Big Think Interview with Jeff Swartz
Jeffrey Swartz has been Timberland's President and Chief Executive Officer since June 1998. Jeffrey Swartz is the son of Sidney Swartz. Jeffrey Swartz serves as a director of Limited Brands Inc., a publicly traded specialty retailer of women's intimate apparel, beauty and personal care products and accessories.
Question: How did Timberland get its start?
Jeff Swartz: My grandfather was an immigrant to America at the turn of the last century. He was a cobbler back in the old country in Russia. He fled Russia because the czar was conscripting people for the Army and if you’re a Jew and you got conscripted in the Army it was sort of a servant until you die thing and my grandfather wasn’t into that and so courageous kind of entrepreneurial kind of crazy stuff. He ended up in Hamburg, Germany from the south of Russia. On the first day he ever saw an ocean he climbed inside the belly of a ship and he sailed across to New York. He didn’t stop in New York because he knew that was where the Yankees were from. He headed up to Boston and there was some family connection of some sort and he went to work in the shoe factories because Boston at the time had shoe factories and he was a craftsman and he made his living with his hands, but he… And I don’t understand this particular passion, but he had to have his own business, so he started. It failed. He started a second business. It failed. He was 55 years-old. I’m about to be 50. He was 55 years-old on the streets of Boston. The good news was he wasn’t formally educated, so if you said chapter 11 he would have said it’s a book too long to read anyways, so he started… He borrowed 500 bucks and he started this third company which was the predecessor company to Timberland.
Question: Was Timberland always focused on shoes?
Jeff Swartz: My grandfather he never met a shoe he wouldn’t like to make and he had to do it. He was a very practical man. He just wanted to feed his children, so they made women’s dress shoes back in the days and then they made shoes for the Navy, so men’s kind of dumb-dumb shoes and the factory in New Market, New Hampshire, which is where we sort of became I guess that was the first step to being a real company in that sense was owned by another company that went out of business on Friday and they were making work boots and so they heard this was going out of business. There was a trained workforce that makes shoes. We make shoes. They have a workforce. We’re out of luck here in Boston and so they went up the Pike. They went to New Hampshire and Monday they were in the work boot business. That’s strategy Swartz family style. It’s you take it as you find it. Over time they… it made sense. We were in crappy weather in Southern New Hampshire and so work boots and waterproof and tinkering around and that sort of stuff, so necessity, ingenuity born of necessity is kind of the hallmark of how we built our business, but there was no abiding passion for someday we’ll grow up and make work boots. It’s just the way we found ourselves.
Question: What are the challenges to running a family business?
Jeff Swartz: Family business calls to question just literally every single day what is the definition of a family and how are you going to function as a family and so whether it’s horizontally within siblings or cousins, if it’s an extended family. And then vertically it calls the question of mortality and it calls the question of how generations relate to each other with respect and love, but challenge too. It’s an overlay which I have only my narrow experience of meaning we battled through all of those things. My father and uncle set of challenges. My father and uncle and their father and when my dad made me the CEO that was… And then there is my brother and my sister, neither of whom are involved in the business now. That’s a… The math on… You understand why businesses don’t pass the second or third generations because maybe the business idea wasn’t so good or actually more likely the business idea is probably pretty good, but it’s really hard. Thanksgiving or whatever, you’re family celebrations it’s hard because all the things that are natural factors or natural stresses in the family become exasperated on the question of money or on the question of power and the question of prestige and our kids are at the age where our two oldest kids are pretty clear that this isn’t something they’re interested in, but our third son convinced A, that he’s be a better CEO today than I would ever be ever and he may be right, but he gets my wife’s attention. She is not dying to play the dynamic one more generation.
Question: How did you build the Timberland brand?
Jeff Swartz: Well you know there are wines that come from the places that they’re grown and the five growing regions in France are very distinct by the terroir. The same is true of our brand. I told you that we came from the, we just want to make shoes to make a living to hey, it turns out that we’re from a place. There is a providence to Timberland, by the Land Prairie River in New Market, Hampshire is a very beautiful place in this old brick building and it’s a village. It’s an American village. It’s a very particular place. It’s the home of American democracy. It’s **** Scrabble. It’s an immigrant community. It’s wet and cold and rough and unforgiving and our brand to the extent that any brand can be nurtured from such very stony soil the truth is before we knew what our brand was our brand had a personality and point of view that was authentic from place.
