Tony Ciepiel has put very few boundaries on what Step2 Discovery can become in the years ahead. The Streetsboro-based company is known around the world for its durable children’s toys and playsets, but Ciepiel is empowering his team of more than 800 employees to engage their imaginations as they look to the future.
“One of the things I’ve focused on with the teams I’ve led at multiple companies in multiple industries is a clearly articulated strategic plan,” says Ciepiel, who was named CEO at Step2 Discovery last April. “And within our strategic plan, we lay out what is our winning aspiration. Where are we going to play with regard to geography, product, market segments and channels? How are we going to win against the competition in those respective areas? And what are the key capabilities that are necessary to enable us to win?”
Ciepiel has built a reputation as a business leader and dealmaker who gets things done. He served in key leadership roles at Realty ONE Group, Griswold Inc., The Flood Co. and most recently, Vitamix. He was brought in by Aterian Investment Partners to lead Step2, as well as Pittsburg, Kansas-based Backyard Discovery and Chicago-based Go Configure.
“Aterian is a midsized private equity fund that acquires companies like these, puts them together or runs them independently, and is very involved in helping to develop strategy and create the resources necessary to grow the companies,” Ciepiel says. “They bought all three of the companies and then they brought me on. I’m the last addition.”
Backyard Discovery is a top manufacturer and seller of pavilions and pergolas for kids, while Go Configure has a network of 600 contractors nationally who can install products in both retail outlets and homes. Step2 Discovery is already doing about 140,000 installations a year. If all goes according to plan, Ciepiel will lead a dynamic enterprise that can manufacture, deliver and install high-quality toys and playsets to customers globally.
But the opportunity to innovate is only just beginning, Ciepiel says. His goal is to keep pushing the envelope and build a culture that not only empowers, but encourages people to pursue new ideas that can transform both the company and its industry.
Find ways to create value
In today’s world, it’s imperative that companies continually scan the market for new growth opportunities. Ciepiel refers to this as the ambition matrix.
“Often you think of products that are core, products that are adjacent and products that are transformational,” he says. “Our focus on core products is to make sure we continue to defend what we have. Then we work on adjacencies and transformational items. Companies should always be spending a portion of their resources and energy in this transformational space.
“Think of core as being 30 to 50 percent of your resources, adjacencies could be 20 to 30 percent and then transformational could be 20 to 30 percent. Some people are now saying, given how fast companies are being disintermediated, that you need to be spending 50 percent of your time in transformational because somebody else is, and they could transform you right out of business.”
The idea of delivering and installing newly purchased products for customers is an effort to create additional value and give Step2 an edge on its competition. It’s an example of how innovation is more than just developing a new product or putting a new spin on an existing product. Innovation can involve the process used to make, ship and store the product as well.
“We’re looking at innovation in all different ways, not just product,” Ciepiel says. “For example, the pergola we offer, you can now purchase it in Home Depot fully installed. So that’s a transformational product. Before it was just a pergola. Now it’s a turnkey service that all shows up at your house on the same day and is installed. That’s a transformational business model.”
Take steps to facilitate innovation
The first step to establishing an innovative culture is developing a vision. Next, you need to create an environment that allows that vision to be realized.
“Resource the organization to be able to attain the vision,” Ciepiel says. “A mistake I see is you create a vision, but it’s not adequately resourced or you don’t create an environment that is conducive to it. It means creating a space where people have the freedom to explore developing all different types of products within our focus. People are encouraged, motivated and incentivized to innovate in different types of ways, including transformational ways.
“Then they are provided the resources to do that. In our research and development area, you’ll see these big CNC machines rotoring out and building out models of different products. People need resources to be able to build those models.”
Along those lines, you need to invest in a process that helps you understand what your customer is looking for.
“Business insights are very important in fueling transformational change,” he says. “You need to understand where the consumer is now, where they are going and what their preferences are. Sometimes it isn’t what they tell you. You need to go and observe it in ethnographic types of research ways. You need to get out and watch the children play with the toys. You need to go and watch people receive parcel packages at their homes. You need to go and see how they interact.”
