Positive reinforcement

Gina Melby’s formula for success at JFK Medical Center is simple: “If I have happy employees and happy patients, I have a happy
hospital.”

As obvious as that sentiment might seem, Melby says the responsibility of keeping employees content is among her most essential
duties as a leader, and one that has a direct impact on the environment JFK provides for its customers — or, in this case,
patients.

“Our patients are going to receive that positive energy on a daily
basis,” Melby says. “Making sure your employees are happy and
satisfied and that they have the best place to work is really a fundamental piece of infrastructure.”

Based in Atlantis, Fla., JFK is one of the largest health care centers in South Florida, with annual revenue totaling $359 million.
Melby, who came to JFK in 2004 after serving as CEO of Northwest
Medical Center in Broward County, says she was pleased to find a
work force that looked upon its fellow members as more than just
colleagues.

“We have a culture of family here,” Melby says of her more than
2,500 employees. “One of the things I would say when I got here is
that it’s a very close-knit group of people. They’re very supportive
of each other, they work as a team, they look at each other for
help, and that’s really where they build their relationships of family.”

With a work force consisting of a support staff of custodians
and receptionists as well as highly trained medical professionals,
such as nurses and physicians, JFK’s employees represent a
monumentally diverse set of cultural and experiential backgrounds. Melby says keeping her team in harmony has taken a
willingness to accept, celebrate and adapt to the diversities of
JFK’s employees.

“The challenge is to make sure that people are communicated to and that they have good information,” Melby says. “The
one thing that people will always second-guess is whether
they’re being dealt with on an honest and fair basis. If we add
a surgery service line, if we do something different and we
build a department, that’s easy to do. The biggest challenge is
maintaining the consistency and the communication and making sure people have what they need to do their jobs every
day.”

By listening to employees, providing them opportunities to
develop and nurturing a trusting environment on an ongoing
basis, Melby helps keep her employees, her patients and, in turn,
her hospital in high spirits.

A finger on the pulse

Remaining sensitive to employees’ needs is often challenging.
With a campus more than a quarter-mile long, Melby says it’s nearly impossible to do rounds through the entire facility and interface
with employees. Rather, in an effort to stay attuned to the changing needs of the JFK work force, Melby encourages individuals
throughout the organization to reach out directly to management
with concerns.

“It is critical that people have a voice,” Melby says. “If people
don’t feel they have a voice, they don’t feel supportive, but even
more important than giving a voice is really following through with communication back. Even if you can’t give them the answer they
want to hear, giving them an answer and following through is the
most important thing.”

Melby carefully balances not undermining her managers with
being available to discuss issues with employees, and she expects
other managers to do the same.

“Employees e-mail me all the time,” Melby says. “We have an
open-access policy here. People can come into my office and see
me. I e-mail people back. That’s the one thing we do a good job at,
whether it’s in terms of myself or of anybody else at the executive
level.”

While casual forms of communication are not necessarily discouraged, employees also have the opportunity to participate in
what is referred to as JFK’s employee advisory group, which provides a more formal venue for interaction between organizational
layers. The monthly meetings, attended by a rotating group of peer-nominated employees, create opportunities to express exactly
what workers need to feel comfortable and satisfied in their jobs.

“The employee advisory group is a little bit more structured,”
Melby says. “They have some tasks and policy changes that they
want to work on. For example, if we have to change something in
the cafeteria, they make sure that it’s going to meet the needs of
the employees. It’s bringing information to this group and really
changing things at an operational level that are going to be in support of employee needs and a work environment [that] meets their
expectations.”

Melby, who attends each session but is no more a leader of the
employee advisory group than any other member, says that such a
forum, where a cross section of a company’s entire work force is
represented, creates a strong and lasting link between the organization’s management and its staff.

“We have about 30 members on that group, and we try to represent different shifts and different departments,” Melby says. “That
group of individuals goes back out and communicates to their
peers what’s going on, and they’re really a great communication
link.”

Delegation and collaboration

Another aspect of employees’ satisfaction is the extent to which
they are able to take on responsibilities, make decisions, and contribute to the overall direction and success of the company. Melby
says that not only can delegation and collaboration benefit individual employees by giving them the opportunity to develop professionally, but also that an organization’s ability to grow depends
on it.

“If you’re stifling people and not getting the best out of them,
you’re not letting them grow,” Melby says. “If a leader feels they
have to do everything, it can also be problematic for the organization. Your organization will never grow when one person is so controlling.”

Once a company reaches a certain size, it is not productive for
one leader to control all aspects of the business. Melby says an
organization’s capacity for change and innovation is directly related to how well the members of its management team can shoulder
new responsibilities, and part of a leader’s job is to ensure that they
are able to do so.

“As you build your management team, you’re creating the building blocks to be able to do more, take on more and also to grow
your own employees and management,” Melby says. “It would
not be healthy for me to do everything. People would not have
their own developmental goals, and part of being a leader is
developing the people underneath me. That has to be part of what
I do every day.”

While giving employees responsibility and creating a sense of
ownership tends to yield improved performance, there are limits
to delegation. Though Melby says that bringing her people together to work collaboratively is her natural inclination, a leader must
also know when it is necessary to make decisions on his or her
own. Finding that balance requires a thorough familiarity of the
skills and capabilities of his or her direct reports.

“I have to know every single person in every single role in
management and understand their expertise,” Melby says. “I
watch them every day so I can see how much more I can give
somebody, how much more they can take on. That’s something
that executives do on a regular basis; that’s how you build your
management base.”

To Melby, effective leadership requires both a command of
strategy and vision and the ability to allow others to make decisions. Effective, responsible delegation can lead to many organizational benefits, not the least of which are employees who are
informed, involved and fulfilled.

“It’s weighing in for people who have a stake in a decision and
making sure you don’t miss anything as you roll out your plans,”
Melby says. “It really creates a better understanding of what
you’re going to be doing and allows people that are involved to
share in that so that you can make the right decisions.”

Trust and vision

Integrity is among the first adjectives Melby uses to describe her
leadership style.

“Every leader has to develop a style by which people trust
them,” Melby says. “If people don’t trust you in a leadership role,
you’re going to struggle. If you don’t have integrity as a leader,
you’re going to struggle. To me, those are the most important
things I can do, at least as far as keeping what we have here.”

For Melby, one aspect of fostering trusting relationships with
employees is showing them that she’s more than willing to get her
hands dirty. For example, she recalls during hurricane season,
running around a waterlogged emergency room floor dressed
in scrubs with the rest of the JFK staff. Melby says when
employees see that an executive and mother of three is not above
working through the night, side by side with her team, it goes a
long way toward developing a relationship based on mutual
respect and confidence.

“People at the front-line level look for your involvement just so
you have an understanding of what their day-to-day lives are
like,” Melby says. “To them, having you there with them, understanding what’s going on, whether it’s during a disaster or
whether it’s during an emergency situation, so that you can really be with them at that level and still be able to view you as a
leader, really makes a difference.”

While occasionally going above and beyond the call of duty is
appreciated, it’s the day-to-day consistency of behavior that
will have the most lasting effect on an employee’s sense of reliability in a leader. Melby says the foundation of any organization is a well-defined vision, and because a recognized and supported vision is a vital tool in maintaining the consistency
required to build an environment of trust, she says creating a
company’s vision should start the day a new leader joins an
organization.

“You develop your mission, goals and objectives based on what
you understand and learn when you get here, and then you create the future,” Melby says. “Everybody has different talents. It
could be based on being strategic. It could be based on being
innovative. It could be based on your experience. You take those
things, you move into an entity, you look at what you have and
you say, ‘Based on what I’ve done in the past or based on what
I’ve seen at other places, you develop your future.”

The process of inspiring trust in the leadership of an organization is one that necessitates constant and continual effort and
attention, and Melby says the work is never done.

“It takes a long time to build trust,” Melby says. “It’s consistency. It’s your communication. It’s following through. Once people
feel that you’re honest with them and forthright, it goes a long
way. If you don’t have the same philosophy going forward and
you don’t have the same mission and vision for the organization,
it’s really challenging for employees to trust what’s going to happen next.”

HOW TO REACH: JFK Medical Center, (561) 548-3791 or www.jfkmc.com

Two of a kind

Earlier this year, Liberty Power Corp. was named the nation’s fastest-growing Hispanic company by Hispanic Business magazine, but Eliezer Hernandez, in typical fashion, let pass a tailor-made opportunity to pat his company and himself on the back.

“We’ve been doing what we’re doing for so long that today certainly doesn’t feel any different, and yesterday didn’t feel any different from the day before,” says Eliezer Hernandez, Liberty’s co-founder and chief relationship officer. “We’ve been running at this pace for so long, I guess someone just noticed.”

Such modesty has been a hallmark of Liberty’s culture since Eliezer Hernandez, his brother, David, and their colleague, Alberto Daire — who now serves as Liberty’s chief operating officer — founded the retail electricity supplier in late 2001. Though, in just a short time, the company’s annual revenue has already grown to approximately $120 million, predictions are that Liberty will reach $1 billion within the next several years as it receives licensing to provide service beyond its current 15-state territory. David Hernandez, now Liberty’s CEO, says that as the company grows, continuing to serve its customers efficiently and effectively will require that Liberty’s employees can work in an environment that encourages communication and collaboration.

“One of the biggest challenges for a large corporation is that people aren’t always willing to work together,” David Hernandez says. “When you have a culture that is conducive to strong communication, it just makes things much more fluid. You can move quicker into new markets, roll out new products and come up with new ideas. The benefit of a strong culture for the customer is that they get the benefit of those new products and innovation.”

Influenced largely by the values imparted upon them by their mother, Eliezer Hernandez says that for him and David, and the rest of Liberty’s leadership team, maintaining an unpretentious outlook has come as second nature as they’ve worked to create a culture that will help take their company to the next level.

“The culture here is very egalitarian in the sense that there is no them and us,” Eliezer Hernandez says. “There is senior management, of which the founders are members, but nobody calls us ‘the founders’ or ‘the owners.’ We’re regular guys, and we certainly haven’t let whatever limited success we’ve had to date go to our heads.”

Learning from the past

Building a positive and successful corporate culture requires employees who can help contribute to and maintain it. David Hernandez says that in order to do so, a company must first learn what qualities make specific individuals successful members of its team.

“A successful organization is one that learns from its experiences and is continuously improving,” David Hernandez says. “One of the areas that is most critical is learning what type of person you’re looking for, what type of person fits in to the organization, so that it’s a functioning machine.”

