Deborah Byers loves the word engagement — as in employee engagement — and the new managing partner of the EY Houston office will be focusing on it now more than ever as she takes the wheel at one of the corporation’s largest offices.
“What may happen in a big organization is that you have very strong connections within small pods — and that is great as long as those pods are all connected through somebody in a leadership role,” she says. “You have to bring all those smaller connections together so they have a common vision.
“You could end up with a lot of connectivity in smaller groups that are isolated and not talking to each other — and you are not going to be as effective. So to start in the right direction, the buy-in effort begins with having empathy to understand what the people in the office are concerned about,” Byers says.
“It’s about what makes them feel good about their jobs, or happy to come to work because a happy employee is going to be much more productive.”
While Byers has been with EY for 27 years, most recently as M&A managing partner for the Transaction Advisory Services Group for the Southwest Region, one of her initial steps has been to meet — or get reacquainted — with the movers and shakers of EY Houston.
One of the conclusions she has reached is that as a leader, it is your job to constantly refresh and remind everybody: “This is the vision; this is what we are all marching toward.”
“Then you relate it back to, if we achieve this vision, why it is good for you?” she says. “That is what people want to know: ‘How does this impact me personally at this level?’ One of the primary critiques of leadership is, ‘Oh, they are in their ivory tower. They don’t understand what is happening in the trenches,’ so you need to be able to connect the vision with how it will improve their day-to-day working lives in the trenches.
“Then you want to connect it back to what does it mean to build a better working world: ‘How does that impact me down here when I’ve got a deadline that I’ve got to meet in 24 hours, and there are not enough hours in the day to get it done?’” she says.
In an organization as large as EY Houston, with about 1,200 employees, parts are going to be moving fast but others may be falling back.
“Your job as a leader is to be connected enough to know when you need to go in and help them tweak things a little bit,” Byers says. “You’re not dictating, ‘Hey, go do this. You should be doing this.’ It’s, ‘Hey, you may be a little off track, so let’s do this, and let’s tweak this.’ And then it is not a matter of coming in and saying, ‘What are they doing wrong?’ It’s what are the barriers and finding ways to help them find a solution.
“And that is why it is so important to be connected,” she says. “While it is important to have these goals and visions and be connected with the broader leadership, you know EY is a huge organization in itself, but you have to connect that back and know what each team is doing, down to the engagement level.”
How to reach: EY Houston, (713) 750-1500 or www.ey.com
When Dana Sellers started Encore Health Resources with Ivo Nelson in 2009, they did it without office space. Four years later, they have an office, but no one actually works there on a daily basis. There’s no receptionist or office manager. There isn’t a single office for any of Encore’s employees, not even Sellers, the CEO. Rare activity can sometimes be seen on a Friday in the form of meetings, classes, orientation or interviews.
Despite its lack of office space, the health care consulting company of 400 employees had $90 million in revenue last year. Sounds a little far-fetched, doesn’t it?
Success like that, according to Sellers, is more likely to occur when you have a razor-sharp focus on strategy — called “smart skinny data” at Encore — and you have to embrace the concept of a virtual office in order for it to become the optimal way to operate.
For Sellers, once she determined the focus, the solution was right behind.
“The biggest problem that our clients need to solve is how to get value out of their data and our answer is a solution that lets them do that in a smart skinny way,” Sellers says. “Really, there is no reason these days, with technology, that you have to have an office. I don’t have any phone number besides my cell phone number. Why should we be held back by big, bulky offices that tie us down to one place?”
Not every business is a good fit for a virtual office, Sellers admits. Companies that deal with a niche, requiring talent from all over the nation, indeed, the globe, have a good shot.
“For our business, it was the only way we could do it,” Sellers says. “It just doesn’t make sense to move everyone into Houston and then have them fly somewhere every week anyway.
“We tell them, ‘Look, you can stay where you want, as long as you are willing to get up and get to an airport and be at your client’s site at a reasonable hour on Monday morning, and as long as you understand you’re not going to get home until really, really late Thursday night. You still work on Fridays — just by conference call.’
“In my business, to be virtual, you have to make a conscious effort to understand how you are going to engage people.
“And I’m really proud that we have been named to Modern Healthcare’s list of best places to work in health care every year that we have been eligible — and we are a virtual company!”
Here’s how Sellers drives Encore Health Resources to develop integral data management systems — virtually — to move the industry forward.
Focus, and then proceed
Sellers and Nelson had a vision when they started Encore and knew that if it were to include helping clients get value out of their data, they had to have replicable tools and assets, as well as ways of being able to help them with that problem. But they didn’t know what it was going to be, and they couldn’t invent it in a conference room — they didn’t have one.
Just as records are to be broken, challenges are to be surmounted. And Sellers was familiar with the health care IT business, having previously worked with Nelson in launching Healthlink, a health care IT consulting company.
Data was being collected and crunched but the outcomes and efficiencies were less than optimal. A breakthrough eventually came and an ingenious solution was reached involving only the most relevant information — smart skinny data.
With the focus now in hand, Encore proceeded to figure out the details.
Sellers had been given advice from Rod Canion, co-founder of Compaq Computer Corp., to hire great people for Encore. With that in mind, Sellers recruited passionate, self-directed people — 60 percent who were clinicians and 75 percent having worked in the health care industry in the past.
These were the types who could flourish in a virtual office setting.
Decide if virtual is for you
Once Sellers had the breakthrough, she could move on with her virtual company plans. She had seen how well Healthlink had worked with its two major locations, Charlotte and Houston. And another plus — the savings in overhead was returned to clients.
“We had merged two companies; we agreed that we weren’t going to relocate people so we had some over there, and some people in Houston,” Sellers says. “We figured out, ‘Hey, that works out pretty well. We didn’t have to have everybody in one office.’ So we began the process then, and over time, we became more and more virtual.
“When we started Encore, we went all the way. We said, ‘Why do we need an office? For training, for recruiting, to do interviews and we need an office to meet.’ But other than that, we only needed an office originally for our bank of servers. Well, at Encore, we don’t own a server. We run Outlook on the cloud; we have an email service. All our IT services are done in the cloud, and we have a virtual P.O. box.”
But there has to be a structure capable of keeping the invisible seams of the organization together. One such method Sellers uses is a company “lockdown.”
Encore consultants keep an eye out for procedures and discoveries that clients are seeing that would be good to share companywide.
“Lockdowns are very intensive; we bring them to Houston, and they will work on a specific topic for a week,” Sellers says. “For example, the concept of smart skinny data — how do we leverage that concept for an Epic software implementation [software for health care, including offerings such as MyChart].”
The lockdown group, which meets in a room for a week, includes people who understand the tools Encore has, who understand smart skinny data and who understand Epic implementation methodology.
“They will work morning to night; they will have a great time; they will laugh; they will work really hard; they will have fun,” Sellers says. “And when they get done, we will have an electronic document that is amazing, that tells a client, ‘Without slowing down an Epic implementation, here’s how you make sure you get the right data captured so that when you get done, you’re going to have all the quality data in the right format so that you can do all the reporting that you need, to make sure that you are capturing the right insurance reimbursement.’”
