SmartWool president tells Steamboat audience how plan helped company grow through recession
September 20, 2012
July 14, 2011: SmartWool, Steamboat reach 10-year lease agreement
June 13, 2011: SmartWool purchased by VF Corp.
Steamboat Springs — SmartWool President Mark Satkiewicz told his Economic Summit audience Thursday at The Steamboat Grand that his company was able to grow its market share in the outdoor sock industry by nearly 50 percent through the heart of the economic downturn — not just because its customers are convinced SmartWool makes the most comfortable socks money can buy but because of unflagging devotion to a strategic, values-driven plan that managers consult on a daily basis.
"In 2008, we had 50 percent of the outdoor sock business," Satkiewicz said. "In 2012, we have 74 percent." The period "from the fourth quarter of 2008 into 2009 could have been a horrific time. But we grew our market share in 2009. It was because we had a plan."
While it's essential to have a good product, Satkiewicz told his audience of local business, government and nonprofit leaders that it can take a company only so far.
Economic Summit 2012 was conceived by Steamboat Springs Chamber Resort Association CEO Tom Kern to inspire community leaders to begin to undertake a new strategic economic development plan that would lead to what the local economy could look like in the future. Following three keynote speakers, those in attendance broke up into groups to define strategic initiatives that will be handed over to the Chamber’s Economic Development Council for refinement.
Satkiewicz said developing a strategic plan as well as making sure everyone in the building understands the vision it is based on are time consuming for leadership. But in his view, a plan complete with clearly defined initiatives and the strategies needed to realize them is indispensable.
"Why strategy?” Satkiewicz asked rhetorically. "Without it, you can't grow in the long term. Strategic goals align an organization on how to grow and negate ambiguity. Ambiguity is a killer, in my view, in a corporate landscape."
SmartWool’s global strategy includes capitalizing on its position as the "absolute favorite sock" of consumers to drive its customer base to purchase more of its apparel and accessory products.
The process of strategic planning begins, Satkiewicz said, with the triumvirate of mission, vision and value statements.
A company's mission statement should be community based, he said.
"It's what you do in the community, what matters to you," Satkiewicz said.
The vision statement spells out where the company intends to be in five years and the organization's identity. The value statement becomes hypercritical in a mountain community like Steamboat, where people have chosen to come to the Yampa Valley for specific qualities that constitute a lifestyle, Satkiewicz said.
We want to affect positive change in the world within which we live, play and do business.
We believe in capitalism with a conscience. We acknowledge an accountability to all humankind, demonstrated through compassion, active kindness and respect.
We accept responsibility for our mistakes; always learning and growing from them. We stand firm in the face of adversity and do what we can to help others turn failures into positive results.
We believe our actions speak louder than words and that both must be consistent and sincere. We remain steadfastly committed to action and for getting things done efficiently without sacrificing quality.
"When I took over as president of the company, none of us could read (mission, vision and value statements) off," Satkiewicz told his audience. "But they are the foundation of whatever you are going to do. They are what you build off of as you build your brands."
However, the strategic plan is much more than the code of ethical behavior described in the value statement. It looks out five years to 2017 and is contained in a monthly calendar. The calendar includes executive team meetings and accounting for every business metric imaginable.
Satkiewicz reassured his audience that smaller companies do not need to create strategic plans, initiatives and strategies that are as detailed as SmartWool's five-year calendar. However, he said, what is critical is alignment on mission, vision and values as well as what the company brand stands for.
"If you aren't aligned on these three things, how can you get alignment on how you want your business to go?" he asked. "Every employee at SmartWool (there now are 120) knows what we want to do in terms of mission. Whether you are a three-person business or a business of 300, you can do that."
SmartWool itself became part of a much bigger company in summer 2011, when outdoor apparel giant VF Corp. acquired SmartWool parent Timberland in a $2.2 billion acquisition.
And a little more than a year later, SmartWool's approach to strategic planning has had an impact on VF Corp.
"They see that we know what we're doing, and they've taken this process to the other 33 brands at VF, which to me is validating," Satkiewicz said.
To reach Tom Ross, call 970-871-4205 or email tross@SteamboatToday.com