Is culture the key to Target’s success?

Discussion
Photo: Target
Jan 17, 2023

Target had a lot to say about the importance of company culture in a keynote presentation at the 2023 NRF Big Show. Target CEO Brian Cornell led a discussion with Christina Hennington, chief growth officer, Cara Sylvester, chief guest experience officer, Kiera Fernandez, chief diversity and inclusion officer, and Alexis Sheppert, group vice president for stores, on the value of the company’s culture in successfully navigating the pandemic and the chain’s ongoing success.

“Our culture very simply we define as the ability to care, grow and win together,” said Ms. Fernandez. “That was [at no time] more critical to come together than the last few years. I would say the impetus of that culture was really putting into words the sentiment of our team.”

“If culture is the ‘who and how we work,’ then strategy is the ‘what we do’,” said Ms. Hennington. “We use [culture] as a guidepost, as a set of filters for the decisions we make in the business both big and small. That’s all in pursuit of our purpose, which is to help all families discover the joy of everyday life.”

Ms. Hennington explored a couple of ways that Target embeds culture into its strategy. She saw culture at work facilitating inclusivity and helping management meet diverse expectations and customer needs. For the latter, she gave the example of the store’s development of its “color for all” palette for designing own-brands, which contains colors verified to resonate better with people who have darker skin tones.

Is culture the key to Target’s success?
(From left) Brian Cornell, Kiera Fernandez, Christina Hennington, Alexis Sheppert and Cara Sylvester of Target at NRF 2023 – Photo: NRF

Ms. Sylvester saw a similar expression of culture in how Target builds its guest experience.

“When you interact with a target brand … we want you to feel something,” said Ms. Sylvester.  “Those feelings that are evoked are because we think about designing our guest experience around a deep emotional connection with our guests, not a transactional or linear one.”

Ms. Sheppert found examples of Target’s culture in the way the company develops team and store leaders. She recounted a conversation with a store director who had joined Target in an hourly role and, through Target’s store leadership investing in her, rose to a leadership role at a store in her own community.

DISCUSSION QUESTIONS: Has “culture,” as Target defines it, been as important to the retailer’s success throughout the pandemic as the people on the panel believe? How can a retailer create and embody a culture that both staff and customers feel?

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"Target has evolved to become a more humble company without sacrificing the brand standards that set it apart from competitors."

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26 Comments on "Is culture the key to Target’s success?"


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Paula Rosenblum
BrainTrust

I think “culture” certainly helps. Retailers, in general, have not been great about developing in-store teams. But at the end of the day, retail is still about selling products people want to buy. Target has that, it’s a pleasant environment, and it’s not Amazon. All these things help it.

Dave Bruno
BrainTrust

Culture is a critical underpinning for any strategic success. And Target has clearly built a strong culture that has made it possible for their (typically very smart) strategic decisions to be implemented effectively. I suspect there will be college textbooks written on Target’s successes, including their ability to foster a healthy culture that thrives on change.

Neil Saunders
BrainTrust

Yes, culture is a very important part of Target’s success. The company is humble and has a strong desire to learn and to implement change. It also allows reasonable risk taking. These things allow Target to constantly evolve in the face of a changing market. Target also works hard to understand shoppers, which is why so many of its initiatives are successful. On top of all this, Target treats people well which is why it comes across as a “nice” firm to work with and to do business with.

Jeff Sward
BrainTrust

I love the definition of culture as “a set of filters.” Filters sort out the undesirable and bring focus to the most desirable. One word that I’d add is “patience.” Patience to invest for the long term. Patience to think it all through and invest in planned evolution versus reacting to short term surprises.

Dr. Stephen Needel
BrainTrust

Culture is only important in so far as it positively affects customer experience — unhappy employees will lead to poorer customer interaction. Target may think they are great at this — not so much, at least here in Atlanta. Not bad, but nothing special either.

Derek Williamson
Guest

I’m not sure if that is the only time it is important … but yes, as with any large chain, results may vary!

Carol Spieckerman
BrainTrust

Target may strive to adhere to certain tenets that define its culture, yet Brian Cornell seems to have broken new ground in that regard. Target was a far more insular company prior to Cornell taking the helm. Under his leadership, Target has leaned into acquisitions and partnerships (and not just in fashion) and basically acknowledged that not everything can or should be home-grown. Target has evolved to become a more humble company without sacrificing the brand standards that set it apart from competitors.

Gene Detroyer
BrainTrust

Cornell has accomplished what few executives in history have. He has broken down an old misdirected culture and turned the ship in the right direction.

Michael La Kier
BrainTrust

Culture is good and bad. My favorite definition of culture is “the smell of the place,” meaning culture is not something that can be put on paper, it is something that must be experienced to be understood. How people live and breathe and act is what defines culture. Management can facilitate and help create a culture — good and bad — but cannot mandate. Target has had a strong culture for years and needs to keep it up.

Andrew Blatherwick
BrainTrust

Culture is so important in any business, a strong company culture helps employees understand the values of the business and provides guidelines on how they are expected to operate, talk to customers and colleagues and their behaviour. A strong culture can absolutely drive a business forward and ensure consistency and performance. It is important that it is lived by all in the business, especially top management. Otherwise, other employees will not see it as important.

Georganne Bender
BrainTrust

Branding expert Adrienne Weiss defines a brand as a country with its own unique language, customs and traditions.” Through consistent attention to brand detail, Target has created a culture so refined its customers take ownership of it too.

That brand transparency definitely played a part in the retailer’s success during pandemic and beyond. Explaining Target culture is easy. You can’t say that about many other retailers these days.