Be conscious that you are virtual
Without a doubt, within a sizeable company, virtual or not, there will be times when discussions have to be held with a large number of employees. Encore developed a learning portal on its website to offer several options to help deal with the situation.
“You don’t have to send out an email to all 400 people, but you can participate in a community and their wikis [websites that allow collaborative editing of content by their users],” Sellers says. “There are various ways of enhanced sharing of information that we have worked very hard to do well in a virtual environment.”
When Sellers realized there needed to be a process to keep employees up to date on new tools and methods, monthly “lunch and learns” were instituted. These are videoconferences with educational topics, which are recorded so they may be accessed on the Encore portal. For instance, a consultant on the road can stay up-to-date with training topics while relaxing in his or her hotel room.
It’s also important to involve the entire company in training exercises. Every 18 months or so, Sellers holds a retreat that includes team building and training exercises.
“That retreat is really important in a virtual world because it is where you come together and actually get to spend time with people,” she says.
The personal connection is also important to retain when there are grievances or problems. Sellers developed a virtual “open door” policy that may rival those of her non-virtual peers.
“We are very, very conscious that we are virtual, so we make sure we do a lot of things to keep people engaged,” she says.
“The policy is this: We will make certain that you are face-to-face, personally, with that person, whoever you reach out to, within two business days somewhere in the United States. We don’t guarantee where. You may have to fly to them, or maybe they will fly to you. We will figure it out. There won’t be any retribution; we don’t guarantee you’ll get the answer you want, but we will take your issue seriously and we will look into it, and we will follow up.” ●
- Focus on your goal and figure out how to proceed.
- Decide if a virtual office is for you.
- Be aware that you are virtual, and it takes effort.
The Sellers File
Name: Dana Sellers
Company: Encore Health Resources
Born: Austin, Texas
Education: University of Texas at Austin. I studied chemical engineering. I wandered into health care accidentally and I’ve been here ever since.
What was your first job?
I did an internship at IBM manufacturing typewriters.
Who do you admire in business?
There are a lot of people I admire. I probably would say I admire Ivo Nelson, whom I have worked for much of my career. I am blessed to have worked with so many great people, but if I had to pick one I would probably say Ivo.
What is the best advice you ever received?
When we were starting up the company that later became Healthlink, Rod Canion, co-founder of Compaq Computer Corp., said ‘First of all, you need to always, always deliver great quality to your clients. Secondly, you need to hire great people. And third, you need to create a company where they can raise their hands and ask for help.’ So, I have always tried to live by those three pieces of advice.
The first piece Rod said about always delivering quality, we phrase that as 100 percent reference ability. We have a set of core values, and one of those core values we call 100 percent reference ability. Our goal is we know we will stub our toe, we know we will make mistakes, but our goal is that every client is reference-able at the end of the day. We will do whatever it takes to make them happy. We know it is a lot easier to make them happy if they stay happy from the beginning, or if consultants can raise their hand and said, ‘Hey, I think I need help,’ than if we wait until the end and find out that the client is not happy. So we want to create an environment where any consultant at any time can just raise his or her hand and ask for help and is not punished for that. We have a whole quality program that is built to support that kind of attitude.
What is your definition of business success?
There are lots of elements there. Obviously you have to meet the expectations of your shareholders. You’ve got to create a great place for the people who work for you and you have to meet the needs of your clients. I think that when I retire someday, I would like to look back and know that Encore made a difference in health care. To me, that would have been a real success. I think health care has huge challenges ahead of it right now. No one company is going to solve all those challenges, but to me, I would like to feel that Encore has been a huge success if when I retire, I can look back and say Encore played a role in helping make a difference.
How to reach: Encore Health Resources, (877) 787-1010 or www.encorehealthresources.com
Google pay-per-click advertising is a great tool for building brand awareness and generating leads online.
It can be a bit complicated for some, but there are four things you should be doing for your PPC to reach its fullest potential.
1. Organize keywords to target niche prospect groups
The difference between an ignored ad and an effective ad is its relevance. An ad for jewelry gets ignored when it appears in the search results of someone seeking remodeling services. The way you can make your ad the most relevant to prospects is by separating them according to the keywords they target and organizing them into groups.
The more thoroughly your keywords are organized, the more they will appear as if made specifically for the prospect.
Organizing your keywords does two things for your PPC: it makes your ads more relevant to prospects, and it increases your click-through rate.
These are the exact factors that also give you a high quality score for your ads. A high quality score gets you better ad locations on websites and better ranking for search ads. It also gives you a lower cost per click for your ads. Google is rating your ad on how helpful it is to your prospect, based on its relevance and click-through rate.
2. Create consistency throughout your PPC process
The PPC process is composed of three steps: grab prospects’ attention with a relevant ad; direct them to a landing page that elaborates on what the ad offers; and present a special offer as an incentive for prospects to fill out a contact form.
From your ad to your offer, your PPC marketing message and design should feel continuous and cohesive. It shouldn’t feel like three steps. If your landing page looks different than the image ad that attracted the prospect, the user will experience disconnect.
At each step, build trust throughout the process, ultimately leading to the prospect filling out your contact form. That’s how you turn them into a lead.
3. Optimize ads for phone responses
For most businesses, phone responses are a more valuable lead than those from contact forms, so it’s a great idea to optimize your ads to generate these calls. There are two ways to do this:
1. Make sure your number is displayed in all images and text ads.
2. Adjust your display times to only show ads when you’re in the office. This gives you the opportunity to get those calls and make the most of them when you’re open for business. Your phone responses don’t cost you anything.
4. Use ad extensions
PPC ads have a small character limit, but luckily Google offers Ad Extensions. These give you the ability to present important marketing information without adding to your character limit.
Location Extension: Helps prospects find your office.
Product Extension: Shows pictures and prices of your products.
SiteLink Extension: Presents multiple pages from your website simultaneously.
Phone Number Extension: Adds a click-to-call number beneath your ad.
Social Media Extension: Shows how many +1s your Google+ page has.
Seller Rating Extension: Shows the rating your customers have given your company. (Google only shows it if it’s four or five stars.)
Make sure you are taking advantage of every opportunity to improve your PPC efficacy. You’ll see the difference in your sales numbers. ●
Joy Gendusa is the founder and CEO of direct mail marketing firm, PostcardMania. She originally started the company in 1998. It now employs more than 200 people and has more than 53,000 customers in more than 350 industries. For more information, visit www.postcardmania.com.
Michael Yormark doesn’t have to look too far among his many steadfast employees to find the perfect example of how his company empowers people who work hard — who are dedicated, passionate and willing to do whatever it takes to succeed.
He stops on Matt Rickoff, vice president of sponsorships.
“I am very proud of the way he has grown his career and made an impact on this organization,” Yormark says.
