Walking away from $1.5 million is never an easy decision, but Dan Stryffeler says it was the right decision at the time for Red Seal Electric Co.
After a 2004 merger, the $11 million distributor and fabricator of electric-related materials found itself with some new products and services that were cannibalizing its profitability. The new lines were not a good fit for Red Seal, so Stryffeler removed them, and even gave two customers his competitor’s phone number rather than take their business.
It may be an unorthodox approach, but the better bottom line and the ability to control growth are worth the sacrifice in sales, he says of the 41 employee company.
“Sometimes you have to take one step forward and two steps back,” he says.
Smart Business spoke with Stryffeler, president of Red Seal Electric Co., about how he establishes and maintains a company culture, and what he looks for in prospective employees.
Q: What qualities do you look for when hiring?
The primary quality is attitude. You’re born with a certain attitude, the way you wake up and face life when you get out of bed in the morning.
That’s one of the few things you can actually control in your life. You can wake up and say, ‘I’m going to be in a bad mood,’ or ‘I’m going to be in a good mood.’ We look for people who wake up and hit the ground running in a good mood and are fun to work with.
We recently let go of five employees, who were critical employees in terms of productivity, but they had the wrong attitude. It poisoned the organization. You come in to work and you see this person coming and you just flinch, because you know they are going to unload on you with whatever happened over the weekend in their life or what they don’t like about the company.
Attitude is critical. I can teach somebody to run a machine. I can’t teach somebody to have a pleasant attitude and be fun to work around.
Q: How do you deal with bad decisions?
The first step is containment. You’ve got to stop the bleeding. That’s the triage, the M.A.S.H. unit stopping the bleeding until somebody can get to the surgery center.
You have to contain the problem, then you have to get to what the root cause is. You usually have to ask yourself four or five questions to peel away the layers. The first question is usually, ‘What was the problem?’ Say it was in shipping. Then you say, ‘Well, what happened in shipping?’ You get an answer and you say, ‘What caused that?’
It usually takes four to five questions to get down to the root cause so you can fix it so it won’t happen again. Your first instinct is to go with the quick fix, but that probably won’t solve the problem. There’s probably something deeper-rooted.
It’s containment first, stop the bleeding, find the root cause, then have the integrity to go forward with the fix once you find it. It might not be pleasant, they might not like the fix, but if you have to do it, you have to do it.
Q: How do you establish a company culture?
Culture has to come from the top down. We’re a family-owned business, and we have values that are instilled in how we should treat our employees, our customers and our suppliers. You have to find a way to attract people who have the same philosophy, so to speak.
You can’t change people. That mystical ‘it’ is either in them or not in them. There has to be a cultural fit. If you find they’re not buying in to the culture, it’s not that they’re wrong and you’re right. It’s just not a good fit, and you have to end the relationship with that employee very quickly because you’re not going to be able to turn it around.
You should be trying to get down who you are, what you do and why you do it and find some way of getting people who buy in to that on the same page.
Q: How do you avoid traps and pitfalls as a leader?
You’re faced with decisions every day. Some are operational, some are a lot deeper. The easy way out is usually the wrong way in a decision. The one that makes you do that gut check is the correct answer to your problem.
If you’re making a decision in your stomach and you know it doesn’t feel right, it’s going to come back and bite you later. You’ve got to make the right decision.
You can’t learn much about being successful by studying failure. To be successful, you have to study success. By studying pitfalls, you’ll be a good company, but it’s not going to get you to a great company.
Success and failure are completely different concepts. You can learn how not to fail, but that doesn’t mean you’re going to be successful.
HOW TO REACH: Red Seal Electric Co., (216) 941-3900 or www.redseal.com