It’s funny. We weren’t brand builders as instinctively. We were manufacturers. We had an Italian guy come to visit in 1979 who had smelled the essence of the brand. I honestly don’t know how he found it, but he showed up in double-breasted suit. My father and uncle thought this was… the guy should be committed. And he said he wanted to buy shoes and they thought that he meant a pair of shoes and he bought 6,000 pairs of one style shoe and they made him pay cash because he said he was going to go sell them in Italy and they thought okay, when this guy finds out you can’t sell shoes in New Hampshire and Italy they’re going to come back for his money back, so we’ll have to move the offices. Giuseppe sold all 6,000 pairs and he came back and he said, “I want to create a distributor’s business in Italy.” And they said, “When we figure out what a distributor is we’ll call you back.” But he built our brand in Italy and we were… Let me tell you who were are. We used to take pictures of the boot. We’d try to correct ever imperfection, in color, perfect. Giuseppe took black and white photos of the boots, took the laces out, covered them with mud, hung them from a clothes line and ran an ad in Italian that said… And thank God neither my father nor my uncle understood Italian. It said, “If you love me you’ll treat me badly.” And so I got the ad translated and like what the hell is he talking about? Well he wasn’t selling boots. He was selling New England rough spirit, independence and romance and all of the sudden we had a brand. We used to be a product, so we talk about boot brand and belief. Giuseppe in very many ways invented the brand. Now we’re smart guys. We’re fast learners and so when we saw this value in brand, not in product we didn’t give up the passion for product, but we sure started making investments in brand.
Question: What were branding mistakes you made?
Jeff Swartz: Oh boy. So far today I think I’ve probably made ten. We’re not formally trained. I went to business school. I’m over educated, but under trained and so brand has been to us egocentric and personal and passion and so we’ve distained competitors when we should have paid attention. We’ve misunderstood consumers. When we should have been listening we were talking. In fact, the best things we’ve ever done in terms of brand building is listen and I don’t mean to consumers. We’re not Proctor and Gamble sophisticated, but I told you the story of Giuseppe. He came to us and said, “It’s not a boot.” “It’s a brand.” And we said, “Got it.”
We’re pretty fully involved, pretty passionate guys about what we do, boot brand and belief and we we’re so busy. I don’t mean in a temporal sense, but I mean in a passionate sense that we don’t know what we don’t know. When we forget that we screw up the brand. We screw up the business. We screw up everything. When we remember that we know what we know and we don’t what we don’t and we are powerful enough to say to people show us, help us, share strength with us, we can fly. And the 30 years of brand building, the brand is as good as it is mostly because we didn’t know and we knew that we didn’t. Most of the mistakes we’ve made is when we said I’ve got this one. And I’m not trying to be you know aw-shucks from the country because that’s not how I think about us. I’m just telling you the model of almost stone soup. Everybody contributing something to make it work is really how the brand got built.
Question: When did you know your brand was strong?
Jeff Swartz: Our brand appears to me strongest when we are at our most vulnerable. In 1994 when I was first put in charge of the company I led us right off a cliff, like one of those Road Runner… You know one of those cartoons where the guy is hanging and he goes, “Uh-oh.” I set the company to grow up 72% in revenue and it grew 56% in revenue. 56 would have been great except I set it for 72 and the rest of it went into inventory and we had a liquidity crisis and we couldn’t advertise. We couldn’t do anything. We could hardly breathe. The banks were on our… literally they had our throat for 18 months and we found the strength of the brand in our weakness because the consumer didn’t notice the distress. In the current cycle we had a tremendous cycle of consumer interest and then disinterest in the brand and so we went out into the market with this like I’m not going to want to hear this and we asked a million consumers tell us about the brand, not literally. We did some real research and they came back and they said, “Look, you obviously have your head up your rear end.” “I don’t know what is bothering you, but our view of the brand is get over yourself.” “We love the brand.” “Show up again.” “Where have you been?” And so the permission that we have from consumers has saved us more than once and when things are really good we should be smart enough… If things are really good again we should be smart enough not to miss the point that at the end of the day it is about people making a choice. No one needs our product. Either they love it or they just don’t buy it and the fact is even as badly as some things have gone in the last 20 years consumers have decided to love our brand and we’re grateful.
