Uh oh. Last week in business news, the board of The Men's Wearhouse fired their founder and long-time commercial spokesman George Zimmer.
For those who've lived on Mars over the last two decades, George Zimmer built a very successful business marketing suits to guys whose eyes bulged from sticker shock whenever they left a Brooks Brothers. Zimmer not only founded The Men's Wearhouse but served as its spokesman. His gravelly voice and winning charm sounded like the Everyman who shopped there.
While death and taxes are few of life's certainties, let me add a third. The Men's Wearhouse will soon regret removing their ace card from their branding. Firing George Zimmer from The Men's Warehouse is like benching Warren Buffett over at Berkshire Hathaway. As the pitch-perfect spokesman for his brand, losing Zimmer will remove the soul from The Men's Wearhouse brand.
I guarantee it.
Both sides have been coy about what led to the split, but a New York Times story hinted that Zimmer wanted to take the company private but the board rejected the cost of long-term debt. There were also differences of opinion on a number of subjects, including some of their subsidiaries and product lines. In the end, things came to a head and George Zimmer was sent packing.
In most cases, when a high-profile CEO is asked to leave, subtle arrangements are made so that bruised egos are preserved and hurt feelings are kept out of the public view. By all accounts, The Men's Wearhouse was a well-run operation that provided enduring value to customers and shareholders alike. The chain weathered the Great Recession reasonably well and took advantage of Nordstrom and Brooks Brothers shoppers who downshifted to cheaper prices.
However, when a high-profile leader integral to the branding is no longer around, it can be rough sailing for any organization. When Dave Thomas, the founder of Wendy's passed away, their branding tried -- often in vain -- to replicate the founder's straightforward charm. When Sara Lee, the current owner of Jimmy Dean Foods, chose to retire the founder as their spokesperson, sales fell like a rock until the former country music legend was asked to return. People loved the rural charm of Jimmy Dean as much as they liked his breakfast. When Martha Stewart exchanged cashmere for a prison jumpsuit, her empire encountered some rough shoals but it appears to be hanging on. Even though Harlan Sanders died in 1980, his Southern fried persona remains central to Kentucky Fried Chicken's branding.
Here is where The Men's Wearhouse is in big trouble. When companies choose to retire or remove the person central to their branding, they had better have alternative plans at the ready so that customers are able to reconnect. There is a big hole over at the headquarters of The Men's Wearhouse now that Zimmer is gone. All senior management has is the faint hope that Zimmer will change his mind, swallow his pride, and return to the camera. However, don't bet on it. If he were to return, every ad would remind the core customer that The Men's Wearhouse threw their popular founder, George Zimmer, under the bus. Good luck.
However, I have also seen other situations where a founder or long-time CEO, central to the branding, collides with an exasperated board. It all comes down to the equity position of the founder. George Zimmer might have started The Men's Wearhouse as a college student but only owned 3.1 percent of the company. It's a weak hand to play when you offer an ultimatum to your board.
This is not the first time that a founder got into trouble with a board of directors. In the mid 1990s, Carl's Jr. founder and then-CEO Carl Karcher was asked to leave the fast food empire that he built from a mobile hot dog stand. However when you walk into any Carl's Jr. location today, they are shrines to the hard work of Carl and his wife, complete with a photo of both and a mural of that first hot dog stand. The moment of past unpleasantness is papered over in the brand's official history.
Both Carl's Jr. and Kentucky Fried Chicken were very strategic in how they handled their situations with their founders. By paying Sanders and Karcher to remain as the faces of the brands (and owning their images into perpetuity), it strengthened their branding and silenced both as potential critics. Both Karcher and Sanders expressed private criticism that their restaurants were not living up to their own standards but were smart enough to keep their thoughts out of the public eye. They had their own legacy to burnish -- preserving their brands as long-term juggernauts designed to even outlast them.
That is the lesson that board members at The Men's Wearhouse should have considered before consigning their founder to the return bin. In the short-term, their financials may hum along in the short term as a legacy of a well-run operation. However, considering The Men's Wearhouse without George Zimmer is like thinking about Wendy's without David Thomas or KFC without Colonel Sanders. George Zimmer, as the pitchman, served as the person who stood at the door and communicated the value story in a way their core customer embraced. How they do that now -- without their ace card -- remains to be seen.