Former Blockbuster CEO Jim Keyes on Transformational Leadership During Marketplace DisruptionMay 17, 2021
On Thursday, Jim Keyes shared the fundamental elements to his success as a leader and CEO. Keyes is the former chairman and CEO of Blockbuster and former CEO of 7-Eleven. GLO spoke with the current chairman of Wild Oats Marketing LLC about the downfall of the mega-business Blockbuster and his learnings as CEO of two major worldwide companies.
What Really Happened to Blockbuster?
Keyes acknowledges that he has become marked as the CEO who did not keep up with the changing technology of the world. In fact, Blockbuster always had the mission to deliver access to media entertainment in the most convenient fashion. Blockbuster had been a pioneer in creating brick-and-mortar stores that made media entertainment a convenience to all. The company had the idea to bring its concept to the digital world and bought one of the first digital streaming companies in 2007 under Keyes’s leadership.
Multiple key issues stood in the way of Blockbuster’s continuing success. Consumer adoption of the technology was slow, partially owing to the limited options viewers could watch on. The iPad had yet to be released and tablet devices were not popularized. Bandwidth in 2007 was weak, another hindrance to consumer streaming abilities. At the time, Blockbuster was millions of dollars in debt. When the market collapsed in 2008, it became difficult for the company to survive.
Despite being one of the first digital streaming companies and adapting to the market, the financial market realities were more than they could overcome at the time. They were forced to restructure and sell the company. Though the popular narrative is different, Keyes is grateful he was part of the company, as he gained a tremendous amount of skills and knowledge from the experience.
How to Keep Up With a Changing Market
Keyes learned much of his methodologies from his time as CEO of 7-Eleven. He took over as CEO in 1991 when the company was bankrupt. Instead of allowing the company to run its course, he took the challenge gladly. Keyes recommends looking at how the consumer will respond to a change in the market and then beating the competition to meet that new demand. The chairman of 7-Eleven at the time taught him that convenience retail is all about change. Keyes took that information in stride and began to adopt new technology to the business to make it more efficient.
A Case Study of the American Dream
Keyes emphasises that part of the success of 7-Eleven is due to the fact that it is a minority populated company. He looked into why that was unique to 7-Eleven and found that people from all over the world saw the opportunity to work in a small store and make their way up. “They could come to America, be an entrepreneur, work hard, and save enough money to buy their own store.” According to Keyes, the barrier to entry for the franchise is relatively low, and they could quickly become their own boss. The more an employee works, the more they benefit.
“This is the manifestation of the American Dream. It’s a classic case study,” says Keyes. He found that many individuals would send their kids to school before acquiring a second store. They would choose to invest in educating their children, then bringing their family into the business and expanding it. For Keyes, that is a central part of the culture he wishes to impart on his companies.
How does Effective Leadership Transform Culture?
From his experiences as the CEO of major companies, Keyes has determined that leadership is about change. Being able to adapt to and adopt new techniques is crucial to effective leadership. He has three principles he maintains and imparts upon his companies.
- Respond to Change
- This fundamental idea is crucial to keeping a business afloat.
- Execute with Confidence
- A leader cannot respond to change if they do not have the confidence to do it.
- Communicate with Clarity
- A leader has to communicate in order to mitigate the confusion that comes with change.
These principles are responsible for maintaining effective leadership and creating a company culture that knows how to adapt and grow. At the forefront of these ideas is an openness to education and a creative mindset that fosters growth.
How to Be a Creative Leader
Keyes’s fundamentals of success, no matter what the challenges, lay in maintaining creativity and in the pursuit of education. He believes that “education is freedom,” and is currently writing a book with that title. His personal journey has been about replacing fear and ignorance with hope and knowledge in the hopes of curing a polarized society. His recommendation for all individuals is to expand their knowledge by taking the personal initiative to keep learning.
Just as the pursuit of knowledge is crucial for effective leadership, creativity is a necessary characteristic of success.
“We’re all artists. As children we paint, draw, sing, dance.
But as we see ourselves being judged, we stop that creative process.”
Keyes challenges each of us to pursue that urge for creativity, as it allows us to be able to respond to change.
Companies tend to outsource creative processes, from coming up with business solutions or creating a new product for their consumers. However, if you nurture your employee’s creativity, they will become more successful business people.
Creativity and Technology
A core aspect of Keyes’s pursuit of knowledge has been adapting to technological changes. Just as technology has disrupted companies such as Blockbuster, it is also an enabler. Technology has transformed retail, especially in restocking, and helped Keyes tremendously during his tenure at 7-Eleven. Keyes sees technology as an opportunity for unlimited learning and education expansion.
Keyes has abided by the same mantra since high school: nothing in this world can take the place of persistence. He urges entrepreneurs, employees, and employers not to stop or give up, but to persist in order to adapt. If you’re interested in hearing more about Jim Keyes’s journey, you can listen to the full interview here.
Samantha Braffman is a Philadelphia based writer for Global Leaders Organization. She is also an undergraduate student at the University of Pennsylvania, working towards a bachelor's degree in Political Science and English.