The Business Value of Niceness

Fifty years ago, Jack Mitchell's father got tired of commuting from Westport, Connecticut, to Manhattan. So he opened a men's and boys' store with three styles of suits. With his wife's help, within a few years, he cleared $50,000 in sales. Mr. and Mrs. Mitchell eventually gave the company to their sons, who expanded it to two more stores. You may have heard of them: Mitchells, Richards, and Marshs, three of the most successful stores in the clothing business. Last year, it's estimated they did more than $90 million in sales.

Clearly, the sons were on to something. Jack Mitchell, CEO of Mitchells/Richards/Marshs, thinks it's hugging.

Literally -- hugging. Mitchell hugs his customers, as he discussed in his first book, Hug Your Customers, a Wall Street Journal and BusinessWeek bestseller. (Those customers, by the way, include celebrities such as Today host Matt Lauer, who also worked at the Richards store in Greenwich when he was in college.) He hugs his employees, the subject of his new book, Hug Your People. He hugs the FedEx guy, the cleaning staff, and any number of other people to whom he wants to give support and recognition.

Lest the high priests of appropriate workplace behavior be alarmed, "hugging" isn't necessarily a physical embrace. When Mitchell speaks of hugging, he also means it figuratively: making employees feel invested, included, and cared for. Hugging is building a culture of niceness, hiring the right people, and making work fun. In this interview, the ever-upbeat Mitchell discusses how he came to his theory of hugging, the effect it has had on his personnel and business, and why he thinks all businesses could use a good hug (hint: because it's profitable. And nice).

GMJ: One of the first things you say in your book is that work should be fun. Why?

Mitchell: To me, if you don't enjoy what you do, then it just seems a shame. We only go through this life once, and it's not a dress rehearsal. So why shouldn't we have fun? We want to hire and keep people who have fun together. I want people to say, "I love coming to work at Mitchells" or Richards or Marshs and, "It's fun here because we have mutual respect, we trust each other, we have common goals to serve our customers and our clients and our vendors, and we're open and honest." To me, that's fun. I love playing games, and we try to hire people who feel the same way.

GMJ: What do you mean by "hug"?

Mitchell: A hug can be a bear hug, but it's more a metaphor for any caring gesture or deed that shows we're nice people and honest people, and we take pride in what we do. When you get to know people on a personal basis, you know whether they like the Yankees or the Red Sox, or Pepsi or Coke. When you get to know people on a personal basis, you know what's a hug and what's a slap, if you will. A hug is something that makes people feel warm and good. It's what we try to do every day with our own people, and then they pass that on to the customers.

GMJ: You keep using the word "nice." What's the business value of niceness?

Mitchell: Niceness creates an environment where people want to come to work, and they become more productive because they're happy, engaged, and motivated within that environment. In a niceness culture, they support each other as teammates. The business value is high productivity; people can grow themselves to be themselves.

We have more than fifty sales associates who sell more than a million dollars worth of clothing. Six or seven of those sell over two million, and two of them sell over three million. Everybody sells differently, everybody hugs differently, but in that niceness culture, people feel comfortable being themselves. If they want to learn to improve and grow -- which of course they all do because one of our hiring criteria is that our people have a passion to listen, learn, and grow -- they stay within the playing field.

We don't "empower" people, we enable them to grow -- we give them the tools they need, and then they become themselves, and they have fun doing it. The economic value is tremendous, because you can do more with fewer people. They are more productive, and you can pay them more. And because they're more productive, everybody goes home at night feeling great. It sounds sort of Pollyanna-ish, but the spirit within our stores is something I'm very proud of.

GMJ: How do you build a niceness culture?

Mitchell: First, we hire nice people. For example, we believe it's easier to educate people on how to open or close a sale or how to improve sewing if you're a seamstress or a tailor. But if you're not a nice person, then the skills don't matter.

GMJ: How do you know people are nice when you hire them? Everyone tries to be nice in an interview.

Mitchell: We have four criteria for hiring nice people. First, they have to be open, honest, and have integrity. Second, they have to be positive. If they blame the president or their spouse for everything, they can work somewhere else. The third [criterion] is competency. Whatever job we are hiring for, from seamstress or tailor to shipper/receiver to sales associate or buyer, they have to have skill sets. They don't have to be the best tailor or the best shipper/receiver, but they have to be competent -- and part of the reason for that is they need self-confidence. The fourth [criterion] is their passion to listen, learn, and grow.

And they have to be genuinely nice. We really try to notice whether the people we're interviewing are nice, which means kind and considerate. We probe to find out what things they have done in their life that show caring and compassion -- simple, little things that you can pick up in an interview process: "Do you have friends? Who's your best friend? Tell me about her." We do multiple interviews, so [candidates] have an opportunity to meet the people they'll be working with. I still try to interview everyone myself, even entry-level people, to let them see that our culture is about having everybody take part.

