As A.J. Hyland sits comfortably on one of the two modern leather couches in his second-floor office at Hyland Software, it could be easy for him to look through his office’s glass walls across the maze of cubes and simply smile in contentment.
After all, the software company, which develops the enterprise content management solution called OnBase, grew 77 percent between 2006 and 2009, reaching $133 million in revenue and landing it a spot on the Inc. 5000 list last year for the fifth time. The company has made six acquisitions, won numerous awards and has more than 9,700 customers, and of that, 97 percent renew maintenance on the software each year. On top of that, it now has more than 1,100 employees and constantly has no shortage of applicants because it has gained a reputation of having a Silicon Valley culture despite its suburban Cleveland location.
Yes, Hyland could simply smile in contentment, but all of that is just the beginning for him.
“I get more excited each year because we’re getting more and more strong, but we have so much potential to grow,” the president and CEO says. “For me, it’s about building a strong foundation but never being content. That’s why we’re talking about evolving this year with all the employees. We’ve got to move forward. It doesn’t have to be this massive rip-up change — we’re doing so many things well, but let’s continue to tweak things and get better and better and better and grow and that’s key.”
Evolution is vital because the competition has taken notice of the organization and all of its successes.
“We can’t just sit here — we have to move forward,” he says. “There are way too many people coming after us in this marketplace. There aren’t a lot of barriers to entry in this space. People can develop products and services to compete with us, and a lot of people are trying to copy what we do, so as they get close to us, how do we leapfrog ahead again? A lot of that has to do with evolution.”
To continue growing and getting better, Hyland is proactive about growing the company by making sure he hires great people, focuses on customer service and effectively communicates.
He says, “If you want to grow, you have to believe that you’re going to do it and make it a self-fulfilling prophecy.”
Hire great people
As Hyland Software has grown, unlike many companies, it hasn’t waited until there is enough work to justify hiring new employees. The company has been proactive and hires employees well ahead of when they’ll actually be needed.
“We hired ahead of where we needed to hire to have people there so that when we got to a point, we were able to service the clients we had,” Hyland says. “It’s not like we held, off, held off, held off, and as soon as something hit, we hired a bunch. We hired a bunch and pushed the growth and kept on bringing people in. …You have to add good people all the time.”
Many may scoff at spending money on such expensive resources as employees before the business is there, but Hyland says that with great risk comes great reward and it’s just one part of pushing yourself to grow.
But it’s not just hire a bunch of people without any thought behind it. Hyland has a specific approach to the practice.
“It comes down to planning and figuring out what areas are going to be hotter than others,” he says.
He looks at the business and says that if it grows by X percentage on the sales side, that shows him how many people he needs to hire on the technical services or support side. He also brings into account data about how many people leave the company each year, as well.
“It’s really about looking at your business and analyzing the historical data and having some lens into where it’s going in the future,” Hyland says.
The key is that you have to be grounded in data and also be willing to use it.
“Spend some time sifting through the data,” he says. “A lot of people have the data but they don’t spend time cutting it up or slicing it from different angles. Every month we look at all of our sales, services data and figure out what’s happening. Are we seeing a couple trends over a couple months? What does that mean from an employee perspective?”
But it’s not just hard data that you have to incorporate into your hiring plans. Listen to what your customers are telling you, as well.
“You get comments from customers — ‘Hey, it’s tough to get a hold of you guys these days,’ or, ‘Your backlog for services is stretched out too long,’” Hyland says. “That immediately throws us a flag, and we say, ‘OK, we’re low in certain areas, and we want to make sure we have enough people to handle those volumes.”
As you assemble the data and the feedback, you’ll likely want to ask your department heads and managers what they think they’ll need in terms of human resources, as well, but Hyland says you also have to make sure to ask questions when you have those conversations.
“When you’re dealing with departments, people are going to ask for the moon,” he says. “If you ask what they need, they’re going to ask for a lot, and it’s good to have some checks and balances on that and check people and say, ‘Why would you need five people there?’ or, ‘Why would we need four people there?’ and make people come up with legitimate reasons.”
Once he knows how many people he needs to hire, then it’s time to focus on the hiring process itself.
“Setting expectations in the interview process is good,” he says. “[It’s] coming up with creative ways of drawing out personalities in an interview process.”
At Hyland Software, it’s a multistep process that doesn’t rely on one manager to make a decision. Applicants go through multiple interviews with both human resource staff members as well as managers they’ll be working with directly.
