RH's CEO holds 10-hour 'adventures' with execs and says 'I don’t yell at people—I yell at the problem'



GettyImages 1321777215 e1717868939687

RH CEO Gary Friedman has long been known for his soaring rhetoric in the luxury furniture retailer’s quarterly earnings reports and more recently for his stark warnings about the economy and housing market.

But a weekend New York Times profile highlighted some of his management habits, including his aversion to meetings and preference for “adventures” with groups of executives that resemble meetings but can last 10 hours or more.

He acknowledged that his vision for RH spooks Wall Street while refusing to hold back on his expansive ambitions, which go well beyond the typical earnings and revenue forecasts that analysts are used to dealing with.

“But our vision is to create an endless reflection of hope, inspiration and love that will ignite the human spirit and change the world,” Friedman, who became CEO in 2001, told the Times.

RH, formerly known as Restoration Hardware, was a favorite on Wall Street when shares soared during the early stages of the pandemic as remote work and rock-bottom mortgage rates sparked a housing and renovation boom that boosted furniture sales.

Even before the pandemic, RH caught the attention of Warren Buffett, whose Berkshire Hathaway conglomerate began buying shares in 2019.

But then the Federal Reserve began hiking rates in 2022, sending borrowing costs higher and putting the housing market into a deep freeze. RH stock tumbled, falling more than 70% from its early 2021 peak to its 2022 low, and Berkshire then sold off its entire stake in 2023.

Still, Friedman remains ambitious, opening more RH retail “galleries” while expanding into branded hotels and furnished homes that the company would sell as well as manage.

As he forges ahead with his grand plans, his team is expected to be fully committed to the company’s culture.

RH’s annual leadership meetings once included a ceremony that required executives to promise to “continuously destroy my own reality to create tomorrow’s future” and explain how they may have failed, according to the Times. That was later replaced by the “Daily Values Adventure,” which asks participants to “share a time when your ego got in the way of finding a better way.”

Friedman dismissed RH’s low scores from employees on sites like Comparably, saying many have worked at the company for years and even some who left eventually returned. But he also admitted that he has a tendency to lash out at subordinates who miss their goals.

“Generally, I don’t yell at people—I yell at the problem,” he told the Times. “If you step in front of the problem and defend the problem, you might feel attacked.”

In fact, Friedman’s management style has earned him the nickname “The Sun” from some executives—offering warmth on good days and burning heat on bad ones, the Times said.



Source link

About The Author

Scroll to Top