In late August, Smart Business sponsored the third installment of its Power Players luncheon series, which featured David Gilbert, president and CEO of the Greater Cleveland Sports Commission.
In the almost 12 years that the commission has been around, it has been responsible for bringing in 104 events to town, with an economic impact of more than $310 million.
“Most of them are the U.S. Jump Rope World Team Trials, the U.S. Taekwondo Junior Championship — not sexy events, but the common denominator in every one of those is they bring people to town,” he says.
And that’s the key. Bringing people to town means more people spending money in the region. The commission strives to bring as many events as it can to town, but to also run them better than the rest of the competition.
“Really, it’s no different than any other business,” Gilbert says. “How do you try to find out what a customer’s needs are and do what you can to make your business better.
“Where we’ve set the mark in the community is the ability to service these events better than anybody else in the country.”
Out of about 250 sports commissions across the country, the Greater Cleveland Sports Commission is one of the largest with 14 full-time employees and has become one of the top three or four sports commissions as a result of its service excellence.
This level of excellence has allowed it to secure two major events for the region — the 2013 National Senior Games and the 2014 Gay Games, which combined should bring more than 30,000 people to the region. Additionally, the organization has hosted several major Olympic qualifying events and expects to see more of these major events in the future.
“It’s very much about building a reputation,” he says. “More often than not, now our leads come directly. Instead of us going out and begging people – it certainly still happens — regularly — but we get calls saying, ‘Hey you hosted [this] and did a great job, would you consider hosting [that]?’ That’s helped a great deal. It’s developing relationships with individual organizations.”
How to reach: Greater Cleveland Sports Commission, (216) 621-0600 or www.clevelandsports.org
Over the past 20 years, I have worked with hundreds of executives who at some point confided, “I’m not sure this is really what I want to be doing anymore,” “It’s getting harder to gear up for travel,” or “I just don’t feel as sharp as I once was.”
And these statements usually are followed by: “Is it me?”
Well, yes — it is you. And me. And each of us at some point in our careers, if we are really honest and self-aware. So where does that leave you? Quit your job? Change careers? Move to the monastery in Tahiti?
Instead, begin by exploring the root of your discontent; what is causing you to really feel as you do and what are your options to change that?
Is the pace and intensity too much? It’s not unusual for an executive to feel like “enough is enough” and desire more free time where there is not 24/7 accountability and pressure.
Does managing no longer motivate you? Leading others can be exhausting and distance you from what most excites you about the company or industry. Some executives realize they’d rather advise or do something other than the day-to-day running of the business.
Has there been a change in your company? Has the composition of your board, leadership team, company ownership, brand positioning or core values left you less enthusiastic or feeling disconnected from the company you once loved to lead?
Do you simply feel underappreciated, unfairly compensated, or under challenged?
You didn’t just wake up suddenly feeling miserable about work. Your discontent has come on gradually and is more like an abrasion that doesn’t heal. Left untreated, the abrasion can become infected or maybe it already has. Remember that infections, untreated, often feel like general malaise.
So what can you do about it?
Find the quiet time to get away and have a candid conversation with yourself. Write out a “what bugs me” list about your work life. Be honest. It is most important that you discover what problem you are trying to solve.
Note the things on there that you influence directly or indirectly. Most executives are humbled when they are truly honest about how much they do or could influence about their work life and possibilities.
Jot down options given what you know. Do you need to designate “no meeting days” or “no travel days”? Do you need more frequent or less frequent contact with your board chair? Is your current organizational structure enabling you to be fully leveraged? Consider what would address the frustrations on your “what bugs me list.”
Have conversations with the appropriate persons to explore options. Gently explore with their confidential assurance, options to the “issues” that you are considering—or that they may suggest that you have not thought about. Talking with those who have a shared accountability for the company’s success is an important step toward addressing the issues you have noted.
Ignoring your “infection” or leaving it untreated will not produce a miracle cure, but taking positive actions that acknowledge and act on your discontent can.
The best gift you can give yourself is intellectual honesty regarding the sources of your frustration/weakened passion, and the options you have available. Once you understand the source of the problem, you can take steps to make necessary changes.
You owe this to your company, colleagues and shareholders who rely on you to lead with passion and commitment every single day. But most of all, you owe it to yourself. Doing nothing is doing something. Take action. You’ll be glad you did.
Leslie W. Braksick is cofounder of CLG Inc. (www.clg.com), coauthor of Preparing CEOs for Success: What I Wish I Knew (2010), and author of Unlock Behavior, Unleash Profits (2000, 2007). Braksick and her CLG colleagues work with leaders at all levels to ensure work never stops working for them. You can reach her at 412-269-7240 or email@example.com.
A personal brand is the unique promise of a person’s value. It is also the process of uncovering, creating, building and promoting your brand to your target audience. Just like products, people can brand themselves to stand apart from the competition. How can you make it happen for yourself if no one knows who you really are?
“Be yourself. Everyone else is already taken.” – Oscar Wilde
I came across an article about Madonna’s secrets on personal branding and thought it made it very simple and clear. Regardless of your feelings about Madonna, you must admit she knows how to brand. So I am sharing her six powerful secrets on personal branding.