“Having the multi-interview process is helpful, but [it’s also] having them talk about experiences where they had to deal with adversity and see how they’re going to function in this environment to see if they’re self-starters,” Hyland says. “If you can come up with questions and approaches and draw that out, that’s going to be part of your success in bringing in the right people.”
He says it’s also helpful to be honest about their work environment and really share what it will be like.
“Have an overall tone of your department that’s communicated to the applicants so they can self-weed-out,” Hyland says. “‘OK, this is how it works here, and maybe it’s not perfect, but this is how we function, and if this is something that’s going to make you uncomfortable, maybe it won’t work.’ Setting proper expectations in both directions is very important.”
It’s also important to involve successful employees in the process. He says that if you have a couple successful individuals in a particular area that you’re hiring for, identify what traits they have that have made them succeed. Train those people to be a part of the interview process so you have more people involved, and look for those traits when interviewing.
Lastly, Hyland says it’s a common mistake to get excited about all the wonderful things you see on somebody’s resume and ignore the red flags that come up in your interview process.
“More often than not, if the HR [representative] isn’t feeling good about somebody in terms of their attitude or approach but their manager felt good about them, they’re not going to be successful here,” Hyland says. “It’s just the data shows that. There are always exceptions, but if you’re ranking fair to poor (and) a manager wants to trump that and say, ‘I want them anyway,’ we have some good data that shows that doesn’t always work out.”
Focus on customer service
When Hyland hands you his business card, you’re actually receiving access — not simply a card. On that little card is not the general company phone number or an assistant’s extension but rather his direct office line as well as his cell phone number.
“Make sure there are no gatekeepers to the senior leadership — period,” Hyland says. “Don’t have a bunch of hoops to go through before you actually talk to the owners or the senior management in any department. That would be No. 1, so customers have to know that they’ve got a final backstop with the leadership of an organization.”
This is just the start of how Hyland Software focuses on customer service, the second critical factor to growing the organization.
“Senior leadership has to lead by example because if they’re not doing it, no one’s going to do it,” he says. “If they’re not customer-oriented, they’re not taking calls, they’re not getting in front of the fire and getting out on the front lines with customers who need help or need resolution on stuff and they’re trying to shirk all those responsibilities, it will not trickle down at all.”
Hyland says that customer service starts with making yourself available to your customers.
“Customer service has a lot to do with accessibility,” he says. “[It’s] making sure that you’re projecting to your customer base that we want to hear from you — it’s not you bought our product and good luck.”
That’s why Hyland and the other senior executives at the company make their phone numbers available for all of their customers, and that’s what he expects of all of his employees, as well.
“If you’re not willing to get on the phone and help customers with problems, you’re not going to last here,” he says. There’s no way for you to exist in this organization if you’re going to take this standoffish us versus them. To us, it’s about partnership. It’s about locking arms and dealing with issues. It’s about saying sorry when you make a mistake and moving on to a solution fast.”
To get everyone to adapt this mentality, Hyland says you have to focus on training your people in customer service.
“Don’t skimp on training for people, particularly when they start with a company,” he says. “Don’t just say, ‘Good luck.’ You have to give them context on where you are in the industry and what your corporate value system is and how you approach customers in general and what we care about as an organization and what our goals are this year and what are we focusing on. People armed with those parameters are better able to serve customers.”
You also have to continue talking to them about why customer service is so important long after they start.
“It means being proactive,” he says. “It means training your people and giving your people the power to make decisions that are pro-customer and they understand that this is who signs the paycheck and building that mentality over time.”
That understanding of who signs his employees’ paychecks is critical, and to reinforce it, he talks about new customers at every Monday-morning meeting with the company, where he reads the name of each new customer that has come on board in the previous week.
“It may sound corny — I could just say the number — ‘Hey, we got seven new customers last week,’ but I think it’s important for people to hear who these companies are that are signing our paychecks and for them to see the names written in front of them,’” Hyland says.
He also wants employees to get to know customers and understand them so customers come into Hyland and present their solution to employees, and it’s also recorded so people can watch it later. They talk about the decisions they make, why they buy Hyland’s product, what have been some of the positives they’ve gotten from it, what some of the pitfalls have been, what they would like to see in the product and what they would like to see from the company. It’s not mandatory for employees to attend or watch it later, but many of them do because they realize it’s important to hear from customers.
Another way Hyland focuses on its customers is by creating user communities where customers can come in and learn from each other.
