Each morning when you wake up and head into the office, you probably know what to expect for the day’s events. When Joel Lunenfeld gets out of bed, he knows that his day at Moxie Interactive Inc. will be full of new — and often unexpected — changes. To start, the advertising and marketing company, which had $405 billion in gross media and production billings in 2008, is in an industry that changes constantly. Not to mention the fact that the way people interact is changing, as well.
“The way that people get information, get news, the way they view themselves, view privacy, the way they interact with companies that are our customers — all these things are changing, so culturally, it’s an incredible shift that everyone is feeling,” Lunenfeld says.
Then add in the fact that Moxie provides cutting-edge technology to its clients, and they are adapting as they try to do more with less given the economy.
“You put all these things together, and it’s just constantly managing change,” he says. “To do that, we try to breed a culture of disruptive innovation with urgency. I fundamentally believe that Moxie, our business, and really any business today is never standing still. You’re either forging ahead and advancing or you’re falling behind.”
Leading change in any organization is never easy, but Lunenfeld made it a more formal part of the culture when he took over as CEO last year upon the founder’s departure.
“With her leaving, it was, ‘OK, how do we take this culture of change that we have and really crystallize it,’” he says.
He attacks this challenge by driving innovation, leading by prediction and focusing on communication.
Lunenfeld put out a challenge to his people: Form cross-functional groups of five and create a mobile-based idea to help people connect better with each other or with brands. But it wasn’t simply said in a meeting and forgotten. The winning team won $50,000 to split.
“A lot of companies like Google, they have their 20 percent rule — 20 percent of your time should be working on something that’s outside the company that’s one of your passions or interests,” he says. “Other companies have similar types of ways. For us, this was a way to get collaboration and really just show everyone that every individual person has the power to come up with something, be an entrepreneur, create it, and the company really wants to back it.”
Driving innovation in your company is the first key to nurturing change.
While money may be tight, he says that this is one area that you can’t afford to skimp in.
“If you’re not dedicated to putting resources there, whether it’s people, money or investment dollars, you’re not going to achieve it,” Lunenfeld says. “It’s not just going to happen, no matter how hard you try, because everyone’s going to be focused on the business at hand, which is what we tend to do. We focus on what’s in front of us, especially in times of crisis and in times of economic downturn. … It’s just like working any other relationship or anything else in your life. If you’re not dedicating time to do so, it’s not going to just happen naturally.”
Beyond having competitions, Lunenfeld has also found a daily way to drive innovation by having his employees embrace Sunao, a Japanese word meaning “the untrapped mind.”
“[It’s] more of a philosophy of not being afraid to adopt an idea that might fundamentally change the way you do something today,” Lunenfeld says. “It’s about not being locked in to either a product or service or just a way that you get things done and trying to encourage that culture of change.”
Sunao is not just a mindset but also the name of a group within the company that he created and charged with looking for trends and new ways of doing things. The group is also charged with looking at emerging technology and toying around with new products to find ideas. You may think it’s wasteful to dedicate people to solely looking for new ideas as opposed to doing the work already at hand.
“If it’s not your primary job to do something, you usually do that last, and that usually means, when push comes to shove, it falls off your plate,” he says.
When you create something like this, you also have to set expectations.
“From a business aspect, it’s a leap of faith, and you have to be very clear when you’re doing a group or starting something like that,” he says. “There are deliverables you expect, and those deliverables may not always be billable ones.”
For example, at Moxie, the group is expected to put out a monthly trend-spotting newsletter and quarterly reports. While the group has a lot of freedom, having expectations has yielded results, which has allowed the group to grow from just one person to more than 20.
“It’s things that you want that group or whoever’s leading that to have very solid deliverables,” he says. “Even though it’s more of a conceptual position, deliverables are real and their measurements are real. That actually does turn into profitable, billable project services that pay off, and the group will begin to fund itself.”
Lead by prediction
One day a little girl was watching her mother cook, and she asked her mom why she cut the end off of her pot roast. She said she didn’t know and that her mother had always done that, so they asked the little girl’s grandmother why she cut the end off of her pot roast. The grandmother said that her mother had always done it, so the trio asked the great-grandmother as to her reasons, and she said that her pan was too small for her pot roast, so she had to cut the end off.
“We do that too much, ...” Lunenfeld says. “People look at rules as, ‘This is just the way it’s always been.’ I think studying anthropology and cultures over time, really not too much is permanent, and there aren’t too many things that are completely immovable, so it’s always nice to remind yourself that one person can come up with an idea that can radically change the world.”
When you — or your trends group — find an idea, he says you have to take a risk and lead by prediction, which is the next key to fostering change.
“The power of prediction is pretty underestimated,” he says. “If you’re facing a challenge, and you’re laying out a vision and saying, ‘This is where we will be or this issue is happening now, but in three months, this won’t be happening because of X, Y and Z,’ once you lay out a bold mission, people will naturally march to that. They want to. It works the same way in reverse, so if negativity is breeding, people tend to quickly spiral in that direction, as well. Leading by prediction is a refreshing way to overcome that challenge.”
To do this, take notice of what’s happening around you.
“One [key] is being able to look outside the walls of this company at what’s going on in the industry and the world and looking at the trends [that] the trends group is bringing forward and peeling that back for meaning,” he says.
Good examples right now are social networking sites, such as Facebook an
d Twitter. Look at these sites on a more macro level to predict how they have been used, how they’re changing, how they’re changing lives and how they’ll be used in the future.
“Pull that out and lead that out as a prediction and say, ‘This will continue to grow, or this will continue to shift, or this trend will morph into X, Y and Z,’” Lunenfeld says. “It’s about industry trends and translating the outside world for the company and vice versa — taking what’s going on in this company and giving that story to our clients and the rest of the industry. It’s not being afraid to look at the indicators and make a prediction of where things will go because nobody wants to work with a partner who’s afraid to make a prediction and make a bet on something.”
You can’t be afraid to be wrong either, so plan for that scenario.
“You try to manage all the risk,” he says. “There’s a big difference between mistake and risk. Risk is something that you plan for, you know what the scenarios and outcomes are, and you have a plan of attack if something goes wrong. If you launch a campaign or roll out a product or service and something goes wrong, you should have been able to predict, ‘These are the ways we [could] go wrong.’ Otherwise, it’s just a mistake.”
Risks are often undervalued but will grow your business.
“We ask our employees this a lot, ‘What’s the biggest risk you’ve ever taken in your life, and how much of that has turned out to be a disaster, and how much of that has turned out to be something that has grown you?’” he says. “It’s always the biggest risks in life that have grown people, and it’s the same way as a company.”
When Lunenfeld is traveling and wants to let his people know what’s on his mind, he can post a video message on Moxie’s social network portal. From there, people can watch it and comment, in turn, creating the kind of communication internally that they also manage for their clients. And it’s just one way that Lunenfeld communicates with his employees.
He recognizes that they are often overused words, but he says that communication and transparency are the last key to leading and nurturing change in an organization.
“When things are moving so fast and management — and whoever everyone thinks the voices above are — are silent, everyone tends to fill in the blanks and expect the worst,” he says.
The problem is, when most of us communicate, we’re just handing down the edict instead of involving employees.
“It’s got to be something where you’re not talking to people, you’re inviting them,” Lunenfeld says. “If you’re trying to motivate, whether it’s a client or it’s your employees, to get on board and march boldly behind you to do something, you can’t just say, ‘This is the way it’s going to happen.’ You have to leave room for participation and leave room for them to help finish the vision that was started. You can’t ever bring a complete package forward. You have to lead with, ‘Here’s the rallying challenge that we all have ahead of us. Here is why we all passionately should feel inspired to do something about this, and here’s what we need from you.’”
He suggests setting guidelines instead of rules.
“One of the things I’ve found about working with creative people over time is the worst thing you can give a creative person is a blank sheet of paper,” Lunenfeld says. “But if you say, ‘Here’s a challenge, and here’s the seven colors you need to work within, and here’s what we expect on the other end, then you’ll get something absolutely incredible, so you have to set the rules of the game up correctly, and you have to enforce those rules.”
And even if you involve people and invite them to participate in the change, recognize that people will still need to process the negative emotions behind it, and that’s natural.