I’ve discovered that you CANNOT expect money or a certain lifestyle and actually get it if your inner brand, your subconscious thoughts, feelings and beliefs dictate something different. If you want to create a bigger brand for both you and your company to once and for all brand both your inner and outer image, you are just steps away.
As a business leader, you are at the helm and steering your company and employees toward the future. Here are a few steps to help you think about YOUR brand along the way.
1. Clarity: Being clear on what you desire is the starting point of all achievement. Sadly, we typically spend more time planning a vacation than we spend planning our future. Do you have a clear view of where you would like the company to be one year from now? It is critical to write down your thoughts, plans and actions because this is going to act as a blueprint for building your success. Take the time to ask partners and staff about their ideas, thoughts and also concerns. When drawing up the blueprint, be sure to include your personal life as well as your business life so you may enjoy a balanced feeling within yourself.
2. Confidence: Self-confidence is the inner feeling of certainty, a feeling that you are worthwhile and valuable. It makes life so much easier and much more fun. It gives us the energy to create our dreams and is essential for empowering our thoughts and actions. If you are lacking confidence, then make the choice to get out of your way and live the life you were meant to live.
3. Focus: This is a major cornerstone for building a foundation for your future, and yet it’s very simple to understand. I use the analogy of a famous tightrope walker who never fell off the wire. When asked how he accomplished this, he said, “I never look back, down or sideways. I just keep my head held high and keep looking straight ahead.” When going into the company each day, focus on your action steps for that day and week. Also, a Master Mind group of two or four people who help with ideas and concerns is a great way of adding extra thoughts into your plan. This can be something that is held once a month over lunch.
4. Action: Your actions are where you will feel the connection to your plans and feel a sense of accomplishment. Make a weekly list of the actions needed to take you to your destination. Since I have gotten into the habit of making lists, I’ve been amazed at how much I accomplish in just one week. Check off your list and then form another list weekly. Actions cause reactions, which act as a stimulator for further planning.
5. Persistence: Lack of persistence is one of the major causes of failure. This is where clarity and desire will help with your persistence and keep you focused. I always suggest placing a few pictures around to see the end result and what persistence will bring in the end. This key is the one that will open more possibilities than you could have ever imagined and give you and your company visibility, credibility and growth.
6. Clothing: There is nothing casual about your future or the future of your company. A polished professional image exudes trust and confidence and also projects a powerful first impression. I have nothing against business casual if it does not turn into a business casualty. If you e-mail me at firstname.lastname@example.org, I will forward you my e-book, 3 Steps to Personal Branding, Power & Influence.
This is your future as much as it is the future of your company, so to stay aligned, it is critical that you are playing ball in the same field. It is your responsibility to wake up each day and have the clarity to see the abundance and opportunities that are there waiting for you and your company.
Sara Canuso is a Personal Branding and Image Specialist and President of A Suitable Solution. She helps professionals claim confidence and power through her insightful keynote presentations, business seminars and one-on-one coaching on the Impact of Image, which deliver new ideas and practical tools in the areas of creating powerful first impressions, developing a positive self-image, dressing for success, and inspiring confidence. Sara contributes columns to the Philadelphia Maven, Legal Intelligencer and the Burlington County Straight Work. She is a sought-after speaker who has presented to the New Jersey and Pennsylvania Governor’s Conferences for Women as well as the American Bar Association. Learn more at www.asuitablesolution.com.
You can’t blame Tim Jahnke for feeling a bit like the wrong man in the wrong place at the wrong time as the new president and CEO at Elkay Manufacturing Co. He was taking over a construction product manufacturer that had experienced double-digit growth every year from 2001 to 2006.
Two million new homes went up in 2006, and it looked like Elkay was positioned for more of the same in the years ahead. Then Jahnke arrived in late 2007 as the company’s new man in charge and everything began to fall apart.
It wasn’t Jahnke’s fault. Many factors led to the global recession that socked economies and businesses around the world beginning in late 2007. But that didn’t make it any easier for him as he searched for answers to keep Elkay from going under.
“It’s not just that we went from a really good market to a challenging market,” Jahnke says. “It was the speed at which it happened that created such an emotional and terrifying set of consequences within our market.
“All the numbers just changed so dramatically and the market shifted so fast that you couldn’t run down the hill fast enough as a company. You couldn’t cut fast enough, you couldn’t close enough factories, and you couldn’t do all the things that needed to be done to cut costs.”
Jahnke knew people were scared, and he knew they were looking to him for answers. But he also knew that if the company was to be saved, it wouldn’t be done solely through his leadership and decision-making. He would need all of his employees to play a part in finding ways to help Elkay stay on its feet and to continue to be a viable option for customers.
“If there is a bit of good news to the dramatic speed that the market was changing, it was that it got everybody bought in pretty fast,” Jahnke says of the initial response he got at the now 3,775-employee company. “It didn’t take long for people to understand that you couldn’t just modify what we did. We had to change what we did.”
Demonstrate your resolve
Jahnke began the effort to turn around Elkay by issuing a challenge to every employee. He wanted the employees to begin looking at ways to make the company stronger, better and more efficient in the work that they did.
