Sports Direct: A catalogue of failures?

We’ve all been there. We’ve dragged our feet under the giant red, white and blue sign, collapsed through the doors and entered the maze of unfolded clothes and crammed in ‘99% OFF’ offers that is, in a nutshell, Sports Direct.

Its boss Mike Ashley eventually mustered up the courage to appear before the Commons Business Select Committee, having initially called it a ‘joke’. He was there to “defend Sports Direct’s good name”, in his own words, against a catalogue of serious allegations at its Shirebrook warehouse.

Ashley was under the spotlight, in the firing seat and he really was stripped bare. The defiant Mike Ashley that we have all come to know was present in the first 10 minutes of the session, but gradually over the next 80 minutes, this farce disappeared and we saw a sensitive, nervous, rather fearful side to him.

“we saw a sensitive, nervous, fearful side to mike ashley”

And he certainly had a right to be nervous. In November 2015, the Guardian sent two undercover reporters into the firm’s Derbyshire warehouse and found that workers:

  • Had 15 minutes of pay deducted for clocking in just one minute late for a shift, even if they arrived on site promptly.
  • Had to undergo compulsory rigorous security checks at the end of their shifts, after they had clocked out. These could become ‘bottlenecks’ and therefore take around 15 minutes, equalling 1 hour 15 minutes unpaid work every week.
  • Therefore received an effective rate of about £6.50 an hour as opposed to the minimum wage at the time of £6.70.
  • Had to conform to a six-month time-span ‘six strikes and you’re out’ policy, although these strikes could be issued for reasons such as “excessive/long toilet breaks” or a “period of reported sickness” – this allegedly led to a worker giving birth in a toilet at the site.
  • Were banned from wearing 802 individual clothing brands at work.

An earlier BBC investigation also found that ambulances had been called out to the warehouse 76 times in two years, where 36 of the cases were classified as “life-threatening”. Yet, when questioned about this by MPs, Ashley said that ambulances were being called out for trivial reasons.

The conditions that workers at the Shirebrook warehouse have undergone are undoubtedly awful, and described by the trade union Unite as “Dickensian”, but they are just a consequence of a much wider problem within Sports Direct.

The firm has exploded in growth, flowing with the tide of the modern globalised world, but its own management has failed to keep up. As Ashley conceded, the firm is “just too big” and had “probably” outgrown its ability to run itself. Indeed, he admitted “it’s like going out one day and you’ve got a tiny little inflatable, and you’re in control. And the next, you wake up one morning and you’re on an oil tanker”.

“Sports Direct is just too big” – founder

Yet, Ashley admitting defeat has been a long time coming. Sports Direct may be bathing in billions, but its managerial structure is simply no longer functional: the shop floor staff have lost sight of the customers, their managers have lost sight of the staff, and the boss has lost sight of the firm in its entirety.

A member of staff at a Sports Direct retail store assured me that the leadership is “fairly adequate” and that “the warehouses are completely different” to the shops, but this isn’t the image that the man at the top of the chain describes.

When asked about the system of improvement being implemented at the firm, Ashley spoke of a review “that will never end”, a review that is currently being conducted by him. He invited independent investigators to assess the company from an impartial standpoint. Yet the fact that he didn’t do this in the first place suggests that there is something, or a number of things, that he wants to hide.

The system of feedback within the firm also appears to be shambolic. As Ashley put it: “Do we have procedures such as secret shoppers in place? Absolutely, yes. Do I see the results of those? No, not necessarily”.

So who does address the feedback from the review? “It’s filtered back to their head and then their head and then their head,” explained Ashley. This is a system at crisis point.

It is shocking how the management of what has grown into a global company can lose track of itself like this. It’s as if the superficial image of Sports Direct has grown with the ever-increasing pace of the world, but the real mechanics of the business are rusting in a dark room that was locked some decade ago.

Sports Direct is a catalogue of failures, and it comes down to the mindset of one particular individual. Mike Ashley, albeit incredibly respectable for his fundamental business acumen, lives in plausible denial, hungry for profit, seemingly uninterested in the way in which that profit machine operates. This, the absence of efficient structure and consequent moral tragedy of the warehouse and retail elements of the business, is the result.

Words by Ewan Somerville

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