Revamping a Recognized Retailer

When Larry McClure was hired by The Children's Place in 2010, the company started fresh, creating a positive culture with strong leadership

Aha! Moment
“One ‘aha moment’ for me early on had to do with communication and collaboration. We had just made a large capital investment in a first-class distribution center in Alabama, but, outside those running the distribution center, I was the first executive from another function to go down to see it. I came away thinking we have to do something to develop cross-functional partnerships and transparency across the company.” PHOTO: Mark Hall

Knowing the business was faltering, Jane Elfers, president and CEO of The Children’s Place, hired Larry McClure to bring in a much-needed change to the company’s HR leadership. McClure joined two years ago, prepared to elevate the retailer to a better functioning company. Equipped with experience in contemporary practice and practical expertise, McClure was the perfect hire. Here, the senior vice president of human resources shares the strategies that revamped the troubled organization and made it the go-to store for moms.

What makes Children’s Place unique is that we are the largest pure-play retailer for children’s apparel and accessories in North America. We have more than 1,100 stores in the United States and Canada, as well as a robust e-commerce business. We will soon expand, opening stores globally. We have a unique brand, recommended number one by moms as the place to shop for children’s apparel. We offer great product known for our quality, value, and fashion.

There were a number of things that happened to the company prior to the new CEO coming in that caused the business to falter. There had been some inconsistencies in how our policies and governance were handled, and a number of distractions that took focus off the business. As a result, many things just didn’t happen or weren’t done to adjust to changes in the marketplace. So, we did a top-to-bottom overhaul of just about every aspect of the company.

We needed to change people, processes, and systems. First, we needed to bring the right leadership into the company who were versed in contemporary practice and could form the right culture. We used psychological associates to assess candidates and incumbents for director-level and above positions as an additional lens to identify talent and as a basis for our leadership curriculum.

There was a tremendous turn initially to get the right leadership and the right organization in place. If you were to take a snapshot in 2010 and again at the end of 2011, you’d see we replaced every senior leader in the company, 50 percent or more of the people in our corporate headquarters, and more than 50 percent of the leadership in the field.

We had to overhaul our performance-management process. We took a very cumbersome and misused process and reduced it to one page to focus on the dialogue rather than the paperwork. At the same time, we put in place new long-term incentive and annual cash-bonus plans.

Job descriptions hadn’t been looked at since 2004. We had more than 450 job titles for the approximately 600 people in our corporate headquarters that had no relationship or no rhyme or reason to one another. We went through a comprehensive job leveling and optimal organizational-structure exercise. New job levels and job titles were developed, allowing us to take the number titles down to around 300.

The reactions to the changes were mixed. When you look at the fact that we changed processes across just about every organization, and the degree and magnitude of the change, everyone had to buckle up and say this is going to be a bumpy ride for awhile. For those that didn’t like it, we looked for an amicable way for them to move on. Those who signed on got excited and energized by the prospect of winning in the marketplace.

I believe the future is very bright for the company. The major HR initiatives that we have on the near-term horizon are to take the same job leveling and organization process to Asia and build a more robust and targeted learning and development curriculum for our field associates.