(difficult) rung is assistant department manager. This is a training slot
where an aspiring salesperson often requests, on top of normal duties, that
they take over certain paperwork and begin to learn the ropes of being a
department manager. There is no economic reward for this extra work.
Sales personnel in this position are paid a small stipend but the wage
increase involved does not offset the loss of commissions from selling.
Given these disincentives, why would a salesperson want to be a
manager? In fact, Nordstrom wishes to avoid the trap of many corpora-
tions that force their most productive employees into management in order
to earn more or to be seen as successful. At Nordstrom, status clearly does
not correlate with hierarchical position and pay grade. Paywise, a store
manager at Nordstrom earns about as much as the store’s most successful
sales personnel. Only those employees who really itch to manage clear the
assistant manager hurdle. It is a kind of trial by fire that truly tests com-
mitment. For those that persevere (and who, while doing so, are adept at
pleasing customers and getting their departmental sales people to play as
a winning team) Nordstrom becomes, in the words of one, ‘a high speed
vehicle to the top’. It is not unusual at Nordstrom to be a store manager in
one’s late 20s and a regional manager by mid-30s. Nordstrom’s four co-
presidents range in age from 36 to 50 years old; the average is 43. For the
individuals who self-select onto this track, few think twice about the long
hours, seven-day work weeks, and the geographic dislocations that are
required.
As a department manager, one truly feels in charge of one’s own busi-
ness, with responsibility for co-hiring sales personnel (the store manager
also conducts interviews), setting budgets, sales targets, and making and
influencing buying decisions that range from complete to partial control, as
noted earlier. In effect, Nordstrom says to its department managers, ‘We’re
loaning you this business. You can rise as far and as fast as you can grow
it.’ ‘Because of the high degree of delegation,’ one manager stated, ‘It really
feels like it’s yours. It inspires and motivates. How often do you have
people in companies say: “If this were mybusiness I could really make a lot
of money.” Well, at Nordstrom they get out of your way and let that
happen.’^25 Department managers receive compensation based on three
components – base salary, commissions on own sales, and a bonus that is
1 per cent of sales increases of their department over the previous year.
Enter the buyer: buyers spend at least one day a week on the floor of the
departments for which they do the buying. The result of their close
working contact with the sales personnel permits Nordstrom to react much
faster to consumer trends and to spot when shoppers are flush or trading
down. While department managers officially report to the store manager,
they are incented to work very closely with the buyer. The fates of the two
are linked since they are given bonuses based on sales increases over the
previous year. One former department manager states: ‘At Nordstrom, the
392 Relationship Marketing