“We still have to remember that it does affect everyone personally, so everyone is going to internalize change, and it’s going to mean something different for everyone,” Lunenfeld says. “You can’t always address that, but you have to be open to talk about it with people and understand that you’re going to go through several stages, but ultimately you’re going to walk away with a better company, a better client relationship.
“The worst thing you can do is fear the fact that this is going to happen and fear what this might mean for a handful of people versus the greater good. You have to be bold in making the right decisions for change. If you’re not changing, you’re definitely going to be falling behind.”
How to reach: Moxie Interactive Inc., (678) 916-4500 or www.moxieinteractive.com
While the economy is down, Rick “Baja Rick” DiRienzo isn’t letting that stop him from having some fun at Rockin’ Baja Coastal Cantina.
“What we try to do is keep an upbeat attitude with our guests, with our employees,” he says. “We want everyone to have a party atmosphere when they come in here.”
So at the restaurant chain, the food and drinks must be tasty, and if a server wouldn’t eat or drink something him or herself, then send it back. If someone is celebrating a birthday or graduation, treat that person to something special and make him or her feel important.
“We need to create a party when people come to dine with us,” the founder and president says. “It’s like going on a mini vacation. We have to give them a party atmosphere to have fun with it, and by doing that, the guests will keep coming back.”
Smart Business spoke with DiRienzo about how he creates a fun and successful business for his more than 200 employees despite the down economy.
Get employee buy-in. We have to get everyone on the same page. Everyone has to buy in to (the culture) or they won’t be able to work here.
I’m not the one who does that my managers do that. They’ll call people out if they don’t look like they’re paying attention. They’ll say, ‘Go on home. If (you) don’t want to listen to what I have to say and if you don’t think it is important enough to you, then go home.’
We only want people who are really committed to our entire philosophy, which is service-oriented and taking care of other people. If you start thinking about yourself too much and not about your customers, it’s not going to work.
So they’ll tell them, ‘John, are you sure you want to work here because it doesn’t seem like you do?’ They’ll get that hint that they either come to work ready to listen and learn or else they don’t. It’s a tough attitude sometimes, but you have to. You can’t afford to have people here that won’t give your guests service.
Give customers what they want. Listen to your guests and listen to your customers. They’ll tell you what they want to see and what they want to hear. One of the biggest faults all of us can have is not listen to what the guest is asking for. You need to provide. We don’t know the word ‘no’ or ‘can’t.’ We can do anything. If we have the food in the restaurant or the alcohol, we can do it. It doesn’t matter if it’s on the menu or not.
Never say no to a guest or a customer if at all possible. There’s a lot of different people who will want some sort of vegetarian meal we only have one vegetarian meal, but we’ve got all the product we’ve made vegetarian pizzas on tortillas. We’ve made vegetarian fajitas. If people want to come in and just get 5 pounds of crab legs, we’ll sell them 5 pounds of crab legs. They’re coming to us and spending money, so why not accommodate them. Usually the people who ask for something special, they’re more than happy to pay a price for it. They just want to be able to get it.
You have to fight for every dollar you get. There’s no reason to turn anybody down on anything. It’s like my father always said, ‘Everything is for sale. Just attach your price to it.’
Set the example. Every once in a while something will pop up and you’ll tell them to do it, and it just doesn’t get done or it does get done and it’s just not right. It could be a simple thing like hanging a sign or banner. Sometimes it’s the easiest thing in the world and people just do it, and because it’s so simple they don’t take the pride in it of making sure it’s leveled or straight or centered. I’ll say, ‘Can you put that banner up for me?’ and they’ll do it crooked or it’s not centered. I’ll just do it myself and I’ll show you how you should have done it. Then they look at you like, ‘OK, why is it that important?’ Well, because it is. It’s important that it’s straight and that it’s centered and that it looks right. You’ve got to have pride in what you’re doing and have passion in what you’re doing. If you’re working, you should have a passion for it. Take pride in your work and have a passion for it.
Set goals. We visualize where we want to be three months, six months, nine months, 12 months down the road, and we identify everything we’re going to do and try to reach them it’s like an onion, and keep peeling back the onion.
All of our goals are set monetarily, so our budgets are pretty much our goals. We don’t make an unrealistic budget we look at last year, we look at the economy, and we study it. A [former] partner of mine tells me that all of these restaurants are complaining that they’re down 15, 20, 30 percent. I’m very upset. We’re flat. We’re doing the same amount of business as we did last year we haven’t increased any. He’s telling me I should be thrilled, but I’m not I’m not thrilled with mediocrity. Our food is good enough and our service is good enough, so we should be up, but everyone tells me I should be happy. I guess in this economy flat is the new up. Flat is not in my vocabulary even for this year we set our goal for 10 percent higher than what we did last year.
You just need to talk about it and open up your eyes and say, ‘What will help you be better, and what will help us all be better and reach those goals? What does it take? Does it take more advertising? Do we need to spend more advertising dollars? Do we need to look inside our walls or outside our walls? Is there something that we can do? Maybe your signs are wrong? Maybe your front entrance is wrong?’
How to reach: Rockin’ Baja Coastal Cantina, (619) 234-6333 or www.rockinbaja.com
When Rob Snyder co-founded Stream Energy five years ago, he never envisioned having nearly 1,200 percent revenue growth in the first four years.
“Probably the biggest issues that we had were posed by the rapidity of our growth,” he says. “Our growth was far beyond our original expectations.”
In fact, he originally signed on as chairman, thinking he was taking a nonexecutive role that required about 20 hours a month.
“That was based upon our view that our growth projections were going to be a fraction of what they are now,” Snyder says. “Hell, I’ve had 20-hour days here at Stream Energy.”
While his title is still chairman, because of the growth the energy provider has experienced, going from revenue of $70 million in 2005 to $825 million in 2008, he functions in the CEO role and has full management involvement instead of those five-hour workweeks he envisioned. And in its first year of eligibility, Stream landed the No. 198 spot on the Inc. 500 list.
“We really didn’t have the luxury of going from start-up phase to early growth to mature,” he says. “Our growth was so rapid that we had to go from start-up firm almost straight to a mature business platform standpoint and without any transitional stages.”
Snyder admits that while he did some things right, he also did some things wrong. Here’s how he kept Stream from faltering during its high-growth period.
Evaluate your systems
By the time Stream launched, Snyder and his team had spent 1,000 hours planning what needed to happen for success. But he learned some valuable lessons in what he hadn’t planned on.
“Proper planning is everything and assume from the standpoint of your various scenarios for success,” he says. “Do a lot of worst-case planning toward stress-testing what you think will be the operating performance of the business under those worst-case scenarios. Plan for the worst.”
But planning for the worst actually goes two ways. He says part of the company’s downside planning should have been asking itself what are the capital needs of the business if it has three or four times the growth that he thought it would be and how would the company could keep pace with that.
“There are two ways you can look at it,” Snyder says. “One thought is, you don’t get any customers, and then you know really what your downside is in terms of the money and the time that you’re going to put at risk. But another downside is growth that is so rapid that you are unable to keep pace with customer demand, and in a capital-intensive sector such as energy, you can be imploded by your own success.”
He hadn’t planned for the worst effectively, and a byproduct was the problems Stream had keeping its systems up to speed, as well.
“The type of customer systems and customer information service platforms that we were using may have been appropriate for 100,000 customers, but it was a much different story when you get into 300,000 customers, 400,000 customers,” he says.
All of Stream’s systems had been developed internally because there weren’t any off-the-shelf solutions at that time, so evolving them internally was a challenge since everyone was busy and the growth projections weren’t accurate.
“It’s a process where you really need to stay ahead of the curve,” Snyder says. “If you don’t have robust systems that will meet your needs for the foreseeable future, you will always be chasing solutions to major operational impediments. You need to make sure your systems are sufficiently robust to accommodate your most optimistic customer growth scenarios.”
To stay ahead of the curve, you have to do an analysis of what the future may look like for your business.
“It’s really going to be a situation-by-situation analysis,” Snyder says. “ … Perhaps take your growth expectations and stress-test it. Perhaps double it and make an assessment as to whether your systems can handle it.”
He also says that making that assessment may require using outside sources.
“You need professionals,” he says. “You need people who know what they’re doing. It’s such a highly technical area that I don’t believe that even your most sophisticated type of businesspersons are able to make critical recommendations in such regards. You need really the best outside expertise you can find.”
