Andy Mills was confident that Medline Industries Inc. was ready to go live with its new enterprisewide system. After more than two years of preparation, it was going to make everyone’s life easier by organizing orders, inventory and every other business process in the organization.
“Then we hit the switch,” Mills says with a hint of doom in his voice. “The system had been tested, but not with the volume of orders that we had. So although it worked fine when you were throwing a few simple tests in there, it wasn’t stress-tested adequately enough. And it really collapsed the whole company.
“We couldn’t locate our inventory; we couldn’t bill. Customer service calls that normally would take two or three minutes were taking 45 minutes to an hour. We had a disaster on our hands.”
Medline has a long and rich history of manufacturing and distributing health care supplies to customers across the country. But that all seemed so far away now as leaders at the 9,000-employee company scrambled to find a solution.
Fortunately for Mills, he had built some credibility with his team over the years. So he went to them and explained exactly what had happened and what the company was facing.
“We said, ‘Here’s the situation we’re in,’” says Mills, the company’s president. ‘“We’re crippled in many different computer aspects. We think we can come out of this in 12 to 18 months. We’d like you to work Saturdays. We’ll pay you bonuses, but we’d like you to work Saturdays. It’s kind of do-or-die time for us.’”
As much credibility as had been built, this was still a lot to ask of his team, and Mills knew that.
“But a remarkable thing happened,” Mills says. “We had this feeling of all hands on deck and people saying, ‘We’re going to get through this.’ People brought in sleeping bags and were living here for weeks at a time. Morale was not lower but higher than normal. We came out of our problem in four to six months, not 12 to 18 months. It really taught us no matter how big or small the problem is, share it.”
Indeed, Medline overcame this significant hurdle to maintain its spot as the largest privately held medical supplier in the United States with nearly $5 billion in annual sales. Mills says the value of respecting your people was never more evident than it was during those tough times.
Here are some of the things Mills tries to instill in Medline’s culture to make employees feel like a valued part of the team and a willing partner to help the company achieve success.
Trust your people
Mills gets as excited as anyone when he has the opportunity to share good news with his employees. But he, CEO Charlie Mills and COO Jimmy Abrams did not earn the loyalty that saves their butts when problems occur by only delivering good news.
“You have to take a leap of faith and trust people when you share information, even challenges,” Mills says. “Some people are afraid to share dirty laundry. But when you share what challenges you’re facing, you really give people a feeling that they are empowered to be part of the solution. I don’t believe in hiding things, but some people are afraid to admit weaknesses or show anything other than a façade of strength.”
Whether it’s a problem in your company that you had no control over or a situation that came about due to a mistake on your part, you’re better off being upfront with everyone about exactly what happened.
In most cases, you’re going to be asking these people who work for you to step up and do something to fix the problem. So why not give them all the facts going in?
“You can say, ‘Listen, you’re closer to the situation than I am,’” Mills says. ‘“What do you think? Because I’m not sure.’ I wholeheartedly believe the people closest to the situation can help you find the best solution, and I’m not afraid to say that.”
When you talk about problems, or even if you’re talking about good news, frame your comments in a way that leaves people feeling like you’re all part of the same team. Don’t give the impression that you’re asking people to fix a problem in “your company.” It should be their company, too.
“We talk about the company being our company,” Mills says. “People like being associated with a company that’s growing and they take pride in the success. That’s part of the reason we get these kinds of unbelievably devoted employees who want to pitch in and help. They feel like we’ve all built this, and we’ve all been part of the success. That goes from the work on the factory floor to anybody in the organization.”
The closeness that leadership and employees feel at Medline was also evident when the company made an acquisition about seven years ago that included a component that created some uneasiness.
Medline wanted to remove the Canadian market from the deal because leaders didn’t feel they had the expertise to succeed there. But the point wasn’t negotiable so Canada stayed part of the deal.
“But we went into Canada, and it has become one of our biggest success stories,” Mills says. “We went from about $7 million the first year to this year we’ll do about $100 million.”
Once again, communication about the problem at hand was a key to achieving success.
“Open dialogue on some of the challenges we were facing and some of the resources we could bring to bear, I think that really created a culture of trust there that is common throughout the organization,” Mills says. “That turned it around. We had people who got involved and didn’t like the idea that we couldn’t succeed there.”
Reinforce your culture
There are times when, try as you might, you and the person you’re talking to just can’t connect on the topic at hand. This occurred with Mills and an employee who was trying to explain an idea she had to redesign and rename a Medline skin cream product.
“I said, ‘I really don’t get it,’” Mills says. “She went on to explain why she thought it made sense and said, ‘We’re going to change the image from a low-end cream to a more spa-like experience for the product.’ And I said, ‘I still don’t get it. I just don’t believe in it.’”