“We had to look at everything we did,” Jahnke says. “Not just how many people we had and how many factories and all this sort of thing. But really look at every procedure, every process, every method that we used for those many years in running our business. I had to believe it wasn’t just going to happen from me above telling people that they needed to do things differently. We needed to start looking at things in a very mechanical way.”
Jahnke had no desire to just make a series of desperate sweeping changes that would demonstrate action but produce no results. He wanted to get to the heart of the matter with his people and see what could be done to make Elkay a better company.
“I remember having a conversation when we were talking about customer service, which is such a critical area,” Jahnke says. “I said, ‘Who is the best person we have in the entire company?’ Everybody looked around and said, ‘Laurie Goldman,’ who at the time was customer service manager for our cabinet division. I said, ‘We need to get her involved in this team.’ When that got said, everybody looked around and said, ‘Wow, he’s serious. I really do have to ante up my best people.’ We did that pretty much across the board.”
Jahnke wanted his senior management team to bring forward talented people with ideas to improve functions. He made it clear that he wasn’t going to stand in the way of their efforts to make changes.
“I could voice my opinion on how we had to make change, but these were folks who were inside the organization working every single day in these areas and generating new ideas,” Jahnke says.
He found leaders for each key area in the business and then an overall leader who would coordinate the team’s efforts. That leader was not going to be Jahnke.
“It’s important that it not just be from the top,” he says. “It started to create some understanding in the middle of the organization.”
Jahnke would get reports about what was happening with the team and the team leader would report directly to him. But it would serve as another indicator that he wasn’t going to micromanage the process to remake Elkay.
“You’ve got these people who make a difference way beyond the job or the job title that they carry,” Jahnke says. “In our case, we took it very seriously. This team got things started. It wasn’t necessarily important that they got everything done. But they started to send the message through the organization that we were very serious about adapting and changing to the world as it was changing around us.”
You need other people in your company, people that are viewed as leaders in your organization, to be on board with you and to support your plan of action.
“You have to have your key leaders, functional leaders or divisional leaders participate and get involved,” Jahnke says. “If they’re not part of it, they’ll fight it until the last breath of implementation.”
Jahnke said despite his best efforts, he still faced some opposition from a few at the management level.
“There were more than a few conversations that had to become pretty aggressive,” Jahnke says. “You will participate, you will give up your key people, or you will listen to the recommendations of some of these teams. They were generating ideas that were going to cause us to do things differently.”
They needed to know that Jahnke was completely supportive of their ideas.
Get on the same page
As the team began to assess Elkay’s ways of doing business, it quickly discovered a key flaw: Elkay was not nearly as close to its customers as it needed to be.
“During that period of time of growth from 2001 to 2006, we really focused on getting the product out the door,” Jahnke says. “Orders came in so fast that the whole concentration of running the business was, ‘How do you get it out the door?’ What ended up happening was we became very internally focused. What was best for us? How do we manufacture it easier? How do we take that order from our perspective in a way that makes it easier for us?
“We really stopped looking from the perspective of the customer and the end user and the consumers of our products and what they wanted. It made it easier for us, but in some ways, it made it more difficult for our customers.”
As team members dug deeper, they found that the way Elkay was doing things wasn’t really easy for anybody, customer or the company itself.
“We had three distinct product divisions: Our cabinet division, our plumbing division and our countertop division,” Jahnke says. “Each of the divisions had multiple manufacturing facilities. We had separate sales teams, separate finance teams. Everything was done very separately. Then within each of our facilities, they were allowed to pretty much do what they want. Everybody purchased at each manufacturing site pretty much on their own what they needed from local suppliers. It really created complexity in our business that we didn’t need.”
Awareness of these problems filtered throughout the company not because they were announced by Jahnke, but because teams of their peers had brought the problems to the surface.
“When people saw we were doing things in so many different ways, they said, ‘That doesn’t make any sense,” Jahnke says. “We should be doing this the same way. It got buy-in from all levels of the organization in a more rapid way than if it was just pushed from above.”
Jahnke tried to reinforce the idea that there could only be one “best” way to perform a particular task. Things such as sales practices, financial decision making and the ordering of supplies needed to be more uniform.
“There can’t be six best ways to do the same thing,” Jahnke says. “We started identifying ways we could take out waste in our own processes and systems to become easier to do business with. It was not only a message from me that we needed to do things differently, these were individuals who had been with the company for many years. They were experts in their own field and their own areas of responsibility.”
Jahnke wasn’t looking to create drones who would eradicate the character and uniqueness that separates selling countertops, cabinets and plumbing. But in the areas where tasks are pretty standard, it would be much easier all the way around if more systems were uniform.
The key is creating teams that can help you take a deep look at your business and then not getting in their way when they take that look and come back to you with their observations.
“They have to trust you,” Jahnke says. “Many times I use the phrase, ‘People do business with people that they like, trust and then ultimately respect.’ That goes whether you’re a customer, a supplier or an employee. For example, initially with an employee, if they like you, they’ll come to work for you. They like what they hear and they like what they see and you’re at that level. After a while, they are starting to trust you because you’re doing the things you said. They start to develop a trust level with you. Then ultimately, they develop respect because they see the results and they see the impact on them and that you have their concerns at heart also and they develop that respect.