By not planning ahead and having scalable systems, Snyder had a couple years of playing catch-up, but he ultimately got there.
“I don’t think it affected the growth too much, and fortunately, I don’t think it affected our customer service too much, but it did create some fabulous stresses here at Stream in regard to just management attention and management energy,” he says.
Hire great people
While he missed on the process planning, he did great at hiring the right people, but it wasn’t easy. Most people coming in didn’t have the industry experience, so Snyder had to look at other facets of their personalities and experiences to see if they would fit.
“When you’re interviewing, you have to focus less on nuances of a person’s past experience and more upon who they are as people,” he says. “You have to be very probative as to whether they’re open thinkers.”
He also needed people who were more entrepreneurial minded.
“There wasn’t a road map for where we were going,” Snyder says. “The tactical decision-making at the firm really had no good precedence out there, so we were making stuff up as we went along.”
People needed to be comfortable with this kind of decision-making process, and he also needed people who were willing to chip in their own ideas.
“We had to have people willing to offer their best ideas and make the argument for that in terms of the firm’s development and direction, and I think that’s been the greatest key to our success — the quality of senior managers we’ve been able to attract.”
Snyder has key questions he likes to ask in every interview. One example is, “What’s your handicap in golf?” If someone is married and has kids, and his or her handicap is a two, then Snyder won’t offer them the position.
“The only way you get that type of handicap is by spending a lot of time in golf, which itself is a time-consuming proposition, and the type of person who would be doing that is spending so much time on the golf course that, in my view, they’re taking away from what they should be doing professionally or with regard to their family,” he says. “ … That’s not the kind of person I want at Stream.”
Another indicator of whether someone will fit in is how comfortable he or she feels talking about his or her personal situations.
“Whether we like it or not, in today’s work environment, it’s almost impossible to completely segregate your personal lives from your professional lives,” Snyder says.
It’s important for people to be honest about any problems or issues they’re having in their personal life, so Snyder can plan for that.
“We can’t accommodate someone’s temporary personal situation
if we don’t know about it,” he says. “Why is this person always in a bad mood these days? Why are they absent from the office more than normal? Unless they communicate those things to us, we can’t know as to how we can help. We don’t know what to expect.”
And this all starts in the interview process.
“When someone doesn’t want to talk about that in an interview process, it sends a signal to me that this is not the type of person who’s going to be receptive to that type of atmosphere we’ve tried to build,” Snyder says.
He just wants to get to know job candidates as deeply and personally as possible in the allotted interview time.
“You want to see how their mind works,” he says. “If you’re a customer service manager for another electricity firm here in the state, you can tell me about all the wonderful projects that you did at this firm that saved the company X amount of dollars and cut down call times by that many seconds, but that goes in one ear and out the other because, all that, that’s what I would expect to hear in an interview.
“By hearing what’s important in terms of their priorities and hearing out loud and getting them to think out loud so I can see their mind operating in real time — those are the key things.”
In the aftermath of Hurricane Katrina, Stream had only been in business for six months, and its EBITDA projection for the year swung from a positive $7 million to a negative $7 million over the course of three weeks, putting a $20 million capital hole in Snyder’s operating plan.
“I had to raise $20 million for the business at a time when we couldn’t give anybody, given the uncertain state of the markets, any determinate guidance as to what the economics for the business were going to look like,” he says.
Throughout an 80-day period, he had to get people to buy in to his business if it was going to survive. Whether you’re growing your business, trying to get your people excited about your annual goals or selling a new customer, it all starts with buy-in. Snyder has to have investors buy in with their checkbooks, senior managers buy in by joining his team and customers buy in by switching providers.
“You’ve got to be passionate and absolutely transparent, and people have to understand your own level of personal commitment,” he says.
Show what you have at stake. For example, Snyder’s situation spoke volumes in convincing one major investor.
“I basically didn’t need Stream to work,” he says. “I was retired, and there was no real reason for me to be doing this other than just the act of creation, but (the investor) knew I had a significant financial stake in this, and, more than that, he knew I had a significant reputational risk here, so he knew I was committed.”
Having that genuine excitement is key to selling yourself, your company or your product.
“Having a reputable investor is key, but more critical than that is people understanding that you are committed and that you believe in the vision of what you are trying to pursue,” Snyder says. “That’s not really something you can fake. I think people sense whether you’re really committed to trying to make things work.”
You also have to show the value in the idea and convince them to trust you.
“It’s basically, ‘Be my friend, give me your business and save, relative to the major competitors in the marketplace,’” he says.
As long as Stream kept its operating costs low, Snyder could offer that value proposition of saving money. For customers, it’s a win because they save on their monthly expenses, and for investors, it was a win because they knew with that value proposition, Stream would bring in customers.
In attracting managers to the business, it was about getting other people as excited as you are.
“You got to get them to not only drink the Kool-Aid, but they’ve got to understand not only do you drink the Kool-Aid, but you love it,” Snyder says. “They’ve got to buy in to the vision.”
The more solid people that you get to drink that Kool-Aid, the more others will want to join you.
“When prospective members of the management team understand that not only is this wild-haired Rob Snyder guy something, but it seems that a lot of smart people are surrounding him; that really makes its own case,” he says.
And the more people buy in, the easier it becomes to lead in the future.
“I am increasingly reliant upon the expertise of the people who have demonstrated time and time again their proficiency,” Snyder says. “People who have been here for three and four years, they’ve completely bought in to the Stream way of doing things. They like it. They embrace it, and when someone has demonstrated expertise, it’s increasingly necessary for me to micromanage less and less and to rely on their expertise.”
How to reach: Stream Energy, (866) 447-8732 or www.streamenergy.net
Story feedback: Kristy O’Hara, email@example.com
“I’ve been with start-ups that have literally exploded with growth,” he says. “I’ve been with start-ups that, after a year, have closed their doors. I’ve been with dot-coms that were the eighth-largest IPO in 1999 and sold two years later for a fraction of their net worth at that point in time. I’ve been with $500 million companies and $5 million companies.”
But through it all, one thing remains constant, no matter the situation.
“I think the one thing that is very, very important is just getting back to the consistency of operation — setting your bar, setting your comp, and then being consistent with that year over year so that people can dig in.”
Now, he’s president of the $240.8 million CDC Software Corp. Building that consistency has been key to aligning the software development company and moving it forward.
“A lot of these, if we’re going to develop a new piece of software, it’s two or three years,” Cameron says. “Sometimes a big sale can take one or two years. Our ability to remain consistent through that period of time is very important.”
Oftentimes, leaders will try to change course right away if they see any sort of problem, but Cameron takes a different approach.
“A lot of people come in and change their strategy every week or every month, which indicates that it was wrong to begin with,” he says. “You have to put a stake in the ground and be consistent with your employees and, most importantly, consistent with your customers so they know what you’re all about.”
Here’s how Cameron uses goals, mentoring and a compensation strategy to drive consistency through his organization.
When Cameron does the annual budget, he does it both top down and bottom up. It may seem like an oxymoron, but it works.
He first looks at last year’s data and adds 10 percent, and then looks at how that plays out across the organization. Then he gets the numbers from his individual regions to understand what their challenges are for the next year. He then takes his top-down analysis, combines it with his bottom-up analysis and meets in the middle.
“The more I can play to what the fields can commit to, the better off we can all commit to,” he says. “ … It’s a matter of No. 1, understanding what the manager can commit to, No. 2, checking that with the top-down budget of what we’re expecting, and that’s the delta I have to manage to get everybody to the same goal line.”
Having solid data and regional input helps him justify the company’s overall goals to the board.
“We’ll get expectations from the board, and the right thing to do right then and there is to make sure we have all the data and we can go back to them if we feel the numbers aren’t fair and such,” he says.
But just because you set company goals doesn’t mean you’re going to reach them. You then have to take those company goals and break them down to different departments and individuals.
“The biggest thing is setting the bar realistically on both sides,” Cameron says. “Some management style says, ‘If I want to get 10 out of my team, I’m going to say 20, and they’re going to work as hard as they can, and maybe they’ll hit 15.’ I’m not a big fan of that management style because even if they hit 15, they’ll feel that they’ve failed because you expected 20.”
