Replacement Ltd. — It's Not Just About Dishes

A funny thing happened after I interviewed Bob Page, the founder and CEO Replacements Ltd., a dinnerware retailer. I was e-mailing my friend Heather and she wrote me the following note:

I know Replacements! Please let Bob know that his staff was able to identify the pattern and get me pieces of my discontinued glassware that I had long been hunting for, based on a digital photo of that I e-mailed them. Since I didn’t even know the name of the pattern, I was thrilled!

It is one thing when the CEO tells you his or her company is customer-focused, it is very different when one of the clients tells it to you totally unsolicited.

"Our culture is very focused on the customer," Page explains. "I grew up on a small tobacco farm, and we were very poor. There were four kids in a three-room house with no indoor bathroom. Even though we were poor, we helped others. Truth and honesty were important values. These are the values that we used to build Replacements Ltd. Even at Christmas, which is our busiest time, we are able to process all of our orders by the holiday with a very short turnaround time in some cases."

In addition to being a good example of a customer-focused culture, Replacements Ltd. has built a unique culture because of the leadership of its founder. In addition to growing up poor, Page is gay. "Being a gay man, I have learned to become sensitive to others," Page says. "And our culture also reflects that."

With 100 gay and lesbian employees and over 20 nationalities represented, Replacements Ltd. is proud of its promotion of diversity. "I don’t have to like what others do in their private lives, but I am not judgmental. As long it doesn’t interfere with their performance," Page says. This management philosophy has helped earn Replacements Ltd. a perfect score on the 2008 Corporate Equality Index. This annual survey by the Human Rights Campaign Foundation in Washington rates companies based on non-discrimination policies and other factors. Replacements Ltd. join a list that includes Nike and Apple.

How to Build a Diverse and Engaged Culture

Objective Performance Measurements: At Replacements Ltd., people are promoted and rewarded by a set of objective criteria based on turnaround and customer satisfaction. "If we have performance issues we communicate very clearly with the person what the issue is and then give them an opportunity to address the issue," Page says. We provide them with multiple opportunities and warnings before we make the decision to let them go."

Enforcing a No Tolerance Policy: "We had one person who made a derogatory remark to one of our employees about African Americans," Page recalls. "That person was fired immediately. People need to value each other as well as their customers. Respect is an important part of our culture."

The Hiring Process: In order to maintain the culture, candidates are screened very carefully. Everybody who applies to Replacements Ltd. is told frankly that the company is owned by a gay man and has a very diverse background. "If they cannot deal with it, that is OK," Page says. "Better to know it now than after they start." In the war for talent, this method also attracts and engages people. One man even moved from California to Greensboro, North Carolina, just so he could work in an environment that would accept him for who he is.

Walk the Talk: At Replacements Ltd., values are not just talked about—they are acted on. "Community builds the team," Page says. "We have one person on payroll whose sole job is to be the community liaison in Greensboro. He is very involved in the school board and such organizations as the United Way. Also, because he is openly gay, he helps dispel many myths that people in the community have about homosexuals." Employees are also encouraged to join volunteer organizations and given time to do it. Replacements Ltd. has been involved in a number of different organizations and charities in the community."

The Bottom Line

How does culture affect profitability? Even though the tableware industry has been in turmoil over the past couple of years, with a number of bankruptcies and mergers and sales down 15 percent over the past year, Replacements Ltd. has actually grown by 12 percent in the same period. Building a culture that embraces true diversity, with people not being afraid to be different, gives them the respect that they pass on to their customers.