Gene Detroyer
BrainTrust
When I teach Leadership, International Business, or Corporate Strategy, I always start the semester with a slide that features PacMan and says, “Culture eats strategy for breakfast, lunch, and dinner.” It isn’t an original quote on my part, but it puts into perspective how vital culture is in an organization … the positive or the negative. Culture in an organization is hard to change. It often comes from the founder, think Disney or Walmart. Culture establishes what is essential to a successful organization. I give big “bravos” to Target. They have accomplished what few companies ever achieve … changing corporate culture for the positive. Culture is so ingrained in organizations that they are more likely to hit the iceberg than turn right or left. Target has gone from a company that saw vendors as the enemy to one that embraces all the stakeholders, most of all, the “guests.” Establishing a positive (or negative) culture comes from the top. It is not just signs with quotes in every office. It is how the leadership acts. Do… Read more »
Dick Seesel
BrainTrust

At the start of my retail career, I worked for Dayton’s, the Minneapolis-based department store from which Target developed. Many of Target’s early leaders came from Dayton’s, and brought with them the parent company’s culture of trend merchandising and customer-centric innovation. I believe those attributes have lasted for over 60 years despite changes in management and inevitable bumps in the road along the way.

During my years at Kohl’s, we hired managers from Target who referred to “guests,” not customers. What sounded awkward to us at the time has turned out to be at the heart of Target’s cultural mindset.

Lisa Goller
BrainTrust

Target’s ongoing success stems from its focus on empathy, collaboration and putting people first. Team unity and respect kept Target agile as consumers’ needs shifted during the pandemic.

For a culture people can feel, retailers need to infuse guiding principles across all levels, systems and reward structures. Aligning people, processes and pay supports consistent cultural norms.

Brian Delp
BrainTrust
16 days 10 hours ago

Culture is extremely important. Happy employees make for happy customers. Target also does a good job of hiring staff that reflects its target customer base as well, which ensures the assortment is merchandised properly. They know the customer as they are the customer.

Richard J. George, Ph.D.
BrainTrust

Target has been very successful in introducing and carrying culture throughout the organization with its successful resonance with customers. While everyone talks about strategy, I am reminded that culture trumps strategy every time. Without a bona fide organizational culture, long-term success will always be a battle. Indeed, Target gets it.

Gary Sankary
BrainTrust

Tar-zhay culture certainly has a part to play when it comes to the shopper experience. Target has backed up “culture” with a strategic vision. They pivoted well during covid to meet customers where they wanted to be met. They stood up curbside and delivery in record time. And they created a place where customers felt safe and could find the products they wanted.

Brandon Rael
BrainTrust

Culture is critical to any business transformation, especially a success story such as Target. However, culture coupled with Target’s relentless focus on the customer experience and enabling that with the capabilities, tools, processes, and a product-centric way around product, store, and digital innovation have been crucial elements of Target’s successful run.

By enabling, empowering, and trusting their associates to drive the business forward, Target’s culture of innovation, hyper-focus on the customer experience, and the right merchandising mix in their stores have built a foundation for the company to continue their relentless growth and success. An outstanding associate experience is a critical enabler in driving exceptional customer experiences.

Gene Detroyer
BrainTrust

Target’s relentless focus on the customer experience and enabling that with the capabilities, tools, processes, and a product-centric way around product, store, and digital innovation have been crucial elements of Target’s successful run, is culture.

Brandon Rael
BrainTrust

I couldn’t agree more, Gene!

Patricia Vekich Waldron
Staff

How one executes is just as important as the strategy itself. Target was able to see and act quickly during the pandemic, taking steps to ensure its teams and guests were both top-of-mind when setting policy and operations, and it has paid off!

Derek Williamson
Guest

Clear winners and losers have emerged after the pandemic — and that is because culture shines brightest when things are dark. The values of retailers were tested, and some revealed their values (and thus their culture) to be nothing more than lip service. Others, however, used their culture and values to drive tough decisions, and built incredible amounts of trust with their teams.

Target was a leader here, where they issues bonuses and bumped pay rates for their team members and build trust and loyalty. An engaged team always finds a way to win!

Shep Hyken
BrainTrust

First, culture is a key to any company’s success. Target has nailed it. Look at the quotes from Ms. Fernandez and Ms. Hennington. That sums up it quite well! Starting there, any company can create strategy, planning and more. It’s important to note that Target has done well to keep their best employees during one of the toughest of times for labor issues. How do they do it? The culture is a strong part of it!

Kai Clarke
BrainTrust

Yes, culture is key to defining success at retail, and at empowering success at a diverse level. Success is more than product, price and promotion, but also creating a core set of employee values which keeps the customer returning time and again for repeat sales, while enjoying a positive environment that both customers and employees thrive on.

Craig Sundstrom
Guest

I’ve never worked at Target, nor known anyone who has, so it’s hard to evaluate the claim, but mostly my perception is that Target’s success is due to brand management: they’ve done an excellent job of coming up with a concept (upscale discount) and executing it.

I guess if one defines “culture” broadly enough it will cover the execution part, but, candidly, these kind of pep talk speeches seldom seem very convincing coming from executives: it’s not so much that they’re untrue as it’s “well what do you expect them to say?”

David Slavick
BrainTrust

Target was my client for many years within the Financial Services area — credit card — both co-brand VISA and proprietary. If you’ve ever spent time in their downtown MSP offices you know immediately how friendly, nurturing and empowering the culture is. Loved being a partner and it certainly contributes to staff loyalty as well as customers feeling welcome across the multi-channel experience.

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"Target has evolved to become a more humble company without sacrificing the brand standards that set it apart from competitors."

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