Instead of setting the bar too high, look at the data you have and push the envelope a little past the current performance.
“I’m more of a fan of, ‘OK, if 10 is a fair bar, can we squeeze maybe and get to 11 or 12?’” he says. “So 12 is a fair number, we’ll budget on 12, and then if you get to 15, you’ve done tremendously well and feel real good about it. I think one of the things that is most important is people need to feel they can achieve their goals. Goals can’t be too low. They can’t be too high.”
If you’re not sure if your goals are reasonable, then look at how people are currently performing under the standards you have in place.
“Understand your business well enough to set reasonable goals,” Cameron says. “As a rule of thumb, 60 to 70 percent of your team should be hitting their goals. A subset of that should be exceeding their goals, and you’ll have 10 to 15 percent that, for whatever reason, are not coming near their goals. They need to be retrained or retrenched.”
If you set reasonable goals that people can achieve, then you’re going to foster a fair and consistent work environment where people feel good about the company.
“More than half the time, people should feel they’re achieving the goals set out for them,” he says. “If that’s not the case, you’re not going to have a company that people enjoy working for. You’re not going to have a lot of success stories. You’re just going to have a lot of frustration. It’s the guys that are overachieving that breed enthusiasm for the rest of the company to believe they can overachieve on their role, as well.”
Cameron has four sons, and as a result, he has coached about 700 soccer games in his life.
“I’ve never played the game myself, but I’ve learned an awful lot about dealing with younger people and understanding and learning what’s important to them, and people need to be treated as an individual,” he says.
That learning has been put to good use. He’s been in management since he was 27 years old — so more than 30 years at this point — and his favorite part about the job is sitting down with his employees, learning what’s important to them, building rapport, helping them map out one- and five-year plans and then working with them to get there.
“I enjoy the mentoring process,” he says. “I look at what I am here. I’m the coach for the CDC team, if you will. I coach the board. I coach all the players around me. It’s a fulfilling job.”
Those goals vary by person, and it’s your job to find what makes people tick.
“Some people, it’s an earnings goal,” Cameron says. “Some people, it’s a promotion goal. You’d be surprised when you really pin a person down and say, ‘Tell me what do you want to accomplish in five years.’ A lot of people don’t think that way. They’re just trying to survive the day or the next quarter, and they’re not thinking out far enough.”
A strong leader will help them think further out and come up with goals and ways to get there.
One way to begin the mentoring process is to take some time for your people.
“The first thing is just getting to know the person and understanding enough of his personal life to see where he’s coming from, where he grew up, what his parental situation was like, what his family situation is like,” Cameron says. “All of those things add to the type of person he is and gives me enough of a background to kind of understand why he would set goals the way he’s setting them.”
He also suggests getting to know people outside of the office instead of inside.
“I’m a much bigger fan of let’s meet for dinner and get outside of the office and get to know people because they need to trust me, as well, and know that I can add value for this thought process for them,” he says.
Another way he gets to know people is through CDC’s annual club trip, where all of the company’s top performers bring their significant others to a remote place, such as Jamaica.
“That gives me a real special time to not only have some real good one-on-one time, but to understand who their significant other is, who their support system is, and things of that nature,” he says.
The more you do this, the more people will understand their role in the company and how they can contribute, which creates that consistency you’re looking for.
“What’s most important is everybody understands their role,” Cameron says. “It’s well-defined, and they understand what means success for them. I don’t care if it’s the lowest level in the company or the highest level in the company, everyone deserves to know what means success to them.”
At most companies, management keeps salaries under lock and key, but Cameron takes a different approach.
“All compensations should be such that any two people can go to a bar, have a beer, and openly discuss their compensation without anybody being disappointed or mad, because at the end of the day, they’ll all know each other’s plans,” he says. “If you have little separate point plans for one person and you don’t for another person, that’s always going to come back and haunt you, so the consistency of the way we’re compensating our people … is really important, as well.”
Just like with setting goals, you have to do some research to set up consistent compensation plans.
“The first thing you need is data, obviously, and what’s tough for us is the size of our business unit in North America is five or six times bigger than the size of the business unit in, say, Spain, so to look at those drivers that allow us to be consistent in both areas is challenging,” Cameron says.
He says to look at some of the same areas as Wall Street does, such as revenue, EBITDA and gross margin.
“By having them put on the same goals as we do as a company makes it very easy for everybody to appreciate the importance, and when we give guidance as a company to Wall Street, everybody is a subset of that guidance, so anyone who doesn’t hit their particular number is going to hurt the team moving forward at this point,” he says. “Those are the hard areas.”
There are also soft areas, which he calls MBOs, or management by objectives. There’s a different one each quarter, and this is where he can break goals down regionally to reflect the special challenges areas may be facing.
“It’s a relatively small part of the overall comp, but it allows me to have a very consistent comp on the very important things but a little bit of flexibility on some of the geographic challenges that they have that I want to make sure they’re focused on,” he says.
Most of the compensation related to the company’s goals are awarded through CDC’s stock-option plan. Then as employees meet their individual goals, that’s where more compensation and bonuses come into play.
“Again, you’re looking for everybody to not only meet their particular budget and goals — the goal is to exceed them,” Cameron says. “We have compensation plans that have no ceiling on them because once they’ve met their goals, all their budget is paid for, so really, the only additional expenses you may have is some sales bonuses and commissions.”
Having the majority of the employees’ compensation tied to their individual goals is extremely important for the company to meet its overall goals.
“If you have a lot of their compensation tied to the entire company, where you have several regions not hitting their numbers and several regions beating their numbers, it can be a demotivator for a guy who could really kill his number but has a lot of his comp tied to what everyone else is doing,” he says. “In some cases, it may cause him to not perform as well as he might when he’s knowing that everything he’s doing is affecting his compensation, and obviously, the better he does, the better the company does overall.”
How to reach: CDC Software Corp., (770) 351-9600 or www.cdcsoftware.com
Story feedback: Kristy J. O’Hara, firstname.lastname@example.org
As Phil Harrison prepared to become the CEO of Perkins+Will Inc. earlier this decade, he discovered that the plan that had originally grown the company was now pulling it apart.
Throughout the 1990s, the architecture design firm underwent a growth strategy that included four acquisitions and the opening of three offices, but it hadn’t gone through a cultural alignment. It’s not that leadership hadn’t tried, but the firm’s leadership in the late ’90s was more passive, and there wasn’t confidence that they could effectively drive a cultural change.
“There were quite a few all-firm principal retreats, and we’d all go off to a nice resort for a few days and talk about this, and nothing would really happen with it,” Harrison says. “It took getting to a point where there had been a series of acquisitions, and we really felt like a surrealist painting where the head was on a different body. A good analogy is a Mr. Potato Head — it really felt like the parts were disconnected and didn’t add up to a whole.”
When he took over as president in 2003, the firm had, in just three years, done three more acquisitions, a merger and opened four more offices, and he still saw these cultural problems. At that point, the board of directors and firm leadership did not see the danger.
“Even though they were pretty high-performance people and were capable, the disconnect on the values side was very destructive,” says Harrison, who now serves as president and CEO. “It took us longer than it should have to recognize that.”
He knew he needed to lead a cultural change, so he set out to identify and communicate the firm’s values and then build on them through more acquisitions.
Identify and communicate values
While Perkins+Will didn’t know what it was culturally, there was no denying it had a strong brand. Employees took pride in their design abilities, and the firm consistently won design awards.
“We sort of thought we knew who we were, and the market sort of thought they knew who we were, but we hadn’t been very explicit in listing, one, two, three, four, five — these are the five things that are most important to this company,” Harrison says. “That’s one of the lessons learned is just the importance of things that seem obvious are often not if you don’t state them.”
First, come to agreement on what your company represents. Harrison and the team engaged people in different ways to find out what people thought they were. Some of that happened in all-firm leadership retreats with opening a dialogue.
“You have to step back and look at fundamental human values — in particular now — and by that, I don’t mean business values, but I mean deeper sort of ethics or social factors — something that’s actually going to mean something on a broad social context,” he says.
For example, Harrison looks at Ray Anderson of Interface Inc. as an example. Years ago, he went through an epiphany about the environment and completely redesigned his carpet company around sustainability — long before being green was in vogue. It redefined the company and made it very successful.
