Inner strength Featured

8:00pm EDT October 26, 2007

When Tom Crawford took over as president and CEO of Crawford & Co. in 2004, he was the fourth CEO in six years.

“That in itself is very destructive to the stability and the communications and visions of a company,” Crawford says. “You cannot change leadership at the top that many times in that short period of time and expect a company to move forward.”

Crawford & Co., which provides claims management solutions to insurance companies and self-insured entities, had previously excelled at investing in people but that focus had dissipated, and its training institute had been disbanded. Without the proper training, quality levels had slipped, so where it once was a quality leader, it now lagged behind.

Seeing the state of the company, Crawford could read the thoughts rolling through every employee’s mind.

“Realizing there had been such a turnover at the top of the organization, no matter what my background had been or successes had been, I’ve got a group of people looking at me wondering, ‘Well, how long is this person going to be here, and why should we pay attention to him?’” says Crawford, who is not related to the Crawford & Co. founding family.

He realized if he wanted to get the company moving forward again, he needed to refocus on its people, but he couldn’t just make changes and expect the employees to blindly follow him. So he committed to improving one of the most basic business fundamentals out there — communication.

“The value of communication as you make change is far more important than any one thing you’re doing,” Crawford says. “Certainly, visions and objectives are important, but for them to be effective, you have to communicate them, and you have to explain them, and you have to get, to the best degree you can, buy-in. It’s that important, and I think it’s fundamental for a successful CEO.”

Crawford says it’s fundamental because management and employees can’t work together if they don’t know what the other is thinking.

“Over a period of time, I think you will fail,” Crawford says. “In today’s world, where there is a distance that has been built over the years, I think on average in businesses in our country, there is a disconnect between leadership and the associate. The companies that have (communication) are winning. The companies that don’t have it may win for a short period of time, but I do not think that sustainability of bringing your vision and your objectives to life in a company will ever materialize long term.”

Communicating goals

Crawford began his career as a clerk in a hardware store. It was there that he first observed that people in the lower ranks were a lot smarter than management gave them credit for.

“They have vast amounts of knowledge of what’s wrong, and when things are wrong, they have a good knowledge of what it is,” he says. “They touch our clients and customers every day. Leadership does not.”

Crawford wanted to tap into that knowledge base so he instituted Friday morning breakfasts every other week with 10 associates from the field who weren’t managers. He flew them into headquarters and met with them to ask if the company was doing what it said, what they saw changing, how they thought communication was and other topics.

Following the breakfasts, the employees would have their picture taken and be sent back to their respective locations with an additional title — ambassador of the company.

“What the people say carries incredible weight of how this company or any other company is viewed on the street,” Crawford says. “My voice gets to a few, but their voices get to hundreds of thousands of people, so the more they believe in their company, the better off we are.”

He also conducted town-hall meetings every quarter and gave employees the opportunity to ask about 10 to 12 questions from the floor at each one. Those questions aren’t pre-screened — they come just as people think them up at the meeting.

“That builds credibility over a period of time because there are some really tough questions that come out when you open it up to the floor,” Crawford says.

He also visited offices, and whenever he did, he’d have a short meeting with all the employees to give them yet more chances to ask questions.

“That pays great dividends in strengthening our communications and letting people get things off their chest that they drive home wondering about,” Crawford says. “They get the CEO standing in front of them, and all I ever ask is, ‘Ask the question in a professional manner, and you’re going to get a professional answer.’ If I don’t have the answer, we’ll get it for you as long as it’s something I can communicate within the SEC [Securities and Exchange Commission] bounds.”

Additionally, he started monthly management control meetings with all of his direct reports. It’s an 8 a.m. to 5 p.m. meeting, and each report gets 45 minutes to update him. Each person can bring a guest too, so this allows employees to see the inner workings of management. At the conclusion of these meetings, the managers take that information back to their people and communicate it down the ranks.

The breakfasts with his employees then let him know just how effective these communication efforts are.

“It’s interesting when you call 10 people into the room every other Friday that are below the management level, and if you listen, you’re going to know if that message is getting out in the field,” Crawford says.

