Continued from Part One
Karthicka Krishnasamy serves as SVP, Merchandising Operations for Michael’s. She is responsible for leading merchandising planning, inventory, pricing, space planning, category management strategy & data analytics areas within the company.
Prior to this she spent last 7 years at Walmart Inc., in various leadership roles. Most recently Karthicka was VP, DMM leading the OMNI channel merchandising strategy and execution for categories such as bed, bath, housewares, small kitchen appliances, mattresses, furniture, outdoor power, tools, automotive oil, home improvement, luggage, tires and battery. Prior to this she served as VP Pricing, Exit & Auctions for Sam’s Club and had the responsibility of transforming Sam’s Club value positioning in the market through disruptive prices and driving member loyalty. Her responsibilities also included overseeing the company’s merchandise exit functions such as liquidations, RTVs, auctions etc., Karthicka started in Sam’s Club 7 years ago as a Senior Planner for ladies and kids apparel businesses. She quickly climbed the ladder from a Merchandise planner to a highly transformational, strategic leader as the Director of Planning and Inventory for apparel, accessories and jewelry. She has been instrumental not only in improving business efficiencies but also focused her time and attention training, developing and promoting diverse talent. She is best known for constantly challenging her associates to change the way they think and work beyond their comfort zones in order to reach their fullest potential. She believes no matter who you are or where you are from, all you need is a will to make change, and a determination to succeed.
Prior to Walmart Inc., she worked at Sears Holding Corp leading various merchandise strategy and planning initiatives to maximize topline growth and reduce SG&A. Telecom and Retail leading major enterprise initiatives, developing and executing strategies to achieve strong financial results for fortune 500 clients across the globe.
A philanthropist at heart, she also represented Walmart Inc., in a non-profit immersion program at the Regional Food Bank of Oklahoma City where she helped them craft their future strategy.
Karthicka holds a Bachelor of Engineering in Electronics and Communication from PSG College of Technology in India and a Master of Science in Information and Communication Sciences from Ball State University in Indiana
Edris Bemanian: What are some of your proudest accomplishments in terms of pricing or merchandising?
Karthicka Krishnasamy: I would say my proudest accomplishments are the people I have promoted. Period. I think as a leader, it’s very important to create more leaders, and I’m a big proponent of that. I think I’m very proud of all the different leaders that I have created and I’m still creating and supporting.
I think that’s what you leave behind. People will forget about your business results. People will forget about the changes you made, but people will always remember the influence that you had on their careers. You can say, “Oh, I changed this in pricing, or I brought this brand in, or I grew the business by this much.” Yes, all great. But if you want to leave an impact, you focus on people.
EB: You’ve mentioned mentors during this interview and in a few other conversations we’ve had. Can you talk about the impact your mentors have had on you professionally or personally?
KK: I am so fortunate to have had the mentors and sponsors I’ve had and still have. The biggest thing that they have done is they truly believed in my potential.
John Furner (then: CEO of Sam’s Club; today: President and CEO, Walmart U.S.), and Ashley Buchanan (then: Chief Merchandising Officer of Sam’s Club; today: CEO of The Michaels Companies) have had a significant impact on my career growth. John/Ashley promoted me from being a director in Apparel, Accessories, and Jewelry to my first officer job as Vice President for Sam’s Club Pricing. I had no pricing experience when I came in. I still remember my first meeting, I asked one of my pricing team members, “What is PI?” And I felt like my team was looking at me like, “Oh wow! How is this person going to lead us in pricing?”
After my pricing stint, they moved me again to a DMM role. I had never had any direct buying experience and I was promoted to be the DMM for Home, Hardlines, Tire, and Battery Center, what do I know? And I had merchants with 20-plus years of category experience reporting to me. I was able to take my team’s strong buying experience, think about customer needs of the future, and set a clear OMNI strategy to drive growth and a robust omnichannel experience.
It’s so powerful when someone believes in you and continues to take that chance on you. You know, I didn’t want to fail. I wanted to be the best at it. I wanted to leave every role I was given an opportunity to lead in a much better position and that’s exactly what I did.
Right now, I’m leading different merchandising support functions at Michael’s because Ashley Buchanan gave me that opportunity. Somebody needs to take a chance on you when you go from leading a 40-member team to 200.
So, that’s what my mentors/sponsors have done for me, and they also truly cared about my personal life. I was able to do what I did work-wise and go through everything that I had to go through personally. Without their support, I don’t think I would have been able to achieve what I did. So, it’s not just about me. It’s people who lifted me. Leaders who looked at a talent and believed in potential and looked beyond years of experience and subject matter expertise
EB: I’ve interacted with many of your direct reports over the years and it’s always clear to me that they feel supported and empowered by you. So, you’ve clearly passed that on to your team and you’re making a difference for them.
KK: I hope they all feel that way!
EB: What’s the secret to driving successful change management? You talked about the example of taking 80 templates to 4 templates. How do you drive that? How do you change the mind of someone who’s been doing something a certain way for 20 years?