“Companies need to be able to articulate their position in more sort of human and socially relevant terms,” he says. “You need to strip away the business jargon and really get down to what makes a difference to people in the world, and if you can get to that, then a lot of other stuff is easier to make decisions about.”
When identifying values, it’s important to be realistic, yet balanced with looking toward the future.
“Be honest with yourself so you don’t try to be someone you’re not, but on the other hand, you have to have aspirations,” Harrison says. “It’s a combination of being realistic and pragmatic with being a little bit of a dreamer, but you can’t be such a dreamer that you’re switching from being, say, a Ford to a BMW overnight.”
In addition to having conversations internally, Perkins+Will also hired a firm to do research.
“They did an external audit on our brand where they spoke with our clients, both existing clients, and they spoke with clients who we would like to work for but aren’t working for,” Harrison says.
The research firm also spoke with the Perkins+Will’s competitors and with the press to get an idea of where the company stood in the marketplace. Then the company had to reconcile between what the outside thought and how the company internally saw itself.
One of the biggest values Harrison saw that employees weren’t buying in to was business performance. They saw it as something conflicting with design as opposed to something supporting it.
“We had to go through a ridiculously lengthy process to create a language whereby people could accept that high business performance could actually lead to a more thriving design company, …” Harrison says. “It’s simplistic, but it was an important turning point — it was a ‘both and’ as opposed to an ‘either or’ mindset.”
That language and communicating it is crucial to getting buy-in for a cultural alignment.
“You just have to talk a lot and talk and talk and talk, and you have to repeat yourself,” he says. “That’s one of the most important roles of leadership. I’m not an extrovert, and I thought you just say it once, and everyone would understand it. Or put it in an e-mail, and they would understand it that way. Or have an annual address, and they would get it that way. I’ve learned that you have to communicate the same message in a lot of ways — forums, large groups, small groups, etc.
“Things that I said three months ago to everyone, I feel like I have to go back and repeat it. It’s not necessarily a bad thing, but it’s the process of repeating it, articulating some very fundamental aspects of the vision of the company or the values the company has or the business objectives of the company — basic things that could be easily communicated in a short period of time.”
And he’s not talking a three-day retreat. It’s shorter things, like 30 minutes of talk.
“You can get into quite a bit of depth in that period of time, …” Harrison says. “It’s the importance of overcommunicating the things that seem like they should be obvious but maybe aren’t if you’re not overcommunicating.”
The more you do this, the more the people below you will communicate, as well.
“That sort of builds,” Harrison says. “If the executive leadership is doing that, then other people in the company begin to sort of take it on. What you really want is multiple layers of the company doing the same thing but in a parallel way so they’re reinforcing each other.”
Build on your values
After identifying and communicating values, Harrison next wanted to shake everything up by going back toward the very thing that had threatened the culture of the firm: acquisitions.
“Even though acquisitions are disruptive, in our case, at that time, we thought a little disruption is a good thing,” Harrison says. “If you’re smart about it, you can use an acquisition as a change tool.”
The acquisitions would drive
growth for the firm but also help him bring on better leaders, people and ideas.
“You can buy it much faster than you can build it,” he says. “It’s just more efficient, so if you can figure out how to go through the cultural change process and learn how to effectively integrate acquired companies, then it’s a much more efficient process than trying to do it homegrown.”
He looked for companies that had similar values as Perkins+Will but that also represented what the firm aspired to be.
For example, sustainability was a core value the firm’s leadership embraced, but the people hadn’t. They found a Vancouver company that excelled in this area, so they came on board in 2004 and functioned as a rapid change agent.
But you have to make sure that any company you look to acquire will align with your culture.
“It’s an expensive way to make a mistake if you find out that you don’t agree on fundamental business practices with someone you’re trying to integrate into your own operations,” he says.
Most leaders start with the financial implications instead of the cultural ones.
“You start off on the values side and make sure it is integratable,” Harrison says. “In other words, you want to be integrated, so you talk about what their aspirations are as a team and also as individuals, and you make sure that the prospects for integration actually make sense.”
Acquisitions are a little like dating in that after you get to know each other, you only move forward if you see a high level of compatibility and a great potential future together.
“Don’t do an acquisition if you can’t tell yourself a compelling story or the people inside your company a compelling story because you can’t tell your clients a compelling story,” he says. “It all starts there, and if there’s a compelling reason — a business reason, a cultural reason or whatever — it needs to be both to combine companies. Then you can be successful. If there isn’t, it will very likely not be successful.”
If it’s a match, then you have to look at the company top to bottom and do integration planning.
“Look at every element of a company’s operations,” he says. “We figure out how those items might change and develop sort of an integration map, if you will, where we anticipate those operational issues might change at this point in time or these roles might change or these financial matters might change.”
Once you decide it’s a fit, then it goes back to the communication factor with both your company and the one being acquired.
“You tell the story of the acquisition in the context of the power that is generated of the two firms coming together and how that can directly impact their lives as individuals and as a group,” Harrison says.
Then you have to integrate quickly. Sometimes companies want to retain their names, because they believe it has recognition, and that may be true, but the longer you operate as two — by name, function, culture or any other way — the longer you hurt the combined company.
“If there’s some compelling reason to combine two firms — it’s not just that you’re trying to get bigger, but you’re trying to get better — and there’s some qualitative objective that you’re seeking out, the more you keep those two firms from being integrated, the longer it takes you to realize that benefit,” Harrison says.
And Harrison is now realizing the benefit. Since 2003, the year Harrison took over as president, Perkins+Will has acquired 11 firms and opened four new offices, all while reaching $400 million in gross revenue. But the benefit isn’t just new offices and increased revenue. The acquisitions have helped propel the cultural change that Harrison wanted by bringing in new leaders and employees who embraced the identified values. With 1,500 employees now, he’s confident in the firm’s future.
“The change is more organic now,” Harrison says. “It used to be that it was inorganic. It was an acquisitional strategy. Even though we’re still doing acquisitions, it doesn’t feel like they’re changing us as much anymore. There’s enough momentum and resonance in the company itself that the acquisition is actually not viewed as a change force anymore. Change is already sort of built into the organization and it’s part of our DNA right now, so people are more comfortable.”
How to reach: Perkins+Will Inc., (404) 873-2300 or www.perkinswill.com
“[It] had so many different dimensions to it, it was like a spider’s web of interconnected issues and problems, that if you just tried to solve one, the unintended consequences of the others that are affected by it would offset any benefit that you got,” says Norwood, the medical center’s president and CEO
He noticed that situations like this were becoming increasingly common. When it comes to leading 3,800 employees and maximizing their effectiveness in achieving goals, Norwood now has to take a more collaborative approach to problem solving.
“Gone are the days when a hospital administrator can stiff-arm physicians on the medical staff and say, ‘I’ll take care of running the hospital, and you take care of practicing medicine,’” he says. “We just can’t solve the challenges of health care in the United States that way. We have to, as hospital administrators, reach out and draw in physician leaders and make a place for them at the decision-making table and share that power and authority and responsibility with our physician partners, and it works.”
In order to make any organization more effective, Norwood says you have to build teams for each issue, have better discussions and respect people’s time.
Build a team
A doctor has a very different approach to problem solving than a businessperson. While you may take a couple of weeks to research all of the possible solutions and the effects of each solution, and then, based on the research, make a decision, a doctor is trained to do the opposite. He or she will make a decision quickly based on the information readily available to him or her, and then if more information becomes available, the doctor may change course.
“You may say, ‘Which of these approaches is the better approach to take?’” Norwood says. “I think the truthful answer is it depends on the situation.”
In some situations, if you take the physician’s approach, it may be a false start and cause problems, but in other cases, if you take the businessperson’s approach, it might be too late. So it’s important to have those differing viewpoints whenever you create a team to address any issue or problem.
“Putting those two together in a team is a powerful proposition,” he says. “It’s challenging to lead, because you are trying to build a team with people who have very different personalities.”
Despite the challenge of it, it’s something that you have to do before you can jump into trying to solve anything.
“Whoever is the leader of the team has to recognize that building the team is a very necessary first step, and trying to jump into the action items too quickly may backfire on you,” Norwood says.
Sometimes when people build teams to solve problems, it’s often centered around positions and titles, but Norwood advises to look beyond that.