Question: How did Timberlands become synonymous with hip hop?
Jeff Swartz: We didn’t know what hip-hop was, what it meant or what it represented and so after the fact… I mean long after the train left the station where people said to us you know young people are wearing the boots. We thought yeah, the young Con Edison guy. No, no, no, 16, 18 year-old kids are wearing the boot as a fashion statement. They’re not lacing it up. What do you mean they’re not? Their feet will get wet if they don’t lace up their boot. I mean I don’t mean to sound like I fell off a turnip truck, but I’m telling you until 1994, ’95 we had no idea. Now I’m not proud of that. I’m just telling you the truth.
How did that consumer decide our brand was valuable? The postmortem says you showed respect because you were in the neighborhoods where we live and work. You made a product without compromise meaning it was tougher than the rest as the Bruce Springsteen song goes and you did fine until you decided you were cool. When you decided you were cool now we’re… We are now an element of hip-hop culture and so now we have to add colors and fancy styles and the consumer said back, “If we wanted colors and styles we wouldn’t have bought you in the first place.” “Stop doing this.” We said, “It’s working.” Our sales were way up and we were rocking and rolling and we were believing that we were cool and the truth is the only thing that isn’t cool is when you try to be, so I’m told. When we were authentically who we are, we make the best damn boot in the whole world. We guarantee it for life and it won’t disappoint you, consumer came to us and said, “That’s respectful and we appreciate it, but if you want to make it cool hey look, look in the mirror.” “That isn’t you.” And we didn’t listen and the last five years has been that cycle of boom and now bust against that consumer, not against that consumer in terms of values, meaning the hip-hop consumer as best I understand it continues to believe in the authentic things we do. They just were put off by our attempt to be topical and cool.
Question: Jay-Z says Timbs are out. Can you win him back?
Jeff Swartz: Now I don’t know about Jay-Z, Mr. Shawn Carter. I don’t know what it would take to get him to wear a pair of Timberland boots again. I don’t know if he wants to. I don’t know what it would do for our brand if he did. He is a very influential guy, but the truth is that’s never been our strategy. Our strategy has been about put your head down and make something so good that they got to have it. Who is they? Well, we think about different consumers all time, men, women, children. Would we like to do business with the hip-hop consumer? Boy, young people with the energy of that movement, music and culture they’re a deeply important part of the fashion scene and we’re going to work humbly and hard to earn their trust.
Topic: Managing employees
Jeff Swartz: There are things that we can do. I’ve got a page in my notebook that is called culture and I try to update it every week, meaning I carry this little notebook and I try to think of different ways to approach the question of scale because the godfather was right about just about everything, but he got it wrong when he said the equivalent of it’s nothing personal, it’s just business.
You know the line from Springsteen. He said, “At the end of every hard-earned day people find some reason to believe.” I don’t want to have to wait until the end of the day to cast a vote for like what was today all about and so yeah, we have businesses at Timberland. We own a brand called SmartWool in Colorado. There is 72 people there in one building in Steamboat Springs and real line of sight. People are connected. They know each other’s story. How to do it with 5,000? I can’t know people’s story the same way and it can’t be about me anyways, but it has to be about a culture where people do want to know your name and they do want to hear your story and in a funny way we’ve really succeeded in that regard. We’ve really succeeded in creating an active citizenship at Timberland where I may not know your name. I know you know mine because of who I am, but you don’t know me either, but it doesn’t matter because if you’re in pain or if you’re in confusion you have real relationships around your desk or your community. It is part of the ethic of we don’t live in New Market anymore. We’re in Stratum, New Hampshire now, just down the road, but that ethic of town meeting and that ethic of speaking truth to power and asking questions and demanding acknowledgement as a human that’s still a very big part of our culture. Look, I do town meetings with pretty high regularity, sometimes in video, sometimes in person. Cultures are different. When I go to Japan to the town meeting I know that I got to have five questions planted because no one is going to ask the first question and I’ve got to have one criticism planted and everybody will look around and then they’re like Jeff planted the criticism, but then they remember oh yeah, that’s right, it’s okay to ask those kind of questions. And so it takes two hours to do a one hour meeting in Japan because I just got to give them a chance to live in their culture, but I also I got to spend the two hours because otherwise we end up being a big company and that would be no fun.
