Nordstrom Inc. (NYSE: JWN) is a Seattle-based department store
rivaling the likes of Saks Fifth Avenue, Neiman Marcus, and
Bloomingdale’s. Nordstrom is a Hall of Fame member of Fortune magazine’s “100 Best Companies to Work For”
list, including being ranked 34th in 2008. Nordstrom is known for
its quality apparel, upscale environment, and generous employee
rewards. However, what Nordstrom is most famous for is its delivery
of customer service above and beyond the norms of the retail
industry. Stories about Nordstrom service abound. For example,
according to one story the company confirms, in 1975 Nordstrom
moved into a new location that had formerly been a tire store. A
customer brought a set of tires into the store to return them.
Without a word about the mix-up, the tires were accepted, and the
customer was fully refunded the purchase price. In a different
story, a customer tried on several pairs of shoes but failed to
find the right combination of size and color. As she was about to
leave, the clerk called other Nordstrom stores but could only
locate the right pair at Macy’s, a nearby competitor. The clerk had
Macy’s ship the shoes to the customer’s home at Nordstrom’s
expense. In a third story, a customer describes wandering into a
Portland, Oregon, Nordstrom looking for an Armani tuxedo for his
daughter’s wedding. The sales associate took his measurements just
in case one was found. The next day, the customer got a phone call,
informing him that the tux was available. When pressed, she
revealed that using her connections she found one in New York, had
it put on a truck destined to Chicago, and dispatched someone to
meet the truck in Chicago at a rest stop. The next day she shipped
the tux to the customer’s address, and the customer found that the
tux had already been altered for his measurements and was ready to
wear. What is even more impressive about this story is that
Nordstrom does not sell Armani tuxedos.
How does Nordstrom persist in creating these stories? If you
guessed that they have a large number of rules and regulations
designed to emphasize quality in customer service, you’d be wrong.
In fact, the company gives employees a 5½-inch by 7½-inch card as
the employee handbook. On one side of the card, the company
welcomes employees to Nordstrom and states that their number one
goal is to provide outstanding customer service, and for this they
have only one rule. On the other side of the card, the single rule
is stated: “Use good judgment in all situations.” By leaving it in
the hands of Nordstrom associates, the company seems to have
empowered employees who deliver customer service heroics every
day.
Based on information from Chatman, J. A., & Eunyoung Cha, S.
(2003). Leading by leveraging culture. California Management Review, 45, 19–34; McCarthy,
P. D., & Spector, R. (2005). The Nordstrom
way to customer service excellence: A handbook for implementing
great service in your organization. Hoboken, NJ: John Wiley;
Pfeffer, J. (2005). Producing sustainable competitive advantage
through the effective management of people. Academy of Management Executive, 19, 95–106.
Discussion Questions
Describe Nordstrom’s organizational culture.
Despite the low wages and long hours that are typical of retail
employment, Nordstrom still has the ability to motivate its staff
to exhibit exemplary customer service. How might this be
explained?
What suggestions would you give Nordstrom for maintaining and
evolving the organizational culture that has contributed to its
success?
What type of organizational culture do you view as most
important?
What attributes of Nordstrom’s culture do you find most
appealing?