A big change ushered Randy Myeroff into his position as president and CEO of Cohen & Co. But that was just the beginning. It unleashed a domino effect of other transformations that he had to steer the firm through to find success.
Until five years ago, the accounting firm’s 18 or so owners served as the board, voting on decisions like naming partners and acquiring other firms. The owners were also responsible for electing a five-person executive committee that ran the firm.
Initially, Myeroff was the managing partner over this committee, a position that — despite the title — didn’t really give him much authority over the group. Plus, he didn’t get to choose the team he worked with, and big decisions had to move on to a board vote anyway.
“It’s a great way to be inclusive, but a bad way to move quickly,” Myeroff says of the old structure. “We acknowledged that we had too many owners to have them vote on recurring things.”
The firm assessed its structure by looking to the future, questioning if the status quo would hold up through time and growth. Before the decision-making process got too cumbersome, it moved pro-actively to make sure it never would.
“Our governance system wasn’t failing,” Myeroff says. “But we had to project forward. As we get larger and get more owners, a system that requires everyone to contribute to every decision is going to get bogged down.”
So the firm, which posted 2008 revenue of $31 million, streamlined to make the firm more nimble. The owners elected Myeroff as president and CEO and named a sleeker six-person board for him to work with. They also gave him the freedom to choose his own four-person leadership team.
That restructuring positioned the company for growth, setting off a chain of changes. In just the past two years, Cohen & Co. has hired about 60 new employees, acquired three other firms and opened a new office in Columbus.
Through it all, Myeroff has learned to stay adaptable and instill unchanging values in his 300 employees to guide them through the future more smoothly.
Here are a few leadership lessons Myeroff learned from the string of changes that have reshaped Cohen & Co. in the past few years.
Drive change through the company
In order to rally employees together under a change, it needs to be founded on the company’s best interests. And that requires communication about what those common goals are and how to best reach them.
When the leadership team at Cohen & Co. began re-evaluating the firm’s governance structure, for example, it identified what factors would cause the status quo to break down. Then the leaders considered whether it would be easier to change the company pre-emptively or after those triggers went off.
Likewise, by continually weighing your options against the firm’s best interests, you can encourage consensus along the way.
“[The employees] better believe that your interests wholly relate to what’s in the firm’s best interests, not trying to move the balance of power,” Myeroff says. “If they really believe that … you really get rid of all the roadblocks.”
Before you can unfold the decision to the entire company, you need to make sure that the management team members are behind it — even if they’re not all getting what they want.
“You make sure the leadership group is fully supportive. That doesn’t necessarily mean that they agree,” Myeroff says. “It doesn’t mean that they would have done it exactly that way. It just means that they understand and they’re totally in support.”
But that’s not the hard part, because rolling change across the entire company is an even bigger feat. The communication alone takes a lot of effort.
“You can’t take anything for granted in terms of people understanding; you can’t do minor communication,” he says. “Because you’ve lived it and it’s been in your mind, you try to communicate it to someone and you’ll almost always leave things out that are important.”
Cohen & Co. sent employees to governance information meetings that covered everything from big-picture reasons for the change to details like who employees should report to. Myeroff began by explaining to employees the importance and integrity of the old structure. Then he discussed the trade-off, covering why changes were necessary and how they would benefit employees.
You should also clarify what remains unchanged, like your values. Make sure to distinguish between what’s constant and what’s adaptable.
“We’re never all going to agree on everything,” Myeroff told his employees. “But we agree on things like a passion for client service. We agree on quality. … We know the rules of the game, and they are very clear and they are unambiguous and they are not negotiable.”
With the same consistent, no-nonsense language, you need to lay out what those rules are for your company. They’ll form a common ground that everyone agrees to, even if individual perspectives diverge. And no matter how ingrained your values seem, don’t hesitate to reiterate them at every meeting.
About six months after the initial announcement, Myeroff started going back to each office. Likewise, after your company has started to live the change, get feedback about the progress and ideas for improvement.
Even though the company’s governance structure was condensing, Myeroff didn’t want employees to feel like their ability to participate in decisions was diminished. To reiterate how important employee input is — even if you’re changing the formal feedback outlets — provide plenty of opportunities for employees to voice their opinions.