“It comes down to two real criteria — interest and expertise,” he says. “If you’ve got an issue that comes up that needs to be resolved, I’m going to be thinking about what’s the smallest number of people that have expertise in this area and have an interest at stake, and try to get them in the room. When you get more than eight or 10 people, it’s becoming a committee, and a committee takes on a life of its own.”
Have better discussions
When you build a team of people that have differing views or approaches, you then have to find a way to unite them so you can be productive.
“In whatever business that we’re in, we’re looking for, ‘What’s the common passion?’” Norwood says. “What is the passion for why you do what you do? It’s a whole lot easier to get people’s backs into a project than it is to get their hearts into it.”
But by getting people’s hearts into it, you’ll be more effective. For Norwood, that common passion comes pretty easily — providing excellent care for patients — but maybe you run a business that doesn’t have as clear-cut of a commonality. That’s when you look for the basics.
“Whether you’re building a car or a computer … at the end of the day, if you’re running a successful organization, you’re actually providing employment for people in your firm and all the industries that support your economy,” he says.
You can also dig more to establish further common ground.
“Sometimes the question would be, ‘What’s the outcome that you’re looking for? What do you want to see come out of this?’” he says. “You have self-interest in it, and the interest of your patients in it, what does success look like? I believe that people always act in ways that make sense to them. We can get into disagreements and disputes and look at the other party and say, ‘That doesn’t make any sense,’ but it does make sense to them.”
As a leader, Norwood says you have to go with Stephen Covey’s approach of seek first to understand and then be understood.
“Instead of pushing so hard to try to get someone to do it your way, spending a little bit of time upfront to understand why it’s so important to them, apparently, to do what makes no sense to you, is huge,” he says.
To understand others, become a better active listener.
“It’s someone who says, ‘Let me say back to you what I think I just heard you say — did I catch what it is I think you’re saying?’” Norwood says. “That’s a hallmark of good active listening — you’re showing respect to the other person to say, ‘I wasn’t just sitting here thinking about what I was going to say next.’”
If you can master this, then you’re already halfway there, and you’ll notice people beginning to relax.
“It’s like a pressure cooker,” he says. “You see the pressure valve go off in the chest of that person across the table because they’re showing you that you finally get it — ‘You understand what I’m upset about or what I’m trying to get to.’”
Despite actively listening and finding a common ground, you’ll still have times when people don’t handle themselves well in the meeting.
“I always have a choice of OK, if there’s a conflict, do I take that conflict offline and avoid dealing with it in the group or do I invest the time — not spend the time — right there in the moment to make a teaching moment and say, ‘OK, let’s take a look at what just happened and how could we have done that better?’” Norwood says.
Often, you may ignore it in an attempt to move through your agenda, but look at that teachable moment as an investment instead of a waste.
“We invest in things that we know will give us a return later, so we can stop and catch ourselves in the moment and say, ‘I’m going to cause myself to invest the time right now, when I don’t really want to do it, because I’m going to get a much better return from this if I do it now than if I go write a memo later,’” he says.
Respect people’s time
Each July 1, at the start of the new fiscal year, the electronic c
alendar at DeKalb Medical is completely blank and has no meetings scheduled on it.
“It’s just wiped clean, and they have to be recreated so that we sunset every meeting in the organization, and it’s only recreated if there’s a conscious decision to recreate it,” Norwood says.
The reason is simple — to not waste people’s time. Often, when you initially form a team to solve a problem, everyone is needed, but as you progress, certain people are no longer needed. Or perhaps you invited someone to come to a meeting once and continued asking that person back, but he or she really isn’t needed there. Or throw the people part aside, and maybe the meeting itself isn’t even needed anymore. All of these situations waste people’s time and affect productivity, so to eliminate these issues, Norwood says to simply cancel all meetings every year.
“We announced it a month ahead and reminded everybody that 30 days from now, everything is going to go blank, and you better start now if you intend to recreate a meeting and who should be in those meetings,” he says. “People are building a culture of if you’re invited to go to a meeting, you have the prerogative to push back and say, ‘Now, why do you need me?’ There’s a cultural collegiality to this, but we’re making the point that your time is valuable — don’t waste it.”
Doing this has helped Norwood and his executive team reclaim the equivalent of about two weeks of time that they can now use doing other things to move the organization forward.
“Killing meetings once a year to re-establish what’s necessary versus what’s superfluous starts to build a culture of let’s not waste time in meetings and waste people sitting around in meetings they’re not contributing to, and hopefully, we can make the ones that do occur more meaningful and more productive,” he says.
And Norwood has found ways to do that, as well. For example, he and his team agreed that the BlackBerry can be a powerful, yet distracting, tool. So they agreed that when they have meetings just among their team, they are permitted to be working on their BlackBerrys as well as participating in the meeting; however, if any other person outside of the core team is present at the meeting, it’s a different story.
“It’s off limits,” he says. “We may not use our BlackBerrys, because that’s not showing respect to the person coming in.”
Additionally, when they had guests for meetings, they used to make that person or group wait until their spot in the agenda, but now they’ve reversed it. If a guest has come for a spot in the agenda, they move that person to the top automatically.
“They get the first slot on the agenda so they can come, do their thing and get back to work,” Norwood says.
They also made a commitment to start every meeting on time and to attempt to end early. By doing all of these things, now even fewer people’s time was being wasted. He says you have to, as a team, identify these kinds of little time-wasters in your organization and make changes so you better respect people’s time and move the organization forward.
“It was just what were the things that made sense to us,” he says. “It was saying them out loud, writing them on a flip chart and reducing them to a list that made sense and looking each other in the eye and saying, ‘OK, we’re going to start living this way,’ and it had a remarkable impact on our culture. It was shocking. I don’t think we were really aware of how much we were being distracted by what Covey would refer to as quadrant-one time instead of quadrant-two time.”
How to reach: DeKalb Regional Health System Inc., (404) 501-1000 or www.dekalbmedical.com
When Bill Jarvis bought his first cell phone, the experience nearly sent him to his grave, but, then again, he was supposedly already dead.
In 2001, Jarvis was starting a wireless company in Hawaii, but until the network was up, he needed a phone through what would soon be a competitor. So he headed into a store to get one.
“How many minutes do you use?” the rep asked.
“I don’t know,” Jarvis said. “I’ve never had a cell phone.”
“Well, would it be 1,000? Or maybe closer to 1,500?” the rep asked back.
“Really, I have no idea within 500 minutes of how many minutes I use because I’ve never used any minutes,” Jarvis said, already beginning to get frustrated.
He settled on 1,000 minutes, but after learning about overage charges, he reluctantly ponied up more money for more minutes in case he went over. He had similar frustrations in deciding about other features, such as roaming and text messaging.
“I’m just glazing at all these options,” Jarvis says about the experience.
Having unconfidently made his decisions, he then begrudgingly filled out the contract application. As the rep entered everything into the computer, a concerned look came across his face, and he told Jarvis that he would need a $1,000 deposit.
“Really? Why is that? What’s the reason code?” Jarvis asked.
The clerk had never seen it, so he got his manager.
“Oh, it says you’re dead,” the manager said, while looking Jarvis in the eyes.
Jarvis joked that he had felt under the weather that week but that he was definitely feeling fine — and alive — now.
Realizing that there was a mix-up, the manager and employee called the credit department, which wouldn’t budge. They then called the Social Security Administration, and 45 minutes later, they were finally able to convince the credit department that Jarvis was, indeed, alive.
“It was at that point that I absolutely knew that there was a market and an opportunity to do this in an entirely different way,” Jarvis says.
He went on to start and grow Mobi PCS into a multimillion-dollar organization. He still serves as Mobi’s CEO, and in February 2008, he also became CEO of Revol Wireless, an Independence-based wireless service provider founded in 2005, which simplifies the cell-phone experience by offering lower price plans, unlimited usage and no contracts. With more than 400 employees at Revol, Jarvis, who has 24 years of experience in the telecommunications industry, is taking a company that has already experienced rapid success, having generated more than $100 million in revenue last year, and making it even better by hiring the best employees, setting priorities and looking for new opportunities.