KK: Active listening. You must actively listen and ask a lot of questions so you can understand how things work today. Build trust and partnerships and relationships, whether it is your direct reports or people who need to sponsor to drive that change. I think listening, trust, and partnerships/relationships will drive successful change management.
Most change management fails because you don’t know what you’re changing because you did not listen to how things get done today. Or you don’t build trust—you have this draconian approach to change, or you didn’t bring people along, whether it is your own folks or folks you need to partner with to drive that change. So, I think those are the three things. That’s the magical formula.
EB: To actually drive change, you have to be listening, right? And empathetic. I think a lot of people, myself included, just jump to the solution and don’t always bring people along. It’s a great lesson.
Tell me about some of your most challenging experiences working in retail. What are some growth moments or maybe hair-on-fire moments you’ve experienced?
KK: Well, the most recent one is the 2021 supply chain crisis. All our inventory got stuck overseas. So, I had to learn not just inventory, but the entire flow end-to-end. We had to stand up an entire workflow of integrated planning. And I learned a ton. It was very stressful. But I think we pulled through and I can comfortably say Michael’s is set up to manage the flow of goods and proactively plan for any kind of crisis in the future.
And obviously, as a merchant leading a team at Sam’s, COVID was hard. You couldn’t keep up with stock levels. We all thought we were going to hit a recession and experience negative sales, and suddenly everyone wanted to spruce up their house!
They wanted to buy sheets, they wanted to buy furniture! And all these products have longer lead times and none of it is manufactured in the United States. So, it was very, very difficult for us to keep things in stock, take care of our customers and run the business.
EB: If you were the CEO of a manufacturer or a brand, what would you be thinking about? What would your top priorities be right now?
KK: It’s a unique macroeconomic environment right now. Obviously, I’m thinking inflation which is at an all-time high, probably going back to the 1920s. If I am a CEO today, I will be prioritizing 5 things: Mindset, Cash, Automation, People, and Partnerships.
Number one is mindset and executive leadership alignment. And I’ll double-click on that. When I say mindset and executive leadership alignment, it’s knowing as a CEO that you cannot control the macroeconomic demand and pressures, but you need to make sure you can control the controllables. You need to align your executive team with your goal “We are in this, and we are playing the long game.”
You can easily play the short game, and you’ll relate to this – you can go and increase a bunch of prices and you can get quick, easy wins. That’s the easiest thing to do.
It’s the classic example of the long game versus the short game.
Number two. Cash is king. Buckle up. You must make sure there are no leaks in your P&L.
Whether that’s labor, shrink, or whatever. You must shut down any leakage point and investment that doesn’t have an ROI. I will protect my cash as a CEO because we have seen so many bankruptcies in and around the retail sector. You want to make sure your cash is protected, and your leakage points are closed.
Third, I’d take all the waste that I have and carefully invest it in automation and tech. This is the time to invest carefully, without borrowing too much money, and drive efficiency to set yourself up for the future. Because right now you’re not going to get demand, but guess what? You can clean your house. You can make sure the house is perfect so when the demand starts to spike, you’re ready to go.
Fourth, I’d say staying close to your people. Communicate more, and be out there, because it’s a very tough environment right now, personally and professionally, for a lot of people. As a CEO or really any type of leader, you’ve got to keep a very close pulse on your people, make sure you are supporting them, and make sure you communicate more than you normally do.
And finally, you must strengthen your partnerships and you have to diversify. If you are a brand, you must think about all the different clientele that you have. Are all my eggs in one basket? How do I think about that? How do I partner better?
I need to set my business up so it’s not just successful today, but it’s also successful for another 50 years.
So my Big 5 are: mindset, cash, invest in automation, stay close to your people, and strengthen your partnerships.
EB: Wow, you just outlined a great business book. I look forward to reading it! What are your Favorite brands?
KK: [laughs] Oh gosh, maybe someday!
Oh, I do have some favorite brands. I like Apple. I love how simple their user interface is, I love the usability, and their focus on customers.
I like Target. They’re very trend-forward at great value. They’ve found their sweet spot.
I love Chick-Fil-A. The speed and timesaving, whether you go in or go through the drive-thru, are just amazing. And obviously, the food is great too.
I love love, love, love Trader Joe’s. I just get lost in Trader Joe’s. It’s like a treasure hunt for me. So those are my favorite companies for different reasons.
EB: I know we’ve talked a little bit already about some trends you’re seeing in retail, but is there anything else you’d like to add?
KK: Artificial intelligence and quantum computing are also going to become very, very important. There’s a lot of talk about AR, VR, and the Metaverse. There are trends, and then there are trends that are here to stay and really disrupt how things are done. In my mind, automation, and computing power are the trends I believe will stick to disrupt. And we talked about the evolution of eCommerce and omnichannel as well. I hope we can get there. I hope I can get a candy bar delivered to me on a mountain while I’m hiking.
EB: I hope so too! Let’s go back to the idea of evolution. How important is competitive intelligence and how have you seen it evolve or develop over the course of your career?
KK: It’s so, so important. The value is so transparent to the customer. There’s no hiding. So, if you want to be better, you need to have the data, you need to know exactly what the competition is doing, and you need to know how you’re positioned versus the competition.