Having been in business for several years, David Hernandez sat down with his executive team, and together they examined current and former employees of Liberty and developed a defined set of attributes common among those employees who had prospered.

“We sort of looked back and did an inventory of some of the traits that made some people successful and why others left or were asked to leave,” David Hernandez says. “When we narrowed down the traits of the people that have been successful here at Liberty Power, we found that those who were humble and who didn’t have the need to be right tended to succeed.”

Along with humility, the management team at Liberty discovered that an intellectual hunger and intelligence were characteristics of those who had fit well with Liberty’s values system and corporate culture. Not coincidentally, those three traits — humble, hungry and smart — are mentioned by author Patrick Lencioni in his book, “The Five Dysfunctions of a Team,” which is now required reading for Liberty’s management team.

As a learning organization, Eliezer Hernandez says much of Liberty’s corporate philosophy has been influenced by Lencioni’s work.

“We didn’t invent this stuff,” Eliezer Hernandez says. “We were kind of figuring it out on our own, but (Lencioni) confirmed and validated a lot of the things that we were thinking about.”

David Hernandez says the strategy has proven beneficial to the company.

“Whenever we’re identifying the kind of people that are successful here, looking back has proven a good way for us to learn what it is that makes our people successful, and other leaders should, and can, do that, as well.”

Building the team

Once a profile of the desired traits has been constructed, Liberty’s human resources department sources and vets resumes in preparation for a thorough and well-structured interview process designed to identify candidates with the right mix of cultural tendencies. Because the culture he has created stresses collaboration, David Hernandez says Liberty’s interview process is a team effort.

“For a small company, we involve a lot of people,” David Hernandez says. “On average, when someone gets hired, they interview with at least eight or 10 people within our company.”

After using a telephone conference as an initial screening of prospective team members, those identified as possible good fits for the organization are asked to come in for a series of interviews, the length of which is adjusted depending on the level of the position within the organization. Eliezer Hernandez says holding interviews over the course of several days has improved Liberty’s ability to truly isolate the personality and qualities of a candidate.

“Our process requires that we have people interviewed over different dates,” Eliezer Hernandez says. “Someone might be having a really good day one day, but even a monster has a really good day. So we invite them back for that second round of interviews on a different day.”

One step of Liberty’s process, inspired by Malcolm Gladwell’s 2005 book, “Blink: The Power of Thinking Without Thinking,” involves an impromptu, informal greeting and discussion, administered by Eliezer Hernandez, during which a candidate is approached in the lobby for a brief, but often telling, interaction. Gladwell’s book argues that too often people insist on having a surplus of information to make a decision instead of trusting their instinct, and Eliezer Hernandez says Liberty’s “Blink” interviews provide an opportunity to form a gut reaction to a candidate.

“The objective of the ‘Blink’ interview is to not get too much information,” Eliezer Hernandez says. “For example, someone could be a jerk, but when you ask them about themselves, they tell you they graduated from Harvard, and they worked for the president of the United States. You end up sort of talking yourself into, ‘Wouldn’t it be neat to have someone that worked for the president of the United States?’ and you look past the really important cultural things. But in that ‘Blink’ interview, you don’t get enough information to talk yourself into making the wrong decision.”

When interviewing for a senior-level opening at Liberty, at some point in the process, candidates are asked to meet for an interview at a somewhat unusual off-site location. Eliezer Hernandez says judging how an individual handles himself or herself in an unfamiliar environment — for example, at the beach or on a roller coaster — can reveal a lot about his or her character and how he or she will integrate into an existing corporate culture.

“Asking arrogant questions like, ‘Why the heck are they wasting my time? Why am I here?’ tells us somebody is going to be resistant in doing things in the way that we found to be successful,” Eliezer Hernandez says. “They don’t realize the test is not just the questions that are being asked, but how comfortable they appear in a setting they weren’t expecting.”

Of course, it is not only the number or nature of interviews in a hiring process that determines its success, but also the types of questions being asked in the interviews. Generic questions are typically answered with generic responses, and as David Hernandez illustrates with the classic “strengths and weaknesses” line of questioning, to learn as much as you can about a candidate, those conducting an interview must be willing to dig a bit deeper.

“People are very comfortable talking about their strengths, and they’re very familiar with their strengths,” David Hernandez says. “Typically, people have a baked answer for what their weakness is — ‘I work too hard and neglect the family,’ or whatever that might be. So we ask them what their
second greatest weakness is, and if it’s another off-the-shelf-type weakness, we’ll ask for the third. We’ll keep peeling the onion until we get to, ‘OK, this person has a problem interacting with people.’ People’s integrity and how honest they are comes through in how they answer questions like that.”

Investing in the future

Especially during times of rapid growth, David Hernandez says it is important to keep in mind that a company’s job is not done once a hire is made. On the contrary, effort is required on the part of an employer to successfully integrate new employees into an existing culture. At Liberty, an employee orientation program has been put in place that, while costly, has created a system through which recent hires are welcomed and familiarized with the organization.

“When you’re going a hundred miles an hour, the bias is for throwing people into a role,” David Hernandez says. “Even though it’s an upfront cost, I see it more as an investment of time and resources, and over the long run, it helps bring people in and integrate them into the organization.”

During their first week at Liberty, employees attend sessions covering the history of the company, what is happening currently and where the company is heading in the future. Liberty is currently in the process of creating additional sessions. One that will address the inner workings of the organization and how the different pieces fit together, and another that will explain the nature of the energy industry and the company’s place in it.

“The point is to get people who are here a month the benefit of having a lot of the information that other people who have been here three years have gotten slowly over time and systematizing it so everyone learns these things at the beginning,” Eliezer Hernandez says.

While it may seem excessive to some, he says making the commitment to educate employees helps create an egalitarian atmosphere where even Liberty’s least-tenured team members have the same information as its founders and are thus armed with a clear sense of what it will take to make themselves and the company successful.

“It’s worth doing this because when people feel like they own their areas, their space and their company, they behave very differently, all the way from wiping down a counter to picking up a piece of paper,” Eliezer Hernandez says. “Those are symbolic things and evidence that people have an ownership mentality and feel like they have a stake. These orientations do that. They give people context and give them a sense of ownership.”

Though creating an orientation program like the one at Liberty might not affect a company’s bottom line directly, David Hernandez says an organization of people who are knowledgeable, engaged and comfortable will pay great dividends in the future.

“Effective companies learn that sometimes the decisions that are not as tangible in the short term are the best decisions,” David Hernandez says. “As you look at building a culture, you realize in hindsight that a lot of the little steps that you take over time really pay off in the long run. If you’re looking at creating a long-term business, you have to invest in your people.”

HOW TO REACH: Liberty Power Corp., (866) 769-3799 or www.libertypowercorp.com

Vision quest

When the employees of Amerijet International Inc. said they
wanted one of their collective goals to be becoming a billion-dollar company, Chairman and CEO David Bassett didn’t flinch, even
though that was about $900 million more in revenue than the company had.

“Companies need to set outrageous goals,” Bassett says. “Who
wants to set a goal you know for sure you’re going to achieve? You
want to set goals that are out there. A quote I’ve heard many times
is that, ‘It’s not that we aim too high and miss; it’s that we aim too
low and we hit.’ Outrageous goals make people really get into the
concept that they can be, do or create anything if they want it
badly enough.”

Amerijet, a provider of global cargo transportation services
based in Fort Lauderdale, reached about $100 million in 2006
revenue and has 650 employees in the United States, all of whom have had a say in the company’s overall mission. Bassett, who learned to fly a plane before he could drive a car, says allowing every person in his organization to have a say in Amerijet’s future has given employees a sense of
empowerment and ownership, created alignment behind a common goal and helped build a more cohesive team.

“One of the soapbox things I get on to people all the time is, look, a company isn’t buildings and airplanes and trucks,
a company is a group of people,” Basset says. “If all those people are functioning together with a very synchronous type of process, everybody understands the goal and everybody is allowed to, within reason, make that happen, it happens quicker and more efficiently.”

Bassett, who founded Amerijet in 1973, has embarked on a process whereby each employee at Amerijet participates in a
two-day training session, which is known as “vision training.” He says getting his entire company working toward a common objective has been invaluable.

“The overall benefit, obviously, is that the more synchronous a team can be, the more championships you win,”
Bassett says. “Individual effort can make you a star, but teams build championships.”

The case for empowerment

Bassett says that without a clear vision, a company and its employees will struggle to be successful, and while it is a leader’s responsibility to create that vision, leaders must
realize that doing so is a task that cannot be done alone.

“My impression of corporate America is that people believe
that the boss knows everything,” Bassett says. “The people that are supposedly executing the business plan are supposed to be people that know everything. The reality is that
most of us don’t.”

Although executives might be experts on business at a macro level, Bassett says you must keep your ego in check and allow employees with a higher level of customer interface to play a role in the direction the company takes.

“What some leaders fail to realize is that there are hundreds and thousands of employees right on the front line that are constantly in contact with the customer,” Bassett says.
“They know so much more about what the customer wants and needs than I do that it’s important to empower them and give them a voice so that you, the leader, can at least figure it out.”

A company’s mission should not be defined merely by its financial goals but also by cultural characteristics it hopes to
bring to fruition. Achieving buy-in and consensus around those things requires engaging every single person within an organization.

“Employees at every level, from the guy who is sweeping the floor to the guy that is running the company, have to feel empowered, and they’ve got to know where we’re going and
what the goal is,” Bassett says. “Everybody knows, ‘Make more money.’ That’s kind of elementary. But what else? What do we want our culture to look like? What kind of a job do I really want? Do I want to work at a place where I feel welcome and I feel a part of and I know where we’re going, or
do I want to work at a place where those things aren’t there? Every employee should be given the opportunity to grow and to be part of what the company really wants to be.”

A scalable vision

Though he has wanted to change the culture of Amerijet for years, Bassett says such an undertaking becomes increasingly complex as a company grows.

“When a company is small, zero or one to maybe 50 people, the owner or CEO can influence that group of people within reason, if he wants to,” Bassett says. “When you get to middle- and large-sized companies, it’s not as easy to do. It’s very
difficult to connect with everybody that belongs to the company. You lose the effect of a team, and you lose the effect of being able to move forward, grow together and allow employees to be empowered.”

