John Ness took a shaky start as president and doubled ODW Logistics’ revenue in five years Featured

8:00pm EDT September 30, 2012
John Ness took a shaky start as president and doubled ODW Logistics’ revenue in five years

When John Ness took over the family business in 2003 from his father, Robert Ness, he knew he was inheriting his father’s leadership team. What he didn’t know was it would be a couple of years before he finally had his own team together and he would have to shoulder the blame for that reluctance.

The company, ODW Logistics, was ripe for a makeover. The third-party logistics provider just needed someone to shake up its corporate culture a little and launch some expansion moves.

John Ness had put in his time in various ODW capacities such as operations, sales and marketing, finance and transportation. Among many other things, he learned about employee seniority and loyalty.

“I realize as I look back, the importance of forming my team and the things that I think I probably did wrong or could have done better — I took too long to put my own team together,” Ness says. “It was mostly because I valued loyalty and tenure much more than performance and results.”

Ness realized some of the old executives were loyal to his father. Some retired and others changed careers. A few made the transition to the new leadership. Others had to be let go. It took time for the new company president to accomplish the moves.

“I value loyalty and tenure a lot, so it’s not like you don’t value performance and results, but I think you can put too much emphasis on loyalty and tenure and not face some of the brutal facts of what your situation is and advance the ball forward by really saying, ‘This is where we need to go,’” Ness says.

Because the leadership team was not all on the same page, it slowed down expansion and growth plans.

If you keep your values and expectations in your head but don’t put them in writing, not only will others not get the whole picture but you also won’t be able to readily point to, follow and understand your standards.

“I also learned I wasted too much time with guesswork,” Ness says. “So the lesson there is to be clear ... get the big rocks in the jar first. You’ve got to put the important things down in writing and make sure you are clear on what you want your company to do and how to behave and what your expectations are.”

Fortunately, a foundation of caring about people and the knowledge that good, great people are the key to success was still alive and well at ODW.

“We have added to and made the foundation more current and more relevant because the business has grown,” he says. “You have to communicate that culture effectively to a broader number of people. We have created some phrases and new terms because that gives us a way to identify and brand that culture in a positive way.”

Here’s how trust, team and balance, the five E’s and SCOPE play a large part in the success of ODW Logistics as it doubled its 2006 revenue to $100 million in 2011 and continues to grow.

Keep your promises

In the service business, as well as many other businesses, culture is one way that companies can differentiate themselves from one another. When you don’t produce products, it boils down to how your people can make a difference.

“Service is about promises,” Ness says. “People make and candidly break promises, so you ask your people to promise their best and deliver their promise.”

Because customers will measure a business on the commitments and promises you make to them, your people will rely on the habits, collective behavior and values of your organization — in short, your company culture.

“You need to have a strong cultural environment to support their promises to customers,” he says. “If you have a really strong cultural environment, then that culture cascades to your customers because your people are infected by this great culture. It’s just evident in how you interact with them, their attitude and their ability to navigate a difficult day or a new challenge.”

Once Ness began to formulate improvements to the company culture, he decided the values of “trust, team and balance” would be part of the new touchstone. He realized every shipment that went out was another opportunity for both successes and failures and every one of those was another opportunity to do right or wrong by the recipient.

“You’ve got to believe in who you are doing business with. And so you make promises to your customers all the time, and you’ve got to be able to execute those promises,” Ness says. “It’s not your executive team that makes your company go. It’s your whole team, and they’ve got to trust that you are doing things that are in their best interest so they’re willing to come in and do the job every day.

“Seek to build trust with your customers, associates and partners based on the foundation of a great team that maintains a healthy balance of work and life.”

Those three values — trust, team and balance — blended together make an unbeatable combination.

“Talk about spirit; talk about hard work, being competitive and getting results,” he says. “In the culture, for a happiness element, talk about balance. Your employees spend a lot of time at work, but you should care if your people would acknowledge that work is maybe No. 3 or lower on their priority list behind their faith and family. Community is awfully important as well. Be open to that and expect your people to have a good balance between work and life.”

Another important facet of your culture should be its purpose — why are you all here?

“It’s lead, serve and love,” Ness says, citing another trio of words. “You want to lead your industry, lead your markets. You want to serve your customers, serve your community, and you want to love what you do and love like a family.

“It hopefully speaks to something that is greater than profits. Financial success is important as well, but if that’s all it is, then I think you lose sight of a higher purpose.”

Use E’s for excellence

If your organizational culture promotes certain values, obviously, you need current employees to buy in — and you have to add new blood who get your message.

“You can’t assume everybody picks it up,” Ness says. “I’ve heard that you have to say something at least seven times for it to sink in, for people to really understand. So you get tired of yourself repeating the same old, same old. But your focus is to really share that message with your leadership team and make sure the executive leadership team is sharing that with their team and so on.”

But as you grow, you will need to find new people — the right people that fit into your culture along with their skills and talents.

Ness and his executive team developed an easy way to remember the qualities they would look for when interviewing job candidates.

“We look for the five E’s: experience, energy, enthusiasm, effort and edge,” he says.

Experience is an attribute of whether you have it or not. It’s that simple; either you have worked in the field or not.

The next three — energy, enthusiasm and effort — are also qualities you either have or you don’t have but can be cultivated. And if they have been cultivated, it’s all the better if they were nurtured at an organization that promoted those values as part of its culture.