The organization? Sunrise Sports & Entertainment, a holding company whose heart is one of the fastest-paced sports characterized by its passionate fans — hockey. Yormark, president of Sunrise Sports & Entertainment, is responsible for overseeing all the organization’s operating entities including the Florida Panthers NHL hockey club, the BB&T Center arena venue, the Saveology.com Iceplex recreational skating and training facility, SSE Gaming and the new Club RED, an exclusive club at the BB&T Center.
What impressed Yormark was Rickoff’s enthusiasm and desire, which he tries to nurture in all his 150 employees.
It all began some years ago when Yormark started receiving early morning phone calls. Yormark, who usually works out at around 4 a.m. and who is in the office no later than 6 a.m., was getting phone calls every morning around 6.
“I said to myself, ‘Who the heck is calling me this early?’” he says. “One day I actually answered the phone and the guy on the other line said, ‘Mr. Yormark, this is Matt Rickoff. I read that you are an early riser so I thought this would be the best time to reach you and tell you that I really want to work for you, and I promise that if you give me a chance, I won’t let you down.’”
Eventually, after a lot of persistence on his part, Rickoff had Yormark’s attention.
“I told him to come in and work on a trial period, and if he proved himself, we would hire him full time but on one condition — that he would stop calling me,” Yormark says.
“Well, Matt came in as a sort of intern and proved himself so much that he just recently earned his VP stripes, and is now one of the leaders in our organization.”
It was that passion that Yormark was looking for.
Here’s how Yormark keeps the passion alive at Sunrise Sports & Entertainment —celebrating its 20 anniversary this year — so the organization can grow the right way and consistently deliver the results the company and its supporters expect.
Work hard to deliver the promise
One of the fundamentals of business is that your customers are your lifeblood and deserve a first-class experience with every purchase — or every time they set foot inside an arena.
“But here it’s different because there is a certain lack of control you have over wins and losses and overall success,” says Yormark. “You can put a team together that you think will perform, and you can service your guests properly.”
But there is still a measure of unpredictably as to the outcome of a game or a season, so there is no secret to success in Yormark’s line of business.
“It takes a lot of hard work, diligence, preparation, perseverance and the like,” he says. “One of the mantras I have always lived by is ‘Dream big and dare to fail.’ I think that’s something our entire executive team and our staff have embraced.”
With the Florida Panthers in a competitive sports market in South Florida and the BB&T Center in a competitive market for entertainment, Yormark knows the pressure is on to offer something different, something that adds value.
“This is a challenging business, but we are not afraid to get up early, stay late, outwork everyone, and dream big that we can achieve the goals, the objectives and the successes that we set out to do,” he says.
The approach is to take the entire contribution of the workforce to make an experience that draws in repeat customers and makes believers out of first-time visitors. And it takes some work behind the scenes.
“From a business perspective I think what most fans do not see is just how hard people work to put on an exciting hockey game, an incredible concert, or even on a day-to-day basis just to keep this organization headed in the right direction,” Yormark says. “There is an incredible amount of work, dedication, sweat, creativity and passion that goes in to this franchise on a regular basis.
“If our fans saw that first-hand, it’s something they would be proud of — it’s something that I am proud of. I can honestly sit here and say that no one in the industry works harder than our staff.”
Stay in front of your audience
Delivering what a customer wants is often the gold standard used to evaluate your businesses’ sales. But how do you gauge what first-time or loyal fans really want? The same way industries such as manufacturing or service do — you study your feedback.
“Not only do we do an incredible amount of research, but we try to stay in front of our fans as much as possible,” Yormark says. “We have a campaign called ‘Talk 2 Us’ where we encourage fans to give their feedback on everything related to their Panthers or BB&T Center experience.”
Fan forums are held before every game where fans can give feedback face-to-face with Panthers representatives.
“Our executives lead advisory boards in each of the three local counties where they get opinions and feedback from 20-plus of our most dedicated and in-tune constituents,” he says. “We host regular town hall meetings with myself, General Manager Dale Tallon and others to keep them up-to-date on the state of our franchise, all the initiatives we are working on, and also to take questions and hear their thoughts.
“We take their feedback very seriously, and when we aggregate all that feedback and analyze it, it often leads to major changes or new programs.”
Accessibility makes a great impression. It demonstrates that in the glamor of professional sports, keeping in touch with fans can show compassion and a desire to want to stay connected with grassroots followers, so to speak.
“We are one of the most accessible organizations in the industry,” Yormark says, noting how he and his staff run an open-door operation. “We answer every email. We return every phone call. We engage on social media. I even give out my personal cell phone number to fans so they can reach me 24/7.
“In my opinion, that’s the only way to truly service your supporters and provide them with the best experience — you have to be accessible 24 hours a day.”
Add value and sustain success
As there are always going to be outside influences that can hurt a business — the recession, or in Yormark’s case, the NHL hockey lockout of 2012-13 — having the ability and flexibility to add value is crucial to repeating success.
“The important thing is that we grow this organization the right way and ensure that any success we have is sustainable success,” he says. “I believe we are doing that by constantly analyzing the way we do things both on and off the ice and making strategic decisions in every area of our business.”
Stars are made and broken each day just as products are sold and returned with the same regularity. The skill is to try to respond appropriately.
“You have to be willing to make the tough decisions to be successful in this industry,” Yormark says. “And certainly, I think as an organization we will continue to be willing to make those tough decisions and stay focused on the goals and objectives that we have set for ourselves.”
If you think of a product that you can buy from many sources at similar prices, it’s often the added value that makes you decide where you will make that purchase. Yormark’s passion for a fan’s total experience makes him sound like, well — like he’s a hockey coach giving a pep talk to his team.
“We do need to provide fans with great value for their investment,” he says. “We need to provide first-class customer service, their experience needs to be second to none, and regardless of the outcome of the game, or what they thought of the show, they need to walk out of our arena saying they had a great night and they would love to come back.
“From the minute they approach our parking lot, park their car, walk through the activities on our JetBlue tarmac outdoor plaza, show their ticket at the main entrance, grab a hot dog or a soda at one of our food courts, and sit down in one of our great seat locations, we need to make every part of their experience magical. Then hopefully the action on the ice, or on stage, will take care of the rest.” ●
- Work hard to deliver the promise.
- Stay in front of your audience to get feedback.
- Add value and sustain a successful operation.
The Yormark File
Name: Michael Yormark
Company: Sunrise Sports & Entertainment
Birthplace: Morristown, N.J. I have a twin brother, Brett, who is CEO of the Brooklyn Nets.
Education: University of Maryland as an undergraduate and Ohio University, with a graduate degree in sports management.
What was your first job, and what did you learn from it?
My first job out of college — after I sent out hundreds of resumes for pro sports jobs and received rejections from all of them — was selling clothes at a men’s store during the day and being a janitor in the evening. It humbled me a bit, and it taught me that you’re not going to achieve anything unless you work hard for it. Eventually, through a family friend, I got an interview with the New York Yankees and was lucky enough to get my first job in sports. But I’ll never forget that feeling of failure when I first graduated and couldn’t get a job. It motivates me to this day.
What was the best business advice you ever received?
“Dream big and dare to fail” or “Anything is possible.”
