Growth
On the fast track
How Chuck Hallberg managed 20,000 percent growth in three years
By Megan Tackett
Smart Business Cleveland | October 2008
When Chuck Hallberg founded MemberHealth LLC in 1998, the company was barely treading.
“At one point, we owed vendors 11 months of payables,” Hallberg says.
But Hallberg learned an essential business lesson from that period: always be honest. “We told everybody everything all of the time,”
he says.
By being honest and paying as he could, he dug out. Ten years later, MemberHealth has skyrocketed to become one of the top pharmacy benefits providers and took the No. 1 spot on the Inc. 500 list in 2007 after growing revenues more than 20,000 percent over three
years. In September 2007, Universal American Corp. bought MemberHealth for about $630 million.
At the recent Smart Business Live luncheon, Hallberg spoke about how growth can be your best friend or it can kill you, and to save
yourself from spiraling out of control, he recommends knowing the who, what and how of your business plan.
The who
In 2006, Hallberg had to more than double his staff by taking on an additional 500 employees in a one-month period. Usually, his hiring process was long and complex to ensure they’d be a good fit with the company, but he didn’t have that luxury this time.
Rather than risk a cultural shake-up by hiring the wrong people in a panic, he brought in temporary workers.
“As we saw the ones that were really spectacular, those we converted to permanent people,” he says.
With these new people, Hallberg found the perfect job for the employee, rather than the other way around.
“We would actually modify jobs to fit a hire,” he says. “When we saw a candidate who was an outstanding candidate, we would modify what we thought we wanted to hire for in order to capitalize on the strengths of that particular person.”
The same can be done with a company veteran. As the business evolves, people’s responsibilities evolve with it. As the leader, set
benchmarks to monitor employees’ work. If people struggle, catch it early and work with them.
“Maximize their strengths and minimize their weaknesses,” he says.
The what
When managing growth, you may have a plan, but everyone needs to know what he or she is doing, so meetings have to be direct,
effective and clear up any confusion.
“You’ve got to have agendas,” Hallberg says. “If you walk out of a meeting, and you don’t have a chart that says who’s responsible for
what, then you haven’t done justice to the opportunity of a meeting.”
That list also needs to include the timeline of each person’s task and how they will accomplish it. That way, at the next meeting, you
can follow up with every person about the details of each task.
To make sure information is flowing even when there’s not a meeting, each day at MemberHealth starts with team huddles. It lasts
about 10 minutes and ensures that everybody communicates their goals and needs to their fellow team members.
Huddles comprise two topics — the “No. 1” and the “What’s up.” The former involves each person in the huddle articulating their top
priority for the day. The latter is an opportunity to report business updates, including the bad news.
“We go right through the line,” Hallberg says. “We write this up on a whiteboard every day, and whatever your No. 1 is today, you
should be able to report tomorrow that it was done. And if it wasn’t, and you’ve got your No. 1 sitting on the board for several days,
‘OK, what gives?’ Your associates — your team members — need to know both the good news and the bad news about what’s going
on.”
The how
More important than the plan is following through on it.
“Generally speaking, people get the concept of what it is they’re supposed to do, but they often flounder when it comes time to execute the plan,” Hallberg says.
That may be because the plan wasn’t detailed enough, but more often, it’s because the plan is outdated.
“You really have to be willing to understand that you have to take a completely fresh look at everything that you’re doing and completely open it up again,” he says. Otherwise, your company will outgrow your plan. And at that point, growth is no longer helping your
company — it’s killing it.
“Great ideas are interesting, but one of the things that my people hear from me all the time is, ‘It ain’t about the idea; it’s about the
execution of the idea,’” Hallberg says. “Growth is the tangible evidence of a successful execution. It’s the product of working hard and,
most importantly, working smart.”
HOW TO REACH: MemberHealth LLC, (866) 684-5353 or www.mhrx.com