“You could apply that mindset to customers, suppliers, employees, everybody. If people who lead realize that it is all about getting people to trust and respect you, that doesn’t mean telling them what they want to hear all the time. It doesn’t mean that everything is always going to be great. If they really trust what you’re saying and respect what you’re trying to accomplish and you get everybody pulling in the same direction, it makes the journey a lot easier.”
Jahnke rewarded the trust of his employees by taking their suggestions to heart about the problems that existed at Elkay and the hurdles it was creating in building solid relationships with customers.
“You have to sit in front of folks and let them ask you questions and make sure you that you don’t either ridicule or be negative toward the people who ask you the questions that are the most important ones,” Jahnke says. “Those are invariably the toughest ones to answer. You have to reward the folks for asking. Create an environment where they understand that you’re willing to not just stand in front, but answer the questions and take the heat.”
Jahnke earned even more trust when the changes to create better task alignment and customer service procedures at Elkay led to positive growth in 2010 and a projection for growth in 2011.
He believes one of the keys to his success was convincing employees that the enemy they were facing was not the sales team or the finance team or anybody else at Elkay.
“We got people looking at things and seeing that the enemy is not within our walls,” Jahnke says. “The enemy is outside. The enemy is a declining market, high unemployment and falling house prices. Those types of things. We had to take action.”
How to reach: Elkay Manufacturing Co., (630) 574-8484 or www.elkay.com
The Jahnke File
Born: Green Bay, Wis.
Education: Bachelor’s degree in business administration, University of Wisconsin Oshkosh
What was your very first job?
I took care of a Little League field when I was 13 years old. I put the bases out and drew the lines out on the field and then umpired the games. It was the best job I ever had. I love sports and being involved in anything sports is a lot of fun. But it taught me lots of things.
I had to deal with the coaches, and they weren’t always that nice to the umpire. And I had to deal with the parents. It gave me a level of self-confidence that you normally don’t have when you’re 13. Sometimes you had to turn around and look at a parent and say, ‘Be quiet.’ When you’re 13 years old and you’re talking to a parent, that’s not the easiest thing to do.
Who has been the most influential person on you?
My dad. I think a lot of people say that, but my dad just passed away a few months ago, so it comes to mind real fast and the work ethic that he showed me every single day growing up. He didn’t rule with an iron fist. He was demanding of me, but that combination of knowing that he loved me every day and at the same time he had expectations of me that needed to be met, that helps create the balance you have to have in life. Having expectations doesn’t mean that you don’t care for a person. Being able to share both frustration and at the same time, caring, is important whether you’re a CEO or a dad or a husband or a member of a community.
Kings and presidents alike have depended on experienced advisers to help them make difficult political decisions for centuries, and CEOs of the world’s leading public companies trust their boards of directors to help them run their businesses. So why do CEOs and owners of smaller, private companies often go it alone?
Business owners often have trusted management teams that they rely on to make important day-to-day decisions that keep operations running smoothly, but when it comes to making tough decisions about growth strategies, organizational changes or succession plans, those same managers may be inexperienced or less than objective. When the outcome of a decision may mean abandoning a favorite business line or impact their own positions within the company, the best, most-trusted managers can struggle with objectivity. But even if they can remain objective, some managers are too isolated from shifting market environments and changing customer preferences to provide truly valuable counsel.
That explains why so many business owners can feel lonely when faced with the most complicated, business-altering decisions, but it doesn’t have to be that way. More and more business owners are looking outside their companies for expert advice. Small companies and family-owned businesses are finding that advisory boards can be helpful in assisting owners, CEOs and executives as they work through complex issues.
Outside advisers can bring a variety of skills and experience that a small company may not be able to afford on a full-time basis to complement the knowledge and strengths of a company’s own management team. In addition to providing expertise that may not exist within the organization, outside advisers can also be counted on for objectivity. Because they have nothing to gain by paying compliments or delivering flattering but flawed reports, external advisers are likely to share honest feedback that can be especially valuable in making decisions.
When compiling an advisory board, companies should try to identify representatives from various stakeholder groups, such as customers, vendors, investors and strategic partners. It also makes sense to consider appointing professionals, such as accountants or lawyers, who can weigh the financial, legal or regulatory implications of business decisions. Another worthy appointee may include someone who can perhaps open doors in a new market or fortify existing relationships. There is no such thing as Match.com to help business owners identify the perfect advisers. Chances are that the best candidates are people who are already involved with the company in some way.
As for how and when to convene an advisory board, some groups meet quarterly for retreats while others meet monthly over lunch, e-mailing or texting regularly between face-to-face meetings. Regardless of the venue, it is generally agreed that advisory boards are most effective when they are focused on high-level strategic and tactical issues. In other words, make it meaningful. While it may be fascinating to sit around with industry experts pontificating business theory, your most valuable advisers are more likely to attend meetings where pertinent and timely business issues are being discussed and relevant decisions are being made. After all, most advisory positions are pro bono, so other than the occasional free lunch, their reward comes from seeing a business they are involved in grow and flourish. At the end of the day, an effective advisory board can provide much-needed support for business owners and CEOs, so they no longer have to feel so lonely at the top.
