Jeff Sharfstein was about as frightened as he has ever been in his life. As he considered the grim future facing the company his father and grandfather had worked so hard to build, he feared he was watching the business crumble before his eyes.
“Here my father had built this incredible business over all these years and in a period of a year and a half, I was successful in completely turning the direction of the business in a terrible direction,” says Sharfstein, CEO at The Strive Group.
The 550-employee corrugated box manufacturer was launched in 1968 and fared pretty well for almost 30 years. By 1997, Sharfstein’s father had had enough and Jeff and his brother Doug assumed control. But shortly thereafter, the trouble began.
First, Strive Group’s largest customer filed for bankruptcy, resulting in a large and unplanned expense. At the same time, Internet auctions for commodity businesses, such as corrugated boxes, began to gain in popularity and sales began to drop.
“What we needed to do was figure out a way to bring additional revenue into the business,” Sharfstein says. “We had all these hard assets on the floor, meaning equipment. We asked ourselves what else this equipment was capable of doing other than producing corrugated packaging.”
It turned out that this equipment could produce temporary point-of-purchase displays that consumer-oriented businesses love to use to promote their products.
“Little did I know at the time how much of a different skill set was needed to make that transition and that transformation successful,” Sharfstein says. “It was a long, hard struggle on top of which, it was going in a direction that I did not have a tremendous amount of familiarity with.”
Sharfstein couldn’t shake the fear of ruining all that his father had built, but he couldn’t let that show with his people. He had to prove to them that as their leader, he would pull the business through.
“I elected to go to one of the largest consumer products companies that
purchased this type of product and that was Procter and Gamble,” Sharfstein says. “I figured if I could sell Procter and Gamble on this value proposition, that would be fantastic validation and would really set our organization on a new path.”
When you’re trying to drive business for your company, or trying to save it from disaster, you need to keep your people posted about what you’re doing and don’t keep them in the dark. Engage them in your effort to find solutions and then make those solutions work.
“We call them courageous conversations,” Sharfstein says. “You have to be willing to have courageous conversations with folks. Having very direct conversations saying, ‘Hey, I just need to let you know what I see. This is where I need your help. If you can do this, it will work out great. If not, it’s probably not the best place for you at this company.’”
Hopefully you’ll find you have a wealth of support to join you in your quest, but you may find otherwise.
“There were a number of long-term employees I needed to have conversations with and let go because they did not sit well with the new vision and direction of the business,” Sharfstein says. “If you have people constantly saying it’s not going to work or if they are constantly looking for the negative instead of what’s in the best interest of the business, you have to cut that cancer out.”
Fortunately for Sharfstein, Procter and Gamble worked like a charm and built desperately needed momentum for Strive.
“That really helped change the course of our business,” Sharfstein says. “Today, our largest customers are all these huge consumer products companies.”
Looking back, Sharfstein says he wishes he had been even more transparent than he was.
“You may not have all the answers,” Sharfstein says. “Be very open-minded and willing to bring in people from the outside who have had experiences before and have successfully navigated through them.”
How to reach: The Strive Group, (312) 880-4620 or www.strivegroup.com
Don’t hold back
When you’re business is in trouble, you often turn to lenders for help. After all, they have money and you probably need cash pretty bad. Jeff Sharfstein says you need to go to them with your books wide open.
“They were my lifeline,” says Sharfstein, CEO at The Strive Group, a 550-employee corrugated box and sign company. “Communicating to them anything and everything that I thought was possible and was happening was critical. I needed to give them the confidence that they could count on me giving them every piece of information I possibly had for the long-term viability of the business.”
You need to give people who can help you, whether it’s lenders, customers or your own employees, you need to give them a reason to believe that helping you will be worth it in the end.
“I had a vision and whether it was going to succeed or not, I didn’t know,” Sharfstein says. “But I had a very clear path in my mind as to what that looked like. And as I communicated along the way, it was critical that people came along.”