Mills wasn’t upset, but the employee’s supervisor, who was also in the room, felt that enough time had been spent on the topic. At one point, he interrupted the employee and told her it was time to go.
The employee remained persistent, however, and ultimately sold Mills on doing a field test.
“We picked this small area to field test it and it came back a couple weeks later validating what she had said, and I said, ‘Let’s go with it,’” Mills says. “But even before we got the results back from the test, I said, ‘I really want to congratulate you for standing up for what you believe in and not being afraid to share that with me. I think that makes us a better company.’”
Mills also went to the supervisor and expressed his disappointment in him for not backing up his employee when she clearly had a passion for what she was talking about.
“We want that culture where people have ideas and want to fight for their ideas,” Mills says. “Sometimes I judge the strength of the idea on how hard the person fights.”
Mills works hard to remind his managers on a constant basis to support new ideas and to encourage dialogue. He wants everyone in the company, from the top on down to the lowest levels, to feel comfortable bringing up a suggestion or a concern.
“One of the things we talk about is accidents in the operating room,” Mills says. “You’ll hear a nurse say, ‘I’ve been here for six months but the doctor has been here for 10 years, and I didn’t want to speak up. Who am I to say that?’
“I give that example when I talk to all our sales reps on their first day of joining Medline and either Charlie, Jimmy or I tell that to our new recruits. It’s kind of part of our standard speech to say, ‘No matter how new you are to the organization, you may see things that don’t seem right. If you do, we want you to speak up because you’re coming in here with a different perspective and you may just be right.’ So we try to get that in from day one.”
Bonuses give employees an opportunity to aim for a goal, meet that goal and be rewarded for their efforts. But as simple as it sounds, there are some corporate environments where it’s not clear what must be done to meet a particular goal.
“You really have to have an understanding of what the individual is working on and what’s controllable,” Mills says. “It’s very important that the individual feels the bonus is tied to something that is within their power to control.
“When you set up a bonus that is too broad and the individual thinks it’s either not measurable or too arbitrary or too broad for them to affect, you lose that engagement. People get excited about controlling their own destiny.”
If you really want to accurately track performance and determine who is being productive and who is not, it will take some effort. But once you have a system, it will be easy to demonstrate what needs to be done and who is doing their part to get it done.
“We know what equipment people are on and we know the size of the product they are picking,” Mills says. “We know the distance from the receiving dock or shipping dock to the slot. We know the hour of the shift and that somebody in their first four hours will be more productive than their second four hours. So we calculate all these things to come up with a standard time.”
Once you look at your business and figure out what metrics to use to track your employee productivity, you’ve got to stick with it.
“You have to make sure if you put it as your core value, that you’re going to walk the talk,” Mills says. “You’ll undermine everything if you don’t.”
If you do it the right way, you’ll create regular opportunities to talk to your employees about what’s happening on the job and what concerns they might have.
“We think making the time from work to bonus as quick as possible is smart,” Mills says. “Every time there is a discussion of the bonus, you look at the pay with the employee and you get them more engaged in what they need to do. If it’s once a year at the end of the year and you’re reviewing 2011 and they made bonus or they didn’t make bonus, you’d be surprised how much more effective it is to do it quarterly. It just reinforces what their target is.”
How to reach: Medline Industries Inc., (800) 633-5463 or www.medline.com
Be forthright with employees.
Commend people who speak up.
Promote what it takes to achieve a goal.
The Mills File
Education: Bachelor of science degree, Tulane University; MBA, J.L. Kellogg School of Management, Northwestern University
What was your very first job?
I went door to door with a bucket and rags and washed people’s cars when I was too young to get a job. You learn the value of hard work. My father and uncle both worked very hard and they would work six days a week. Frequently, they would have employees or customers over for dinner and be with them on the weekends. One of the ways that I got to spend time with my dad was to follow him around on some of these dinners and meetings when I was young. So I kind of grew up in the business.
Who has been the biggest influence on you?
My father and my uncle. If I can have two people, I would say both of them. They have been so supportive in mentoring. They just set an example of how to work together. It’s hard working with three people and not having an ego about things. They were very good about sharing ideas and crediting one another.
[Charlie, Jimmy and I] try to be the same way and we also try to be very supportive and they were always supportive of one another. They’ve been good and they’ve also taught us that nothing goes perfectly straight up. You’re going to hit bumps in the road, but don’t give up and don’t be afraid of hard work.
What person would you most like to meet?
I had a grandmother who had Alzheimer’s most of her life when I knew her, so I really didn’t know her very well. So for me personally, I would like that experience.