“If I come into a culture that promotes those things, I’m going to live by them if I have them or not,” Ness says. “If I come into a culture where they are not promoted, and I have them, I may be less likely to demonstrate or display them. So there is infectiousness, if you will, about a cultural wave in an organization that’s important.”

Edge is an interesting concept and has a motivational quotient about it.

“Edge is defined in basically a competitive way — I want to throw myself into a spot where I can make a difference,” he says.

“Our VP of operations describes it like the wave at a football game where everybody stands and does the wave cheer,” Ness says. “The first time around not many people are standing up, the second time maybe more, and you’re kind of goofy if you’re standing up. But by the third time or fourth time around, the goofy ones are the ones that are sitting down.”

When it comes to reinforcing trust, team and balance, Ness finds celebrations help underpin those values.

“Our tagline is, ‘We’ve got range,’” he says. “So we have Ranger Awards for most improved operation, best customer experience and others. We have the trust award, the team award and the balance award, the operation of the year award — there are 11 of them in all. Those are honors for our people to win, and it helps reinforce the values.”

Determine the SCOPE of things

An operating philosophy, once written down, helps employees figure out how to apply the values of the organization. If you can devise a mnemonic device, your chances to have more employees remember the philosophy will improve.

To establish an operating philosophy for ODW, Ness and his team decided SCOPE told it all: safety, customers, operations, people and execution. They even award a trophy similar to the Stanley Cup to recognize one of their departments or operations each month with reinforcement of the behavior they hope to see.

Ness says safety is a nonnegotiable standard that all employees should live by. Customers should receive attention promptly and with delight. The people, productivity and their commitment to come in and do a great job every day are the core of the operations. Spirit, hard work, competitiveness and results define the people who are components of the team. And finally, execute — and execute profitably.

“Any circumstance that comes up in day-to-day activity is going to come back to those foundational issues,” he says. “You still need the expertise to figure out the technical process, apply the principles and be consistent, but if you continue to remind yourself that’s your base, then those decisions become a little easier.”

Decision-making for the leader is built on the same principles. It’s not much different than for other employees.

“The leader has to be emotionally strong enough and mature enough to cycle through and be able to provide action going forward,” Ness says. “If you get paralyzed by those concerns and those worries, then all the symptoms come out. You don’t sleep at night. You get into irrational thoughts. You lash out at people. None of that is productive.”

If you can stay healthy emotionally, then you are well-equipped to get people around the table and begin to talk about specific things that need to change or that need to be done in order to get the company back on the right course.

“Whether it’s a major course correction in the event of a big crisis or a minor course correction when the fears aren’t as strong, that same process applies for both,” he says.

“Hire the best leaders. Ask your leaders to behave like owners so everyone has an entrepreneurial mindset. You want your leaders to own the business they run so their customer satisfaction is their responsibility, their profitability is their responsibility and their cost management is their responsibility. We believe if we can hire well and put those leaders in a position where they have a lot of autonomy to make decisions to run their business, then they can provide better value to customers.” <<

HOW TO REACH: ODW Logistics Inc., (800) 743-7062 or

www.odwlogistics.com

The Ness File

John Ness

President

ODW Logistics Inc.

Born: Columbus, Ohio

Education: I have a bachelor of arts from Wittenberg University in business management. I played football at Wittenberg. In my junior year, we beat the College of Wooster 66-0. It was unbelievable.

What was your first job?

It was at ODW Logistics. I got a job right after high school working as a banding machine operator, so I banded packages together that we were shipping out on UPS trucks. I lifted hundreds and hundreds of boxes off pallets every day, banded them and shoved them down the conveyor line. I did that all summer long. Then I went to college and said, “I’m going to stay in college.” Banding was an important job but one that I didn’t want to do the rest of my life.

What was the best business advice you ever received?

I’ve received lots of advice. A good friend of mine, Jeff Sopp, used to devise sayings. We called them Sopp-isms. He used to say you can be wrong on people but you can’t be wrong long on people. So you could make a hiring mistake, we all do, but you can’t go on and on without dealing with it. I don’t know if it’s the best piece of advice I’ve ever received, but I also like Coach John Wooden’s quote, “Success is never final and failure’s never fatal.” I think that that kind of keeps you on track.

Whom do you admire in business?

I think locally there are some great leaders: Jeff Sopp, Dave Blom, Tanny Crane, Les Wexner. Personally, I admire my father, Robert E. Ness. He built this company with his own two hands. He was a self-made man. He borrowed $5,000 from the bank in 1971 and thought that he could start a company on his own with the intention of taking care of the people who worked for him and knowing they would take care of his customers. He was certainly very successful and instilled in me just a tremendous number of values in terms of how to take care of people and how to lead.

What’s your definition of business success?

I really stay with lead, serve, love. Lead our industry, lead our markets, serve our customers, serve our community, love what you do and love like a family. If we do all that well, I know the financial success and the financial results will come and our customers will be happy. I know our problems won’t all go away, but we will certainly feel like we have accomplished something we can look back at that had great purpose and value.

Ness on the rule of threes: We follow the rule of threes in the interviewing process that has worked well: pick three candidates for each position, interview every candidate three times and have three people interview them to select the best.