Last year, Bassett decided to bring in a consultant to assist in formulating Amerijet’s global vision and help shape what
the company would look like in the future. Bassett, along with the rest of his officers and directors, participated in a two-day session during which each attendee had an opportunity to offer suggestions and help influence Amerijet’s direction.

Bassett says while leaders might initially have some apprehension about a complete overhaul of their company’s culture and mission, if each person is given equal voice and the ability to check one another, the result is a collectively
agreed-upon and concise vision that is well within the bounds of common sense.

“People that are part of this, in that initial group and those
subsequent to that, all know what business we’re in, so it’s not a debate of, ‘Let’s go sell shoes’; it’s a question of, ‘What
could we do to enhance our business? What do we want our business to look like? What do we want our environment to look like?’” Bassett says. “That was the beginning of what we now call our vision training program.”

Over the past year, every employee of Amerijet has been asked to complete the same two-day training, and Bassett
has sat in on every single session. Each employee, regardless of his or her position within the organization, is given the same opportunity to help mold the company’s vision that
was given to the executive group. Bassett says that despite the wide range of responsibilities and roles held by the participants, the sessions’ outcomes are fairly consistent.

“When they walk into the classroom, whether it’s a group of sales guys or it’s a group of linemen who move cargo, they go through the exact same training that the officers, directors
and I went through,” Bassett says. “At the end of those sessions, I stand up in front of them and say, ‘For the next two hours, you people in this room are now the board of directors. You get to choose what it is you want this company to
look like. Here’s what we’ve said the global vision is, so if you want to add to that or talk about that or, more specifically, how do you want your department to react in connection with that vision?’”

One of the attendees to the first vision training session, Amerijet’s Vice President and CFO John Nash, says that, in this case, the word “vision” carries special significance.

“What that really means is that you can accomplish anything you envision that you can accomplish,” Nash says. “At the heart of this is going through the whole program and
training people how to be positive and how to accomplish the goals that they want to accomplish. The direct effect is that it leads to people being empowered. We are literally reaching to every employee in the company, saying, ‘You’re
very critical, we value everything you’re doing, now how are you going to help us grow to the next level and beyond?’ Of course, along with that growth, they’ll be growing professionally, as well, within the company. It’s a big commitment
on our part to do this program, and we have seen tremendous results throughout our company.”

The payoff

Bassett says the culture of a company, as well as the leader and employees within it, benefit tremendously from involving an entire organization in creating a clear-cut and recognizable vision.

“When you know where you’re going, you’re excited about
getting there,” Bassett says. “Your whole attitude about work
is different. You’re interested in being here and executing
what you have to do, and we have spread this throughout the
whole company.”

Nash adds that while programs like Amerijet’s vision training certainly create benchmarks for a company, they also
allow for individual growth and help create a collegial and
collaborative environment.

“When you leave that program, it gives you a better feeling
about yourself and it also gives you a better feeling in terms
of the company,” Nash says. “We constantly reinforce not
just what the company wants — obviously we have goals
that we’re trying to achieve — but at the same time, there’s
personal development and team-building going on and many
other things along this line. It starts taking on a life of its
own, and it has really tremendously changed the culture of
the company.”

Employee attrition can be incredibly costly, and Bassett
credits his employees’ opportunity to contribute and grow
within the organization for Amerijet’s high retention rates. If
an individual is leaving for a job that will make that person better and improve his or her position, Bassett says,
“Godspeed,” but he says that Amerijet has had almost no
turnover because of an employee’s unhappiness.

“They come alive because they feel like they’ve been given
authority to do something,” Bassett says. “They feel they are
contributing and being a part of that team and that has a
huge impact. If you stop and think about it, when you take a
new job, you want to know what you’re going to get paid
because you’ve got to pay your rent and have money to buy
groceries and go to the movies. But more importantly, do you
feel wanted? Do you feel important? Do you feel like your
job is worthwhile? I don’t know too many people who hate
their job but get paid so much that they won’t quit. It’s usually the other way around.”

Because Amerijet’s employees played such a large role in
creating its vision and goals, Bassett says the vision training
program has also created a level of responsibility to act in
accordance with those principles and has given individuals
ownership of their roles within the company.

Additionally, Nash says in creating the vision, the company
also created a blueprint by which those individuals at the top
of the corporate ladder can lead.

“The whole senior management is very much committed to
this culture that we have, and once you get a company culture
to a certain point, it really becomes the overriding, guiding
principles to the company,” Nash says. “In many respects, it
guides what you can do and what you can’t do. A lot of times
we will sit back as a senior management group saying, ‘We
can’t really do that because it violates our value system.’ When
you get it to that point, you know it’s really working because
it’s keeping people focused on the right things.”

As a leader, Bassett says it is imperative that you hold yourself to the standard that you worked so hard to create.

“If you’re going to step out there and you’re going to make
a commitment to a vision, to a process, and you’re going to
create a culture, you better be very careful that you’re prepared to live with it,” Bassett says. “The cornerstone of leadership is trust. If you’re not trusted, you can’t lead.”

HOW TO REACH: Amerijet International Inc., (954) 320-5300 or www.amerijet.com

Leading by example

In the mind of Elizabeth M. Fago, a strong leader is a virtuous
one. And although guiding Home Quality Management Inc. to
where it is today has required perseverance, tenacity and resolve,
to Fago, HQM’s founder and chairman, the qualities of effective
leadership don’t stop there.

The daughter of a developer and a licensed broker since she was
18, Fago began her career in commercial real estate, but her
involvement in several transactions involving long-term care facilities for the elderly sparked her interest in a field she saw was
brimming with potential.

“I did a deal for a client, and in the process, I became familiar
with the industry and realized what opportunities were there,”
Fago says. “It was in its infancy. I decided then that I would
become a commercial broker of senior housing and basically self-taught myself the business.”

Based in Palm Beach Gardens, HQM, which Fago describes as a
“fixer,” acquires underperforming and troubled nursing homes and
assisted living facilities, mostly in rural areas, and helps bring them
back to prosperity. Since making her first acquisition in 1992, Fago
has grown HQM to more than 80 properties and 8,700 employees
across the southeastern United States and expects to reach $500
million in 2007 annual revenue.

Success, however, didn’t come as easy for Fago as it might seem.
Much of HQM’s growth was achieved during a time when many
health care companies were teetering on the edge of failure. When
the Balanced Budget Act of 1997, which included major Medicare
reforms, left virtually the entire industry eyeing bankruptcy, Fago
saw opportunity.

“We said, ‘Let’s come up with a plan that we can give our vendors
and lenders,’” Fago says. “We presented it. Our vendors extended
terms, and one even loaned us money. Our lenders extended
terms, and one even loaned us money. They believed enough in us
because we believed in ourselves, and we did it.

“When everyone else was dissolving entities, we were buying.
We tripled and quadrupled our growth during that period. It was
a difficult time, but our lenders today, and even then, are amazed
by our tenacity, and that started with my tenacity.”

Overcoming obstacles was nothing new for Fago. As a single
mother and a woman in an industry dominated by men, she has
grown accustomed to rising above adversity. Such dogged determination has been critical to Fago’s success. But now, with thousands of employees and a half-billion dollars of business to look
after, she has found attributes such as compassion, generosity
and optimism critical to creating the best chance of success.

Compassion

When HQM acquires a financially troubled facility, Fago says
the root of the problems are often caused by the employees’
lack of voice. As a result, Fago defines compassion differently
than other leaders might.

“You don’t go into this industry because of the money, you go
into this industry because of your compassion,” Fago says. “To
me, compassion is giving people the opportunity to speak.”

Fago says providing that opportunity and giving her employees a voice means allowing them to come forward with ideas,
and allowing them to come forward with concerns as well. And
while great ideas can come from any level of an organization,
achieving the latter is often more difficult.

Every single employee of HQM has Fago’s personal cell
phone number, yet she encourages her staff to follow the proper channels of communication. As a result, her phone rarely
rings, though she says the fact that she makes herself available
nonetheless has produced significant benefits.

“Management at every level knows they can ultimately get to
the chairman, but they don’t need to,” Fago says. “It’s the
knowing that they have that, the ability to pick up the phone
and call me anytime, that creates honesty and diligence on the
part of senior management.”

Fago says being an approachable leader is vital to her business, and by setting the example, a leader can inspire the same
accessibility throughout any organization.

“It’s about people, and if I wasn’t approachable, my senior staff
could take that same role,” Fago says. “The fact that I’m approachable makes them approachable, and it makes everyone
approachable.”

How a leader responds to the feedback he or she gets is as
important as keeping the lines of communication open. While
some leaders are inclined to sweep problems under the rug,
Fago says that despite the outcome, an employee will appreciate a leader’s diligence in addressing an issue.

“Things fester when you don’t address them,” Fago says. “I
teach my people to address the issue. Give that call common
courtesy. I tell people that I will look into it and get back with
them after doing my investigation. They may or may not like
what I come up with. Even if they don’t, because of the fact
that I addressed it, it becomes a nonissue.”

Fago says HQM’s openness and honesty, which includes sharing financial information, has made her organization a more
attractive and comfortable place for her employees to work.

“There are no secrets, and there’s no reason for secrets,”
Fago says. “When you have that open-door policy, people want
to come through it. They want to be part of it. Most people are
really good, and they want to be part of something good. You
don’t want to be part of something that’s secret or private.”

Fago says honesty on the part of a leader goes even further in
encouraging employee loyalty and creating an environment of
trust.

“You have to be honest, put all the facts on the table, and tell
someone upfront exactly what the situation is or what your
thoughts and intentions are,” Fago says. “They need to have
that trust in you. If you have honesty, you create trust, and people want to be with strong leaders that they can trust.”
Generosity

It is that same honesty and openness, along with a generosity of
heart and of time, that Fago credits with her organization’s ability
to avoid the backstabbing and politicking that plague many
offices. Fago speaks proudly of her organization’s desire to allow
for the success of its employees and allow for their dreams to
come true, but perhaps nothing embodied the generous spirit of
Fago’s leadership more than when, beginning several years ago,
she registered more than 10 members of her senior staff for a two-year MBA program at the University of Miami.

“When my president came to me with the program, it started
with a couple of people who wanted to go to this school and
that school,” Fago says. “Our thought was, ‘Let’s put a group
together, where they go together and build systems and programs and learn together.’ They would all go together over the weekend,
in the same class, and assist each other. It was an incredible opportunity for us as a group and as a company.”

Fago says the programs and processes that HQM has implemented as a direct result of its graduate program have created
financial advantages beyond imagination.