John Allen is president and COO of G&A Partners, a Texas-based HR and administrative services company that manages human resources, benefits, payroll, accounting and risk management for growing businesses. For more information about the company, visit www.gnapartners.com.
Michael Zavoina has never agreed that you should change your company depending on the business climate. He subscribes to doing things right the first time and making sure the organization continues that consistency. That’s how The Gateway Engineers Inc., an engineering firm, has remained an industry leader.
“People talk about a difficult business climate,” says Zavoina, CEO of the 128-employee company. “That’s not something I’m a fan of, because it suggests we should do something different in these times than we do in other times and when the economy is good and when the economy is bad. I’m more in favor of the status quo. If you set something up right in the first place, let’s keep going with that.”
The company’s drive to remain consistent and efficient has been paying off and has led to growth.
Smart Business spoke to Zavoina about how he makes efficiency and consistency the company’s top priority.
What are some of the ways you keep the company consistent?
We look at efficiency statistics, and we do benchmarking just like anybody else comparing ourselves to other similar firms. It seems like a lot of companies tend to look at absolute stats, and we tend to look at either relative stats or efficiency stats. Instead of looking at things like pure revenue, we look at the efficiency of revenue, like profitability as opposed to profit. We’ve always tried to continuously improve and get better at the efficiency side as opposed to, ‘Times are good right now; let’s raise prices. Or times are bad right now; let’s lower prices.’ We didn’t do any of that because we’ve always focused on the efficiency side. So when good times come we just do that over a broader volume. When bad times come and everyone’s saying, ‘We need to get more efficient in these bad times.’ Well, we always were efficient. That’s what has always bugged me about operating differently. You should have been thinking about operating efficiently all along.
How do you get the company to focus on efficiency?
The key is trying to get everyone involved with that. We do a lot with focus, and I think focus and efficiency go together. One of the things we say is we focus the project people on projects and the support people on support. A lot of companies have the project guys doing support functions. You could say it doesn’t matter, but then their focus is not there. It’s not just me being efficient. It’s all of us doing those things. You have to find the value in everything and everybody. If you need accounting, then you need accounting. If you need IT, then you need IT. Every one of those plays an important piece and can actually help you.
How do you turn that efficiency and consistency into growth?
We broke ourselves up into nine different market segments, and we have leaders of those that focus purely from a business development standpoint. There isn’t just one person marketing or one person developing business. We set it up to broaden that out a bit and they always have their ears to the [ground], they’re well attended at the industry conferences and well read.
We were successful through the recession, and there is something to be said for being the opposite of complacent. We could have stopped there and not looked for more work and said, ‘We’re good. We’re fat and happy.’ We could have done that, but we just kept doing our gig and developing business and spreading it to different segments and keeping our ears to the ground. Certain things pop up and you have to take advantage of those things and be nimble.
That’s a benefit of being relatively small. We’re not bogged down in structure. We can move quickly and did that on the Marcellus stuff and got in early with some of the pre-eminent companies that are doing business here.
What are the keys to finding new opportunities like the Marcellus Shale?
Try not to prejudge things too much. Try to keep an open mind. You could hide your head like an ostrich in the sand, but then you’re not out there. If you do that, then you’re not out at industry conferences, you’re not reading, and you don’t know what’s going on. You have to remain in tune with what’s going on.
You have to try to be consistent. Don’t only develop business during bad times. Try to keep up your business development efforts even during good times. Don’t just say that. You have to develop goals.
Do the same with relationship building and networking type things. You want to stay in touch with partners even when there is no work. You know at some point it’s going to turn around and you want them to say, ‘Hey, who do we go to?’ They will be thinking of you.
HOW TO REACH: The Gateway Engineers Inc., (412) 921-4030 or www.gatewayengineers.com
Bill Conner was constantly busy as the president and CEO of a publicly traded company.
In leading the security solutions company Entrust Inc., he and his team had so much to keep up with, and it was exhausting. So he decided to take the company back to being privately held about two years ago. It freed up his and a lot of other people’s time.
But the decision wasn’t just good from a time management perspective; it also gave them a new opportunity to really focus on new capabilities and customers and transform the business, which had more than $100 million in revenue last year.
Smart Business spoke with Conner about how he led the changes in his organization.
What’s the key to leading a transition in your organization?
Understand if your corporate strategy fits the environment you’re in. There are a lot of discussions about how big do you need to be to be public these days. I think that’s a real question.
We were certainly not big enough and simple enough to be a public company. Our products are very complex. Our customer base is 45, 50 percent government contracts. That’s hard to get predictability for an average investor or even a sophisticated investor, so understanding how your corporate capability and vision and industry fits and in what kind of market was the first thing we had to really look at in terms of assessing that and we did that.
Then really understand your customer and how you differentiate to that customer. Is it customer service or technical support, or is it your product or your sales and marketing and how you get your product to your customer?
How can you assess your business to know if you’re in the right environment?
The first thing is a good dose of reality. It’s always hard to look at yourself in the mirror and say, ‘Yeah, I’m getting a few years older — the gray is showing.’ But you really have to have the ability to look at it and say, ‘What’s working and what’s not?’ and not take it personally, and take the personal action to get it out and see if the team agrees or disagrees with that.
What tips can you give for leaders to be brutally honest?