Who do you admire in business?
I was fortunate enough to work for Wayne Huizenga early in my sports career, and to this day I still consider him to be one of business’ greatest entrepreneurs. He is the reason we have an NHL franchise in South Florida, and for a period of time, he was by far the most dominant sports figure in the region. For people who knew him and worked with him, he was an incredibly intelligent and creative businessman, a tough negotiator, and someone who could look at any endeavor — be it a sports team, a land development project or a business — and know exactly how to make it successful. I consider him to be an incredible mentor, and a person I greatly admire to this day.
What is your definition of business success?
In my current role, I define success as building and maintaining a first class organization with the right culture, the right employee DNA and one that the community and all our fans and supporters can be proud of.
How to reach: Sunrise Sports & Entertainment, (954) 835-7000 or www.floridapanthers.com
Robert H. “Bobby” Schottenstein, chairman, president and CEO of M/I Homes Inc., has two mentors to thank for his entrance into the business world — and not surprisingly, he’s had two different careers.
His father, Irving Schottenstein, was his biggest influence in the real estate development business. Irving Schottenstein’s first cousin Mel Schottenstein was a Columbus lawyer.
“Irving and Mel were business partners,” Schottenstein says. Both have since passed away.
“They were the best of friends. They were just absolutely incredible men; each was a very impressive leader in his own right.”
The exposure to individuals who can be mentors is essential to develop an entrepreneurial spirit, Schottenstein says. In particular, he says his father’s character, integrity and commitment to doing things right was absolute, and he learned those values as such. Secondly, the two men were very successful in business.
“The combination of those two things helped set me on course, and gave me balance,” he says.
“A lot of the work of Junior Achievement is taking the time to expose young people to just those kinds of things to help broaden their horizons, to give them perspective, to give them hope, to help shape their dreams. I just can't say enough about how important that is.”
Schottenstein says there are a lot of unknowns in business to a newcomer, and one person can make such an enormous difference in an individual's life in terms of inspiring them or directing them.
“There is a lot of mystery in business,” he says. “What does it take to start a business, to be successful in business? And what is the X factor?”
He says Mel Schottenstein was his strongest influence when it came to the legal field.
“From the earliest age, I always wanted to be a lawyer,” Schottenstein says. “Following graduation from Indiana University, I went to Capital University Law School, and I loved it.”
After nearly 14 years in private practice as a business lawyer, and a lot of internal debate, Schottenstein decided to be in business in a more direct sense.
He left the practice and joined M/I Homes, which has grown rapidly and is one of the largest homebuilders in the country.
“Though I had a fair amount of business knowledge and certainly a lot of real estate and legal knowledge from my years as a lawyer, suffice it to say I didn't know a whole hell of a lot about home-building,” Schottenstein says.
He started at the lowest level, which he calls the foundation of the company — construction of new homes.
“You can't fully understand and appreciate business unless you really begin to understand what it takes to create the foundation of the business,” he says. “That was a very intrinsic value that my dad held, and he was right. I spent my first two to three years with M/I being just immersed in what I call the foundation of our business. Then I went into sales and other parts of the business.”
Schottenstein says he believes would-be entrepreneurs should first follow their hearts.
“Follow your passion,” he says. “It is hard to do anything really well, but it is extremely hard to do something well that you don't love. Try to find something that really excites you and that you enjoy doing so it's not work.”
A second piece of advice is to work with people whom you respect.
“Work for good people,” he says. “If you work for good people, good things will happen to you. If you are lucky to find something you like and even luckier to deal with people who you like, you are really riding downhill with the wind at your back.”
How to reach: M/I Homes Inc., (888) 644-4111 or www.mihomes.com
John P. McConnell has three straightforward pieces of advice for those thinking about going into business for themselves:
Never give up on your dream.
Have confidence in yourself.
Seek the help and advice of others.
“Remember, you can't do all of it yourself,” he says. “You need support of friends and others. Look to people you have admired in your life to go to when things get tough. Always be open and engaging with them. Don't make it difficult for them to be helpful.”
The chairman and CEO of Worthington Industries Inc., McConnell strongly believes in those three principles — having used them as he began working in the company his father John H. McConnell founded. The company has become a leading diversified metal processing company with annual sales of $2.5 billion.
John P. McConnell started as a second shift general laborer in 1975 at the company’s Louisville, Ky., steel plant. This was after some previous summer jobs there.
“I cut grass and did various odd jobs and tarred roofs, that kind of stuff at the cylinder plant for the summer,” he says. “So I kind of grew up in the business.”
While not everyone has the opportunity to join a family business, stepping into that arena sometimes takes a little pondering.
“It is something you want to be thoughtful about,” McConnell says. “There is a point where it is like, ‘Maybe I shouldn't go into the business.’ So I gave it some thought. It ended up — I started with our cylinder company right after school. Then I worked a little bit of sales there. Next, I became personnel director and did that for seven or eight years. Then I eventually started managing our Columbus steel plant.”
Active in numerous community organizations, McConnell currently serves on the board of directors for OhioHealth as well as on the boards of the Greater Columbus
Chamber of Commerce, the YMCA, Children's Hospital and the Columbus Zoological Association.
He is majority owner of the Columbus Blue Jackets National Hockey League franchise and chairman of the Columbus Blue Jackets Foundation.
As you can expect, McConnell is one of Columbus’ biggest boosters.
“I think the Columbus area is a fabulous area on many, many fronts,” he says. “It's obviously a great place for families. That's one of the things people say right away, but I think it is just a fabulous community, all the way around. And certainly from a workforce standpoint, there are a lot of very talented people to pull from here in the area.
“The Arena District made a huge change in the downtown. Everybody just keeps continuing to improve on the city. I just love Columbus the way it is; we should keep building on our strengths. It has a very diverse economy so it generally holds up pretty well relative to other areas of the country.”
McConnell is also concerned about the skilled labor shortage.
“I think across the country we still need an emphasis placed on skilled labor, because as machinists and tool and die makers — those people with those skills — age, there aren't that many coming in behind them. That is going to be a challenge for the country. It will be addressed. Shortages and voids always get filled, it seems.”
And entrepreneurs will continue to rise and flourish.
“I think there's always going to be an important role that entrepreneurs play,” McConnell says. “There will always be entrepreneurs. There are people who just see something and believe they can create something that others would want or that satisfies their needs. That kind of person is always going to be around and is always needed.”
How to reach: Worthington Industries Inc., (614) 438-3210, or www.worthingtonindustries.com
Rich Johnson was preparing to wrap things up for the week at his company, ViaQuest Inc., at about 4 p.m. on a Friday. It was 2008, and while he knew the credit crunch was starting to affect the economy, the last thing he expected was to have bank representatives walk into his office and inform him they were not going to renew ViaQuest’s line of credit.
“That basically sucked the cash out of our account, and I needed to come up with a large sum of money to meet payroll on Monday morning,” says Johnson, president and CEO.
Johnson was in a state of shock. Lenders were waist-deep in the red ink flood, and many businesses were hurting.
