Linking 360° Feedback to
Business Outcome Measures
Anna Erickson
Tony Allen
Nation’s #1 Specialty Retailer
of Technology and Entertainment
Products and Services
Best Buy Performance
($ in billions)
$30
$25
19.6
$20
15.3
$15
12.5
$10
$5
7.2
7.8
8.3
'96
'97
'98
10.1
5.1
$0
FY
'95
'99
Revenue
'00
'01
'02
Best Buy Retail
• Structure
– 584 Stores
– 56 Districts
– 3 Regions
• Leaders “Score Carded” on Key Financial
and Operational Measures Including:
–
–
–
–
Revenue & Gross Margin
Sales of Key Products
Customer Loyalty
Employee Engagement/Satisfaction
Our Research
• 360° Feedback Results (June 2002)
– 38 District Managers (DMs)
– 573 Store/General Managers (GMs)
• 4 Key Financial Measures (July 2002)
– Revenue
– Gross Margin
– Accessory Sales
– Sales of Product Service Plans
Best Buy 360 Highlights
• Administered Annually
• Retail and Corporate Leadership
– Corporate Director level and above
– Retail Store Manager (GM) and above
• Purely Developmental
• Competency Based
• Raters = Self, Superior, Subordinates
and Peers
Best Buy
Corporate Competencies
District Manager Correlations
(n = 38)
Revenue
Drive for Results
-.100
Managing Vision & Purpose -.213
Organizational Agility
-.234
Strategic Agility
-.118
Customer Focus
-.252
Integrity, Trust, & Ethics
-.145
Self-Knowledge
-.288
Building Effective Teams
-.099
Developing Direct Reports
-.145
Listening
-.308
Managing Diversity
-.391*
Motivating Others
-.276
Gross
Margin
-.066
-.155
-.180
-.074
-.235
-.133
-.240
-.057
-.063
-.271
-.370*
-.182
** Correlation is significant at the 0.01 level (2-tailed).
* Correlation is significant at the 0.05 level (2-tailed).
Accessory Service
Sales Plan Sales
.486**
.547**
.455**
.484**
.445**
.464**
.365*
.396*
.431**
.415**
.349*
.274
.518**
.423**
.508**
.591**
.396*
.406*
.431**
.251
.615**
.487**
.470**
.389*
District Manager Results
• Correlations with Gross Margin and
Revenue NOT statistically significant
for most competencies
• Managing Diversity negatively
correlated with Margin & Revenue
– Gross Margin r = -.39 (p<.05)
– Revenue r = -.37 (p<.05)
District Manager Results
• Service Plan and Accessory Sales strongly
related to 360 Results for DMs
• Strongest Relationships with Accessory Sales
were
– Managing Diversity
– Self Knowledge
– Bldg Effective Teams
r=.61
r=.52
r=.51
• Strongest Relationships with Service plan
Sales were
– Drive for Results
– Bldg Effective Teams
– Managing Diversity
r=.55
r=.59
r=.49
Relation of scores to outcomes
14.5
9.0
8.8
14.0
8.6
13.5
8.4
8.2
13.0
8.0
12.5
Mean JUL PSP %
7.8
12.0
11.5
11.0
3.00
4.00
BUILDING EFFECTIVE TEAMS
5.00
7.6
7.4
7.2
7.0
3.00
4.00
BUILDING EFFECTIVE TEAMS
5.00
Store Manager Correlations
(n = 573)
Drive for Results
Managing Vision & Purpose
Organizational Agility
Strategic Agility
Customer Focus
Integrity, Trust & Ethics
Self Knowledge
Building Effective Teams
Developing Direct Reports
Listening
Managing Diversity
Motivating Others
Revenue
.192**
.116**
.079
.151**
.176**
.177**
.188**
.174**
.154**
.196**
.177**
.109**
Gross
Margin
.218**
.133**
.086*
.170**
.194**
.193**
.201**
.191**
.171**
.214**
.184**
.102*
** Correlation is significant at the 0.01 level (2-tailed).
* Correlation is significant at the 0.05 level (2-tailed).
Acsry
Sales
.258**
.220**
.251**
.251**
.237**
.245**
.290**
.264**
.278**
.280**
.288**
.170**
Srvc Plan
Sales
.356**
.167**
.225**
.336**
.319**
.325**
.355**
.330**
.340**
.385**
.343**
.137**
Store Manager Results
• All correlations positive and most
statistically significant
• Again, accessory and service plan
correlations stronger than those with
Revenue & Gross Margin
• Overall, correlation coefficients
much smaller than for DMs
Why are correlations for Dist. Mgrs
larger than for Store Managers?
• Frequent movement of Store Mgrs
• Sophistication of Raters
• Quality of items included in the
survey
Sample Items: Drive for Results
District Mgr. Items
Store Mgr. Items
– Focuses attention and
– Creates and executes
energy on factors critical to
plans to improve
success
store performance
– Sets high standards and
expectations for him/herself – Has a sense of
urgency, passion,
– Consistently meets
and energy
aggressive timelines as
– Accepts nothing less
established by self or
others
than our best effort
every day; strives for
– Mobilizes others as a way to
accomplish difficult tasks
excellence
– Consistently follows
through on his/her
commitments
Summary/Learnings
• 360 does relate to important Company
outcomes – especially those more directly
impacted by manager behavior
• Rigor in item development pays off later
• Don’t assume the process is purely
developmental – identify outcomes most
likely to be impacted and build a
measurement plan early
• Shape best practices to work with culture