Always start with data and the numbers — good old GAAP. Some people think you can take them out, but they’re pretty good numbers. If your competition is doing better than you by the numbers, nine times out of 10, it’s not that they don’t have integrity and they’re faking their books — it’s they’re doing something different.
What we did here was look at the revenue line to see if maintenance was going the way it should, was product revenue going the way it should, and was professional service going the way it should. We measured all of those and then we looked at all our products and how they were doing. How are they competitive with the products out there? What were customers telling us about them? Then we looked at the cost side. Be brutally honest. Were we spending too much in sales? Was our sales force making their quotas? Who was the best? Who was not the best? Did they have a plan or were we going to get rid of them? R&D — is it working or are they just putting more features and functionality on there and it’s taking it longer?
Most people, if they’re honest in that first stage and do the analytics around that stage, the numbers aren’t going to lie. The only thing that’s going to lie is your own team, and that starts with you not lying about what you think is good and bad and communicating that, and them not lying to themselves or being conflict avoiders to avoid it.
How do you avoid lying to yourself?
It’s easy to do. It’s kind of like sand — you squeeze it in your hand, and the harder you squeeze it, the less it’s there. We try to say, ‘OK, our hands are pretty full of sand, let’s mold it and not try to squeeze it just because we’re stressed.’ We just try to control it. You have to control it but you have to control it in a different model, in a different framework.
How to reach: Entrust Inc., (888) 690-2424 or www.entrust.com
When Stephan Liozu came to ARDEX Americas three years ago as president and CEO, he was given a big, fancy, corner executive office. Nowadays, he doesn’t use it. As the global leader for strategic innovation, he decided that his big office could be put to better use. The executive office got a complete overhaul and now goes by the name of Innovation Station.
“I felt that we needed to have a space in the business to really promote that innovation by discovery,” Liozu says. “You cannot do that in a dead-boring conference room sitting on leather chairs. You have to do that in a space that is colorful.”
The manufacturer of building materials has 260 employees in Pittsburgh and 1,850 worldwide and is known as an industry leader in innovation. Liozu, who has a master’s degree in innovation management and is halfway through a doctorate in innovation, wasn’t satisfied with that status, so he opened a competition for the new name of his former office to help further the company’s innovation.
“[In April,] I decided to leave my executive office, and we created — in a big space that was not very useful to the company — we created an innovation station,” Liozu says. “This is a creative space where we have a special paint on the wall that you can write on, we have foosball, basketball, music and people go in there and brainstorm and they just create ideas. We have nice paintings of Einstein’s head on the wall, there are red chairs, there is a lava lamp, and there are tools and small tables, but we want people to move. We want people to dance, we want people to just create and play basketball. As they do this they are emotionally connected to the team there and to the process of, ‘OK, there is no barrier, there is no hierarchy, there is no corporate logo, it is just a space where I can freely express myself.’ I felt we needed this to be able to go to the next step of our creativity potential.”
It is through initiatives like the Innovation Station that Liozu works to improve the ways the organization becomes a better company all around. Here’s how he focuses on innovation throughout the business.
Always be innovating
More and more, the name of the game is to constantly reinvent your company, constantly bring new technologies to the market and stay one step ahead of the competition. To do this, you must look to innovate in every opportunity.
“Companies most of the time innovate because they are forced to,” Liozu says. “Maybe there is a disruption happening in the market or there is a competitor that is making things more challenging and your costs are going through the roof. You constantly have to disrupt your organization, and you have to create some gaps and reinvent yourself through innovation, whether you face a crisis or whether you’re very successful. That’s the best time to be investing in innovation is when you’re successful, not waiting for the crisis to come.”
Too often, companies wait for the market to offer opportunities or necessary times when innovation and change must occur. You have to get your company to look for innovation when things are normal in the market.
“It’s a little bit of a challenge that I’m trying to change the culture to be not reactive to events in the market but to be more proactively innovating whether we need it or not,” Liozu says. “It’s that constant change in innovation and disrupting the organization and introducing new technology when customers weren’t expecting it. It’s challenging because you have to bring your whole organization on board and you have to convince them that everything is going fine. But imagine five years from now, there’s going to be a crisis, you’re going through cycles, you have ups and downs, so eventually there is going to be a crisis. Let’s not stay still; let’s project ourselves and find out how we can avoid the crisis and make the changes now but control the changes. It’s what we call a revolutionary change management. You create your own mini-revolutions and not wait for the markets to dictate when you have to change.”
To get your company to adapt to a new way of looking at innovation, you need to start with the leadership.
“First of all, you need creative leadership,” he says. “You need a lot of creativity, and you need to embrace creativity. You need to promote it and let people give you ideas. So there is a lot of ideation process and ideation culture you have to introduce — brainstorming sessions, discussions with customers or customer observations. You have to constantly be scanning the market, opening your ears and listening.
“The second thing is you really have to embrace complexity. The world has become more complex, and you have to leverage that complexity by bringing in solutions that are simple but innovative. The best companies that are succeeding right now are the ones that really understand the complexity, capture the opportunities that come from complexity and fully leverage them. You do this through innovation and creating systems, creating solutions and creating ventures.”