“I was sitting at my desk on a Friday night, trying not to panic,” he says. “My strong faith had a lot to do with helping me not to panic, but the first thing I did was to calm down, and just try to clear my head. I started making phone calls to people who had the same experience; I had never had this experience. I knew that I’m a fighter — and I was preparing myself for a fight.”
While he understood the reasons behind the credit crisis, he was surprised that it knocked on his door.
“We had never missed a covenant payment,” Johnson says. “We weren’t overleveraged. It really had nothing to do with us as a company. It was what was happening with the banking industry. It just took us by surprise.”
ViaQuest at the time was a $15 million company. Its longest standing division serves people with developmental disabilities in the home and community-based settings, and it is one of the largest providers of those services in Ohio.
“We had 1,100 employees who were dependent on us, and we needed to act quickly,” Johnson says. “We are passionate about serving a very special population of people with disabilities, older adults. Our staff is the most remarkable employee base that you can imagine. The first reaction was not, ‘How is this going to affect me?’ It was, ‘How is it going to affect the people that we serve? Let’s fight to make this work.’”
As you can imagine, ViaQuest had a difficult time for the next 12 to 18 months.
“We were late paying vendors. We were late making a lot of payments,” he says. “We had to decide what we could pay and what we couldn’t pay. It was just a very dark time in our history and we came very, very close to not surviving.”
But not only did ViaQuest survive, the company grew. It now has 1,400 employees and is on track for revenues of $60 million this year.
Here is how Johnson put together multiple approaches to keep ViaQuest’s head above water — including an astonishing bailout for the immediate problem at hand.
Leave no stone unturned
Many business leaders may admit that one of the biggest fears is having your lender pull the rug out from under you. What Johnson found to help his situation, however, was akin to an angel investor stepping up to the plate and hitting a home run.
“When the bank came in and shut down my line of credit, they said they would not extend any credit to me without collateral to back that credit,” he says. “They already had my house that I lived in as collateral, and all my assets were in the company. I had to act quickly.”
The first person he called for help was his ex-wife, Jill, with whom he was still good friends.
“This was Saturday and I asked her if she would be willing to put up the house [she had received it as part of the divorce settlement] as collateral to fund my next payroll. She started crying and said, ‘You know, this is the house that our kids live in, and I know that you would never let anything happen to me or the kids. You have always taken care of us, and I know how passionate you are, and I know that this, too, will pass.’
“That’s how we survived,” Johnson says. “She put up her house as collateral; it got us to the next payroll.”
While such a bailout may often provide a little breathing space, it also is a cry for a major review of company operations.
Once Johnson started to review his options, he and his team worked on collections and vendors.
“Some vendors didn’t get paid for months, but they didn’t stop service,” Johnson says. “They hung with us. We are just very fortunate that we had a long history with them.
“It is at times like that when you find out what relationships are all about.”
Involve the rank and file
Before you spend all your time with financial matters, you need to let your people know during a crisis what is going on.
“Over the weekend I drafted a correspondence to all our employees and told them exactly what was happening,” Johnson says. “We are a very transparent organization. I am the sole owner. And good, bad or ugly, I always let people know where we are at all times with everything — I let them know what was happening.”
Johnson told his employees that they were fighting for the future and asked them to stand with him.
“I said I understood if they wouldn’t, or if they felt that their family was in jeopardy and they needed to take care of their family. I understood that, but I asked them to bond together and fight with me. And every person did.”
One of the greatest things you can learn during a time of crisis is about the perseverance of the company and its culture.
“A lot of people were very afraid, but we did not lose any employees during that time,” Johnson says. “Most employees elsewhere would have been running for the door. I’m fortunate to have the greatest employees in the world who said we are going to stand and fight with you, and we are going to see this through.
“Today we are fortunate enough to have another bank in place,” he says. “We actually are doing very, very well. The experience taught us to manage the business a lot more efficiently, and it really made us tougher.”
Find a silver lining
Going through a crisis offers a unique opportunity to focus on the company culture that you have been building.
“The No. 1 lesson that I learned is that we really work on our culture more than any other function in the company. We spend a lot of time building our culture and showing our employees how much we value them.”
Johnson points to quarterly Culture Crusader meetings, where employees talk about living out core values, and annual conferences where managers receive inspirational training.
“It has built a culture that even if we didn’t know if we were going to be around in the future, the culture that we built together really bonded us, and we made it through,” he says.
Making it through a crisis shows how strong your culture has become and offers a particular insight.
“I guess we have matured a little bit,” Johnson says. “I never would have imagined that would have happened because we didn’t do anything (out of order). It is not like we were doing something and the bank gave us a warning that said you had better stop. So now, we make sure that we have the proper systems in place. We make sure that we have the cash and not depend so much on credit.”
In ViaQuest’s case, executive team members realized that they needed a greater focus on the processes of collecting and billing.
“We were 100 percent government-funded, so if you don’t have your ‘i’s’ dotted and your ‘t’s’ crossed, if you don’t have the systems and processes in place, your collections can get backed up, and you can make any bank nervous,” he says. “So we make sure that we have all of our core processes down to mitigate any billing or collecting issues. Then we develop different relationships and have alternative measures in place if this is ever to happen again so that we would not be taken by surprise.
“I think we have a great, great billing department now,” Johnson says. “Our finance department is outstanding. If there are any accounts that are just a little bit overdue, they start working it.”
It’s also a good idea to consider the role of the line of credit. If you rely on it, it becomes your safety net.
“We do not look at it that way,” Johnson says. “We view us as not having any safety net, and we still operate like we need to meet payroll every month. We still operate today like we did during that six-month period of time when we needed to fund every payroll. It’s kind of like we are Depression-era babies hiding money under the mattress and all those things.
“We’ve been scarred a little bit so we don’t take that for granted, and it taught us a great lesson. We run better as a company because of it.” •
- Leave no stone unturned when seeking help.
- Involve all your employees in the recovery.
- Find a silver lining.
NAME: Rich Johnson
TITLE: president and CEO
COMPANY: ViaQuest Inc.
Education: I was one of those kids that the judge said, ‘It’s either jail or the service.’ I went into the U.S. Air Force right out of high school. It provided me with the G.I. Bill, and I finished at Capital University with a bachelor’s degree in accounting.
What was your very first job? I was 16 and I worked at a Rax Restaurant. I was the second employee hired by them in Marysville and got my baptism by fire in the restaurant industry. I did everything. They were famous for roast beef sandwiches.
Who do you admire in business? Herb Kelleher and Southwest Airlines and the way they built culture. I have to admit I am not a huge fan of how you fly with Southwest, but you always know that you can get there on time, and you know it’s going to be a fun trip. I wanted to build a culture like that. I really studied Southwest Airlines. In 2001, we signed up Southwest Airlines to speak at our annual conference. Our conference was two weeks after 9/11. I said, ‘Look, we all know what is going on right now in the world. We respect that, and if you want out of the speaking engagement, I completely understand.’