Jeff Swartz: We have three elements of our strategic plan. One is build brand heat and height. They can rap it back at you. Everybody in the warehouse in California can tell me number one, brand heat and brand height. Okay, but what does that mean in your day? What are you doing differently today than yesterday? And they think I’m in the warehouse what does that have to do with brand heat and brand height and so and they are by the way the reason that our brand is only so cool and so successful is because there is a lot that they can be doing and they have power and strength and insight and genius, but we’re not calling on it because there is a gap between concept and execution and so taking it down to the desktop to me that is the... What iTunes allows you to do which is to reach in and bring it right down to your personal device that’s the… We’ve got to find a way from a management perspective to take the highest concept and drill it down to the most concrete place 5,000 times and then… 5,000 people, and then regularly update it. People have to be connected to the mission to care about it.
Jeff Swartz: the best example I can give you is there was a guy who came to Timberland from the pedigree world and he grew up in our treasury department, so it’s analytical and powerful and rigorous and about 12 years into it I realized that there is a real human being in the treasurer’s office and so I went down to his office one day and I said, “Here’s a strange one.” He goes, “Go ahead.” I said, “I’d like you to run sales and marketing for us outside the United States.” And he didn’t even laugh because he is like, “Come on.” “What are you doing in my office?” And I said, “No, I’m dead serious about it.” We’ve been through five really pedigreed sales and marketing internationals, like ****, perfect yeah, right? I got a British guy. I got an Italian guy. I got a Chinese guy and they all flamed out. And so he said, “I’ve never been outside the United States on Timberland business ever.” I said, “Perfect, but I trust you.” “The team trusts you.” “You’re a for real smart guy.” “We’ll figure this out.” “Let’s make a slow transition.” “We’ll take a year.” “You travel with me every month to Europe for a year until we’re ready.” Six months into it he says to me, “I got it.” Not like I got it, I’m dead, but I got it, cool. He said, “You’re right.” “They trust me.” “I trust them back.” “We can do this.” He was the best international guy we ever had in the history of the company except for me because I did it before, but for real executives he killed it and he had zero experience, but he had intellectual model. He had integrity. He had respect in the organization. He could work the levers. The undervaluing the strength of culture is a failure that I got to remind myself not to make. We do need external talent. We need to bring in diverse points of view, but we also need to recognize there is an incredible ownership class at Timberland of people who they absolutely give a darn, which is not like standard operating procedure. It’s cool. And we need to honor that, which means invest in training folks. We haven’t done enough of that. We’re a place where like figure it out. We got things to do. We’re becoming more self-conscious about the need to invest in talent because we value the strength of our culture.
I can give you examples of really powerful professionals who have been successful in other organizations in the same function who come to Timberland. Well I’ll give you a for instance of a guy who was successful despite it. He came to Timberland from Pepsi. He was trained in their finance organization and that’s a very… That’s world-class. I mean it’s the best of the best. And he said to me about six months into the job or maybe nine months into the job. He said, “I’m not sure I’m going to stay.” And I said, “What?” And he said, “You know at Pepsi they teach us institutional thoughts.” So there is a way to do things. There is the Pepsi way. And he said, “I brought that with me.” “That’s what you wanted, right?” I said, “Yeah, yeah.” And he said, “And I keep trying to fit it in here and it’s really clear to me that there are elements of the Pepsi way which are right that won’t work here.” And so he said, “I am faced with a choice will I reinvent my…?” He called it a mind map. “Will I reinvent my mind map?” “Is it worth it enough to me to do that or should I go somewhere else where they won’t require me to reinvent the mind map, but they’ll simply value it.” Pepsi’s finance organization is an up or out organization, so they have 50 people for every ten slots, 50 capable people, so they know 40 of them are leaving and so people circle around like sucker fish around White Plains and it’s a well tried path. You get great finance people out of Pepsi. We got this guy and so he said most of the Pepsi alumni go to a place where people say, “Tell us what to do boss.” “We’ll do it your way.” That’s what we hired you for. He said, “You guys are like stiff-necked Yankees up here in New Hampshire and I see strength in it, but it’s a big ask.” “You’re asking me to sort of reinvent myself and I’m not sure I want to do it.” And I’m listening very politely.
