Most Recent Articles In Business Features
Latest Business Features Articles
- Bogner No Longer Up for Sale
- NYC Fashion Production Fund Awards Six Loans
- Creative New York Report Sizes Up New York City’s Creative Class
More Articles By
Eric Wiseman doesn’t want executives at VF Corp. spending too much time in the office.
Wiseman, chairman, president and chief executive officer of VF, opened the WWD Apparel & Retail CEO Summit with a presentation on “Transformation: Learning from the Past, Living in the Future” in which he described a VF mandate dating back to the 2010 initiation of its push for innovation.
Executives are sent on periodic “transformational intellectual journeys,” as Wiseman called them, to expose them to a variety of developments, ranging from the cultural to the highly scientific.
The destinations often have been well outside VF’s historic comfort zones in areas including lifestyle apparel and supply-chain dynamics.
“We have 1,200 retail stores,” he noted, “but what do we know about lighting? How do we know how to spotlight the story we want to tell that day? We don’t. Who does? Broadway theater lighting specialists, so we had a whole session with Broadway theater lighting specialists about how to bring light to our stories in our stores.”
A trip to the UCLA Botanical Garden, intended to educate VF executives on biomimicry, exposed officials to a plant that withstands desert fires. Officials from the Bulwark unit, which specializes in fire-retardant apparel, now have botanists and other scientists studying the composition of the plant and how it might enhance the fire-resistant traits of Bulwark apparel.
“We don’t have any expectations when we do these things other than that they should be, at a minimum, interesting,” the ceo said, adding that “little examples” of their value, like the one at UCLA, “happen all the time.”
RELATED STORY: VF Earnings Rise 13.8% >>
Groups of VF executives have also met with Robert Redford and other organizers of the Sundance Film Festival “to improve our storytelling skills,” he said, and with experts from Stanford University’s Virtual Human Interaction Lab, Pixar and Industrial Light & Magic to increase their understanding of how digital technologies can enhance the consumer’s shopping experience.
They’ve also been enlightened by West Point generals and basketball coaches from the National Collegiate Athletic Association, as well as from Internet standouts Facebook and Google.
“There are 70 [examples] to choose from,” he said. “I chose eight, and that’s all in the last three years.”
Wiseman emphasized the need to bring in new talent to best deploy more recent technologies, pausing to contemplate how ill-advised the company would be to have someone like himself managing comments on the Vans brand’s Web site.
Still, he noted, “we need to get more innovative with our existing talent because these are the guys who are critical to our future and they have the experience to run our company today. We invest millions of dollars annually just to expose our mature leaders to new ways of thinking.”
Later, he noted, “At VF, we’re not arrogant enough to think we know what tomorrow will bring, but we are curious enough to expose ourselves to lots of opportunities. Hopefully, that will nest us in a place where we’re prepared for whatever tomorrow brings.”
He challenged attendees to take the same approach: “As leaders, I think our most important job is preparing our organizations and the only way to do that is by preparing our people to survive and thrive in a changing tomorrow.”
The pace of change is quickening, he cautioned, pointing out that some of the essential tools of marketing and merchandising today — from Facebook to smartphones — have all come about in the last decade.
“The reality is that this technology shift is huge and it’s a big iceberg and it’s coming at us,” he said. “It is not an evolution. This is a communications and technology revolution and we are just on the front side of it.”
During his spirited talk, punctuated with his usual assortment of quips and self-effacing remarks, Wiseman described how VF has added over $100 million to its spending on technology in recent years, a 50 percent increase over previous levels.
The Greensboro, N.C.-based firm, the largest U.S.-based apparel marketer, posted $10.9 billion in revenues last year and is seeking to reach $17.3 billion in 2017. Eighty percent of the growth is expected to be organic, with the remainder coming from acquisitions.
VF’s embrace of technical innovation was reinforced this summer when it unveiled plans to develop three innovation centers — one each for technical apparel, footwear and jeans — to be located near, but not within, the respective offices of its North Face unit in Alameda, Calif., Timberland business in Stratham, N.H., and Wrangler brand in Greensboro. The separation from existing operations was advisable, he noted, so as not to ensnare the scientists, engineers and researchers in the day-to-day operations of the company, in which progress on a project can be interrupted by upcoming trade shows or market weeks.
“Their objective,” he said, “is greatness…to not ever get distracted from finding something that’s really a breakthrough in the industry.”
As in August, when the plan was revealed, Wiseman wasn’t prepared to discuss a budget for it. “It’s going to cost a lot of money. We hope it works,” he said.
Wiseman couched his remarks about VF’s future with tales about its past, including its unsuccessful beginnings as a glove company, its transition into intimate apparel in the early years of the 20th century and then its acquisition of Lee in 1969 and the purchase of Blue Bell, including Wrangler, in 1986.
But the growth afforded by jeanswear came to a halt in the early part of the current century. “We were stuck,” Wiseman said of a period in which both top- and bottom-line expansion ended. The question, he noted, became not so much how to be bigger, but “how do we get different.”
Beginning with the 2000 acquisition of The North Face, a highly popular brand among outdoor enthusiasts but a “flat-out broken business” at the time of its purchase, the company opted to focus on “activity-based lifestyle brands,” according to Wiseman. “At the time, if you think about us then, we were great operators but we were really conservative and we were risk-adverse.”
VF’s operational skills included its ability to heal the ailing. “We also knew how to turn around an underperforming business,” the ceo noted. This knowledge proved valuable when The North Face registered $100 million in operating losses the year it was acquired.
With a portfolio made up of three of VF’s five “billion-dollar brands” — The North Face, Timberland and Vans — VF’s outdoor and action sports coalition accounted for nearly 60 percent of corporate revenues in the company’s third quarter ended Sept. 28. It is expected to account for $11 billion of the company’s projected $17.3 billion in 2017 revenues, or 63.9 percent of the total.
Yet for all its diversification and even the divestiture of its legacy intimate apparel business in 2007, Wiseman said he’s frustrated that many people continue to refer to the company as “Vanity Fair,” which ceased being the corporate name in 1969 upon the acquisition of Lee.
“Some of you still refer to us as Vanity Fair. Please stop,” he said, drawing the first laugh at the summit Monday. “You’ve had 44 years to figure out that we’re VF Corp.”