Her employees got a great degree, built camaraderie with their
colleagues and got the opportunity to further foster HQM’s family-oriented environment. From a leadership standpoint, Fago — who
also offers free schooling to any certified nursing assistant who
wants to become a licensed nurse — says a leader’s willingness to
invest in his or her people can pay dividends far beyond the bottom line.

“It was an expensive ordeal, but I believed in them because they
believed in me,” Fago says. “When you do something that is so
rewarding for your employees, they’re going to give more of themselves than you can ever imagine. I believe in giving great people
great gifts, and education is the greatest gift you can give anyone.”

Fago’s belief in her employees extends to her refusal to stifle
their creativity. As chairman, she has the ability to second-guess or
alter the decisions and policies of her CEO and president — she
never has. At HQM, Fago says that those who come looking for
direction are at the wrong company. On the contrary, organizations
with employees who are unable or unwilling to think on their feet
are doomed to failure.

“This world is changing at such a constant pace that if you are
complacent, you’re going to be gone,” Fago says. “They’re out
there, and they see it. They need to come back here and say, ‘I
think we should do this, this and this’ and enact their program. It
just keeps making them better and better and better. I’ve made
them all stakeholders. They feel that it’s theirs because it is.”

Optimism

Without optimism, which she considers one of the key functions
of any successful business leader, Fago says some of the world’s
greatest and most successful companies would have never gotten off the ground — a fact to which she believes she is a living
testament.

“Without hopes and dreams, which is being an optimist, I don’t
think you have much,” Fago says. “I was a single mom raising three
children on my own with no visible means of support, and I had a
dream. My dream was to go into this business, and if I didn’t
believe in myself, nobody else was going to believe in me.”

Fago has gone to great lengths to load HQM with individuals who
share her positive outlook. On the other hand, she says recognizing a negative individual in any organization is easy, and the proper method of dealing with such individuals is likewise straightforward.

“You can see negativity all over someone’s aura, who they are and
how they present themselves, and nobody wants to be around
those people,” Fago says. “Someone that is negative is like a cancer. If they’re negative, they’re going to be negative, they’re going
to infect their negativity, and they must be cut out.”

As Fago explains it, an optimistic leader need not be one who is
out of touch with reality, nor does being optimistic come at the
expense of the ambition and intelligence to execute a plan. As a
leader, Fago constantly challenges her team and makes no apologies
for doing so, yet she maintains the positive environment that she
believes has led to her organization’s success.

“You can make people accountable and you can be tough, but
that doesn’t mean you have to be negative,” Fago says. “I am very
tough and very demanding, but it is not negative.”

As important as optimism can be from a leadership standpoint, it
is as equally important when analyzing opportunities for your business. HQM has found success by acquiring facilities that others in
its industry felt weren’t worth the effort, and Fago illustrates the
potential financial benefits of optimism with an example familiar
to any businessperson in South Florida.

“This real estate market, for instance. If you’re an optimist, you
know it’s going to come back,” Fago says. “People are trying to
unload deals or unload properties, and it’s a perfect opportunity
for someone who is aggressive and optimistic.”

In much the same way, Fago has managed to overcome and capitalize on what many would consider negative circumstances in her
own life by turning obstacles into opportunities — a mantra she recommends.

“Obstacles can be negative, and they usually are, but if you take
that negative and make it a positive, what do you have?” Fago says.
“Opportunities come in many fashions: They can be learning lessons, they can be teaching lessons, and they can be making money.
Obstacles can always be opportunities. It all depends on what
you decide to do with them.”

HOW TO REACH: Home Quality Management Inc., (561) 627-0664 or www.homequalitymanagement.com

King of the road

In an office located somewhere in the heart of Destination
Daytona, the world’s largest Harley-Davidson dealership, Bruce
Rossmeyer answers the phone with a hearty and jovial hello. As
the proprietor of 12 locations spread throughout Florida and
beyond, Rossmeyer, always affable, has become, in just more than
a decade, the country’s largest Harley-Davidson dealer.

After nearly 30 years as a car salesman, Rossmeyer had left the
auto industry when, in 1994, he built Rossmeyer’s Daytona Harley-Davidson, his first foray into the motorcycle business and the genesis of his Harley empire. He has since expanded his motorcycle
interests, re-entered the car market and become a restaurateur,
and at 64, shows no signs of slowing down.

“My wife says to me, ‘All of our friends are retired,’ and I say,
‘What do you want me to do, come home and paint the porch?’”
Rossmeyer says. “I don’t need a job. I don’t need the money. I enjoy
coming to work.”

With a territory covering such a wide geographical area,
Rossmeyer’s leadership style is one that, by necessity, places a
high value on effective communication. For him, that means
face-to-face, verbal interaction.

“I don’t have a computer, I don’t have none of that stuff,”
Rossmeyer says. “I’m going to get through the age of that. The
people coming up can’t. I don’t e-mail, I don’t have a computer
on my desk, because I don’t have to do it. They do. That’s the
old school; it got me here today, and it will get me there tomorrow.”

Rossmeyer’s enthusiasm is just one way in which his motto,
“Take risks and follow your passion,” has manifested itself
over the course of his career. In 2004, Rossmeyer opened the
doors of his most ambitious project to date. Situated on 150
acres in Ormond Beach, just north of Daytona Beach,
Destination Daytona includes hotels, condominiums, bars and
restaurants, a concert pavilion and, not least, the biggest
Harley-Davidson showroom ever constructed.

Rossmeyer, whose South Florida dealerships are headquartered in Ft. Lauderdale, says that his ability to take risks when
necessary has been vital to his success, and has allowed him to
achieve his ultimate goal.

“When I got into the motorcycle business, I thought if I put
my car industry knowledge and aggressiveness into this, 10
years down the road maybe I can be the world’s largest Harley
dealer,” Rossmeyer says. “Ten years later, with 12 locations
and over $200 million in sales, I’ve accomplished that.”

Taking risks

Taking timely and effective risks can help your business grow
and keep you ahead of your competition, but, as Rossmeyer
says, risks are inherently, well, risky. He likens risk-taking to a
high-stakes game of golf. If you’re putting for $100 a shot, you
can make a putt and win $100, but the risk lies in missing and
not having a hundred dollar bill in your pocket to make good
on the bet. However, Rossmeyer says that a company in stagnation is often the result of its leader’s unwillingness to take
the shot.

“Trying to jump over 100 buses on a motorcycle is taking a
risk,” Rossmeyer says. “You might not make it, but if you’re not
ahead of the competition, you get left behind.”

For Rossmeyer, effective risk-taking started with having a
clear vision of what he wanted to accomplish.

“My vision was, ‘I’m going to do whatever it takes to buy and get locations and be the world’s largest Harley dealer.’”
Rossmeyer says. “I said, ‘This is what I want to do and how I
want to do it, and I’m going to go a hundred miles an hour to
accomplish it.’ Obviously, there are a lot of bumps in the road,
but we overcame it and came to where we want to be today.”

In making the decision to move forward with what was, by
industry standards, a monumental undertaking, Rossmeyer
says he had a high level of confidence in his product and market. Despite that, he was sailing into uncharted waters — a
feeling that was not unfamiliar.

“When I built my first dealership in 1994, which was about
22,000 square feet, people said, ‘This guy’s nuts,’” Rossmeyer
says. “When I built this store in 2004, people said, ‘This guy has
now lost his rocker, it’s 109,000 square feet.’ What I did in ’94
was something that was phenomenal in the Harley industry as
far as size, and now that store is just a normal store.”

The lesson is, of course, that what was once extraordinary
will not be extraordinary forever. Staying ahead of the pack
means constantly pushing the envelope, seeking new ideas and
not settling for status quo, which Rossmeyer certainly did not
settle for when he built a Harley showroom that more than
tripled the standard size.

“If you sit down and put it on paper, it didn’t make the most
sense,” Rossmeyer says. “But if you wait, you snooze, you lose.
It’s harder to catch up than to go forward. If everybody did
everything step one through step 10, by the time you got to
step 10, you’d be left behind.”

Rossmeyer describes his risk-taking philosophy as “throw it up
against the wall and hopefully enough sticks.” Though his risk
level is sometimes high, the rewards have always been higher,
and taking his businesses to the next level has been his most significant payoff.

“I will sit here and say, ‘Hey, I’m going to pay you $50,000 a
year, $1,000 every week or I’m going to pay you $35,000 and the
option that you could make $70,000 with incentives,’”
Rossmeyer says. “Some people jump at that chance, and some
people say, ‘I’ll just take my thousand dollars.’ It’s the same
thing in business. Some say, ‘I’m here today, but do I want to
risk and go forward to the next step?’ And that just separates
the men from the boys.”

Leading a team

Rossmeyer is quick to point out that one should not credit his
or her success solely on the willingness to take a risk. Growing
his businesses has required a lot of being in the right place at
the right time, a lot hard work and, as is the case with any
organization, surrounding himself with a lot of quality people.

“If you surround yourself with good people it’s not a risk,
because you’re going in with talented employees,” Rossmeyer
says. “I couldn’t have and have not done this by myself. I could
not have done what I’ve done without good people.”

As a company grows, it becomes increasingly difficult, if not
impossible, for a single leader to stay in touch with the minutiae of day-to-day issues. This is especially true of an organization such as Rossmeyer’s, whose Harley-Davidson locations
span four states.

“I also have car dealerships, I have restaurants, and you can’t
be at 20 places on the same day,” Rossmeyer says. “When you
have good people underneath you that understand you and
work with you, it’s a team.”

Surrounding yourself with quality talent is only the first step.
Rossmeyer says that once a leader recognizes the need to delegate responsibility, he must then step up and give others the
opportunity to be leaders as well. Not all embrace the responsibility, and, as Rossmeyer has found, it’s not as simple as giving someone an IQ test.

“Give them that opportunity,” Rossmeyer says. “Some people don’t want to go to that next level. They just like their job,
and they like what they’re making.”

Separating leaders from followers is only one distinction that
Rossmeyer has had to make while building his team. As he
says, utilizing an individual’s best skills and building a successful nucleus of talent sometimes requires a more significant
change.

“There are some people that are good salesmen that are not
good managers. There are some people that are good managers that are not good salespeople. It’s any combination of
things,” Rossmeyer says. “Everybody is not always in the right
place. Hey, I’m a Houdini. Believe me, everyday there is a challenge.”