In order to constantly innovate, you need to look for opportunities through design and discovery within your organization.
“You have to do a little bit of both innovation by design and innovation by discovery,” he says. “You really have to constantly be redesigning the organization internally to match the customer voice and match the trends that are coming — being able to design things very well — designing systems, designing solutions, designing approaches, but at the same time, put yourself in discovery mode. You know what you know, but you don’t know what you don’t know. You have to go out there and try to discover new things, so you need both design and discovery in the innovation process.”
Innovating on a year-round basis can be disruptive and a challenge to get used to for companies that follow a routine. You have to be willing to embrace disruption.
“I call myself an agent of disruption,” Liozu says. “One of my favorite sayings is, ‘When you are at peace, prepare for war and vice versa.’ You have to constantly challenge yourself to look at where you are going 10 years from now. Everything may be fine right now, but how do we already work on technologies that may not be needed now but may be needed five years from now? It’s really avoiding the ups and downs, avoiding the reaction, be more productive and systematic in your innovation approach and invest in the right programs. It comes back to constantly reinventing yourself and your value proposition.”
Be serious about innovation
Reinventing yourself and how you do business can be very beneficial, but you need to measure your progress in innovation and invest in it for it to truly be successful.
“We just measured our innovation culture worldwide,” Liozu says. “We just did a very unique survey to measure innovation culture, which is fascinating, and we are learning quite a bit. We developed an innovation cockpit with key performance indicators that we have in there — number of new products created, number of ideas in the bank, etc. We measured things like market orientation, willingness to take risks, importance to customer, voice of the customer and the questionnaire was about 12 minutes with a list of items that you have to agree or disagree with, and you have to respond to those truthfully.”
Having a system in place to measure your progress in innovation will help your company continue to improve. You have to come up with key indicators that you measure on a regular basis.
“You definitely want to have key performance indicators just on innovation,” he says. “Those are very important, and you want to measure those every six months. That way you have annual measurements to say whether you are making progress or not making progress. The numbers speak for themselves, and you can’t hide anything from the numbers. If you really want to change the culture, measuring it is the best way to do so.”
Measuring is just one aspect of staying on top of innovation progress. You have to be willing to make a full commitment to it and designate the necessary resources to it.
“Another key measurement is the investments you’re going to make and these investments have to be made,” Liozu says. “A lot of companies decide to innovate and be more innovative and give them $2 to do it. You need funds, you need investments, you need obviously the payback for it, but you have to show sustainable investments. It’s not short term. You may introduce one or two products from a short-term brainstorming, but at the end of the day, if you want to do that consistently, systematically at the corporate level, globally and locally, you need the right people, the right process and the right investments to do it.”
Part of those investments in innovation is training your staff on better processes and the tools necessary to be on the cutting edge.
“If you’re really serious about innovation, you create dedicated resources to people who are trained in innovation,” he says. “You cannot improvise. If you really study innovation, you really study the tools to innovate, the processes, how to do this, how to do that, how to measure. You cannot just take a guy who has been in marketing and say, ‘Now you’re the innovation manager.’ You have to send that person to a class or to a course. You have to train your people on that.”
Innovate the whole business
Innovation is a complete improvement process of everything you do. It isn’t enough to just look at ways to innovate your products. You need to take a deep look at everything within your organization.
“That’s why you need the culture,” Liozu says. “You need the climate and the culture. You need to communicate a lot and remind people of innovation day in and day out. You have to be serious at multiple levels. One is the infrastructure. Secondly, you have to give them the culture and the climate to be able to share their ideas. And then you have to do something with these ideas. So once you get the ideas, you have to reward the best ones and then work on them and launch them.”
A lot of companies want to appear innovative and will ask for ideas, but then just sit on them.
“That’s the best way to really demotivate people to share that with you,” he says. “You have to execute on these ideas. That’s the way you reach all the way to the front-line people from the top throughout the organization to get people onboard. If you do that, people will know that you are serious. You tell them it’s not just product innovation, its process. How can I do my job better? How can I service my customers better? How can I do this XYZ? How can I cut costs? You have to encourage everybody to share their ideas.”
To get your employee’s creative juices flowing, you have to give them a culture that encourages them to think about new ideas.
“You need to give people a place to be free from the routine and regular noise associated with the business and they will be able to come up with ideas,” Liozu says. “The No. 1 thing is you need to create a culture. You need a culture and a climate that embraces that message that we are going to change for the best. Within that culture, you need to bring in a lot of time that will allow people to brainstorm, and they have the will to brainstorm because they understand why. You allow people to fail, and you celebrate the failures and understand why you failed and you learn from that and do better next time.”
A culture that supports innovation is crucial to developing those processes into your company’s daily fabric, but you also need someone to lead that charge.
“Obviously, you need a champion,” he says. “At the end of the day, every business manager, every CEO and president, should be acting and leading as a chief innovation officer. Because fundamentally if you can do that constantly and if you’re willing to reinvent your business proposition — the value you bring to the market — it has to come from the top office, otherwise change is not going to happen. Some people are too risk averse and some companies are too risk averse and it paralyzes the creative potential of their people. You need the top guys to be the champion of change or the champion of innovation.”
