Commentary: Entrepreneurs, think creatively

I founded Crutchfield Corp. 52 years ago. Looking back over those many years, I see a unique factor which led to my success: It is my willingness to think unconventionally. More precisely, it is my willingness to think unconventionally when I invented and, later, when I reinvented my business.

In 1974, I founded a car audio mail order company in my mother’s basement with only $1,000 in capital and a $25,000 bank loan. As with most startups, the teething pains were tough until I found a viable niche. It was a totally unique type of catalog. At the time, one of the “best practices” in the mail order industry was that every square inch of a catalog should be devoted to selling space. I violated that best practice by inventing what is now known as the magalog, a hybrid between a magazine and a catalog. Besides the presentation of products, it provided the informational content that my shoppers needed. This new catalog format, complemented by strong support services, led to six years of soaring sales.

In 1982, sales slowed. The next year, they contracted and led to my company’s only operating loss in our 52-year history. Experts gave me all the traditional advice like cutting prices to compete with our less service-oriented competitors, lowering expenses by reducing our support services, and replacing myself with a “professional” CEO. I looked for a more unconventional solution.

In the early years, I answered sales calls, packed orders, ensured that those orders were shipped immediately, and quickly resolved customer problems. However, as the company grew, I delegated these functions to my growing workforce. Because of this delegation, my frontline people were not treating our customers with the respect which I had shown them. That was the problem.

My solution was the creation of a strong organizational culture which aligned with my behavior. To accomplish it, I created a set of core values centered around treating customers, employees and business partners with an exceptionally high level of respect. Initially, I inculcated these values into my existing employees. Since then, we have hired and trained new employees based on our core values. This unconventional solution worked. Sales and earnings grew tremendously over the ensuing years.

An example of a highly consequential reinvention was in early 1995 when I created a “skunkworks” to develop a website. At the time, few people knew about the internet and its potential for commerce. Several prominent business executives told me that I was crazy since they believed that no one would ever buy consumer products using a personal computer. Nevertheless, I launched this “crazy” initiative. Doing so transformed my company from a small catalog to a large online retailer.

These are only two examples of my unconventional thinking. Over the past 52 years, I have successfully applied this practice to countless other situations. I am not alone in thinking this way. One of the world’s most transformative entrepreneurs was Steve Jobs. When he returned to Apple in 1997 (after being fired in 1985), Jobs put signs up throughout the company which read, “Think Different.” That different thinking propelled Apple from an almost bankrupt company to one of the world’s most valuable.

In conclusion, my recommendation to new entrepreneurs is to never resist thinking unconventionally when conditions dictate. And to never discount the need to professionally manage the business. Both unconventional thinking along with proven management practices are two of the major contributors which led to my success.

Bill Crutchfield is the founder and CEO of Crutchfield Corp., a consumer electronics retailer based in Charlottesville. The company has about 600 employees and approximately $400 million in annual sales.