Hire great people
Once when Jarvis and his team were looking to make a hire, everyone really liked the candidate, but the general manager walked into his office and said he had never seen an interview situation where the person actually worked out better in real life than he or she did in the interview — basically, the general manager just wasn’t there yet on this candidate. And that’s perfectly OK with Jarvis because if you want to take your company to the next level, then you have to make sure you get the best possible people to help you.
“It’s sort of like in tennis,” Jarvis says. “You play tennis, and the first serve, you have total control over it. It’s as good as it’s going to get. If you can’t make that shot work, it’s only going to get tougher. Some of those same things apply in terms of the gold-plated resumes.”
Because of that, Jarvis has been known to spend nearly two hours with a candidate, even if only an hour was slotted in his schedule.
“If I do nothing else in this company, if I hire well, we’ve got a great chance at being successful,” he says. “If I don’t, I almost can’t be good enough to succeed. There isn’t a tradeoff that makes that an acceptable exchange because frankly, I’m not that good. You can’t be good enough to make up for the deficit of a bad team.”
In addition to spending a couple of hours with a candidate, he says that the average candidate goes through at least five hours of interviewing over the course of multiple sessions. You need to ask questions that get at reality instead of the hypothetical. Jarvis asks candidates to take him back to a time when they worked for an organization and had to deliver great value at a low cost and asks them to describe the process, how they became good at it and to walk him through the challenges they faced.
“It’s easy to deal in the hypothetical,” Jarvis says. “You ask me any question in the hypothetical, and I can give you a pretty good hypothetical answer. I think it’s a lot harder to falsely draw from your own experience if it doesn’t exist.”
Jarvis also asks to hear about a time when the candidate had to go above and beyond the call of duty to satisfy a customer — describe the situation, what he or she did, why the action exceeded the customer’s expectations and how the customer reacted.
“If they say, ‘Oh, it was five minutes to 6, and we close at 6, and I let the customer come in,’ that’s far different from the experience of, ‘Well, it was 20 minutes after six, I had locked the door, we had already closed, we had done the cash count for the day, the power was off, everything was shut down, and I was walking out the door, and I was on my way to the car, and a woman rushed up to me and said, “Are you closed for the day? Did I miss you?” Yes, but how can I help you? Let’s go back in, …’” Jarvis says. “Getting to that level of realism really sorts out how someone perceives to go above and beyond.”
Another way to get a true picture of someone comes in how you check your references. Instead of calling and asking the standard questions, be more targeted in what you’re trying to learn.
“Ask people to stack rank based on five attributes,” he says.
For example, he often uses characteristics, such as being a self-starter, being ethical and being customer-focused, among other characteristics specific to the position.
“Rank them 1 to 5 because then they don’t have the luxury of saying, ‘Oh that person, she’s actually great at all those things. She’s perfect at all those things,’” Jarvis says. “That’s what you get in a reference. At least if you get to what’s No. 5 on the list versus what’s No. 1 on the list, your next reference, you can say, ‘There are some concerns we have about this person being a self-starter, can you comment on that?’ Because that was No. 5 on that list. Then all of a sudden, you get to a, ‘Yeah, that’s not this person’s strength,’ and you get more integrity in the process.”
Lastly, you need to get a change of scenery into your interview process.
“Mix up the environment,” Jarvis says. “Ronald Reagan, when negotiating with the Russians, instead of sitting across the table from Gorbachev, got him and said, ‘Let’s go for a walk.’ They were at an absolute dead standstill. And Reagan got Gorbachev moving. It’s hard to disagree with someone you’re walking side by side. Just change the environment.”
For example, a few years ago, Jarvis’ assistant was moving on to another position, so he had her help hire a r
eplacement. She had screened 100 resumes and narrowed it down to a handful, and one seemed particularly promising as she went through the interview rounds, yet there was just something about her that didn’t seem right. So Jarvis invited her for a cup of tea at a restaurant, and there, she completely let her guard down and started talking about how she was out the night before really late with a group of friends and had overslept and backed up and hit a pole that morning, and now had to get her car fixed.
“I was just like, ‘Well, now we’re getting to it,’” he says. “It was just a different environment. If you walk in and sit down and say, ‘Well, how did your day go?’ It’s just a totally different question than, ‘Why don’t you walk me through a little bit of your resume and some of the jobs you’ve had and where you felt like you really made some contributions.’”
Set your priorities
Jarvis won’t talk process. His chief operating officer has meetings to work through process, but when he walks into the room for a meeting, the process talk stops.
“Her meeting either precedes or succeeds mine, but when we walk into the meeting that I call, if it wasn’t one of our strategic initiatives, we don’t talk about it,” Jarvis says. “It doesn’t matter if it’s relevant, timely, topical, it doesn’t matter. If it needs to get on this list, let’s talk about whether it should get on this list, but it doesn’t get to intrude on the strategic objectives we have for the business. Those are very clearly defined.”
Setting your top priorities is another key to taking a good company to the next level, and those objectives sit right on his desk in a PowerPoint that he can reference any time. It’s the only document that Jarvis works from during his staff meetings in order to avoid confusion or losing focus.
“It’s so easy to get pulled in so many different directions, and the only way I’ve been successful at keeping folks on track is to just not talk about the other things,” he says. “If you can’t devote any airtime to it, people will start to understand, ‘Huh, Bill only asks about the same 10 things all the time.’
Choosing what to focus on requires some research.
“Some of it is tangible data; it’s industry trends, that sort of thing,” Jarvis says. “It’s listening to customers and understanding what they really value. It’s listening to employees and figuring out what they’re hearing out in the marketplace and understanding what our competitors are doing.”
The key is asking questions and doing research, but Jarvis says people tend to get bogged down in the word “research” and think they have to spend hundreds of thousands of dollars.
“You can get in front of your customers and, in two hours, learn more than you can in most formal research,” he says. “Customers will tell you what they want and what their hot buttons are.”
For example, when Jarvis is in a Revol store and asks a new customer why he or she came in, the answer is rarely something about how the customer can save $25 a month or would prefer not being tied to a contract. It’s typically more like, “Those rats — grrrrrrr! My kid used 1,000 text messages over the weekend, and I got a bill, and it was $500, and I’m never going back to those guys again!”
“It’s an emotional reaction, …” Jarvis says. “It’s a very visceral response. I find that if you ask a question that gets a little more to the visceral response, I think you get something that’s more actionable.”
He suggests asking, “When was the last time you cursed us?” Even an enthusiastic customer can typically tell you about a time that he or she wanted to let you have it.
“That gets to a pain point that a customer has about something that’s very personal for them and very emotional for them, and that’s when customers either hire you or fire you,” he says. “It’s not a terribly rational process. It’s actually a fairly emotional process.”
It’s also important to ask employees questions, too, as they have the most interaction with your customers. He prefers asking, “If you were CEO for a day, what would you do to change this company for the better?”
“You get to their hot buttons pretty quickly,” he says. “They don’t think of 50 things. They think of two or three. Inevitably, when you have a list of 50 priorities, you have no priorities. You have to get it down to the critical few.”
In his first week of leading Revol, Jarvis spoke to more than 50 employees and customers. In asking these questions and understanding their frustrations, new opportunities began to unfold.
Jarvis uses a three-pronged filter: simple, different, better.
“It’s generally not any one of those attributes uniquely or specifically,” he says. “It’s that combination of attributes. If it’s different for the sake of being different, who cares? But if it’s simple and it doesn’t help the customer, who cares?”
He typically asks if the product can be simple, yet not simplistic, as in, can a phone be high-tech with a lot of functions but not be confusing to use? Also, can you manufacture it simple so that it drives down costs and you can pass those savings on to your customer? Is it different in that it will make you stand out from your competitor and give you unique positioning in the marketplace? Does it break convention?
If Jarvis can answer those questions with a yes, then he moves on to the third element — better. Does the idea actually improve a process or product?
“It’s got to pass all three of those filters, but that’s one of the ways I use to really determine where should we go with this and how do we turn it into something that looks and feels like Revol,” he says.
After going through these processes, Jarvis can set his top 10 priorities. From this process, Revol moved forward with creating two rate plans, regional and national, as well as adding new phones, family plans and cross-training employees so that customers didn’t have to deal with multiple people when they entered a store. As he and his team accomplish each item, he uses this process to add new priorities.
