The president and CEO of Broad River Retail, a licensed Ashley Furniture retailer, led the company from near-bankruptcy to a remarkable turnaround through a people-centric, abundance mindset.

Charlie Malouf’s statement early in his conversation with Chris Benguhe sets the tone for his exclusive interview for the Dave Alexander Center for Social Capital: “I’m surrounded by some amazing people, and business is more fun when you make it about people and about lifting others up.” And he shares the remarkable story of how he came to apply that attitude toward business.

Charlie, president and CEO of Broad River Retail, a licensed Ashley Furniture retailer, discusses how his company’s near-bankruptcy experience in 2015 transformed their approach to business. Rather than cutting costs and reducing headcount, he invested more in his people by creating clear career paths, incentives and elevated titles for his sales associates. This “human capital” focus, versus a traditional “human resources” mindset, empowered his team and led to a remarkable turnaround and growth for the company.

“Our purpose statement is, “Furnishing Life’s Best Memories,’” he says. “But the way we like to think about it is outwardly focused. So, we like to think of it as ‘Furnishing Life’s Best Memories … for others.’ For other people.” And by “other people,” Charlie means employees — whom he calls “our own memory makers” — and their families as well as customers and partners. “Because it’s not a zero-sum game; it’s a spirit of abundance, a mutual prosperity — and we want a healthy ecosystem for our neighbors, for our community, for our planet, for our friends in the industry, and for other organizations whom we get to support.”

Charlie emphasizes the importance of building an organizational culture through consistent daily practices, not quick fixes, while embracing that abundance mindset which prioritizes the success of all stakeholders.

Talking about the Broad River way of doing business, Charlie says, “We like to say, ‘Love is acting in the long-term best interest of another.’ And so, if you don’t trust us today, well, give us time and hopefully we’ll prove that you can trust us. We’ll prove that you can trust us by the decisions we make in your best interest over a long period of time.”

Consistent actions over time, he emphasizes, is how culture is built. And it can’t be a “one and done,” as Charlie explains, “We’ve got to be mindful of our organizational culture as a company, and we do pulse surveys and engagement surveys to do that. But also, we’ve got 36 unique locations and we’ve got to mine the culture of each of those locations all the time, at any given moment in time, and make sure they’re synchronized and synced up and everyone’s reading from the same playbook.”

He likens his approach to the concept of compound interest in banking. “We just take the power of compound interest, or the power of compounding, and we apply that to other aspects: culture building, learning, growing, developing, personal development. And so it’s that whole ‘consistency over intensity’ mindset.”

Charlie is open about the situation he faced when he took over as CEO of Broad River Retail: “Every day for 11 months, I basically had to wake up, put a smile on my face, not show fear to our people, and there was a gun pointed to my head. Because the bank could have just pulled the trigger if we sniffed the wrong way; if they woke up on the wrong side of the bed, we could have gone away. That’s how tense it was, how close it was to the line for several months.”

So, why does he call that the “greatest thing that ever happened to us”?

Because he decided, “Hey, if we’re going down, we’re going to go down the right way, swinging, where we have nothing left to lose.”

Charlie explains that, since nothing in the old ways of operating was working, he changed everything. Importantly, this included the HR attitude toward human capital. Recognizing that people want to grow, to be recognized, to be celebrated, he created something unheard of in the industry: career paths on the sales commission level. It was a mindset shift, he emphasizes: Instead of a liability on the balance sheet that HR would try to minimize, it becomes capital — which businesses want to grow.

So, contrary to conventional wisdom, Charlie says, “We gave everyone a raise on the sales floor by paying them commission on a category that we had never paid commission on because it was a no-margin category” because he felt “We’ve cost them money by how we’ve lost sales and broken promises in the first six months.”

The result: “The more we’ve invested and compensated and celebrated our people, a crazy thing has happened — the better we have done, the better our performance has done. And our performance has grown beyond our wildest dreams. Our profitability has grown beyond our wildest dreams. Our growth of our company has gone beyond our wildest dreams.”

It’s exciting to hear him talk about what he calls “the great experiment.” “It was never a ‘Woe is me. Why is this happening to us?’ It’s, like, ‘Hey, this is happening to us and we get a chance to be unbounded by our previous limitations.”

And Charlie took the new mindset to other operations of the company, transforming service, delivery and the company’s brand in ways that upended conventional wisdom.

Charlie is clear that he sees his company’s success as having an even broader impact, “It’s just the whole ecosystem,” he says. “You get to be a role model that others will emulate and learn from.”

As he makes a comparison to “sitting in the shade of trees that I didn’t plant,” Charlie expresses his belief that it’s important to “think generationally and be legacy-minded and think long-term – and be planting seeds for long-term growth and opportunities for the trees that will sprout, that will be providing the shade for people who come after us. Just like people have done for us in our own lives and in our business careers.”

Click on the link below to hear Charlie talk about transforming to this people-centric, mutual prosperity approach that has driven Broad River Retail’s remarkable performance.