And so three, four months went by and he came back and he said, “What do you think?” And I said, “I see.” “I see you kind of twisting and turning and it’s amazing and I appreciate it very much.” And he had… But it hits the second part of your question because that was on him. It wasn’t like he came to Timberland and I said, “Hey, I recognize the power of our culture and so let me help you with this transition.” I was like, “There is the swimming pool.” “Good luck.” And his strength was in the swimming pool he realized I’m swimming in Jell-O, not water and so if I want to not drown I’m going to have to put on floaties and he did. So he was successful. He chose to leave the company in the end and his professionalism and his strength is missed. He was a very, very, very capable guy and so we couldn’t retain him. He didn’t fail. We couldn’t retain him. I learned a lot from that about bringing executives at that level of the company because the power of their pedigree is they know what to do or at least they know what they think they’re supposed to do. We have to spend different kind of time helping people succeed in our culture and so we have two or three new executives that are joining in this 60 days and we have a very, very concentrated effort against making our culture transparent to them so that they can bring their skills and strengths against not hidden traps and ambushes, so we hope that the process, which I learned much from this guy, will be we can leverage what we learned from them.
Question: How important is sustainability in business?
Jeff Swartz: I guess it depends what the stakeholders’ point of view is. If you’re an employee sustainable means that they will be humble and powerful and excellent and they’ll adapt and I’ll keep my job and I’ll build a career and I can count on that, not count on that as Japanese, but count on that as long as I do my part in this relationship they’ll do theirs.
Unsustainable is let’s get excited about some really bad idea. Let’s convince ourselves we’re right. Let’s not listen. Let’s power down the path and let’s fire you for my decision. That’s not sustainable and so if you’re an employee as a stakeholder sustainable is better than not. If you’re a consumer sustainable is important both from a product perspective and from an environmental perspective. If you’re a shareholder I don’t know about that to tell you the truth because despite all the conversation with social responsibility investment it doesn’t show up from my perspective and so most of our shareholders are predicated on knowing when it is no longer sustainable. Most of the people who do business in Timberland stock or anybody’s stock do it on the basis of I buy it before you know what it’s worth and I sell it before you know what it’s worth and so it’s absolutely not a sustainable notion. What is sustainable there is I know something you don’t know. I have an insight you don’t have and so if Timberland is consistent and predictable that is… That takes the fun out of it for the folks that invest in turning over their positions. So with the exception of the shareholder on the level of financial results sustainable seems to me and all win, no loss proposition.
Well the way the shareholder values sustainable is if we can generate a return for it, so if we can create a culture where the men and women who are Timberland are committed to it, not just in loyal terms, but in engagement terms, we’ll be more innovative than our competitors. If we can create products that are more innovative than our competitors and find ways through different media strategies, which is innovative again, to make the consumer care about Earthkeeper Footwear from Timberland then we’ll outsell our competitors and then our shareholders will say sustainable is interesting to us in so far as it generates superior returns. I don’t believe that the enlightened shareholders at hand yet. The enlightened consumer is much closer to hand than enlightened shareholder and so my view of that is… Bill Clinton said this once. He said, “The world is made of yes, no and maybe, spend just the minimum amount of time with yes you need to feel reinforced, ignore no and focus everything on maybe.” And so if the shareholders’ view is like whatever then my view is fight for the consumer. The conversation is if I can convince you that Mountain Athletic, lighter faster, further, sexier and green is a unique proposition and you will buy our trail running shoes, not North Face’s the shareholder will think whatever you’re doing you keep doing it and I sound borderline cynical there. I’m surely skeptical. I think the shareholder is going to get… The shareholders should have woken up by now, but they haven’t.