As he has grown his organization and continued to open new
locations, Rossmeyer has also been careful not to, as he calls
it, “cannibalize,” his existing operations. Rather than transferring employees wholesale to a new shop, he instead identifies
within his organization one key individual around which to
build a team. Rossmeyer says that though it might be more difficult and time-consuming, an organization is better off building a new team from scratch.

“There are different areas, different people and different personalities, and you’ve just got to take the time to build a team
with the same basics that have been successful before,”
Rossmeyer says. “It might take you a little longer than you
sometimes want it to, but when it’s all over, it works out for
the best.”

Following your passion

In addressing the latter sentiment of his “Take risks and follow your passion” motto, Rossmeyer doesn’t mince words in
summing up the current landscape of corporate leadership.
Too many people aren’t passionate about what they do.

“Go take a survey of any 20 executives. Ten of them will tell you
they hate their job.”

As a longtime motorcycling enthusiast, Rossmeyer has no
problem being passionate about his own current endeavors.

“One thing I’ve always said about being in the automobile
business and also the motorcycle business is that the automobile business is a job, and the motorcycle business is fun,”
Rossmeyer says. “I have on my forearm a Harley bar-and-shield
tattoo. On my other arm I don’t have a Toyota tattoo. It’s a passion.”

The fact that he displays his pride and devotion so openly has
a tangible effect on his team and his business. Rossmeyer says
that a leader who has dedication to his organization and is willing to show it, will be rewarded with employees who share in
his enthusiasm.

“If they feel you have the passion and the desire, they’ll follow in the footsteps,” Rossmeyer says. “I don’t ask my employees to do anything I wouldn’t do. I’ve done it, and I’ll ask them
to do it, and if your people feel you have the desire and passion
to work, they’ll follow through with it.”

Though Rossmeyer says passion does not necessarily lead to
success and success does not necessarily require passion,
when the two coincide, the results cannot be understated.

“I get up every morning and enjoy going to work,” Rossmeyer
says. “Does that maybe overcome some obstacles or some
things? Yeah, just look at anything you do. The fact that these
people enjoy what they’re doing, they’re putting more effort
into it, they’re spending more time doing their job and not complaining about it. If you get up and you enjoy doing what you’re
doing, it sure makes a big difference, whether it’s business,
sports or anything else.”

HOW TO REACH: Bruce Rossmeyer’s Ft. Lauderdale Harley-Davidson, (954) 724-2800 or
www.brucerossmeyer.com

Knockout punch

Most business leaders would love to have employees who wear
their love for their company on their shirtsleeves. As the president
and CEO of Marketing Magic Inc., Bob Rose prefers his team take
it one step further and show their pride by wearing no sleeves at
all — metaphorically, anyway.

“When you come into our company, we ask you to put a tattoo
on your arm of our logo. The question is whether you’re going to
wear a tank top or a long-sleeved shirt,” Rose says. “If you’re wearing a tank top, that means you’re proud. Most people who have tattoos really want other people to see them. If you’re wearing a long-sleeved shirt and you’re covering it up, you’re probably not really
proud to be a part of our company.”

And while no one is actually being branded with a company logo,
it does show what kind of attitude Rose expects from his employees.

“You’ve got to love our company,” he says. “If you don’t love our
company, I don’t want you to be a part of our company.”

Getting that level of employee devotion is obviously easier said
than done, but Rose says without a team that enjoys and takes
pride in its work, his business would fail. Loving what you do leads
naturally to better job performance, which translates to better service for clients and better and more plentiful opportunities for your
business.

Keeping Marketing Magic free of malcontents has been key in
helping Rose grow the company to nearly $250 million in annual
revenue, making it the largest independent advertising agency in
the southeastern United States.

“The death knell for every company is when the people start
gathering around the watercooler talking about what’s wrong with
the company,” Rose says. “That’s the beginning of the end. What
you want is people gathering around the watercooler talking about
what’s great about the company. That’s a tough thing to get.”

In an effort to encourage his employees to make a commitment in
Marketing Magic, Rose makes a commitment to his employees by
fostering a culture that emphasizes employee education and creating
opportunities for their personal growth. Not wanting his organization
to be a bus stop for advertising professionals, Rose makes sure he
gives them ample reason to stick around.

“We have incentivized our people with everything from education to the ability to move up the ladder to stay with us for the long
term,” Rose says. “Turnover is the worst thing in any business. The
longer you have an employee with you, the more they understand
your company, the more they understand you and the more effective they’re going to be.”

Orientation

At Marketing Magic, learning and utilizing new information and
getting buy-in starts with getting everyone in the organization in
the same mindset. For new hires, Rose says acclimating oneself to
the company and its culture is a process that is identical for anyone who joins his team, regardless of talent or previous experience.

“There is an educational process in understanding who we are
and what is going to help you fit in to the company,” Rose says.
“You could come from another ad agency or you could come from
school, it wouldn’t matter. You need to understand our company in
order to be effective.”

Rose says failing to allow new employees to become accustomed to the customs and culture of an organization will, without
exception, negatively affect those employees’ performance.

“It’s like selling the same suit in a different store,” Rose says. “It
would be the difference between how you would train your sales-people at the Men’s Wearhouse as opposed to a boutique shop. It
might be the same exact suit from the same exact place, but the
results would be different based on how it’s approached.”

At Marketing Magic, the intricacies of the company’s processes
and procedures are learned through sessions with department
heads. Peers lead by example to demonstrate work ethic and
accountability. There is technical training to make new hires comfortable with the company’s custom software system.

Perhaps the most important aspect of the orientation is the
review Rose gives after 90 days of employment, the amount of
time he says it takes for someone to get up to speed at Marketing
Magic. Though Rose says a favorable review means financial benefits for the employee, its purpose has at least as much to do with
allowing him a chance to encourage feedback from his staff.

“When the people come in for their 90-day review, the first thing
I ask them before I give my opinion is for them to give me a review
of the company,” Rose says. “‘Tell me what you have learned about
the company. Tell me what you like and what you don’t like.’ I give
them an immunity bubble so they can say whatever they want, and
I have found people to be very open about it and very appreciative
that they actually have a chance to be heard.”

In addition to ensuring that his recent hires have all the information they need to function as a member of the company team, Rose
says that asking for feedback demonstrates to employees that
their opinions are valued and they have the opportunity to contribute and make a difference.

“When you’ve been in business for 25 years, the good part is that
people can say, ‘I’m with a company that’s very stable, they’re not
going to close down and I’m not going to lose my job,” Rose says.
“I get that, but the downside is that they say, ‘I’m with a company
that is set in their ways and they already know how they’re doing
things, so there is no opportunity for growth for me.’ We need to
address that, because that’s not the case.”

Homework

If being schooled in the Marketing Magic philosophy is the first
stage in Rose’s educational process, the next step is developing an
awareness of what is happening in the world outside the company
walls. His investment in his employee’s ongoing education
includes required and recommended readings that he says have
been critical in building and maintaining credibility and providing
clients the highest possible level of service.

“The question is, what might affect the thinking of our clients and
how can we help them do their jobs better? At the end of the day,
we just want to be a good ad agency for them,” Rose says.
“Therefore, if our people are not well-informed, if they don’t really
understand our business, what we’re doing, what our clients are
looking for and so forth, they’re either going to say the wrong
thing, get caught off guard or lose credibility with the client. From
a very practical business point of view, you need to know what’s
happening.”

To Rose, knowing what’s happening is synonymous with staying
well-versed on the current happenings of the market. As such, he
encourages his department heads to distribute articles and other
readings that are not only relevant to the marketing and advertising industry but those of their clients. For example, because
Marketing Magic has several clients in the finance industry, Rose
says it’s important that his team be aware of news concerning
interest rates and related topics.

Rose assigns every person who joins the company to read
Harvey Mackay’s “Swim with the Sharks Without Being Eaten
Alive,” which he considers the best sales book ever written.

The criteria for deciding what materials to ask your staff to read
are simple.

“When you offer books to read, it should be something that helps
somebody think, helps them grow or is applicable to your industry,” Rose says. “It has to be something that you yourself learned
something from. If you read something and it seemed familiar or
remedial, why would you recommend that to somebody else?”

Rose says his emphasis on education plays a role in developing his
employees’ pride in what they do. Additionally, staying abreast of relevant current events contributes to a company’s collective ability to
execute.

“Education is knowledge,” Rose says. “It’s the key. The more you
read, the more you know about what’s going on as an employee or
even as an owner of the company, the better you can handle business, the better you are as a part of your team.”

Putting it to the test

What one might consider the culmination of Marketing Magic
101 is creating a stimulating environment that allows employees to
further their development by actually putting what they know to
use.

“You have to offer people opportunity to learn,” Rose says.
“People can get bored in their jobs really easily. You don’t have to
just be packing meat to get bored.”

Through a process of delegating decision-making and management duties to his vice presidents, department heads and those
below them, Rose creates those learning opportunities. His
employees get the chance to take on new challenges and advance
themselves professionally.

Most of the strategic decisions are still handled by Rose, but decisions that are closer to the clients are often handled by employees.

“If we’re going to move our offices or make a major change like
that, or buy somebody out, I probably would not ask for a lot of
advice on that,” says Rose. “I might get some preliminary information, but that’s a decision that I’m going to make on my own. When
it comes to how we can go about doing better creative briefs, presentations, incorporating state-of-the-art equipment, what we need
in terms of equipment and training, and things like that, I rely on
my people a lot.”

From a leader’s perspective, the benefits of sharing responsibility are numerous.

“It benefits me as a leader because I don’t have to do all the
work,” Rose says. “It benefits them as employees because it allows
them to utilize more of their skills, it allows them to make more
money and it gives them a reason to stay with the company, which
benefits me as an employer, also.”

Though making the decision to give up any amount of control of
day-to-day operations can be difficult, Rose says that it is simply
impossible to run a company without doing so. Having been
burned in the past by former employees — including a controller
who embezzled more than a half a million dollars — it would be
understandable if he were even more hesitant than most to trust
those around him. However, Rose compares the process to dating:
Just because someone has been through a relationship that ended
badly, it doesn’t mean they should never date again.

“I’ve been disappointed by people on more than one occasion,
but it’s not going to stop me from continuing to do it,” Rose says.
“If somebody earns a position, if they earn the right to be promoted, you do it.”

Of course, as with any learning process, mistakes will be made,
and Rose says you must be ready to respond to those mistakes
appropriately.

