Mindy Grossman, CEO of HSN, Inc. on Culture Trumps Strategy at Stanford GSB View From The Top Talk – Transcript
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Interviewer: In preparing for this interview one of the things that I learned about you is that you make a point to eat lunch with most of your employees at HSN, particularly for their first, fifth, 10th and 20th anniversaries. And I’ve heard you’re known for sitting down and asking, why are you at HSN and what keeps you here? So Mindy, to get us started, would you mind if I ask you why are you at HSN, and what keeps you there?
Mindy Grossman: That’s a great question, and to your point, I learn more from those breakfasts and those lunches than you can by reading any report, or doing anything. You’ve got to have the pulse of your company, what people are thinking, what they’re feeling and I believe that culture trumps strategy, and I know people have written about that. But I think that you can’t have a long-term, successful, sustainable company unless you have an incredibly engaged culture, and I’ve been fortunate to work for many of those, and it certainly helped me in the transformation of HSN.
But I think where I want to start, to kind of get to the point of how I ended up making the decision to go to HSN which at the time was a pretty big risk according to many people. And I’m known as somewhat of an unconventional risk taker and it really started
Interviewer: Pop ahead to the next —
Mindy Grossman: Yeah.
Interviewer: She’s just driving the interview for me.
Mindy Grossman: You know, my career, and the fact that I’m even in this business was definitely not my original path so. Just quick story. I was – I finished high school at 16 in my junior year, went into college I was in English literature and Philosophy major and there I was in my last semester at GW. I was engaged to be married to my high school sweetheart who was going to become a doctor and, I was graduating and I was going to go to law school.
So if any of you can relate it’s every stereotype of a Jewish mother’s dream. And I was an adopted kid. First one to ever go the college. So everything was in the stars. And I literally — and I’m sure, you know, I say that I woke up. But I’m sure it was on my mind but I did wake up one morning and said, I can’t do this. I’m living someone else’s life and I have to live my life. And with that, I called my folks and I said, I have something to tell you: I’m not getting married. I’m not going to law school. And I’m leaving school right now and I’m moving to New York because I’m going to figure it out. And that’s what I did.
And I moved to Manhattan in 1997, and said I know that I want to be in a creative field. I may not be the creator. And I don’t know how I said it in my head at the time, but I said I want to be in the business of making creative people successful. And it’s the first time that I realized that, having the power to do that was, it really gave me the feeling of if you believe in yourself and you really, to the point that Jennifer made, passion, purpose, and impact and the quote that you see up there.
Risk-taking and boldness is the essence of transformation.
That moment that I picked up the phone, I made that decision that transformed my entire life. It wasn’t picking up the phone and going, I’m going to be the CEO of a public company, I was picking up the phone and I’m going to do what I’m passionate about and I’m going to be able to take chances. And so throughout the course of my career, I think people now have made it kind of a joke, okay, what is she going to do next, because it’s going to be something different. But, it was leaving Tommy Hilfiger to go run Chaps Ralph Lauren when that was the hottest company. But I knew that there were going to be very few opportunities for a woman president in the men’s wear industry or deciding to leave a company when I didn’t feel the values of the CEO of that company lined up with me and I quit without having another job, which made Ralph Lauren come and hire me because I’d been running another business. It was making a decision to start up Polo Jeans. It was making a decision to leave Polo Jeans and go to Nike which was also very unconventional because I was one of the first outsiders to really come in to the company, especially the fashion doyenne from New York.
And then fast forward to how I made the decision to go to HSN. I’d been at Nike for six years, and it was a spectacular experience. I worship at the altar of Phil Knight, he’s an amazing man. And I had great opportunities at that company, I was the most senior woman, in the organization. I ran their global apparel business, but I also had the opportunity to spearhead kind of their transformation to really be more emotionally connected to women. Some of the work on the Nike foundation and the girl effect.
But I was at a pivotal point in my career. I was in my late 40s and they had just announced a new CEO, a new president, both of whom were about 50 and had been at the company a long time and, most importantly they were in very good health. So as that succession plan wasn’t looking like it was happening, so fast but it was truly like, what was life after Nike going to be like? Where was I going to go? And I think, too many people were like she’s going to go run the Gap or she’s going to go run this, and I just knew that wasn’t the case. And I had the opportunity to travel the world and really see how technology was changing the landscape, much more so yet than it had in the United States. So really the explosion of mobile in Japan and what was happening around all the marketing efforts, whether it be the Olympics or World Cup. And I just said if I’m going to do anything I want to be in a direct-to-consumer business. Because I’d worked with all these great story telling brands and we would create the narrative around the product and we would create the technology, for example at Nike. And we’d have all these stories.
And then I would see my dreams dashed by going onto a selling floor and nobody was telling the story the right way to the customer. So I said I wanted direct-to-consumer business. I want a business that’s going to be able to take advantage of what’s happening in technology and what’s happening in changes in consumer behavior because the way consumers were consuming, right? Media, information how people were changing their habits of shopping. How could I take advantage of that?
And so when I got this call from Barry Diller, to say I got a call from a recruiter that, that Barry Diller wants to talk to you about going to take over IAC Retail. And I said that’s great, but what the hell is IAC Retail? I never even heard of it. And they said well, it’s HSN and this portfolio of these catalog and e-commerce brands. Some of those I had heard.
And I said, well, not really sure but you wouldn’t want to have lunch with Barry Diller, but if I’m going to have lunch with him, I better have a point of view. So give me two weeks, let me do all my due diligence, let me see if this is something really interesting. So, I completely immersed myself in the business and the brand and the competition, and the marketplace and I’ll never forget. I was — I’m watching and I’m glued, and I wasn’t even familiar with it before, I’m glued to this channel, like constantly. And my husband’s like, oh my God, are we watching this again?
And I also was a big Food Network freak, right? I love Food Network, so this was eight years ago. And I’m going, what would I do with this, what would I do with this? How could I make it more engaging and interesting? And all of a sudden, I was watching Food Network and I clicked over to HSN and Wolfgang Puck, who was the only person in this video, that was on HSN at that time eight years ago. None of those other people had been launched. And the light bulb went off, and I said, we have to stop thinking of this as a selling channel. And we have to start thinking of it as a network that’s going to inspire people to want things. I started getting really excited. Well we could be like HGTV and Food Network and Style and DIY and we can transport people through experiences. And that’s when I had lunch with Barry and I said, okay, here’s the big idea. If you are willing to buy into this idea, I am willing to take this plunge and do this. And if you are not, it’s not really interesting and in great Barry fashion, because he epitomizes that, he said go for it.