Members of H-E-B’s management team are usually very reticent when asked about the privately held company’s thinking regarding changes in the competitive landscape, tactical moves and long-term strategy. Without revealing any specifics, Craig Boyan, who at the beginning of the year was succeed by Roxanne Orsak as president of the retailer and now serves as senior advisor to the company, pulled back the curtain a bit on the principles that undergird H-E-B, regularly rated as one of the three or four best supermarket operators in the United States. During remarks delivered at last month’s FMI Midwinter Executive Conference, Boyan, who is also the association’s chairman, spoke about what motivates the company.
“I often like to describe our industry as full of purpose-driven companies,” he said. “That’s the way I describe H-E-B. And here’s how I describe purpose in grocery and at H-E-B. Our role is to be the most competitive retailer we can possibly be. So that we can do two things. We can do our best to take care of our 175,000 employees we call partners. And No. 2, to be the best community citizen we can be.
“That’s why we do it. We don’t make a heck of a lot of money in this industry, but our goal is to run great businesses so that we can do a better job of taking care of people. And that, in my many years of leading H-E-B, has been my job and our job — to be more competitive so that we can do an even better job taking care of people.”
H-E-B’s adherence to that strategy throughout its 120-year history has enabled it to resonate with consumers and ensure continued growth and success. Today, the retailer operates some 460 stores in Texas and Mexico that generate more than $50 billion a year in revenue.
Boyan said that H-E-B aspires “to be a better employer, to be a place of respect, of dignity and meaning. To be a place where everyone belongs and everyone feels respected. And per Gandhi’s teaching, to be the change we want to see in the world.”
To that end, the company not only continually innovates to hone the merchandise mix, enhance stores and improve the customer experience, but supports public education, the arts and the environment, as well as stepping in to help communities hit by natural disasters. “We’re driving our convoy of trucks into the storm when people are fleeing,” Boyan noted. “That, to me, is what it means to be a great purpose-driven company.”
H-E-B exemplifies the good things that happen when a company couples a clear vision of what it wants to accomplish with a principled plan of action. Values matter. Retailers that want to achieve long-term success need to adopt a business model that inspires the trust of customers, associates and other stakeholders.