“You do expect that there will be mistakes, but there are mistakes that are acceptable and mistakes that are unacceptable,”
Rose says. “You have to be prepared to reward someone for doing
a good job and that could be as much of a reward as equity in the
company, or punish someone for doing a bad job, which could be
firing them, and everything in between.”

Though Rose says there are limits to the amount of authority a
leader can surrender, if you are not willing to allow your employees space to operate, any benefits you might have gained in building a positive culture will be lost.

“There are certain decisions that you have to make yourself, but
if one of my VPs wants to go in a certain direction and we have
three people who all look at it and voice an opinion, at some point
I’m going to let him break the tie,” Rose says. “You have to let the
people you empower make a certain amount of decisions or otherwise they’re just paper puppets.”

HOW TO REACH: Marketing Magic Inc., (954) 923-7700 or www.marketingmagicadvertising.com

The top investor

When Rory A. Brown founded Lydian nearly a decade ago with three partners and a background in banking and investment management, he had never before experienced life at the top of an
organization.

And along with his new role as chairman and CEO came an unexpected revelation.


“The most surprising thing to me in my role at Lydian is that oftentimes, it is much more enjoyable working for somebody than being the final person,” Brown says. “I didn’t quite contemplate
that it is a lot more stressful when something goes wrong and there is nobody to ask about it. When you make a change, it affects a lot more people than just yourself.”

In an effort to tap the intellectual capital of his entire organization, Brown has developed a leadership style based on finding talented people and giving them the opportunity and authority to
become leaders in their own right.


“When you mention the word ‘leadership,’ I immediately fall back to, ‘How do we provide an environment that allows leaders to succeed?’” Brown says. “It seems that the best leaders are surrounded by people who are leading.”

Lydian serves high-net-worth individuals through wealth management and other services, and also has an Internet banking division, VirtualBank.com. With headquarters in Palm Beach
and nine additional offices nationwide, the company grew its combined annual revenue to about $140 million in 2006, compared to just more than $50 million in 2003.

Though Lydian might have evolved into a larger and more diverse organization, the core foundation of Brown’s leadership philosophy has remained intact: an emphasis on the company’s ability to attract and retain successful employees.


“Through the last eight years, we’ve probably started about eight or nine different businesses all under the Lydian umbrella that do different things, but the thing they all share in common is talented people,” Brown says. “The environment of the company has changed over time. If you walked into five of our company offices, all five might feel entirely different, but
what they would share is that you would like all the people.”

Hiring with purpose
As the leader of what he considers a people business, Brown says he watches his most important assets walk out the door every night.


“If you don’t start with quality people, it’s hard to build a quality business,” Brown says.

As such, one aspect of his leadership with which he is most pleased is Lydian’s low employee turnover. Brown does not underestimate the relationship between a company’s ability
to retain its people and its ability to grow and succeed.


“The top priority is retaining talented people,” Brown says. “The organizational loss when you have turnover is multiples of what anybody ever believes it to be. That institutional
knowledge is invaluable. If you have a talented individual, it’s incredibly important that you retain him.”

Brown says the easiest way to do that is to make sure the people you bring into your company in the first place not only have the skills required for a job but that his or her personality and values mesh with those of the company and of the position.

“You end up with lower attrition if you do a better job hiring people coming in,” Brown says. “If your hiring process is well-thought-out and structured, you’re going to have a lower
turnover rate than if it’s kind of a law of large numbers approach, saying, ‘We’re going to hire people until we find the right ones.’”

With a goal of building a team that shares a unified goal, as Lydian has grown and evolved, so, too, have its recruiting and hiring processes. As a small company, ideal employees were
those who possessed a broad and varied skill set and who could make contributions in many areas.

As a company grows, Brown says a leader often has the luxury of employing multiple individuals in the same position with far more defined specialties. When looking to add someone to his team, Brown is now able to use a series of formalized psychological tests to create a profile of the common attributes of the four or five most successful people in a particular position.

Using the same testing process, Lydian then compares the attributes of each candidate to the company’s ideal profile. Only when a person matches will he or she become part of the
formal interview process.


“We’ve changed over time in that, early on, it was the typical interview process, where you met with somebody for a while,” Brown says. “Now, we can compare an individual’s profile to our target profile, and if it doesn’t match, that person is simply not considered for that position.”

Brown says having a more defined set of characteristics can also be helpful in recruiting candidates, and Lydian’s profiling processes has been highly successful in avoiding bad hires,
which, in turn, has improved employee retention. As Brown says, someone is far more likely to leave Lydian because he or she plans to relocate — not because there is a better company to work for locally.

Allowing employees to succeed
But what makes a company a great place to work? In Brown’s opinion, it’s creating an environment that empowers employees to succeed — a priority second only to finding the right people to begin with.

“One of the biggest challenges is finding talented people and then allowing them to be successful,” Brown says. “Oftentimes, it’s easy to fall into the trap of saying, ‘Here, do it this
way,’ as opposed to saying, ‘Look, you’re a smart individual. How would you solve this problem?’”

Brown says successful growth requires a delegation of responsibilities, which requires trust and understanding on the part of a leader.


“You have to trust the people you’re delegating authority to, and you have to be comfortable that other people aren’t always going to do it the same way you would do it,” Brown says. “In
order for a business to be scalable, one individual can’t make all the decisions. If you actually want to grow rapidly, you have to hire talented people and you have to trust them to make
decisions.”

Allowing for your employees’ success is not always as easy as plugging someone into a role and walking away. Rather than let a talented employee flounder in a role that might not best
suit him or her, Brown says a proactive approach is necessary to ensure that all of the pieces of a company’s puzzle fit together correctly.

“Sometimes, you might have a talented individual in the wrong role,” Brown says. “If we have a talented person who is just in the wrong job, we look at that as a good role for our human
resources department to find the right job in the organization for them.”

Brown identifies two types of struggling employees. One is an individual who might struggle in executing in his or her responsibilities but who fits culturally and intellectually with your
organization. The other is one who neither performs at a high level nor meshes with the culture. At Lydian, Brown is interested in retaining and nurturing the former, but not, necessarily,
the latter.

Telling the difference between the two isn’t always easy, but the employees to keep usually have more allies.


“Typically, the managers will say, ‘Here’s somebody I really like, but they’re just not working out for me, is there something else we can do with them?’” says Brown. “Those people tend
to develop that relationship with their manager. If you’re in a job and the person you work for really likes you, but you’re just not hitting on all cylinders what they want you to do, they’re
going to help you. It’s the opposite if it’s somebody the manager really struggles with interpersonally or culturally.


“You’re constantly evaluating people in different areas of your organization. What we monitor in our organization is that we want to transfer good people. We don’t want to transfer a problem.”

Using a profiling process similar to that used to bring new employees into the company, Lydian matches internal people who might be best used elsewhere with other roles in the company. Brown says that different roles require different personalities, and retaining a talented performer and giving that individual the greatest chance for success is worth the extra effort.
“It’s not that a person is good or bad,” Brown says. “You just need to make sure they’re in the right role.”

At Lydian, correctly positioning employees and empowering them is only one half of a leadership strategy that encourages overall staff development. Brown says that in addition to
allowing employees the freedom to operate, a leader must support his or her staff with the tools they require to succeed.

“As a management group, we want to do everything possible to make a person successful,” Brown says. “If you hire talented people, you want to provide them with the infrastructure,
resources and guidance to allow them to succeed. You don’t need to lead them, you just need to support them and help them.”

In the eight years since Lydian’s founding, Brown says the company has developed a corporate infrastructure that he likens to a reliable public utility. He says such a support system
is instrumental in giving his employees and his company the best chance to succeed.


“Somebody starting today can walk in and, whether they’re starting a new business for us or building a new department or becoming part of an existing department, there is a base
level of infrastructure that just works,” Brown says. “It’s a two-pronged approach, and the other side of that is you have to have an environment that is conducive to developing those
people and growing them.”

Building an innovative culture
As Brown likes to point out, the importance of hiring the right people is twofold in that the character of a company’s culture is a product of the character of the people who constitute it, a fact of which leaders must be ever aware.
“You have to focus on building a culture, because it isn’t just one person,” Brown says. “It’s a collection of individuals that is the culture.”

Brown says the ideal company culture is one that is constantly innovating and making improvements, and it necessitates people who wake up each day looking for ways to better the
company and its processes.


“If a person has been doing the same thing for the last 20 years and they haven’t improved it, that is not the type of individual you’re looking for,” Brown says. “There is a type of person that enjoys building, and that is the personality profile you’re looking for, somebody who has a restless curiosity to make the process better, and it doesn’t matter what process it
is.”

Furthermore, Brown says a company with a truly innovative culture is one that actively solicits feedback from its employees, as well. While the adage of ‘Catch somebody doing something right’ and positive feedback are always nice, Brown says that leaders must be ready and willing not only to accept negative feedback but to take steps to correct the shortcomings it illustrates.

“If you have a culture that encourages feedback, you need to be willing to accept that feedback and adjust or adapt,” Brown says. “It’s one thing to have a culture that says, ‘We hear
we’re doing this poorly,’ but you also have to be open to the fact that you need to make change.”

Though Lydian employs approximately 1,000 people, Brown says that a flat organizational structure and a leadership team that seeks feedback from all levels of the company, not just its
direct reports, facilitates a flow of ideas and information that allows everyone in the company to share in its success. Leaders who are able to take the next step and act on the information
they get will reap the rewards of an ever-improving organization and of a satisfied team of employees.

Says Brown, “If people feel like they’re part of building something that they’re instrumental in its success, that’s a very motivating environment for people to be in.”

HOW TO REACH: Lydian, (561) 514-4900 or www.lydian.com

The opportunist

The phrase “a perfect storm” refers to an unlikely convergence of events resulting in a force far more powerful than that of each event taken individually.

One would not be incorrect, nor would one be the first, to describe as such the formation of Moss & Associates LLC, a Ft. Lauderdale-based construction firm that has become one of the largest general contractors in South Florida.
“We were in the right place at the right time with the right people to take advantage of the opportunities,” says Bob L. Moss, founder
and president. “And there were plenty of them.”

A veteran of the South Florida construction market, Moss had worked with several major contractors — most recently as CEO
and president of Centex Corp. — for more than 30 years when he decided in 2002 that it was time for a break. Little did he know
that less than five years later, he would be busier than ever, leading his own company that by its third full year would be posting
yearly revenue in excess of a half a billion dollars.
“Starting my own company was not an idea that I hadn’t had on a couple of occasions in the past,” Moss says. “If you would
have asked me in 2002, I would have said we probably would have a $50 [million] to $100 million-a-year business, and we’ll focus
on some clients that we worked with in the past in the Ft. Lauderdale-West Palm-Miami area, and that’s OK.”

