Christine Day arrived at fast-growing yoga wear chain Lululemon Athletica Inc. with a mandate to right a culture that had strayed from its founder’s collaborative roots.
Chip Wilson, founder and chairman of the Vancouver-based retailer, was drawn to Ms. Day’s co-operative approach to managing employees, a welcome contrast to the top-down management style of the previous CEO. But Mr. Wilson quickly found that her collaborative blueprint didn’t necessarily mean she was a soft touch. While Mr. Wilson was racing ahead with new ideas, Ms. Day had to rein in the visionary creative force behind Lululemon and convince him to back off.
It wasn’t easy for Mr. Wilson to give up control of his retail “baby” to another “step-parent,” Ms. Day says, as she orders a mid-morning yoga-friendly green tea instead of a planned full brunch. (She had eaten poached eggs and mixed berries at an investor breakfast meeting, clad in her Lululemon black stretch yoga pants and blazer.)
“Chip is an idea-a-minute guy and he’d pursue all of them tomorrow and that would set the organization off on so many different things,” Ms. Day says, after sliding into a plush booth in the restaurant of the ritzy new Shangri-La Hotel on a working trip to Toronto.
“And so I’d have to say, ‘Okay Chip, here’s the deal: I can carry 20 balls and you can say, ‘I love the shiny one,’ and I’ll figure out how to put it in. But something’s got to come off. You can’t run around the other side of me and say, ‘You dropped this ball.’ You’ve got to trust that I’m always going to make the right decision about what’s needed now.’”
Ms. Day’s handling of Mr. Wilson following a bumpy time internally under predecessor Robert Meers, underscores her vision of running a company: encouraging grassroots participation and delegating decision-making, while staying in control – and never being a pushover.
Her attitude, which borrows from the playbook of premium café giant Starbucks Corp., where she rose up the ranks for almost 20 years, shows up in more than just her dealings with Mr. Wilson. She gives store managers leeway to make local decisions on things like store displays. (In 2011, a downtown Toronto store mounted controversial signs in its window to protest Mayor Rob Ford’s anti-bicycle stance with “More Bike, Less Ford.”)
And Lululemon’s head office has taken similar controversial stances. Both Ms. Day and Mr. Wilson share a passion for author Ayn Rand and her brand of hard-core libertarianism, even though it doesn’t necessarily jibe with many yoga practitioners’ view of the world. Ms. Day found that out in the fall of 2011, when the company emblazoned its shopping bags with the question: “Who is John Galt?” a reference to Ms. Rand’s novel Atlas Shrugged , which rails again government and advocates self-interest as a key ingredient to a better world. Lululemon’s link to Rand’s theory of objectivism offended some its customers, but Ms. Day says the philosophy is about hard work and being accountable for oneself, and she doesn’t shy away from the criticism the Rand references generated. “I’m not going to get hung up on those few people who don’t get it, if they’ve not done the work,” she says.
Her approach to managing is also reflected in her attitude to customers: While CEOs generally dread criticism, she takes it in stride, viewing it as part of being an edgy retailer taking calculated risks and responding quickly to comments in the stores, on social media and in online product reviews. She uses the information for future merchandise planning instead of conventional market research.
It’s an approach that has defied the company’s doubters, taking the apparel retailer to industry-leading status ($2,050 in sales per square foot) and sending its stock, at $71.97, to four times the $18 a share it traded at when it went public in 2007.