The speaker said, ‘We made a commitment to you. We understand what is going on in the world but our commitment that we made to you — we are going to honor it.’ And she showed up at our conference, was our keynote speaker and did not accept payment. It was absolutely moving. It was incredible.
What is the best business advice you have ever received? A gentleman gave me the advice, ‘If you don’t have time to do it right the first time, you’re not going to have time to go back and fix it. So take the time to do it right the first time.’ That really stuck with me. But my personal mantra that I started early in business is if you do the right things, the dollars will follow. You always do the right thing first and not let financial pressures get in the way of that. I have stood by that and there are times when we were going through all the ups and downs that we had that it would have been easy to cut corners and do something differently. But I always believed if you do the right things, the dollars will follow and everything will be in place. That’s how we have operated this company.
What is your definition of business success? Positively impacting as many lives as you can so you can make as many people in your organization successful. It is not monetary. It is changing people’s lives. It is changing the way things are done. It is changing the world. Innovators to me are a business success. When you say you have changed someone’s life or have helped them improve their life, that is business success.
Mattress Firm and Mattress Giant had been competitors for years. So when Mattress Firm took over the rival 180-store Mattress Giant last year it was imperative for Steve Stagner to build camaraderie, teamwork and a foundation of common culture between the two teams.
That’s why he closed all the stores — temporarily — and held a team-building exercise at seven locations across the country.
“We had about 400 of their sales associates show up along with a couple hundred of our people,” says Stagner, president and CEO of Mattress Firm. “In the first four hours, they spent it in shorts and T-shirts, running around the community finding things together, creating videos on their phones and trying to help (each other) do things.”
The modified scavenger hunt was a success, creating a clean slate for the team members and allowing the foundation of a new company culture to be built.
“The idea was to take our culture and their culture, strip our titles and our ‘badges’ — badges meaning what company you work for, Mattress Firm and Mattress Giant — and get people to work together, play together, laugh together and solve problems together for a few hours,” Stagner says.
“What was amazing about that was that by noon or so when they all returned, they were wearing the same shirts, high five-ing, knowing each other on a personal level. We had been fierce competitors for 25 years, and by noon, we were all sharing ideas. To me, that is the foundation for how a culture is built. It is built on trust and on a relationship.”
Stagner believed a crucial component of building a merged culture was for people to let go of their egos and their assumptions on what really counts on both sides of the ledger.
“Then it’s to figure out how one plus one equals three,” he says, “and how together we could be more powerful than separately. That is the way I like to do things. It’s sort of an experiential process because I don’t believe in sending out a memo. Whatever I write, it’s going to be thrown away in about 30 minutes anyway.
“When you bring them together and you let them go through an emotional experience, and then two years from now, they will have a foundation. That’s really the key to growth and how you bring cultures together.”
Stagner is seeing positive results from last year’s acquisition.
“We had anticipated there would be a certain level of attrition, as a result, and it hasn’t happened,” he says. “The people have stayed.”
To Stagner, it is critically fundamental to maintain the culture to support the very aggressive growth plans Mattress Firm is undertaking. Here’s how Stagner and his team focus on culture to generate $1.1 billion in annual revenue from 1,200 locations with 3,000 employees.
Find the pillars of culture
Look at a successful business, scratch the surface and underneath you will find a company culture that ties together some great people. Building a company culture often starts with a leader eager to develop an equally eager workforce.
Stagner became CEO in 2010, but he had been associated with Mattress Firm since creating a business plan for the company in 1995. He credits having several strong mentors and thousands of hours studying leadership and the art of selling as helping him mold his philosophy.
Stagner developed his business plan based on hiring the best of the best, assembling a team that was focused on building something greater than itself, which would be a national chain.
“We always challenge each other to grow as individuals,” he says. “The hours that we spend at work are not just about selling mattresses; it’s about how can we grow into better leaders, better people and better performers in that role. Those pillars are the key underpinnings of the culture.”
In comparison to other retailers, turnover at Mattress Firm is low. Stagner gives credit to investing in the individual growth of employees.
“So what happens is you invest in your people, in their individual growth,” he says. “I look at it as a hiring promise. When the company hires someone, the hiring promise is basically that we really want to invest in you as an individual.”
At Mattress Firm, employees go through Ground School, an education process like a college degree program in the sense that it doesn’t just end after the first couple of weeks on the job.
“We are not only investing in you when you first start, but all the way through your career so when you leave here, you are better off than when you came here,” Stagner says. “You’ve learned critical work and life competencies that will help you for the rest of your life. I don’t believe in my heart that people work for companies solely because of their compensation.”
Many companies, in addition to salary, significantly invest time and money into leadership training and communication. Mattress Firm goes beyond those tangible benefits, and significantly invests time and money into community involvement. For instance, last year, the company spent about 5,500 hours in community work across the chain, and raised and invested more than $1 million for various causes, particularly working toward a cure for pancreatic cancer.
“Measure that by things that you do to make sure that you are investing time into your people and that way, the idea is that the culture will take care of the strategy,” Stagner says. “The company can have a strategic plan, which we do, and we execute on that, but the culture is really what makes the plan work.”
Positively seek continuous improvement
Capturing the gist of your culture in a catchy phrase is a great idea if you want your team to remember it. Stagner puts the unique description simply: a positive sense of discontent.
“Ours is a culture that is highly positive,” he says. “But the sense of discontent is that we always believe we can do better. There is a humility that goes through our culture based on the fact that we are just very aggressive about winning but humble about achieving success.”
To put it in perspective, the positive discontent drives a desire to improve continuously and in effect, to become, perhaps, a little larger than life.
“So that is the positive sense of discontent — never set sail; there’s always so much more that we can do for each other,” he says. “That is a key component to why I think our culture works.”
Another fundamental is to have employees who demonstrate passion in some areas of their life.
“Whether or not they are in operations, advertising, communications or sales, acquire people who are successful, who are highly passionate about what they do,” Stagner says.
He finds that recruiting heavily on college campuses increases the chances of acquiring future managers as well as sales associates.
“I think it is unique that about 60 percent of our team has college degrees,” he says. “But people are like, ‘Well, I just spent four years getting a degree. Why would I want to go sell mattresses?’”
The reason? It’s not just about selling mattresses. Rather, at Mattress Firm it is about the opportunity for employees to learn critical work and life competencies that will help them for the rest of their lives. Stagner has created a brand promise to invest time in helping them grow.
“It’s, ‘Come work here and learn how to run a business. Learn how to become a better leader,’” he says. “And as a result of that, there are 400 to 500 students every year who come and work for us right out of college. Most of our management team is stacked with people who have been with us for 10 or 15 years.”
Once Stagner stripped away all the layers, he defined a sale as a transfer of enthusiasm so that employees would understand the transaction in its basic terms, as a core principle.
“It is simply that if I am trying to convince you to do anything, whether it is to go on a trip or to buy a mattress, it happens to the degree that I can transfer my enthusiasm to you,” he says. “Selling a product is really about transferring the passion and enthusiasm I have about that product to you. When you feel that passion and enthusiasm, action is taken.”