Topic: Getting rid of bottled water at Timberland
Jeff Swartz: I saw something on Twitter about bottled water or something like that and our team made the mistake of letting me do Twitter and so I can like get around my handlers and so I just blasted a note that said I’m getting rid of bottled water. I can’t solve the world’s… universe’s problems right this minute, but it makes no sense for our employees to be buying bottled water and no, it’s not big brother. It’s none of that crap. I’m just telling you I can give our employees a raise by banning bottled water and so I thought that would be cool and it would be hip and my kids would be impressed. None of it worked. It was like, “What the hell are you doing?” “I like my bottled water.” “What about the soda machine?” It was like for crying out loud. So then I got the equivalent of the daycare team together and said, “Will you… Since I’ve said we’re going to do this will you make me look no stupid and make I happen?” And they got together and they wailed away at it and we made bottled water go away and everyone at Timberland thinks it’s a pain in the neck. Everyone at Timberland thinks it’s kind of cool and everybody at Timberland thinks… knows. They know Victoria that something big is coming and it wasn’t bottled water. Bottled water was an example that said the status quo sucks and we need to challenge. Existentially, politically, spiritually, practically, professionally good enough isn’t good enough. It’s time to rock it up a little bit and so okay, I’m going to ban smoking next at Timberland. People now go outside to smoke. I’m saying… I’m going to post armed guards, shoot them, no cigarette smoking because I watch the government just bludgeoning to death this notion of healthcare and in the meantime I’m paying for healthcare at Timberland. We’re self-insured and people in our community are smoking cigarettes and you and I are paying for it if you’re a Timberland person. So like no, no, no, no, no, come on, back to the ownership mentality. No riders on the storm here. We’re going to differentiate healthcare rates at Timberland. If you take care of yourself you get one rate. If you don’t’ take care of yourself… Look, this is America. We’re not telling you what to do, but we’re going to create incentives or disincentives because hey, come on, we’re not getting any younger here.
Question: Where does CEO accountability mean?
Jeff Swartz: In baseball when they bring in the relief pitcher they say the starting pitcher is responsible for the runners. I’m responsible for the runners at Timberland and you’re not a baseball fan, but by that I mean look, I’ve been working at Timberland for 20, almost five years now. That’s a lot of product in the marketplace, a lot of promises made to consumers. I own those. Now not like Captain Queeg. I don’t mean to… I said failures, not successes. If you want to come be the CEO of Timberland, which by the way would suit the stock market and me and my family, you can come right now and be the CEO of Timberland.
Every success that comes from tomorrow is yours, but every failure that trails, a boot that gets returned because it didn’t work, an employee who lost their job, I own every single one of those failures forever. They don’t go away. When XYZ lays off 10,000 people and then next week hires 10,000 people it’s not the same 10,000 people. Even if it was the same 10,000 people you can’t undo the injury you did to somebody, you can’t. What’s the accountability of the CEO? Cows in a feedlot that are chewing on grass destined to become hamburger, a derivative product from that will be leather. The methane emissions from the cow are my accountability. When somebody slips on a piece of ice in outer Afghanistan with a pair of boots they bought third hand, since Timberland… I’m not arguing legal responsibility. I’m saying to you morally I put this thing in motion. I’m a third generation of my family to do this. The accountability of the CEO, you own it baby. It’s not Sarbanes-Oxley. Sarbanes-Oxley is like a band aid after the fact. When… Accountability, I have the names in my desk in the middle left-hand drawer of everybody that has left Timberland in the last 18 months, most of whom didn’t leave voluntarily. Some people lost their jobs because I didn’t do a good enough job running the company. I keep the names on a list. By the way, that’s my problem, not theirs. There is no comfort to them that their name is on my desk. I keep the list there because I’m accountable for those failures and I don’t want to replicate those mistakes and being a CEO, you own that, period.
Question: What have been the biggest challenges to running a company?
