There is a new advertisement that has provoked a storm of comments, both positive and negative. Purporting to show a school production, it is a remake of Queen’s Bohemian Rhapsody, complete with spacemen, Martians and clever special effects. It’s not like any school drama production you will ever have seen in real life, but it has certainly got the internet humming, not least because of the choice of a song which has always been at least slightly controversial, but is also practically iconic in its status.
Rebranding John Lewis
This is, in fact, an advertisement designed to highlight John Lewis’s forthcoming rebranding process. This rebranding exercise is the first for the John Lewis Partnership in 18 years. Like any other corporate makeover, it brings a new and more modern ‘vibe’ to the logo and corporate artwork. Like several other recent rebranding exercises, it also gives a nod to the brand’s history, using the ‘diamond’ logo as a basis for the shapes and sizing of artwork.
Unlike other rebrands, however, it puts the company’s business model front and centre. The big difference that shoppers will see is that the two shops have been rebranded as ‘John Lewis and Partners’ and ‘Waitrose and Partners’. This emphasises the John Lewis Partnership’s business model: every employee is a ‘partner’, owning a share in the company’s shops and getting a share of the profits at the end of the year. Similarly, the advertisement’s strapline, ‘When you’re part of it, you put your heart into it’, is deliberately chosen to emphasise the central role played by staff and their expertise. The company has commented that the rebranding is as much internal, for its staff, as external. Staff have also been provided with iPhones to help them improve the customer experience and act as employee advocates on social media.
It is fair to say that the rebranding has not be universally welcomed. Critics have pointed out that it may be an internal as well as external branding, but staff did not seem to be aware of it. Other commentators have suggested that it is linked to the staff cuts that have meant that more is asked of each employee/partner, and that it is an expensive way to tell the world what it already knows: that John Lewis is a partnership.
The John Lewis business model
The John Lewis shared ownership business model is very much a selling point for the brand. It is not completely unique, because plenty of other companies have significant employee ownership. However, in an era where corporate social responsibility is increasingly seen as essential, the model ensures that employees are front and centre—although it has not stopped staff being made redundant when the board deems it necessary.
Employee ownership at John Lewis is very much not a matter of lip service. The structure was set up back in 1929 by owner John Spedan Lewis, as way to create a ‘better form of business’. The company’s constitution explicitly includes a mission to maximise employee (partner) happiness. Employees have their own council to feed ideas and issues back to the board, and every employee takes a similar percentage share of the annual profits, meaning that large bonuses do not create the same outcry there as elsewhere. The ‘partners’ also share ownership of the company’s assets.
This ownership structure, and particularly the profit-sharing aspect, gives employees at all levels a real incentive to work hard, to increase the company’s profits. It is fair to say that several other retailers consistently out-perform John Lewis in profit terms, but research suggests that employee-owned businesses generally have higher rates of sales growth and job creation during recession. The so-called ‘stakeholder approach’ tends to mean employees are more committed to the business, and therefore more prepared to be flexible when necessary.
A business model for the 21st century
Perhaps the most important aspect of the John Lewis model is that it recognises that employees have a contribution to make. It is, if you think about it, almost more surprising that more companies have not embraced employee ownership into the 21st century. Companies are talking about co-creation with customers, but at the same time, not using an obvious mechanism to ensure that staff are fully engaged.
Co-creation done well requires that all stakeholders are involved, and that is what the John Lewis business model offers. It may be almost 90 years old, but John Spedon Lewis’s ‘revolution in industrial democracy’ could actually turn out to be the most suitable business model for the digital economy.