Fontenot gets WPS focused
January 14, 2002,
New York — Twelve months after taking the reins at WestPoint Stevens, a company then in disarray after a series of management upheavals had wiped out virtually its entire top management team, Chip Fontenot, now dug in as president — less tentative, less tense and far more relaxed — expressed his satisfaction with the company's new direction.
Taking stock of the year just past — "And what a year it was," he laughed. "I don't need another one like it." — Fontenot contemplated the changes that have taken place in the company, the industry and himself.
We clearly know where we're taking the business in terms of product and channels of distribution. We have added the dimension of sourcing. We are aggressively increasing the amount of product we bring into the country. We're not just talking about it, we're doing it."
Addressing an ongoing string of management changes, Fontenot said, "The changes we've made have empowered the managers to run their own businesses. We've given them a lot of elbow room, the tools to do the job, and a sense of accountability, of ownership. We've put in place for them financial goals, inventory goals; they are, in essence, managing their businesses as if they own them. We used to run the company top down. Now we're running it bottom up."
Fontenot responded to early criticism that he had recruited cronies and friends to fill top management slots, like veteran Bob Dale, giving rise to the soubriquet "Chip and Dale." Fontenot grinned, "I know, I've heard all the stories and all the jokes."
And suddenly turning pugnacious, he added, "Let me tell you something. This management team is a whole lot better than most people think it is. How do I know? Because our chief competitor, Springs, keeps trying to hire our people away. When your No. 1 competitor thinks it needs your people and keeps trying to take them away, then I take that as a very great compliment."
What's changed in the environment? "Clearly, several things are going on. You've got a department store channel that has matured. Substantial growth will be difficult to achieve in that channel going forward. You've seen the growth of the middle market — a Sears, a Penney, a Bed Bath & Beyond, a Kohl's, a Linens 'N Things. They're trying very hard to differentiate themselves from the department stores and the mass merchants, using price and value."
Turning to the rapidly expanding mass merchant channel, Fontenot said, "It's become more price-driven than ever. And they're reducing everything to the level of commodity products with reverse auctions and everything."
The retail universe has changed in just a few short years, said Fontenot. "And now we have to pick the winners in each category and get as close to them as we can."
How has he changed? What's different about Chip Fontenot?
"I'm very much a realist today. That probably comes with old age. Well, not really all that old. But look, I've been fortunate in my career. I was trained and tutored at one of the best companies in the industry, Springs. Then I went beyond that to become more entrepreneurial at a much smaller company and was able to make a difference. And I worked at an over-leveraged company, and [I] know what happens when you don't manage it right. Now I'm at Stevens, with all that behind me, and I'm much more realistic, a lot less idealistic.
"I take a much more realistic approach now than I did a year ago to the realities of the marketplace. I better understand what's achievable and what isn't. And I'm not kidding myself. I better understand that nothing is going to change by wishing it."
He added a rueful post-script. "I've also learned that it takes a lot more patience and a lot more work to get the job done — and that sometimes you have to settle for less than what you'd originally hoped for."
What's next? "We've got the people in place to help us execute. The challenge now is to better understand the balance between our asset base and sourcing. We're not kidding ourselves about sourcing issues. It's a new global economy, and nothing is going to change that. And it's changing every day. Every time I think I understand the global playing field I'm proven wrong. We, as an industry, don't understand it the way a Coke or a Proctor & Gamble do, and we're going to have to get better fast.
"There are so many parts of the world that are so very different, and we don't always understand that. All too often we assume that everyone is just like us. Well, they aren't, and we've got to get a lot better at understanding the international playing field. Just when you think you've got Europe figured out, you've got to deal with India and Pakistan. And then we've got to know China and the sub-Sahara. Ultimately, we have to get to know them all as well as we know our own customers here."
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