Lastly, he started holding managers accountable for their communication with employees via performance evaluations. When he started, between 600 and 700 employee performance reviews were late, and now that number is just 16. If employees don’t know where they stand, they can’t improve and move to the next level, so the business can’t move to the next level.

“Those things are just fundamentals in my eyes, but when you walk into a company where they don’t have things like that, it becomes not just a business fundamental, it becomes crucial to turning something around,” Crawford says.

Surveying the staff

Throughout his career, Crawford has seen how helpful employee surveys can be to gauging the company’s progress and promoting open communication.

“You’ve got to establish benchmarks when you get into a company, and that’s one of the biggest benchmarks I’ve been working from is our own employees’ evaluation,” he says.

He instituted a 25-question survey where employees ranked each question on a scale of one to five. The back was blank for them to write any comments or concerns on, as well.

“There are two things people say on a survey,” Crawford says. “They say, ‘If I say what I really think, they’ll get me,’ or No. 2, ‘We’ll say what we think, but they won’t do anything about it.’

“Those are the two things that you have to convince people of — that it’s anonymous and you never allow it to be anything other than that. If you do, it’s worthless to do. It’s death to your program.”

To prove these things to people, he took their responses and went back to them as a group.

“You must respond with their results, as they state them, and what you’re doing about them,” Crawford says. “If you don’t do those things, don’t do the survey.”

It’s also important to share not just the areas that scored well, but also those that aren’t doing well. Honesty will help people buy in to what you’re trying to do, and continuously tracking and showing people the feedback helps others understand the state of the company.

“We measure everything in graphical form,” Crawford says. “I’m convinced, as a person that’s come up through the ranks, that when they showed me graphs, if the line was going up or down, I knew we had a problem. I think people can identify with measurements when you paint that picture of the key measurements of the company.”

Since that first survey, the company has done three more, and Crawford is listening to what people say. When people said that one personal day wasn’t enough, they increased it to two, and now employees have three.

“You don’t change it all at one time, but it’s touchable,” Crawford says.

While some things are implemented and transitioned to gradually, surveys also help reveal more serious problems that require more immediate action. When several people from one department wrote in that their supervisor had treated them dis-respectfully, Crawford and his team looked into it. They found that this person had indeed been mistreating the employees, so he removed the person from the job.

“That’s dramatic,” Crawford says. “That doesn’t happen often, but you have to react if someone takes the time. If you have a 50-person unit and 30 of them write comments very negative about who’s leading them, then you have got a problem.

“It also lets the management know that we’re very serious about doing what we say — don’t be out there operating in the culture you established, which is outside the culture that we have.”

While the thought of figuring out a survey system may seem overwhelming, Crawford says it’s quite easy to do, but instead of talking about it, you have to just plunge forward and do it.

“Put it in place,” he says. “There are a lot of companies you can hire that will do the survey for you electronically. It’s not hard to do it, but be serious about it. Don’t say it, and then not give them the feedback.”

Only half of Crawford’s employees responded to the first survey, and one question that asked if they would recommend someone else to work at the company scored below a three. Now 82 percent of employees complete the survey and every score has improved. That same question now scores above a four, on average.

These survey results tell Crawford that he’s on the right track, but he cautions that it’s also important that once you choose what to measure, that you stick to it and not change those measurements or how you define the measurements, otherwise you’ll not be able to accurately gauge how the company is performing.

While the surveys have revealed that communication and employee satisfaction are up, the numbers also say Crawford & Co. is moving in the right direction. Since 2004, total revenue has increased nearly 11 percent to $900.4 million last year.

As Crawford & Co. continues to rebuild its employee initiatives, Crawford will continue striving to bridge the communication gap between employees and managers, and in doing so, he knows the business as a whole will improve.

“I do what I think has to be done, and I thought clearly the culture of communications and building connectivity between associates and the leadership was vitally important to this company,” Crawford says. “That’s a judgment you make as a leader. We started acting upon it, and we were right. You have to know when you’re doing a right thing. When you believe you are doing the right thing, you have to go for it. Communication to every level of the company is the right thing to do.”

HOW TO REACH: Crawford & Co., (800) 241-2541 or www.crawfordandcompany.com