Cover Story
No fear
How Steve Klingel drives the culture at NCCI Holdings by not being afraid to make mistakes
By Mark Scott
Smart Business Broward/Palm Beach | April 2008
Steve Klingel had no idea just how much buzz he could create
in his company simply by wearing a pair of jeans to the office.
While casual Friday had been around for nearly two years,
Klingel, the president and CEO, had never actually joined in the
ritual carried out by many of his employees at NCCI Holdings
Inc.
“I got to work and 20 minutes later, my New York office head
calls me and says, ‘Hey, I heard,’ and I said, ‘What?’ He said, ‘It’s
all abuzz up here. You’re wearing jeans today.’ It’s amazing how
the behavior and the way a CEO presents himself gets around,
for good or bad.”
Fortunately for Klingel, his influence on the operations at NCCI
and the 1,000 employees he leads stretches beyond fashion.
As the nation’s oldest and largest provider of statistics and employee injury data for workers’ compensation insurance, NCCI handles
about 4.2 million unit statistical reports and 2.6 million policies each
year.
The sheer volume of data that is processed could easily lead to a
fear of mistakes. So Klingel decided the best way to ease such
fears was to purposely put himself front and center, this time as an
employee who has been far from perfect in his professional career.
It was at a meeting with about 175 company managers held at a
local hotel.
“I dragged a stool up on stage, and I sat down, and I started talking about my views on leadership, and I also talked about my own
personal evolution in management,” Klingel says. “I made a point
of listing three to five significant errors I made as a manager and
what I learned from that. My point was No. 1, CEOs make mistakes, too, and No. 2, you can learn from them. We’re not running
an organization where it’s an absolute failure to make a mistake.”
Just as he inadvertently got people talking by wearing jeans,
Klingel made a clear impression by admitting that he has made
mistakes in his career.
“Good judgment comes from experience, but experience comes
from poor judgment,” Klingel says. “You have to have room to make
mistakes if you’re ever going to learn how to do things best. That was
my point to the employees: Hey, I’ve made my share of blunders, some
of them big and some of them small, but I learned from them. We have
to have an organization where we allow people to try things and to
stretch themselves and to make an error and learn from it.”
Klingel says a big reason why the $140 million company has succeeded is its ability to maintain a culture in which employees feel
that their work truly matters and that their voices will be heard by
the company’s leadership.
Here’s how he did it.
Give them the chance
Delegation is critical to getting employees both engaged in your
plan and active in its execution.
“If I can truly give people the responsibility and authority — whatever that particular assignment is — to truly own it, they will buy in
to the culture and the mission and the direction of the company,”
Klingel says.
“It’s the difference of giving someone an assignment and saying,
‘I want you to do this, and here are the 37 steps you need to go
through exactly to do it right,’ or giving them the assignment and
saying, ‘Here it is. Figure out what you think is the best way to get
this done and feel free to come to me anytime if you’re wrestling with it or struggling with it.’ Giving them the chance to figure it out
is as much a key to getting them to buy in to the vision of the company as anything I can think of.”
If you expect your employees to feel empowered and driven to
succeed, you must support their development by being open to
fielding their questions rather than only issuing directives or being
secretive.
“I have always been direct in answering a question,” Klingel says.
“Sometimes, it’s a great question, but it’s not appropriate for me to give
you an answer on who I’m thinking about for the next senior staff promotion. I tell them I can’t tell them and I tell them why.
“It’s going back to that cultural aspect of how I behave. Do I discuss
things openly with employees? Do they ever have a reason to feel that
something is going on and I am not conveying to them what’s going
on or that I’m hiding something? That’s dangerous.”
You must also be willing to accept, within certain boundaries, the
way the person you delegate chooses to complete the task if they
are to truly grow in your organization.
“Most of us became managers the first time because we tended
to be great individual contributors,” Klingel says. “We got our work
done so well, and we’re known as being really good at it, and suddenly, we’re a manager. Now, the job isn’t about getting my own
work done anymore or doing it myself. Now, it’s all about motivating others to get the work done. That is the essence of delegation.