HOW TO REACH: ARDEX Americas, (724) 203-5000 or www.ardex.com/default.asp
The Liozu File
President and CEO
Born: France, became a U.S. citizen in 2009. He has lived in seven different countries.
Education: MBA in marketing from Cleveland State University; master’s degree in innovation management, University of Toulouse. He is trilingual, speaking French, English and Spanish. He also knows a little Italian and Portuguese.
What was your first job, and what did you learn from that experience?
My very first job was when I was 15 and I was selling doughnuts on the beach at Med Sea Resorts in Argeles-sur-Mer. It was brutal. The sun was brutal, and I had competition on the beach. I had six guys selling doughnuts next to me. It really taught me to be resilient and to go out there and try to find a way to differentiate.
What is the best business advice that you’ve ever received?
I get a lot of my advice from books, because I do quite a bit of reading. The one piece of advice I really like is when you have peace prepare for war and vice versa. That is from ‘The Art of War.’ When you’re in business, you really have to constantly be ready for the next round. This is what I really focus on.
What was your favorite name for the Innovation Station?
I liked the Creative Space or ARDEX Innovation Center, but I didn’t win.
If you could do something dangerous without any consequences, what would you do and why?
I would go into space and look at the Earth from up there. The universe is a beautiful design and it makes you wonder how all of this is just suspended. We are in this universe and I would like to see it closer. It’s fascinating to me how we are here on a planet among other planets in the universe that we barely know.
Sue Burnett, founder and president of Burnett Staffing Specialists, had never heard of a staffing firm doing an employee stock ownership plan until a friend told her about a staffing firm in Missouri that decided to do one. Intrigued by the news, Burnett investigated the possibilities for her and her husband, Rusty, who serves as CFO and executive vice president, to do an ESOP in their company.
“We thought that this was something that might be an option for us,” Burnett says. “Rusty and I really have no plans to retire, and we weren’t looking for an exit strategy because we weren’t ready to exit. At the same time, Rusty turns 70 this year and I turn 65, so our staff — particularly our younger staff — were wondering what is the future of the company.”
Burnett thought an ESOP was the perfect situation, because she didn’t have to leave the company or retire. It was a way to give back to the people who helped her build the $64 million company.
Smart Business spoke to Burnett about what went into her ESOP decision.
What are some of the advantages of doing an ESOP?
I think that the advantage of it is that now my staff knows what the future of the company will be. I think there was a feeling of relief that we were not going to sell the company No. 1, and that No. 2, we were going to continue on with the company. It gave my management staff a real vision to be able to see into the future that they will be able to run the company without us. With a management staff that’s young, it made them feel like there was really something to work toward, because they are now owners of the company. It is definitely a long-term way to retain staff and particularly management staff.
For me personally, it was a tremendous feeling of relief from the standpoint that now I know that the company is in good hands. The people that helped build it will be the leaders of the future for it and I can stay for as long as I want. It was a way for me to ensure that the company will continue into the future and my staff won’t be worried about what is going to be happening.
Are there any disadvantages?
From an employee standpoint, there’s nothing but positives. They are being given stock, and it’s free. It’s a retirement situation for them. As the company continues on into the future for all of these people who are fairly young, when they retire, if the company is still in business or if the company is sold, whatever happens, their stock will be worth a lot of money. There is no downside for the employee whatsoever. ESOPs have shown growth faster than normal companies because the employees become very committed and excited that they have ownership in the company.
Why would other CEOs want an ESOP?
I do think that for the owners, it’s a wonderful exit strategy, but they have to look at it as a long-term exit strategy. If you want to just sell the company and leave, then that would not be the best thing to do. In our case, it will take about seven years or so to allocate the stock, and we will certainly be involved during that period of time. There have been some ESOPs that I’ve heard about where the owners basically did the ESOP and then left. That was not as successful, because the management team could not keep the success going and the owners didn’t get paid off.
How can you tell whether an ESOP is right?
It is an expensive thing to do because there is a cost. You need to make sure that you’re willing to take on that cost. There are a lot of attorneys involved and a team of people that work on it. You have to have the financial ability to be able to do the ESOP. Also, you have to recognize that the money of the ESOP really just comes from the profits of the company.
I think that if you’re too young and you want to continue to own the company, you shouldn’t consider it. I see the ESOP as more of an exit strategy for people who want to transfer ownership and perhaps stay involved in the company but maybe not for 20 years. The ESOP decision is an owner’s decision.
HOW TO REACH: Burnett Staffing Specialists, (713) 977-4777 or www.burnettstaffing.com
The IT industry must strive to remain relevant in a rapidly changing market, while maintaining availability, reliability and security. Under President and CEO Jeff Levine’s leadership, BlueBridge Networks — a leading provider of custom business continuity services — has maintained operational excellence by responding to the needs of its customers.
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Levine’s dedication to protecting important and sensitive data information has been exemplified by his innovative efforts to create new products and services toward that end. He demands the same degree of innovation and excellence from BlueBridge employees and vendors, encouraging participation and idea sharing in meetings. The results of these efforts can be seen in the considerable growth of BlueBridge Networks, which is continuing at record pace into the company’s seventh year.
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How to reach: BlueBridge Networks, (216) 621-2583 or www.bluebridgenetworks.com