“Sometimes people feel that’s dangerous and all the bad stories are going to get out, and yes, you’ll have some individuals that will take advantage of that, but more often than not, people are good, and they’re just trying to find answers and share best practices,” he says.
Between these avenues as well as simply working with customers every day, Hyland can see when trends are starting to develop that need addressed, but the word trend is important.
“You learn through experience and mistakes that getting crazy off a one-off experience doesn’t really help,” he says. “There’s usually two sides to every story. It’s really if you’re getting a consistent wave.”
He says there are certainly situations that you need to correct right away, but more often than not, if you’re seeing many customers telling you the same thing, that shows you it needs to be addressed.
“Feedback is coming from different avenues, and you’re getting a sense that this is a problem and we need to address it” he says. “I think knee-jerking to one particular issue, I’ll leave that to the government. I don’t think that’s really smart. You can certainly address the issue, but is it a trend if it happens once? No. That’s a mistake that a lot of people make, and they’ll get all fired up and start blaming and moving a bunch of things around, and you need multiple data points before you shift focus. … If you have multiple avenues of feedback from partners, from customers, from user groups, then you know you have something to address.”
As Hyland Software redid its large HR system, it was a huge project that touched everybody as they tried to consolidate other systems into it. It also forced managers to be more accountable on certain things, so there was a lot going on with it. Even though Hyland had talked about why they were doing the project multiple times, people were still getting upset.
“As you get further along in the project, people get angry about certain things and you have to reset everybody,” he says.
That’s where communication comes in, which is another critical element to the company’s growth. Hyland says he was naïve when he was younger in that he thought he could just go out and say what the company was doing and where it was going, and everyone would get it.
“You wonder why people wander off in a different direction — ‘Wait a minute! They’re not following me?’” he says. “It’s just getting the discipline down of talking about things fairly consistently and then creating avenue and mechanisms at the global level and departmental level that reinforce that vision or the values or whatever it is you’re trying to get across.”
So he’s become more disciplined in his communication approach. To start, he’s created a small group of several vice presidents and meets with them about once a quarter to ask them how he’s doing with his communication. He’ll ask where they think the company is on a certain issue, what they think he just communicated about it or what their team thinks about it. He’ll ask what is fuzzy about what he said or what didn’t link right with people.
“It’s been eye-opening for me,” he says. “I won’t let them talk and hear each other so they can’t mold their answers. I actually make them write them before we talk about them so I get the raw feedback before we get mob mentality.”
Doing this helps him see that he hasn’t projected the real reasons he’s doing something or what the purpose behind something was. Hyland says that when you get a group of intelligent people who know you and the business really well, they can really help shed light into your communication efforts.
“Creating that and being humble enough to take that is the key advice to just create a group of individuals who do that,” he says.
He’s also done this with employees and asked them a couple strategic questions to see if they really understand where the company is heading. Sometimes he sees that newer employees don’t get it but older employees do, and sometimes he sees that everyone gets it.
“If you’re willing to open yourself up to the feedback, people will talk,” he says. “It may take them a little time, but they will talk and they will say, ‘This doesn’t make sense.’ The advice I would give to any leader is open yourself up. Put the target on your shirt and just take it. It’s going to forge you as a better leader, period. If you think you know everything or you’re God’s gift to whatever, that’s great, but you’re not going to evolve as an individual, and you’re not going to be a stronger leader three years from now.”
In the case of the HR system, it was clear from the feedback that employees didn’t understand the point. Hyland recognized that it was creating different work for everyone, and change doesn’t make people happy, so he spent five minutes at the Monday-morning meeting talking about it. He explained why it was important, why they needed to do it from an employee-development and career-development perspective, how they didn’t have a consolidated system, why it was strategically important as a business, and how people are crucial and doing this keeps turnover rates low.
“Immediately, people said there was a massive upswing in involvement and energy behind it, and it just took five minutes for the leader to say, ‘OK, everybody, I know there’s pain, but get through it – there’s a light at the end of the tunnel. We’re not just doing this to put you through pain, but there’s actually something valuable here that we want to get to,’” he says. “Sometimes we need a little reminder.”
He says you don’t want to do this every single time you communicate to people, though, but rather when you get feedback that the simpler message isn’t getting through.
“If you do this every week, you drive people nuts — ‘Oh here he goes again,’” Hyland says. “But once every six or eight weeks — ‘OK, he’s actually thinking about things.’”
HOW TO REACH: Hyland Software, (440) 788-5000 or www.hyland.com