GMJ: How do you handle performance reviews?

Mitchell: We do formal reviews twice a year. We ask the associates to do their own evaluation based on their job and the goals that they were asked to achieve; then their supervisor or manager reviews them. The two copresidents sit in on many, but not all, of them. We try very hard to stress the positive side, their strengths, without emphasizing where they have not been able to achieve their goals. But we certainly point out where we think there's room for improvement and where there's room for growth and learning.

And from time to time, we give surprise hugs, surprise bonuses, which is always fun to do. After our fiscal year ends, in the last couple of years, we've been able to share a little extra compensation with all our associates, which really creates a team atmosphere. It makes people feel involved, included, recognized, and rewarded, and that's important.

GMJ: Why is inclusion so important?

Mitchell: Feeling included invests you in decisions, whatever you do. Most people can give you examples of how they've felt excluded in work situations rather than feeling included. When we bring new associates aboard, we often hear that no one's ever asked them how they could improve in their job role. They've just been told the rules and regulations, to read the manual, to follow it and do it. That makes people feel excluded because they are excluded.

For example, we have a relatively new collection under the design of Brunello Cucinelli, and everyone in the women's department will go to a product knowledge seminar on it. They'll see the whole collection, our buyers will talk about what we've bought, and the sales associates can add to the order for their particular customers. There will be wine and hors d'oeuvres for everyone, and some people will end up going out to dinner.

From time to time, we bring in the fitters and the tailors to product seminars, and we sometimes include them in buying trips. We take them to Italy, because we might want their opinion on a certain collection or to see the factory. We include as many people as we can who are directly involved in the decision-making process. Even if their ideas aren't always used, at least they have had the opportunity to feel a part of that process. Then when we announce something, everybody feels invested; everybody knows that they had an opportunity to tell the owners how they felt about it. It's very successful.

GMJ: How do you get input from people?

Mitchell: First, you have to be genuine about it. If you don't genuinely want input, then you shouldn't ask for it. You have to invite people to tell you candidly how they feel. When you genuinely want their input, you invite their opinions, because their opinions count.

One of the downsides is that it takes more time, because you have meeting after meeting, and some people think that you're slow and you can't make up your mind. But when you make a decision, everybody feels that they're part of it.

Sometimes by adding one person who really isn't in the mainstream of the area of the decision, you get great ideas that are off the charts. Our accountant might have opinions on the buying process that nobody else would have thought of because they're so close to the situation. Including people gives them a feeling of ownership, and they take more responsibility, they feel more pride, and they are more invested.

I think great leaders surround themselves with great people. They would be remiss if they didn't ask for input from the people they work with.

GMJ: You mentioned recognition and reward a little earlier. How do you recognize employees?

Mitchell: Well, my view on compensation is that it's important, but most of the time, it's not the most important aspect of recognition. If people feel that they are fairly compensated in their job market or job role, or a combination of both, they don't feel like they're being taken advantage of. We try to be at the top of the bar and then some. Sometimes we'll give incremental bonuses to all our people -- that's another way we recognize our team effort, by hugging ourselves, hugging the huggers.

Recognition also means having special things done for you, or individualized recognition. Maybe your son is playing in a Little League game, and your boss says, "By all means, go to the game." That's a great reward.

One of our employees, Tom, has twin sons now graduating from college, and they were six or seven years old when we hired him. At the time, I happened to say to Tom that my wife and I had twins too, and I said, "I just hope that you'll take the time to watch them grow up." He shook his head and said, "You're kidding, right?" I said, "No, no. Provided you have the store covered for the customers, if you go to your manager and plan it, we want you to have a life."

But fair is not always equal. So you must dig in and find something that is important to each person. One of our top sellers at Richards always goes to the Super Bowl. Super Bowl weekend is a very busy sales weekend for us, but everybody knows he goes.

Another thing we do to recognize our people is to include them in almost every brochure we do. We print 165,000 copies of our image piece, and last fall we had pictures of everyone who works with us. People like showing that to their neighbors and kids and parents. E-mails about a job well done are great hugs, and so are words of praise, but don't ever forget how nice it is to get a real letter signed with a real ink pen.

GMJ: How do you know how to recognize your people?

Mitchell: You ask and you listen. That's the great thing about a niceness culture: It encourages people to be their true selves. So you learn what's important to everyone. Sandra, our telephone operator, gave me a check for my birthday toward a scholarship that was set up in my mom's name at Yale Cancer Center. It was a hug that really touched me; she knew that was something special for me. That's what happens when you create a niceness culture. It's the human connection that makes work fun.

-- Interviewed by Jennifer Robison