That becomes evident in the organization in many ways: from the way employees answer the phone, to the way people are greeted in the stores, to the way employees talk about things, everything is around that passion.
“So if I am happy about my iPhone, I tell you how cool my iPhone is, and I am passionate about it being used and excited about it, and then maybe you start thinking ‘I, too, should have an iPhone.’ And that is really important because that is what perpetuates the brand. The brand is not just a transaction to us.”
How to reach: Mattress Firm, (877) 384-2903 or www.mattressfirm.com
Find the pillars of culture.
Positively seek continuous improvement.
Transfer the enthusiasm.
The Stagner File
president and CEO
Born: Lubbock, Texas. I grew up in Kingwood here in Houston.
Education: I went to Stephen F. Austin State University and received a degree in marketing.
What was your first job? I was working in a warehouse for on office supply chain, pulling orders. What I learned while I was doing that was that hard work is important. People do hard jobs. The summers in Houston, especially in a warehouse, are not exactly that enjoyable. But I also saw a lot of how the culture works, how culture works when there are people who are dissenting leadership or supporting leadership because you hear the guys. I can kind of remember how they talked about their bosses and stuff like that. So I learned a little bit about how cultures worked and how quality control is really impacted when people don’t care about their jobs.
Who do you admire in business? One of my mentors actually just passed away. His name was Larry Wilson. He co-wrote books called “Play to Win: Choosing Growth Over Fear in Work and Life” and “The One Minute Sales Person.” His theory was really based on a couple of different things, one of which is the wonderful paradox of if you help enough other people get what they want, you get what you want. So I have kind of modeled my personal life around not worrying about what happens to me at all, financially or anything. I don’t even pay much attention to that. It’s spending time making sure that you are helping others get the success in their careers they want. The paradox is that things just happen to work out.
What is the best business advice you ever received? Invest in yourself and hire people better than you. And the way I would capture that is to be very humble. One of my favorite chapters in the Jim Collins book “Good to Great: Why Some Companies Make the Leap … and Others Don’t” is the chapter on Level Five Leadership. He talks about the balance between humility and will, to really follow people because they want to, not because you have to. It’s by demonstrating the strong balance between being humble, being real with everyone and being willing to do what they have done.
What is your definition of business success? Success can be measured in many ways. Certainly there is no reason to apologize for achieving financial success and growth. If you are good at what you do, then you should be rewarded for it. But I don’t measure my success based on how much we sell or how much we make, because I don’t believe that on my deathbed I’m going to be worried about what our success was in the first quarter of 2013. I believe the true measurement of success is the value that we as an organization of people provide our communities and our customers, because if we do that, we add value, then we will be rewarded for that, and then the shareholder value will go up. It’s kind of the same paradox. I measure success on the value of creating and then the financial measurements happen. That’s my definition.
Leading with honor™ by Lee Ellis
As a prisoner of war in the camps of North Vietnam for five years, I believe that my comrades and I saw the purest examples of leadership possible. Our senior leaders put their country and teammates above their own well-being to fulfill their responsibilities. They held themselves accountable first, which inspired us to follow. In the camps, life and death were at stake, but all leaders hold sway over the destiny of others.
As I travel today speaking and consulting, I repeatedly hear complaints about the dearth of courageous leaders — not managers or personalities — but leaders who will take responsibility for their actions and for those under them. Without accountability, organizations and people get off track, miss their goals and everything begins to deteriorate.
Can you think of some recent examples in the news or your personal situation? We all can!
Witness the unhealthy abuse and misuse of power, misappropriation of funds, mistakes in judgment and misinformation used for cover-ups. Surely something is amiss in our culture. We want the easy way out, and we don’t like doing difficult things.
Likewise, when we deviate from standards, our first reaction can be to deny or cover up to protect our image and reputation.
Accountability is not easy — it takes energy and a plan — and it requires courage to take difficult but necessary actions.
Accountable leaders are committed to their duty and their organizational values. They lay out expectations and then follow through to ensure things get done properly. What is needed is leadership founded on character, integrity and accountability in every sector of society. Here are three steps that will help restore the practice of healthy accountability.
Communicate with clarity
Whether it’s a POW camp or a Fortune 500 company, leaders must go the extra mile to clarify and overcommunicate expectations at every level. From top to bottom, everyone should know the organization’s mission and values and be able to align with them. Leaders at every level must regularly clarify standards and performance expectations.
With clear communication, there should be no surprises in what’s expected.
Each team member has a unique role to play to ensure that goals are accomplished and standards are met. Everyone must own his or her portion of the assigned goal and execute his or her personal duty.
If you have people reporting to you, make sure that they have been given the resources to accomplish that goal. Coach, mentor, develop and resource them as needed, and you will have done your part. Then, your people must do theirs or be held accountable.
Act with courage
Leadership takes courage, and that means leaning into the pain of your fears to do what you know is right even when it doesn’t feel natural or safe.
A lack of courage in holding people accountable to standards is ripping gashes in our institutions — think of the issues at Penn State, the Atlanta Public School System, the Internal Revenue Service, Congress, Arthur Andersen, etc.
Remember, personal accountability comes first. Whether you’re a leader or a future leader, it begins with personal accountability. POW leaders where I was held went first into the crucibles of torture and suffering, setting the example for the rest of us. Likewise all leaders must set the example of what is expected.
Will you have the courage to do the “right” thing by obeying the laws of the land and putting your people and our country first before your own selfish goals and ambitions? Will you make sure the right things are happening for the right reasons?
If so, you will make a difference in the lives of those you lead — and in our country. We need your help.
Lee Ellis is a speaker and author of the award-winning book, “Leading With Honor: Leadership Lessons from the Hanoi Hilton,” in which he shares his experiences as a Vietnam prisoner of war and highlights leadership lessons learned in the camps. He is president of Leadership Freedom LLC and consults with Fortune 500 senior executives in the areas of hiring, team-building, executive development and succession planning. For more information, visit www.leadingwithhonor.com.
Yosi Gil understands the pride that a person feels when he or she can point to a construction project and say, “Hey, I helped make that happen.” It’s a feeling that anyone who’s ever helped a building rise from the ground can relate to.
“The guy who built the Empire State Building will pass by and say, ‘I was one of the people who made it,’” Gil says.
That sense of pride is something Gil feels very strongly about. It’s a feeling he not only wants to share with his employees, but it’s one that he hopes his employees and customers feel too.
“You know, they say cheap is expensive,” he says. “But we always build quality. Look at my buildings; everything you see is real! Everything is real stone. Everything is quality. Nothing is fabricated.”
The accomplished real estate development executive uses that fact to make his point that quality materials and workmanship pay for themselves.
When the Pinnacle, a 246-unit luxury condominium high-rise on the ocean in Sunny Isles Beach, was launched 15 years ago, the monthly condominium maintenance fee was about $850 to $900.
“Today, the maintenance fee is $1,100,” Gil says, noting amazingly that it hasn’t climbed much in all those years. “The foundation is so good because the Pinnacle was built with quality.