When Ciepiel learned that people were adding lights to the new pergolas and pavilions, the company responded. All new models have electric built right into them. Ciepiel also has built a strategic relationship with a company called BoxLock. It’s a product that fits on a delivery bin and enables a specified person, such as someone from a delivery company, to open the lock and deposit the product in the bin.
“There are all kinds of deals to be had,” Ciepiel says. “As a leader, I’m always looking at strategic alliances, joint ventures, different ways I can partner with companies that can bring technology or bring distribution or do something that will cause us to advance faster.”
Stay ahead of the curve
The importance of taking a proactive approach to innovation was perhaps never more evident than when Toys R Us closed its stores last year.
“A company like Toys R Us goes under and yet this company has not missed a beat,” Ciepiel says. “How does that happen? Necessity was the mother of invention 10 years ago and we started shipping our product direct to consumers. When Toys R Us went under, we were fortunate to have a wonderful e-commerce position and the business found its way to the internet and we just continued to ship products. We’re very fortunate. All of those competencies and the people who develop those were in place before I got here.”
Ciepiel says it’s his responsibility to continue to find ways to help the company evolve.
“My job as the CEO is to come in and look at our wonderful heritage and say, ‘How do we build upon it? How do we grow from this? How do we have a vision that has expanded beyond these areas and leverage out this wonderful e-commerce capability, leverage out our ability to do rotomolding and build products in resin and in wood and expand out the distribution and new products?’” he says.
“As a leader, I try to create an environment for people to succeed. I always tell our team that when I’m in a room with our employees, my job is not to be the person with the best ideas. It’s to know the best idea when I hear it, no matter where it comes from in the organization, and then rally and get the whole organization behind whose ever idea it is to be a winner.”
One of the things that attracted Ciepiel to Step2 was the potential of blending its rotomolding capability with some of its other product materials.
“We’re now starting to introduce products that have rotomolding, resin elements and wood elements together,” Ciepiel says. “Those are some of the products you’re going to see en masse in 2019 and 2020. We’re working on those sets right now. The substraits can be intermingled, they can go on and be expanded beyond those areas.”
The future is also likely to include Step2 products that are made for adults, furniture that is made with the same durability, but is subtly different in a way that appeals to an older customer. Whatever the future may hold, Ciepiel says he and his team will take the journey together.
“I always say we’re going to work really hard as a team and agree on the strategy and direction we’re going to go and what our priority initiatives are and then we switch roles,” he says. “I go to work for you. What can I do to help you achieve that aspect? To me, that’s very fulfilling and rewarding and I get energized and excited to come to work every day and work with some really talented people.”
The Ciepiel File
NAME: Tony Ciepiel
COMPANY: Step2 Discovery
Education: Bachelor’s degree, accounting and finance, Baldwin Wallace University.
Book you’re currently reading: “Detonate: Why — and How — Corporations Must Blow Up Best Practices (and Bring a Beginner’s Mind) to Survive,” by Geoff Tuff and Steven Goldbach. It’s a book about transforming the way you think of strategy, taking the historic way you think of strategy and focusing on the new way of thinking.
Who are a couple of your mentors?
I was very fortunate early in my career in my late 30s, and even before that, to develop some relationships with some great leaders here in Northeast Ohio that really shaped me. They poured into me and I’ve tried to emulate them over the years. People like Gordon Heffern, the former CEO at Society National Bank, and John Beckett of R.W. Beckett Corp.
These were guys who took time to meet with me and provide me guidance and leadership on how to develop as a leader. They helped me when I had some tough problems or tough issues to deal with and I owe a lot to them for what they’ve done helping me and investing in my career.
It’s something I’m starting to do now is identify young leaders in Northeast Ohio and invest in them because I was fortunate to have those great leaders invest in me.