And we talked about how we got omnichannel, you know, from brick and mortar to just eCommerce, to multichannel, and now to omnichannel. It only makes it that much more complicated to manage your value equation and your value pyramid. And competitive intelligence is such an important piece of that.
Think about inflation right now, right? Like how do you surgically invest in price? How do you still maintain your price perception? If you don’t have the competitive data, what can you do?
People used to go take a piece of paper and a pen and go to different competitors and write down every price and come back. And then we said, okay, now we’re going to have a third-party company do the same. And now a third-party company can collect prices with an app, and we’re going to add web scraping to get the online data. And maybe you could even do something with crowdsourcing to get as much competitive intelligence as you can.
It’s one thing to get the data. But your success depends on how you utilize the data. What’s the fastest way to turn that data into action? How do you get the data, crunch it, and get it into more predictive and prescriptive analytics faster, so you can act in that space? I think that’s going to be key.
EB: Did you ever meet Helena on our team? She’s our Global VP of In-Store Data Operations. The first week I joined Engage3, she gave me a pen and paper and asked me to go do several price checks just so I’d have a reference point for how price checks were being done historically. I remember thinking I would breeze through the three stores she assigned to me in a few hours, and it ended up taking me all weekend. And that’s after I somehow talked a friend of mine into joining me. And it turns out I was one of the worst auditors that we’d ever sent on that mission.
But it really made me appreciate the technology, right? It made me realize how technology can create the scale, automation, and consistency you need.
KK: Yeah, the data collection has come a long way. Now, it’s all about how you utilize it to drive business decisions. Who can be the fastest to not only get us the data but also get it to a format where it’s immediately actionable? That’s critical.
EB: Well said! Analytics-ready data and then the analytics itself. As someone who has built these processes and organizations over your career, what advice do you have for retail organizations that want to strengthen their capabilities around competitive intelligence and pricing?
KK: You must first select the right partner. That’s super important. And then you also need to hire the right people on your team. Then, you’re trying to collect the data in the most efficient, low-cost format, and apply it to your business model in a way that helps you make decisions quickly, then measure those decisions that were made and finish the loop.
EB: Let’s talk about Price Image and price perception. I always appreciated that you immediately got the concept, and you went up and whiteboarded with us and we talked about it. How does it fit into your thinking?
KK: Price image is a very important part of the value funnel. It’s becoming more critical, especially when you’re thinking about portfolio mix, high-turn items, and low-turn items, inflationary period. How do you manage? You still have to balance your P&L but also not lose the Price Image. I think it is an important part of value. In terms of how you address price and how you build that image, there are different ways we can solve that equation now.
Prior to this, when we were just brick and mortar and it’s just, okay, I go to the store, and my only point of reference is another store or another competitor who has a similar product. But now it’s not that way.
It’s super important for us to keep a pulse on the price perception and the Price Image because it’s becoming more table stakes in an omni world with everything else that’s part of the value equation, like your convenience, your frictionless shopping experience, personalization, so on and so forth. Price image is going to become foundational for any retailer’s pricing strategy.
I know a lot of retailers don’t think about it that way. It’s either increase price or decrease price, and they don’t consider the most important items that set the image when someone walks into the store.
I think sometimes retailers overcomplicate and create more price files and try to optimize the price across locations and zones, or they think “Since I don’t have competition, I can charge customers higher.”
Now this is just my own ‘Karthicka’ philosophy. If I’m the CEO of the company and I’m running a business, I don’t want to charge people who don’t earn a lot more just because there is no competition. You can make money by doing that, but do you want to go there? It’s almost like there are principles and then there is optimization. Sometimes certain companies go ditch to ditch and try to optimize their P&L better, and they forget the principles and lose customers in the long run.
EB: That’s one of the biggest mistakes we see price optimization companies and their customers making: burning their long-term Price Image in favor of short-term profits. As you said earlier, the easiest thing in the world to do is just raise prices and get your short-term wins. Sticking to those principles is challenging even if it’s better in the long term. And what people don’t have a system for, traditionally, is managing that long-term lifetime value.
Are you up for a few rapid-fire questions to bring us home? What TV shows are you watching?
KK: Oh man, you don’t want to know. [laughs] I love anything supernatural. Supernatural TV shows, crime, science fiction, I love it all.
EB: [laughs] I’m in the same camp. What books are you reading?
KK: We’re going to have a baby, so lately all of my reading has been baby related. No business books, just a bunch of stuff on how to raise a baby. “Twelve Hours’ Sleep by Twelve Weeks Old” is the one I’m reading now so hopefully I can sleep, and I can also feed and take care of the baby.
EB: What’s your favorite dish?
It’s an Indian soup called rasam. It’s a South Indian dish that you mix with white rice and eat. My soul food.
EB: Favorite restaurant?
KK: Any sushi restaurant. I love sushi.
EB: Finally, what advice do you have for someone interested in exploring a career in pricing or merchandising?
KK: If you don’t love data numbers, and how to simplify complexity, you’re in the wrong place.
EB: Thanks for your time, Karthicka.
KK: My pleasure.