For the president of Groveport-based Midwest Electric, it’s the same in the business world. He says executives must take chances to learn, but there’s a difference between risks and measured risks. And when it comes to running his 200-employee business, he prefers the calculated option. Armed with the knowledge that his company’s competitors don’t put money into their management teams, his company has invested in leadership before the need, and Nicolosi expects the risk to pay long-run dividends as Midwest continues to grow.
Since 2004, its revenue has grown nearly 400 percent, from $5.9 million in 2004 to $29 million in 2006.
Smart Business spoke with Nicolosi about how he bets on success.
Q: How can executives grow their companies?
Be in the right market at the right time. There’s some fortune associated with that, and there’s some planning.
When we purchased the company four years ago, we realized the energy market was going to go through dynamic growth and change over the next 30 or 40 years. We were going to be in a position to take advantage of those risks and rewards.
People sometimes tend to do too much research. You know whether you’re in a good market or not. Some markets make a lot of sense, and then there are other markets that have a natural cap to them. It’s fine to do business in them, but you have to be comfortable with a much slower rate of growth.
Be honest about where your company is and where your market is. If you’re in a market that doesn’t support fast growth, trying to grow fast is much harder and much more dangerous. If you’re in a market that encourages and allows fast growth, it’s a heck of a lot easier.
Q: How can executives make changes in their industries?
One step at a time. Big dreams are important, but if you try to accomplish them in two, three, five, sometimes even 10 years, you can be foolish.
Break down your big dreams into discernable steps, and then break those steps into tasks that need to be done on a month-by-month basis. As you get more successful and learn from those small steps, maybe your dream changes, or maybe it stays the same, but it gives you a better footing on which to continue to pursue it.
Don’t be overoccupied by what you want to be in 30 or 50 years because that’s a long ways away. It’s good to have an idea of what you want to be, but it’s important to allow your vision and your dreams to change.
Markets, competitors, customers’ needs and your supply are constantly evolving. To not re-evaluate where your organization’s strengths lie in comparison to all those other networks is silly.
You’ve got to constantly make sure you’re doing the right thing and using your resources in the most value-added way within the market available to you.
Q: How do you do that?
It’s more about sensitivity to what’s going on, as opposed to things that you do. (CEOs) should be doing more than talking and preaching to customers, suppliers, employees, competitors; they should be listening. If they’re listening, they’ll know what’s going on.
Q: What can prevent a company from growing?
Fear of risk and change. There are lots of fears in life, and it’s the largest motivator there is. Fear can really put handcuffs on leadership and everybody else within the company.
Q: How do you overcome that?
By doing it. You have to go out and do something uncomfortable. There are a lot of entrepreneurs who don’t take measured risks the way they should, and there are a lot of entrepreneurs who sometimes take too much risk.
Managing that risk appropriately is unbelievably important, but avoiding all risks at all costs is the easiest way to kill off an organization.
Q: What advice would you give leaders of fast-growing companies?
Manage cash closely. When you grow, you always underestimate how much cash you need. Things never go the way you planned.
Knowing how much cash you actually are spending and have on hand, and then having backup plans for accessing additional cash if you need it, is pretty important working with other banks, nontraditional financial sources and current investors to add investment.
Hire great people. I always look for people who have been successful in their past; it usually means they’re going to be successful in their future. I look for people who are highly motivated and as smart, or smarter, than I am.
Don’t micromanage. Great people shoulder the load of your company. Don’t hire somebody great and then not allow them to do their job. The best way to reward a great person is to allow them to do great work.
HOW TO REACH: Midwest Electric, (877) 482-8008 or www.midwestelectric.biz