When Tom Campbell arrived at Quick Solutions Inc. in 2000, he encountered a challenging but not unpleasant management dilemma.
Quick Solutions had adopted an employee stock ownership plan in 1999, and employees initially owned 5 percent of the business. Two years later, their ownership interest had grown to 15 percent, and they wanted information about their company.
“The employees wanted to know more about this business and how it worked,” says Campbell, who is co-owner, chairman and CEO of the IT consulting firm.
After reading Jack Stack’s “The Great Game of Business” and studying open-book management, Campbell realized that he needed to move in that direction and be more open with his employees. And that need for more information has grown, as employees now own 34 percent of the business, which posted 2007 revenue of $28.1 million.
Smart Business spoke with Campbell about how he opens his books to his 250 employees.
Q. How do you introduce open-book management to employees?
At one of our quarterly meetings, I gave a presentation on why it was a good practice. I bought 25 or 30 copies of Jack [Stack]’s book and passed them out to people, and from there, people read them and passed them around.
People want to know what’s going on in the company they work for, and they want to be a part of it. People are pretty amazing; if you give them opportunity and you’re open and honest with them, they become a lot more dedicated. The business becomes a part of their family.
It was hard at first because back in 1999 to 2000, we had a lot of mistrust between employees and management: ‘Management gave me this information, but how do I know it’s real and that it’s right?’ You have to break the mistrust barrier. I inundated them and gave them information until they told me to stop, and then we were able to back it off.
You work your way through it.
Q. How do you break that barrier of mistrust?
First, we share all of our financial information our goals and our budgets. Every week, we have a huddle with all of our people. If people can’t be here, we videotape it and post it on our Web site. We have measurable goals we’re trying to achieve every month, quarter and year-to-date, so we go over where we are against those goals and talk about the reasons why.
We have quarterly meetings very religiously and schedule them out a year in advance. We have everybody come in for a nice dinner and a presentation at a conference center at a local hotel.
We talk about our business where we are, where we’re going and how we plan to get there. We tell people about any critical decisions that are being made why we’re making them, how we believe the decisions are going to affect the business and how it’s going to affect them.
We also have a bonus program everybody participates in, based on the achievement of those goals. If we exceed those goals, everybody has the opportunity to earn a bonus, and we treat everybody equitably. That gives people a stake in the outcome.
Q. How can other leaders get buy-in from their employees?
Be open and honest with your employees and share your information with them. That doesn’t mean you have to share everything, like nobody here knows how much I make; you don’t get down to that level of detail.
You do show people what your company’s sales are, your margins, your operating expenses, your taxes and your income. You set goals for what you want to achieve, and then you allow them to participate if you exceed those goals. It kind of sounds simplistic, but most business owners don’t do it.
A lot of them just want the employees to come in and do the work. The senior ownership - they run the business, keep the financial statements and don’t share the information with any of the employees. The employees don’t know what’s going on in the business. The owner is afraid to disclose the actual activity, and that results in a lot of mistrust.
When you have the courage to share that information and really let people know what’s happening and let them be involved with it, it’s amazing how much more productivity you gain. You’ve got to be willing to take that leap. You can’t half do it; you have to do it or not do it.
Q. What results have you seen from implementing open-book management?
Last year, we had record sales, record margins and record earnings, and as part of playing the great game of business, we passed out bonus checks to our employees. When people start getting those checks, it becomes very real.
When they see the increased value in their ESOP account and the value they they’re gaining by having an ownership interest in the business, they get excited about that. You get a lot less turnover, your retention rate goes up, and you have a great core group of people to work with.
HOW TO REACH: Quick Solutions Inc., (614) 825-8000 or www.quicksolutions.com