“When I tell my overseas clients that I am going to build a new building, they ask me, ‘Where?’ They don’t ask me what type of quality there will be. They know there will be quality.”
Gil, principal for condominium development and executive vice president of sales at J. Milton & Associates, sums up his biggest challenge philosophically: Everything is about achievement.
“When you wake up in the morning, everyone likes to do better and better and better; that’s what I believe,” he says.
It’s about quality talent and quality leaders and the sense of accomplishment that you get when you’ve built a Pinnacle, King David, Sayan or Intracoastal Yacht Club in a small city like Sunny Isles Beach that was vacant land 17 years ago, he says.
Here are some insights into how Gil focuses on achieving quality to be a leader in the premier rental-community market.
Know your market
You’ve already taken a big step toward having your vision for your company if you’ve decided that you plan to focus on a quality, top-shelf product.
To finish that visualization, you have to research market conditions, seek opportunities, determine the feasibility of future expansions and then create a demand that ensures the company will make a profit.
“Look first at the location you intend to buy,” Gil says. “Then look at the needs of the market before you announce any project. Third, build something that the market can really afford in case it collapses. Fourth, make sure if the economy collapses you can make some substitutions to achieve what they want to achieve and not go bankrupt.
“Fifth, avoid taking any risk. We are not gamblers. We buy the land in the right way.”
Speaking of risks and contingencies, Gil fortunately had developed a vision well before the 2008 real estate market crash. Simply put, it was this: “Less is more.”
“You can see what we did; thank God we were smart enough to create some merchandise to fit the needs of the market,” he says. “Our company definitely creates the right inventory to fill the needs of the market.”
By limiting the size of a project, it better matches the demand and the chance of a sell-out. Every building that J. Milton has built in the last 12 years reflects no more than 100 to 120 units.
“We did it on purpose,” Gil says. “We did not want a building with 500 or 600 units.”
While others are chasing the big dollars with big projects, it can pay off if you are less willing to take risk.
“We are a very, very conservative company,” Gil says about the family-owned business. “It is better for us to be smart than bright. Smart people don’t get into trouble where others might.
“I would rather not go out and make $100 million. We might only make $25 million on a project, but we would make five or six projects. We definitely minimize our risk to almost nothing. ”
While there is competition in nearly all markets, you can’t attract all possible customers. Some may go to your competitors, but be realistic that the pool of potential buyers has its limits.
“If you are going to build 500 apartments in South Beach, with each apartment about 15,000 square feet, do you think you are going to do well? I don’t think so,” Gil says. “There aren’t enough people in the market to buy 500 apartments at 15,000 square feet each.”
A realistic look at supply and demand will offer you some guidelines. Gil expects to see certain types of customers: the primary resident who wants a vacation home, the owner of a second home or an investor.
“We only have a few people we sell to as investors,” he says, noting the possible risks that overleveraged investors may pose. “When we reach the amount of, let’s say, 25 percent, we stop selling to investors.”
As for planning for the primary resident, Gil puts himself in the shoes of the buyer.
“I don’t believe any worldly person likes to go to stay in a place three weeks a year and put up $7 million for real estate that he doesn’t use at other times.”
So his team designed an apartment in the 2,000-2,500 square foot range selling for about $800,000 — all with three bedrooms.
“The three bedroom apartment always fits the needs of the clients,” he says. “If you want to rent it out to an investor, it is easier to rent a three bedroom than a two-bedroom or a one-bedroom.”
Go the in-house route
One of the biggest questions for a company is whether to go in-house or outsource for its needs. The deciding factors often depend on the industry, but for Gil, who focuses on quality as a top concern, the choice has been an in-house staff.
“Everything in our company is in-house,” Gil says. “Everything from the architects, to the marketing, the financing, the banking, the management — everything is in-house. We are an A to Z operation.”
With an in-house staff, the chances of establishing loyalty are much greater than when you are outsourcing, Gil has found.
“It is much easier to manage quality because of the loyalty,” he says. “You will have control over correcting mistakes because the team is working together.
“My partner, Joseph Milton, is our building engineer. He knows how to build, how to create. Gina Milton, executive vice president, is the marketing director. I can’t move 1 inch without her approval.
“I am not going to tell you that everything in our business works perfectly,” Gil says. “But if it doesn’t work, you start all over again. You have to fix it. This is your foundation. We don’t tell you that everything is just cookies, flowers and nothing else.”
Collaboration is important, especially when you have quality people doing the work.
“Gina likes the gray kitchen for a new project, and I like the white. So we picked white and gray. Gina gets the top half and I get the bottom half. We compromised to make sure it is going to look right.”
Build your reputation
You don’t get to be a leader in any industry without establishing your reputation. You can’t buy a reputation, but you can build one through trust.
“Everything starts with the reputation of your company,” Gil says. “When I tell someone something is going to be done, it’s going to be done. Then people trust you.”
To ensure that your business continues, be professional and stand by your product, especially since in the construction business there are concerns that may arise to delay the project.
“All of us are very professional; all of us work together,” he says. “Let’s put it this way: our people are definitely very, very strong in what they do.”
A positive experience hopefully creates a return customer. Gil also focuses on buyers who follow a statistic that estimates that every four to six years, people like to move from their residence to a new location.
“I have to make sure clients fall in love with the apartment,” he says. “They know the finishing and they know the service. So why would they go someplace else? The deal with me is better. This is the way I see it.
“We will help sell the unit. The clients are very excited because they get to move to a new unit. They made a profit from the unit they bought before and they transferred everything to the next deal. They already know the quality.”
How to reach: J. Milton & Associates, (305) 460-6300 or www.j-milton.com
Know your market.
Go the in-house route.
Build your reputation.
The Gil file
principal, condominium development
executive vice president, sales
J. Milton & Associates
Education: I attended Tel Aviv University. I was in the Israeli Army and then came to America. I moved to Los Angeles to join Crescent Heights, one of the nation’s largest condominium converters and was responsible for the company’s marketing, advertising and in-house financing. In 1991, I went to Pacific International Equities as sales and marketing director for some high-profile developments, including Sunset Harbour and the Courts at South Beach.
What was your first job and what did you learn from it?
I did a lot of building in Israel. From there I moved to California and to Miami but I was always in marketing and selling real estate and development. I learned continuation in each one a different way. You have a client; you have to take care of the people, the service and everything that is leading you to do well. I also learned work ethic and work dedication.
Who do you admire?
I always admire God because he gave me the opportunity to do what I have. It was the right thing. I pray every day. I am religious, and thank God my partner is also religious. We donate to a lot of causes. My partners are helping a lot of children. We donated a synagogue; we are helping the people with everything we do. We learn how to give back what God gives us.
What is the best advice you have ever received?
Believe in God first; believe in yourself second. Don’t give up. I have learned one thing: God gave you the opportunity, and he will try you.
What is your definition of business success?
Achievement is what it is — when you see something you created and it’s already been there for many, many, many years. I promise you, the guy who went to see the Empire State Building that he built and is still there today, he will pass by and look at it, and say to himself, ‘I was one of the people who made it.’