Jeff Swartz: Well, we have all sorts of competitor challenges. Nike is a big hairy beast from the West Coast. Along the line in my career there has been incredible reinventions of the business model. The folks from Inditex that own Zara from Spain have reinvented like UNICCO in Japan reinvented a power retailing one step towards fast. Now along came Zara and made it really fast and folks like H&M are doing that. Now so far they haven’t done that to the shoe business per say, but it used to be good idea, good shoe, take your time, everything will be fine. Along came brands like Zara who said we’re going to do that so fast your head will spin off your shoulders, so competitive challenges I’ve seen reinventions of the marketplace of real consequence in 25 years and all I know is it took 38 years for 50 million people to use radio in the United States and Facebook had 100 million users or whatever it was in a year and so all I learned from those statistics is whatever we think the competitor of the moment is we better deploy some people to think about tomorrow’s threat because the pace of danger to our business model is higher now than it was when we started and we can barely cope with the one we’ve got and so I will call that broad frame, the business model itself. That’s not a particular competitor, so their shoes are better than ours. It’s their idea of how to do business, not what to do, but how do it. To me that’s an existential threat to all our businesses, surely to ours. I’ve also made tremendous mistakes with consumers. We’ve talked about that, but I made the most sort of profound failure was with this consumer who wanted to be treated with authenticity and simple and we made it complicated and we had a big business, then we didn’t have a big business and that’s a failure that’s mine. And I guess the one that bothers me the most, which is neither of those two, although both of them bother me a lot, is the consequence of those kind of failures is loss in business. There are relationships that you set out to create and you fail to consummate and you leave behind loss and that’s something that -- that’s the hardest part of what this job is for me.
Question: What is an ethical dilemma you face?
Jeff Swartz: If you read our code of conduct, which is the rules by which other companies employ people on our behalf, so in China or Vietnam or in Portugal, if you want to make Timberland’s shoes in somebody else’s factory or apparel our code of conduct says we will not permit an employee to work… your employee to work more than 60… We will not allow you to have an employee of yours work more than 60 hours during a work week, any consecutive work week. Now if you read the codes of all our competitors, good companies, they say no more than 60 hours in any given work week, except at peak times because business is seasonal, right and so the problem with that is it’s hogwash because we have to define our terms, so since we’ve said peak time in haven’t said more, then if you want to work 120 hours in a factory six months out of the year just call it peak time. Now there is a dilemma boss because we pay more as a result. We have to have more people in the factory. We have to flex the factory up and down harder than the other guy does and the factory owners say to me you’re not doing the right thing. When we say you have to be 16 to work in a Timberland factory anywhere in the world, not our factory, but somebody else’s factory making our stuff. They say, but the law here says 15 and we say I heard you and if it sounds like the imperial American from New Hampshire you got to live with me fellows because I can’t live with me otherwise. We’ve done work on this. This is what we believe is right and so it’s not an ethical challenge in the sense of should we or shouldn’t we, but it plays out as like these guys aren’t easy to do business with or this insistence of a point of view creates tension and it’s real.
Question: What keeps you up at night?
Jeff Swartz: A clear sense of mortality and a deep sense of fear that for all the rhetoric I have very little to show for it.
Question: What is love?
Jeff Swartz: Love, the love of a father for his children is different than the love of a husband for his wife, of a congregant for his god, but I have the joy of all of those and it’s not like pornography, like I’ll tell you when I find it. It’s almost palpable. It’s almost sensory. There is an unconditionalness to the love that I pray would become the standard for the love of every parent for his or her child, not unconditional in a blind sense, but unconditional in it comes from an infinite place and it’s inexhaustible. The love of a husband for his wife is a mixture of awe and fear and joy and the love of the congregant for the divine is silent and stupefied and breathless and so overwhelming that it goes beyond words
Question: Who are you wearing?
Jeff Swartz: I’m wearing SmartWool socks. I’m wearing Timberland shoes and Timberland pants. You’re going to laugh because it was a New York day, so I’m wearing… Oh God. I’m wearing a Zinnia blazer. I know this is a Brioni shirt. Don’t laugh at me. My wife got it for me. And I’m wearing… These are some Danish kind of glasses. I don’t know who they are. I got a Red Sox hat here because we got to carry the colors and I’m wearing a watch that I don’t know what brand it is. I don’t even think it has a brand. It’s a cheap old watch, but it was given to me by a man whose son died when he was wearing it and so I don’t know what brand it is, but he asked me to wear it to remember the sacrifice that others make so that we can be free.
Recorded on September 21, 2009
A conversation with the CEO of Timberland.
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