How Dragons Den star Theo Paphitis motivates his staff

He may well be a famous Dragon from the BBC's series Dragons Den, but Theo Paphitis's day job is as a successful retail entrepreneur, buying and then turning round failing retail brands such as Ryman, La Senza, Partners and Contessa. In a revealing interview in Retail Week he shares a number of his secrets, a key one being staff morale and staff motivation, and how it helped him change a business for the better.

Theo shares a common philosophy about retail, with Sir Terry Leahy from Tesco - the staff have the answers.

When Theo took over Rymans, he adopted a very personal approach by insisting he was called by his first name, readily mixing with the staff at all levels and going to the pub for a drink with staff. This was something that had been completely alien to the staff with the previous management, and it had an immediate impact. "Once word got about that I was approachable and would listen, I was pleasantly surprised to be receiving some incredible information about the business" said Theo. He had a good idea what need to be done with Rymans, but he was getting the staff to endorse his thoughts and at the same time give him new ideas. Straight away he was giving the staff the feeling of empowerment.

Then he went about investing in some areas that all staff hold dear - the canteen and staff rooms. He simply purchased microwaves for the staff rooms and paid for all their tea and coffee. Little things I know, but staff everywhere do appreciate being thought of, and for Theo, it started the winning the staff over. It obviously worked, and combined with his other strategies for the business, he turned an £8million loss into an £800k profit. He was very complimentary about the staff he had motivated, "by making sure the staff feel they are the most important people in the business, it answers the natural question about the customer - because they feel good, they will undoubtedly give the customer good service"

His ethos comes across as being simple and obvious - the KISS method (Keep It Simple Stupid) is his mantra. This is surely a lesson for companies who keep talking about retention and morale problems -  they should start by making the staff feel that they are the most important people in the business and I am sure they will be surprised by the outcome!