When the 18-month noncompete agreement that he had signed when he left Centex expired in 2003, Moss’ phone started ringing. Rumors were swirling that he was starting his own company, and people wanted in.

As Moss says, you can develop quite a bond when you work with the same people for decades and many of those with whom Moss
had shared success in the past were looking to continue their good fortune. Nearly simultaneously, Moss & Associates was granted a
$50 million project by Nova Southeastern University, a stroke of luck that was a sign of things to come.
“Not only did I have the desire, I now had the need for some good people because I had to build a $50 million project,” Moss says.
“The timing of that was great in that it was almost to the day that my noncompete was up and several very, very good people decided they wanted to join me and build that project.”

Moss & Associates was off to the races. The successful completion of the first project led to others, which, in turn, led to still
more. By the end of 2006, just three years after the company’s founding, Moss & Associates had grown revenue to $620 million,
doubling its 2005 figure.

And although Moss knows good fortune and great timing had much to do with his company’s success, he isn’t ready to surrender all credit to chance.
“I consider myself to have always been somewhat lucky,” Moss says. “Luck in business, to me, is when opportunity and preparedness connect. The opportunities have been there and we have been able to be prepared or get prepared in a timely enough
manner to respond to those opportunities.”

Prolific growth such as that experienced by Moss & Associates is often accompanied by a laundry list of potential complications — a list with which Moss is well familiar — that, if ignored, can stifle a company’s growth before it ever gets off the ground.
“You might ask people to do more than they’ve done before, you may not have enough people to watch the details and so some
things fall through the cracks,” Moss says. “If you try to do too much, sometimes you don’t do anything well.”

Relying on a strategy based on clear expectations, providing the necessary support and recognizing his company’s limitations,
Moss has avoided those pitfalls while building a company whose revenue will never outgrow its capabilities.

Communicating expectations
Of course, revenue isn’t the only thing that grows when a company expands. By the end of 2004, the staff of Moss & Associates
had increased from four to 55 employees.

By the end of 2005, that number had ballooned to 201, and today, the company has 330 salaried workers. Moss says to successfully manage a company’s growth, it is important that every person the company employs, and those people who are hired
along the way, be aware of the company’s expectations.
“We don’t want to surprise our employees,” Moss says. “We want them to know what’s expected of them, we want them to know
how we want them to operate and we want them to know that we’re paying attention. We are not at all bashful about telling people that if they are willing to work hard and they’re willing to apply themselves and learn, this is a good place to be, but if they
want to just coast and be an 8-to-5 person four-and-a-half days a week, it’s not a good place to be.”

To help make his expectations clear, in 2004, Moss called a roundtable meeting of all of the company’s 100 employees. Their goal
was to create a document, now known as Moss’ Non-Negotiable Standards, that would detail the essential features of a successfully run company.

The result of their efforts became a blueprint that Moss uses not only to hold current staff accountable but to illustrate to new
and prospective employees exactly what it takes to be a successful member of the Moss team.
“It’s helpful for people to know that’s how we expect them to behave and to communicate that, because we’re bringing in new
people all the time.” Moss says. “We’re able to show that to somebody who was thinking about becoming an employee of this
company and say, ‘These things are important. We don’t want to deal with managing these things on a regular basis. If you can’t
do these, you don’t understand these or you don’t want to do these things, then this is just not the right place for you to work.’”
By detailing what he expects of employees and what he wants the company to be, Moss has assured not only that employees
are working toward the right goals but that they’re doing so in the right way.

“I don’t think it’s a secret to any business,” Moss says. “If you want to be successful, you’ve got to have smart, hard-working people
that pay attention to the important aspects of the business and what it takes to succeed and not succeed.”

Furthermore, as Moss points out, it is necessary that once such expectations have been established, effectively communicating
them requires that everyone in the company — especially its leaders — hold themselves to the same standards.
“It’s important every day for everyone to know what’s expected of them, and it’s especially true with new folks coming into the
company that you walk the talk,” Moss says. “If your senior leadership doesn’t walk the talk, how can you expect your other people to do it? If you set bad examples, you get bad examples.”

Providing support
Although Moss had modest expectations for the size to which his company would grow, it wasn’t long before he realized Moss
& Associates was going to be more than a mid-sized, local operation. And once he understood the potential of the company, he
immediately set out to build the framework to support the growth he foresaw.
“In 2004, it was obvious that we were going to have a sizable company,” Moss says. “We needed to recruit people in the support
area, not operational people but people to help manage the financial and risk management of the company from a corporate
standpoint.”

That support structure included a chief financial officer, a chief administrative officer, two controllers and several other positions whose primary responsibility was keeping the company’s financial processes tight and precise. Moss says that in a growing
company, adding such positions as quickly as possible is vital to an organization’s ability to monitor growth and continue to operate successfully.
“Those people are essential to help manage risk,” Moss says. “There’s nothing that would destroy the credibility of a new company faster than inconsistent and inaccurate financial data. We had the strong operational team in place, but we needed the
strong support team to help them be as successful as possible and to help me run the company.”

Equally important to supporting growth from a financial and administrative standpoint is supporting the individuals responsible for executing on a day-to-day basis. As he has taken advantage of new opportunities, Moss has been careful not to ask too
much of the new, often less-experienced employees he has brought on.
“You have to put people on the front lines that have experience in doing what you’re asking them to do and who have proven
that they can do it well,” Moss says. “If you put unknown people in responsible positions and you don’t provide them leadership
and check on them, before you know it they will get you in trouble.”

Because growing companies often encounter difficulties when they outgrow their talent and grant too much decision-making
power to unproven individuals, Moss says the importance of supporting your staff with guidance from more experienced leadership cannot be overstated. At Moss & Associates, this is accomplished by teaming a more junior member of staff with an
industry veteran, which Moss has found allows his company to groom future leaders while maintaining positive results.
“If somebody has worked with me for 20 years, I know what to expect,” Moss says. “If they’ve worked for me for a year, I don’t
know what to expect, and typically I’m going to be surprised negatively. If I have that person working day to day with someone
who has worked with me for 20 years, I get a much more predictable outcome.”

Recognizing limitations
At the end of the day, Moss & Associates’ growth is a credit to the talent of its team and its ability to execute successfully, something that Moss says requires a dedicated attention to detail.

Hoping to continue developing that trait, Moss has no ambition to duplicate the growth rates the company has experienced in
recent years. Instead, he plans to devote the next year to further streamlining processes and procedures, which Moss says will
be essential to support the company and improve execution in the future.
“We have new people that are stepping up, understanding their jobs better, learning how to work the way we want them to
work,” Moss says. “2007 is going to be a year of focusing on execution and continuing to improve our working together and all
those things.”

Although Moss doesn’t plan on doubling the company’s previous year’s revenue, he is careful to point out that Moss &
Associates isn’t halting growth but simply growing less quickly. While growing companies are often aggressive to a fault in exploring new opportunities, perhaps the most surprising fact about the growth of Moss & Associates is that it could have been even
more explosive.
“We have said no to some very big, sophisticated projects this past year because we just didn’t have the resources available at
the time the project needed them,” Moss says.

Although often difficult, Moss says recognizing the limitations of your company during a growth phase is necessary to avoid
spreading your resources too thin. Saying no to additional revenue requires discipline, but in successfully managed growth, the
opportunities you pass on can be just as important as those you choose to pursue.
“In a growing business, you’re always anxious to learn about potential opportunities to grow your business and increase your
profitability,” Moss says. “There’s a temptation in a very busy market to try to do too much too fast. You have to have the right
filters in evaluating new clients and new opportunities and matching that with your available resources.”

HOW TO REACH: Moss & Associates LLC, (954) 524-5678 or www.mosscm.com

Fred Stock

Fred Stock believes that there is always room for improvement, and he’s created a culture at Miami Jewish Home & Hospital for
the Aged to reflect that. Stock, the hospital’s executive director and COO, aims to provide quality care and does so by empowering
employees and holding them accountable. MJHHA is the largest skilled nursing facility in Florida, serving more than 700
residents and posting annual revenue of $70 million. Smart Business spoke with Stock about how continually striving to be better
has kept his organization ahead of the competition.

Create a problem-solving culture. No organization functions perfectly
at all times. That may be the goal, but you never actually achieve
it.

A culture where people are afraid to bring their problems to the
table because they feel like they’re going to be blamed and belittled can cause extraordinary problems long-term in a company.
You can hide problems for some time, but sooner or later, if there
are deficiencies or inefficiencies in the way you operate, eventually they’re going to come out, and if you don’t deal with them they
will fester and create more problems.

You have to create an environment where people are not afraid
to talk about negatives, and the only way you do that is by telling
your people, ‘What I’m holding you accountable for is a quality
effort. I never said you couldn’t make a mistake.’

Everybody has problems, and nobody functions without issues
that develop. The problem is when you don’t bring them to table
and they don’t get resolved and they just stay there and are
allowed to then affect the bigger picture.

As a leader, you have to create that environment through your
own interactions with your staff. Once your staff starts to bring
issues to you and they see they’re not going to be made to feel foolish or stupid, they’re not going to have any fear and they’ll feel
comfortable that, ‘I’m not going to get blamed for a mistake. I’m
going to bring it to the table, put the people together who are part
of that issue and figure out a way to resolve it.’

As an executive, you have to model certain types of behavior,
and the way you model is the way your staff is going to be. If you’re
closed and you don’t seek out differences of opinion or seek out
conflict or seek out problems, neither is your staff.

Seek opportunities to improve. I don’t think you ever overcome a challenge. The challenges are always there. They may come in different ways, but there’s never a situation where you can say, ‘I’m
done. I don’t need to do any more work.’

The adage that perfection is something to be sought after but
never achieved is the same approach as the work we do as leaders.

You have to be continually striving both personally and professionally. You don’t ever reach all of your goals. You can reach some
of the goals some of the time, or even a good deal of the time, but
with every new opportunity, there are new challenges.

The way I look at it, you’re always a work in progress, but if your
work in progress is not moving forward and is not seeking out new
opportunities or trying to make what you do more effective or efficient, then you’re not focusing your energies in the right area.

I would never tell my staff, ‘OK, we’re done.’ We’re good, but we
can always be better. It doesn’t mean it’s a bad thing to be good,
and you should congratulate yourself on being good, but if you
don’t instill the belief in your staff that you can always be better
and you rest on your laurels, you’re going to be overtaken by your
competitors.

