The cultural lens

Artifacts
• The founding story: Chip responded to a need
• Language: Guests (clients), Educators (salesforce), Support Center (HQ)
• Symbols: Manifesto on stores, clothes and bags, informal dressing, placing of
the logo, Lulu-stores (no wholesale)
• Rituals: Training and goal setting for employees, joga classees on the job, weekly
meetings and monthly product call, R&D relies on customer feedback

Espoused Values
• Vision: Ignite a community living the sweat life („sweat once a day to regenerate
your skin“)
• Communicated values:
1. Quality, Product, Integrity (function)
2. entrepreneurship, greatness (dedication)
3. balance, fun (passion & community)

Underlying Assumptions
• Functionality is fashion (accidential athlesure)
• Personal passion, dedication and development are key to success
• Invest into common culture rather than strong hierarchy
• Feedback is key to quality
 Strong internal and external culture (cult)
 Asset to alignment and informal control (enables local decision making)
 Major differentiating factor
 The political lens
One Admiral at the top Multiple captains at the bottom
informality • „the store manager is the key
culture
position in our organization“
• Entrepreneurial spirit (laissez faire and
Chip – „the entrepreneur“ incentives system – 20% based on
• performance)
Culture as top priority
• Promotion of strong informal network • Feedback culture (store support center)
Christine – „the right fit“ • Living the brand (8h with customer contact
Over achiever at global player (Starbucks) every month)
yet incorporates the values (woman, athlete,
mother)
• Pro: high responsiveness to customers
• Contra: risk of brand distortion

Bob – the „CEO“

• Hiring of outside-experts
• Adapting the strategic structure

hierarchy
standardisation
Recommendations: Culture &
Politics
• Informal networks are hard to maintain in an ever growing company
Company events for the store supervisors to stay in personal touch – e.g. recovery weekends

• Don’t lose yourself in high diversification

 Grow the core: Goal: Digital2x mensware2x international 4x
Test and learn: Away from the core… Skin care, shampoo, footware  where do my values of
“performance makes fashion” fit?

• Laissez faire attitude in some aspects can be detrimental

 regulate/question the store design and bigger local marketing campaigns, location decisions etc.
(the more important decisions on the lower level)
History and evolution
• Founded in 1998 Vancouver Canada, by Chip Wilson
• Started as a joint business: small apparel design shop + yoga studio
• 2001: Started selling in Canada.
• 2004 : first store outside Canada.
• 2005 :
• Robert « Bob » Meers as CEO
• 20 stores in Canada and valued at $40 million
• 2007:
• 100 stores (56 in the US)
• 3000 employee
• IPO at >$350 million
• 2008:
• Christine Day takes over as CEO
• Company and global market in difficult situation, many challenges to overcome.
Problems in 2008
• Operations on large scale and unfamiliar markets.
• Lot of bad locations in the US.
• Decrease of Comp Store Sales from 24% to 3%.
• Decrease in sales per square foot.
• Recurrent inventory issues.
• Cross-functional barriers
• Demoralization of top manangers.
Projected history from the
assignment
• After 2008:
• Stock price slump
• Product recall
• 2013:
• Day resigns
• 2014 : the crisis
• 2015: Chip Wilson resigns as board chairman.
Structural lens:
• Organization structure went through different phases of evolution.
• Pure vertical
• Flat

• I believe it is more of : font/back structure.

• Front: stores and educators.
• Back: Store Support Center (head office) : organized by function.
Structural analysis
• Cross functional barriers:
• Day’s comment in the last video : One expert who played the role of the teller
with a centralized green team.

• Pro: High degree of specialization.

Linkage and Alignement
• Linkage:
• Monthly product call: managers and employees from different functions interact to identify
product deficiencies
• Weekly meetings.
• Every employee has to spend 8 hours/month in a store.
• Alignment:
• Entrepreneurial spirit: store managers roles as responsible and compensation strategy 80-20.
• Training: from 40 hours to 1 month of training based on company culture
• Manifesto: core values of lululemon
• Feedback loop: R&D and design valued and took seriously the feed back from “guests”, store
managers “educators” and ambassadors
Culture lens
• Artifacts:
• Manifesto
• Personal training and development
• Language/Vocabulary:
 Salesman/store manager: Educators
 Customer : guest
 Head office: Store Support Center
 Product tester and influencer : Ambassador
• Local hiring policy
• Function is Fashion/Elevating the world from mediocrity to greatness/…
• Physical structure : goals wall/ success library
• Casual dressing
• Events : naked shopping event.
Culture lens
• Values:
• Quality
• Product
• Greatness
• Integrity
• Balance
• Entrepreneurship
• Fun
Culture lens
• Assumptions and actions:
Assumption Action

Customers feedback is the key to differentiate Build a solid loop of feedback : guests, ambassadors and
educators.
Every employee has to work at least 8 hours / month in a store

Educators and not sellers Adapt the interaction between sellers and customers to be an
educational process. Therefore: educators and guests.
Employees should fit the core values Manifesto to recruit

Training importance Landmark program

Reasonability and accountability Give the store managers the freedom to design their stores and
define goals with them.
Power and leadership
• Chip Wilson:
• Centralized power: single person leader
• Emotional bound with the company
• Small scale company
• Innovation driven
• Bob Meers:
• Big companies culture
• Hires external professionals
• Profit and value oriented
• Day:
• Role Model
• People person
• Rapid expansion
• Cross-functional management
Anticipated power struggles
• Chip and Bob:
• Different visions about the company and its culture.
• Chip : emotional bound to company
• Bob : lucrative objective (expansion and stock price)
• Day and Chip:
• Day :
• people person.
• Role model female
Crisis : Stock price evolution 2007-
2014
Crisis : Stock price evolution 2013-
2014