulse of the floor,† she began to get some signals that she would need to adapt her style, which had been honed in the more â€Å"rough and tumble,† confrontational worlds of operations and merchandising. She explained, â€Å"The first time I decided to challenge a marketing program, I thought we were going to have some good honest dialogue around it. But the person was just devastated. It was a real eye-opener for me. I realized I needed to shift my style or would have people leaving my office in tears and end up accomplishing nothing. † Wearing two hats and running between the fourth floor (where her office in merchandising was located) and the third floor (where marketing was located) kept life interesting, and Lewis knew her staffs on both floors were finding her less accessible than they would have liked. She did her best to counter this. As one of her direct reports acknowledged, Lewis had â€Å"an open door policy and made an effort to be approachable. Her days were full, but you could pop into her office for anything, even to tell a joke, as long as it was the right time. † One of her new direct reports remarked, â€Å"I saw Jeanne look tired, but I wasn’t surprised, considering the jobs she had to deal with. She always had a smile on her face, and was really positive, even on a bad day. I could go the extra mile for someone like that. † Do By the late spring, it was still unclear when the merger would go through. Krasnow and other executives continued to be embroiled in legal negotiations, which took a toll on the entire organization. As a member of the merger transition team explained: â€Å"An organization of this size— with over 30,000 employees—which is moving this fast, needs clear direction. When you’re driving that race car, you need to know where you’re going, you can’t just be making turns! † Lewis concluded she should no longer juggle two full-time jobs, especially since Krasnow was preoccupied with the merger. In addition, Coles announced that she would be leaving Staples in July for personal reasons. This development further unsettled the department. As one member described, â€Å"Everyone felt a lot of loyalty to the ‘old regime. ’ There was a lot of fear and trepidation around Bridget and Todd both leaving within six months of each other, the fear and insecurity that comes with change. † 7 This document is authorized for use only by Harutyun Gevorgyan at HE OTHER until November 2014. Copying or posting is an infringement of copyright. [emailprotected] harvard. edu or 617. 783. 7860. 400-065 Jeanne Lewis at Staples, Inc. (A) (Abridged) rP os t So, Lewis insisted that her replacement in merchandising be appointed, and in May she moved downstairs into a new office in marketing. Beginning to Move op yo Then, in July 1997, a federal judge ruled in favor of the antitrust challenge. Stemberg announced that Staples was abandoning the merger, but he charged his employees, in true Staples’ fashion, to â€Å"see the positive in the sea of bad news†: to learn the lessons and move forward on them. The Point Team had learned that to maintain a competitive edge, Staples had to intensify its efforts to focus on profitability and to build the business. This meant providing more corporate leadership to assist all departments in getting tighter control over their costs, especially salary and administrative costs (SA), and figuring out how to maximize the use of resources across SBUs. Marketing would continue to differentiate and build the brand. Everything the company did should be consistent with the newly articulated brand statement of â€Å"slashing the cost and hassle of running your office. †6 Lewis wondered if her time to seize the moment had arrived. After 10 months assessing the department, she had a clear understanding of marketing as the brand champion and the key support for other departments. She elaborated: It was our job to think strategically—to keep the other departments honest when it came to long-term growth. We had to find the right balance between hitting the numbers in any given quarter and really growing the customer franchise for the long haul. All the brand-level marketing was really making sure that we were creating a personality and a promise that would drive the right customers into the store by talking about who we were and what we offered, and providing whatever incentives necessary to make sure that the product would sell, and that the customer would come back and buy more. tC Yet, Lewis was convinced that there was a â€Å"firewall† between the two marketing areas. Marketing’s strategy was being developed by the marketing side and handed over to advertising to execute, so neither party was benefiting from the extensive experience and expertise of the other. How could they produce an integrated message unless they did their work more collaboratively? Lewis felt that she could not begin to improve the integration of marketing across merchandising, operations, and the SBUs until her own house was integrated. She remarked: Do No I was amazed that while we had this huge marketing budget that everyone shared, no one knew what the other people were doing. You couldn’t even have that conversation. I remember the first staff meeting that I had them all together, there was lots of feedback I was getting on â€Å"Well, I don’t really know what Marci does, or how Lisa looks at this. † No one really knew the marketing mix, how much we spend on each piece, in relation to the other pieces, either in terms of dollars or objectives. I think you need a group that understands the overall strategic objectives and what we do as a department to support these objectives, even if it’s not within their particular area. I also found them terribly disconnected from the strategic objectives of the other areas—merchandising and operations. The thought I would go home with at night was, if they knew more, then they would do a better job. It sounds so simple. â€Å"Knew more† means if they knew more about each other and the marketing results, and if they knew more about our overall objectives. And then, as you expand that circle of knowledge out to include merchants, operators, Contract and Commercial, and other SBUs, then by the time