“Getting feedback isn’t always a formal process,” he says. “It’s walking around the hallways, being present, calling people, periodically asking them to stop in, ‘What do you think about this?’ When you do those kinds of things … people feel like they are engaged, that they have an opportunity to ask questions. They have an opportunity to at least hear what the firm is thinking.”
The communication loop shouldn’t end when employees respond, though. Reinforce their willingness to participate by letting them know how much you appreciate it.
“Be over the top when people offer suggestions,” Myeroff says. “If someone makes the most minor suggestion in the world to me, I will always leave them a personal e-mail or make a phone call: ‘I really want to thank you because, no matter what the issue is, it takes some risk to put yourself out there and put ideas out there.’”
Hire employees who fit
Through the changes, Myeroff has also learned that you can’t force employees to adopt company values. So rather than trying to convince employees why yours are important, just hire ones who share similar beliefs in the first place.
Because any applicant can tell you what you want to hear, Myeroff recommends giving each one an objective personality assessment. Measure applicants against traits that your employees already possess. Cohen & Co., for example, ran 10 high-performing employees from different departments through a personality test to come up with a master profile of commonalities to judge candidates by.
“I never thought I’d say that I’ve gotten more scientific about the interview. I felt like it was a gut feeling,” Myeroff says. “But interviewing is more of a science. Doing profiles and personality assessments is really valuable.”
The gut feeling comes into play during the interview portion, where Myeroff has several current employees conduct round-table discussions with candidates.
Again, to avoid canned answers, don’t start by describing your culture then asking if the employees agree.
“You can’t tell somebody, ‘Here’s our culture,’” he says. “You have to be strategic about it so that it doesn’t appear to be about culture: ‘When’s the last time you got upset with a co-worker? How did you react? How did you resolve it?’ Ask those kinds of questions. Their answers can tell you a lot.”
After the interview portion, bring all the interviewers together to compare notes about their interactions with the candidate. Because your employees won’t all ask the same list of questions, they’ll each see different sides of the candidate. Together, you’ll be able to paint a more comprehensive picture.
Myeroff also checks references and backgrounds to see how candidates’ prior behavior lines up with the values at Cohen & Co.
But ultimately, at least for Myeroff, the decision comes down to science.
“If they don’t do well in the interview but they fit on the profile, we give them a chance,” he says. “If others go through the interview and they miss on the profile, we may make the decision not to take a chance.”
Make the most of mistakes
Myeroff meets with every new hire to explain the firm’s expectations. But he’s learned through the changes he’s overseen through the years that even if employees start from the same foundation, they won’t all make the same decisions.
To deal with the difference, he borrows a formula from one of his mentors called the 80 percent rule.
His mentor admitted that he wasted energy getting upset when people didn’t make decisions exactly the way he would. He realized that his standards were high, and he needed to leave some leeway for people to make up their own minds.
“If people can do something 80 percent as well as you think you would have done it yourself, that’s not a reason to be upset. That’s a reason to celebrate,” Myeroff says. “People aren’t going to do things the way you would do them; they’re going to do things the way they want to do them. That’s how they’re going to grow and develop.”
Now, Myeroff operates Cohen & Co. on the philosophy that there are no absolute right answers. He empowers employees to make their own decisions, and as long as those are in line with the firm’s nonnegotiable values, he remains open-minded.
“Delegate. If you don’t start trusting, you won’t develop leadership,” he says. “Give people the experience of making decisions.”
Sometimes, employees may be more than 20 percent off target. But Myeroff believes that mistakes come with built-in recovery. If your employees existed in a vacuum without you, they would still learn from their mistakes.
“You don’t like falling on your face too many times, so either you’re going to stop trying because you don’t like how it feels when you fail or you’re going to get a little upset and say, ‘Alright, I’m not going to let that happen. I’m going to figure out, why did I fall on my face, and how can I avoid falling on my face?’”
The best thing you can do to complement the experience is to celebrate what the employee did right, rather than dwelling on where he or she went wrong. Help employees identify the strengths in their approach and then develop those further.
“Let people make mistakes. It’s OK,” Myeroff says. “Sometimes the only way to learn something is to fall on your nose and get yourself back up.”
How to reach: Cohen & Co., (800) 229-1099 or www.cohencpa.com