Show your appreciation. What employees look for is a sense of being
valued, of being appreciated by the people that they work for.

If you can do that on an ongoing, consistent basis, you will
create a team that will literally do almost anything for you
because they’re proud to be with you and work with you
because you sense their capabilities and you allow them to do
their job. It goes along with empowerment, with creating an
environment where people can think out of the box and they’re
not afraid to do it.

There are some things we’ve done here in the past few years
that are absolutely extraordinary, and it’s not because of me.
It’s because the people who are doing them have found a way
to create amazing quality by working together toward a goal,
and it has resulted in a huge increase in our capabilities to
serve our patients.

It’s resulted in bottom line and revenue, but more importantly, it’s resulted in quality of care. The key to what you do is
your ongoing capability to provide quality.

Encourage contribution. You empower people by giving them opportunities to modify, change and adapt. For example, if my housekeeping director says to me, ‘There’s a better way to clean that
floor,’ the way I empower that person is to allow him to bring me
that opportunity and for us to look at it, demonstrate it, see
whether it makes sense, and if ultimately it does, empower that
person to make that decision and to change.

A leader has to use specific means to show his staff that he values what they bring to the table. The worst thing you can do to
someone who reports to you is make them feel as though they
can’t contribute.

You have to show people that if you’re willing to pay them a
buck, then you’re willing to allow them to contribute their
expertise to the running of the organization and the completion
of what they have to do in order to move forward.

HOW TO REACH: Miami Jewish Home & Hospital for the Aged, (305) 751-8626 or www.mjhha.org

Tough love

If tales of business world vindication were the stuff of blockbuster hits, the story of Michael Earley and Metropolitan Health Networks Inc. would have Hollywood producers drooling.

The screenplay might go something like this: A dissident director leaves the board of a large company after his objections to its diversification strategy go largely ignored.

In the months after, following said strategy, the business suffers considerable losses as investment in new ventures far exceeds earnings.

In an effort to rescue the company from certain doom, the board recruits the former director to come back as chairman and CEO and lead the company back to glory, which he does by following the
strategy he had advocated all along.
“I had spent several years in difficult business situations, working in a number of turnaround situations, so stepping into a troubled company isn’t foreign to me, and it isn’t frightening to me,” Earley says.
“In this case, I understood the business and the various personalities at work, and I felt I had probably as good a chance as anybody at trying to turn the business around.”

Earley’s knowledge and experience served him well as he took on the task of divesting the company of its money-losing ventures and salvaging the company’s core Medicare managed-care business. By
the time he was asked to return in 2003, Earley had spent a year-and-a-half watching as Metropolitan further broadened its business scope within the health care industry, getting itself deeper and deeper
in trouble. New investments that had been made continued to hemorrhage resources.

The company was virtually bankrupt, and tensions had built among creditors, business partners and employees alike as Metropolitan appeared to be sliding toward failure.

Earley reduced the staff by more than 50 percent. He sold Metropolitan’s pharmacy business, which was operating at a loss, and wound down the company’s other fringe interests.

In time, he was able to eliminate millions of dollars in accounts payable the company had accumulated, and by focusing solely on its primary managed care business, Metropolitan is back on solid ground. In
2002, the company posted a net loss of $17 million, but by 2005 recorded net income of more than $2.3 million. Over the same period, Earley helped grow revenue from $140 million to $183 million, with $250 million projected for fiscal 2006 and employee levels back to where they were prior to his return.
“We have built a very nice business caring for Medicare members who are enrolled in a program through Humana, which was the business the company got involved with in 1999,” Earley says. “Today,
we care for more than 27,000 of their members, and it’s a thriving business.”

No, this based-on-actual-events saga of corporate “I told you so” won’t be coming to a theater near you, but for Earley and those directly involved in Metropolitan’s turnaround, the story is all too familiar.
“It wasn’t certain as we were going through the process of turning the company around that we would succeed,” Earley says. “But through some hard work and some luck, we survived.”

Agent of change

Earley says one of the biggest challenges in turnaround situations is that leaders tend to be hesitant to concede that the path they chose might not have been the best one. In the case of Metropolitan,
Earley gives the board credit for ultimately acknowledging that its business model was unsuccessful — a simple yet critical first step that is often easier said than done.
“It’s hard for somebody to perform surgery on themselves,” Earley says. “It’s hard for a management team to admit that maybe a strategy wasn’t working and to make a change, because there is ego and
ownership and all those things involved.”

Difficult decisions will inevitably have to be made at a troubled company, and Earley says it is advantageous to bring in someone who will provide a new perspective and can more easily make the tough choices that more invested leaders often struggle with.
“It’s really hard for a manager who has not succeeded to come back and admit defeat, undo all those things and make the hard decisions,” Earley says. “When businesses reach that point, the board of
directors or whoever controls the business, one of the things they have to seriously think about is, ‘Do we need a new manager here to move the process forward?’”

As a new influence at Metropolitan, not only did Earley have the advantage of more easily making those decisions, but his arrival represented to those pressing the company for answers a fresh face with
a new direction for salvaging the company. With so many stakeholders in the success or failure of a company, Earley says it is important that leaders take responsibility for dealing with those interests.
“A big challenge in a situation like this is you have creditors and other interests that are some combination of concerned and angry, and it’s hard to operate a business when you’re besieged by creditors calling wanting their money,” Earley says. “One of the roles I took was to deal with those interests.”

Earley’s willingness to step up and manage external distractions allowed his company’s managers and executive to focus on their jobs without the burden of having to simultaneously deal with forces outside the company. He relieved Metropolitan’s CFO of managing the company’s relationship with its creditors.

He worked to convince those interests that the company needed their patience and support to get back on its feet, and he delivered the message, “If you’re not patient, there’s probably very little for you
to get if we ultimately go into bankruptcy.”

Calming concerns

As Earley says, calming the company’s business partners and investors and getting their buy-in is only one piece of the puzzle when a company is facing the possibility of failure.

One advantage Earley had when he returned as CEO was that, as a public company, the financial situation at Metropolitan was no secret to employees, and their understanding of the situation was vital
to turning the ship around.
“Ultimately, you need every person on the team to do their best work and not be overly consumed with concerns about their own situation,” Earley says. “There’s nothing more destructive than uncertainty about mission and a company’s situation.”

In further easing the concerns of his staff, Earley says open discourse was key to his ability to quell the paranoia that often spreads in a troubled company. As he returned to Metropolitan, it wasn’t long before
he began working to build those lines of communication.
“I had to be careful as I walked in the door of the situation,” Earley says. “I wasn’t at all certain that we could turn the company around, but I knew what had to be done, and I tried to be very clear and honest with everyone that we dealt with as to what the mission was and what we needed to do.”

On his first day at Metropolitan’s corporate office, Earley called a staffwide meeting to introduce himself and explain why he was asked back to the company and what he planned to do.


“One of the things I did was to give everyone there my personal cell phone number, so that if issues or questions arose, they could call me,” Earley said. “I will tell you that not many people called me
along the way, but the fact that I offered that accessibility went a long way toward helping people feel comfortable with the changes that were coming.”

Whether by holding regular meetings, traveling to speak with employees or simply allowing employees to approach you with concerns, Earley says a leader’s openness is significant in allowing people to
execute on their responsibilities.
“The fact that you’re visible and you make yourself accessible and you keep your door open so that people can come in and chat with you, and you get out and see people, is a huge part of calming them
down and allowing them to do their job,” Earley says.

Among the tough decisions Earley made was reducing headcount. During his time away, the board of directors at Metropolitan had approved investment in a pharmacy business, a laboratory business
and an e-commerce venture — all things Earley knew would have to be sold or phased out if the company were to have any chance of survival. At the time of his return, the company employed more than
200 people, and Earley was forced to reduce his staff to approximately 80 employees.
“Those sorts of decisions aren’t easy ones to make, but they’re necessary if the business is going to survive and have an opportunity to turn the corner,” Earley says. “Those decisions have to be made,
and you have to err on the side of being willing to cut too deep, because ultimately, if you don’t salvage the company, all the employees are going to lose their jobs.”

Earley made an effort during all his interactions to ensure that his staff was aware of the gravity of the situation. Pretending that circumstances aren’t grim when they are will ultimately be counterproductive to the turnaround process.
“There can’t be any real surprises,” Earley says. “You can’t come in and say, ‘Listen, this company is in desperate trouble, and don’t worry, everyone is going to keep their job.’ People are brighter than
that.”

Refocusing on growth

Perhaps the biggest challenge as Earley has led Metropolitan back to profitability is keeping his staff in the appropriate mindset. He observed that the company’s leaders had grown accustomed to constantly
evaluating potential business ventures, a result of the long-term diversification strategy that had led the company to near-failure.

As Earley made clear to his team, the focus for the company in a turnaround situation must be short-term survival.


“The management team was used to looking at different opportunities and thinking about them,” Earley says. “We basically had to cut that down so that all we thought about was what we’re doing today
and what we need to do to survive.”

Earley says that while sources of motivation vary in different business situations, in a troubled business, it is really quite basic.


“In the turnaround mode, the motivation is simply survival,” Earley says. “People have a natural instinct to survive, and if you present the challenge and give them a fair assessment of the odds, people will fight to
survive.”

However, as a company begins to turn the corner, Earley says the challenges associated with motivation, culture and business strategy become much more complex.


“One of the little secrets in turnaround management is it really is much easier to deal with a troubled situation with the problems all in front of you,” Earley says. “Once you stabilize the company and you
have resources and opportunities, the process of growing the business is much more difficult.”

As he guided Metropolitan out of diversification mode into survival mode and then back into growth mode, his leadership style has had to evolve. When the situation had stabilized and the company had
its first profitable year, it was able to pay out its first bonuses.

The company recognized the opportunity to again begin expanding its business within the managed care field and launched its own Medicare HMO. In the same way he once forced his managers to adjust
their mindset for survival mode, Earley now had to adjust his own mindset to deal with the issues of growth.
“Once you stabilize the company, you have resources and opportunities, and you have to decide which opportunities to pursue, and they’re not all sitting in front of you,” Earley says. “You have to look
at the market and decide which opportunities to pursue and what resources to commit to it. That’s a much more abstract process.”

HOW TO REACH: Metropolitan Health Networks Inc., (561) 805-8500 or www.metcare.com