“I know this particular task, and if I did it myself, I could do it
faster and better. But the job of a manager is to coach others to
build those skills and to accept their work as long as it is adequately done. The job isn’t to make sure all the output from your
department is as good as it possibly could be if you did it all yourself. True delegation is being willing to appropriately accept the
performance of others instead of thinking, ‘How does it match up
to myself?’”
Klingel put his delegating skills to the test in his second year at
NCCI when he appointed Chief Communications Officer Cheryl
Budd to head up a major annual event held each year in Orlando,
Fla.
“When I got here, having never been through it before, I had my
fingers all over it trying to understand how to make decisions,
what do we do and how does it work,” Klingel says. “After being
through it once, it was very clear to me that I was in much better
hands if I just backed out of it and let Cheryl, who had plenty of
experience and had delivered, put the thing together and operate
it.”
The event ran without a hitch.
“It’s assessing each situation and determining what is the issue at
hand, what are the person’s capabilities, what are the risks for the
company and then making the delegation,” Klingel says. “They
tend to relish it and run with it.”
Focus on teams
Klingel believes in a culture where employees are empowered to
play a key role in the growth of the company. But he says the control he has over his company’s culture is limited.
“I would not use the word manage or control,” Klingel says. “I
would use the word influence because I think that’s the most that
a CEO can do is influence the culture. The culture happens by
watching behaviors among the management team and consequences of how the corporation deals with things.”
Teams are a big part of NCCI’s culture and go a long way toward
keeping the culture healthy.
“My senior staff team, as I get them convinced and involved at
the same passionate level, then they carry it down through the
organization,” Klingel says. “Bill George, who was the former
chairman of Medtronic, wrote a book called, ‘Authentic
Leadership.’ He said, ‘Get the right people onto your direct team,
and then inspire them and build a level of trust with them that
everybody is viewing the world the same and speaking in the same
way about the direction of the company.’”
One of the mistakes leaders often make in building a team is trying to assemble people who think just like they do.
“You want people that are going to look at things differently,”
Klingel says. “That’s where you get the best quality of decision-making in that senior leadership team. It’s not right for me to think
I have all of the answers and that if I have people understand what
I’m saying and march to my orders, it’s all going to be great. I know
that there is so much going on that I don’t fully contemplate and
consider. I need that team to be out there constantly evaluating
with me our environment, our strategies, our tactics and what we
need to do next.”
Don’t get lazy
As a company experiences success, it is important to take steps
to ensure that complacency does not set in.
Klingel says he likes to focus on consistent gradual improvement
as opposed to radical change.
“I find employees can grab that and understand it and handle it
as opposed to revolutionary change to light things up,” Klingel
says. “I’m in an insurance industry. They are not known for rapid
change and creative innovation. ... It’s both having a vision of where
you are trying to go and constantly testing that vision and constantly communicating back and forth with the organization what it is
you are doing and what are the goals and how you are doing with
the goals.”
Klingel says when revolutionary change becomes a characteristic, it does attract people who love constant change and constant
exposure to new things. But in a culture that values integrity and
excellence and quality, Klingel says it doesn’t fit.
“We’re not trying to drive ever-increasing profits in our organization,” Klingel says. “That’s not what we’re all about. We’re trying to
make sure that we’re doing our job as accurately and deliberately as
we possibly can. ... Sometimes, a significant revolutionary change is
healthy for an organization, and it gets people energized. But change
for change sake is not a big play in my book.”
By maintaining open lines of communication and staying in
touch with your employees, you increase your chances of avoiding
complacency.
“You have to always have your antennae up,” Klingel says. “You
always have to be asking, ‘What’s after us? What’s out there to bite
me?’ I don’t express that as a paranoia type of thing. But you have
to be conscious and never take anything for granted. What are we
going to do next year?”
The key to leadership is seeing the big picture and getting people
to follow along.
“You can only be a leader if people are willing to follow your lead,”
Klingel says. “A leader is an architect who sees their operation in multiple dimensions and looks at the financial situation, the strategic situation, where your employees are at, where technology fits in and
where the community is at. It’s an environment of constant adjusting.
For me, a true leader is somebody that is a visionary, a communicator
and an adapter.” <<
HOW TO REACH: NCCI Holdings Inc., (561) 893-1000 or www.ncciholdings.com