“When No. 6 on that list is done, it gets replaced by a new No. 10, and everything moves up one, and so on and so forth, and you just keep cycling your way through those.”
Seek out new opportunities
Jarvis is enamored with Arm & Hammer baking soda. It’s not that he loves to cook or clean particularly, but it’s the fact that the company was able to find an alternative use for its product to increase sales. There were already many known uses for baking soda — cleaning and baking in particular — but then the company came up with something new.
“Baking soda was not used to put in your refrigerator, and then they convinced people — put it in your fridge, pull off the lid, it’ll soak up odors, and then throw it away every three months,” Jarvis says. “That was a brilliant growth strategy. Convince your customers to buy your product — and then throw it away.”
Jarvis says that if you want to take your company to the next level, then you have to actively seek out growth, just like Arm & Hammer did.
“You can’t play defense,” Jarvis says. “In fact, I think far too many businesses today are playing defense. I can see the log
ical recoil from being hit with the recession that we’re in, but at the same time, I think you have to go on the offensive, and you can’t wait for growth to find you. You have got to seek it out.”
For example, when Revol started, it was geared toward younger customers. As the company grew, it saw a way to connect those people with their families, so Revol began offering family plans. Jarvis could have stopped there, but he kept pushing and saw that some people wanted a small business plan — and wasn’t a small business just like family? Wouldn’t an employer love to be able to hand a phone to employees and tell them to go crazy with it and not have to worry about them running up their bill just from normal usage or because they become disgruntled? So he began offering a small business plan, as well.
“It’s finding parallels in other segments or categories that might apply to your business,” Jarvis says.
You also have to make sure you’re paying attention to the macro trends in your industry. For example, when Jarvis started noticing that text message usage was rising while voice minutes were decreasing, he could have simply thought that people were texting more, but instead he looked deeper at this trend. What he found was that more parents were getting their kids on a wireless plan, and kids, not wanting their parents to overhear their conversations, were texting instead of talking. Seeing this trend and the way the marketplace was heading because of it, he was able to revamp Revol’s line of phones to tailor them more toward Web use and texting.
“It all starts with the management of that growth from studying the macro trends and understanding at, perhaps, an unintuitive or in a very vague or obscure set of data what’s causing that and figuring that out,” he says. “I think that’s the best way to manage growth. Then you can truly commit to, ‘We’re going to grow in this segment of the market with this product in this time frame.’”
The last way to find new opportunities is to look at your own consumer experiences. By seeing how complicated the cell-phone buying process was, Jarvis knew he wanted to make it easier, but he also drew from an experience at Nordstrom to improve the service. When a college-aged apartment neighbor was constantly playing his music too loud and talking to him about it hadn’t resolved the issue, Jarvis lost it one night and began thumping his Nordstrom shoetrees as hard as he could on the wall toward his neighbor. The result? Broken shoetrees. He slinked back into Nordstrom and got new ones, but the store wouldn’t accept any payment.
“I said, ‘Oh no. I broke them — I banged them on the wall,” he says. “Nope. They wouldn’t accept any money for them.”
It was an amazing customer service experience that Jarvis has never forgotten, and in the same way, he enjoys being able to tell customers to talk and text all they want and they won’t get charged for it. So by simply looking at your own experiences, it can help you find ideas for your business.
“I think that complexity can hinder a process in a pretty dramatic way, and that there’s genius in simplicity,” he says.
Looking for parallels and trends helps keep your company focused, moving forward and makes more sense than just trying to grow for growth’s sake.
“That, to me, is a proactive indicator rather than, ‘We need to grow — you know? OK, let’s just go grow. He told me to grow, and I don’t know what that means, but I’m going to add five stores.’ Does that really help us?”
How to reach: Revol Wireless, (800) 738-6547 or www.revol.com
Earlier in his career with Comerica Inc., J. Michael Fulton was an account officer in Detroit and was working on the Chrysler relationship. At the time, Chrysler was near bankruptcy, so Fulton was flying to New York every week, because the bank had so much money tied in to the automobile company. It made for some long trips and late nights, but before he crashed to get some shut eye, he always did something that seemed so small at the time.
“These were the days before computers but after abacuses,” Fulton says. “I’d go home, and I’d type up the memo, everything that happened in the meeting, and I’d go in the next morning, and I’d put it on the chairman’s desk.”
He didn’t have to do that, but he just thought it would be nice for him to know the details of these meetings since they seemed very important. That simple act got him noticed. Down the road, that chairman plucked him out of his position and put him in a greater role, which springboarded Fulton’s career. He eventually led the company’s entry into the California market through the acquisition of a San Jose-based bank, and today, Fulton is president of the bank’s Western Market, overseeing more than 2,000 employees in about 100 locations. During his nearly four-decade career with Comerica, he’s learned the right — and sometimes wrong — ways to lead in business.
Years ago, on Fulton’s first day as an assistant manager at Comerica Inc., he was feeling around his desk and accidentally set off the alarm button, and 10 minutes later, he had three police officers bursting in the front door. He initially didn’t fess up about it out of fear of getting in trouble, but the incident was eventually traced back to him.
It’s not the only mistake he made early in his career either. On his first day as a teller — his first job with Comerica — he was out of balance, which isn’t the best way to start in a bank. While he’s made countless other mistakes over the years, he’s learned from those and recognizes that he needs to be accepting of other people’s mistakes, as well.
“If I remember those things, 37, 38 years ago, I think people really learn from mistakes,” Fulton says.
By moving forward instead of dwelling on mistakes, it’s gotten him to where he is today — and as a result, he welcomes employees making mistakes when it’s a learning experience.
“Trust their judgment, and on something where they’ve used their best judgment, mistakes are forgiven, and you learn from it,” he says. “I find that kind of environment fosters growth, creativity and makes it more enjoyable.”
Fulton sometimes shares his embarrassing mistakes with his people to show them that it’s OK to make them, as long as they learn from them.
“If occasionally they don’t [make a good decision], we’re not going to come down on them so hard that they’re afraid to even make a decision anymore,” he says. “It’s seeing that when someone did make a mistake, they were forgiven. It’s promoting the mistakes I made so people know I don’t think I’m immortal.”
By forgiving people for their mistakes, it also helps foster trust between himself and the people below him. It’s also important to help people learn how to make better decisions, and to do that, you have to give them guidelines or parameters. At Comerica, the company has policies and procedures to help people make decisions.
“You can draw the box, and as long as I stay within the box, whether I’m in the upper left or lower right, and that box is big enough, I have lots of flexibility to do my job,” he says.
While you can create guidelines to help people, recognize that sometimes people may have to stray outside of that box if the situation calls for it.
“If I inadvertently stray a little outside the box to get a deal done or I thought there was a really good reason with the right kind of explanation, I would hope I’m forgiven, too,” Fulton says. “Most often, I am, and most often, I would want to treat my people the same. I don’t like micromanagement, and I don’t want to micromanage my people.”
You have to recognize that the more policies, procedures, guidelines, or checks and balances you put in place, the more people will fear making decisions and the longer it will take to make those decisions.
“Every company has policies or controls,” he says. “I think when you put those together, you have to make sure that you’ve given enough latitude. If you require something has three levels of approval, you just have to recognize that you’ve added more time in the decision.”
Stick to your strategy
Fulton has also learned that it’s critical to have a strategy when moving forward.
For instance, when the Comerica team decided to enter the California market nearly two decades ago, it didn’t simply rush in.
“It’s really understanding the market, market size, market growth, the needs of the market, how the market’s being served today,” he says.
He logged nearly 200,000 frequent flier miles flying between Detroit and California to investigate the market. Fulton asked how well potential customers were being served, what customers’ perceptions of their banks were, what they valued in a relationship with a bank and how they evaluated their current service. By doing this and asking these questions, Fulton and his team saw that the small and midsized businesses weren’t that happy with the large banks, which had most of the market share and were all trying to do 500 different things. So they saw a real opportunity to simply focus on relationship banking with small and midsized businesses.
“We had to ask ourselves, first and foremost, is that market, or what the market’s looking for, something we truly believe we can be good at?” he says. “If it is, then we’re going to look for a way to get started here.”
Sometimes it can be hard to know if you can be successful at something, but that’s when you look at your track record.
“Some of it, in our case, has been, ‘Have we done it before elsewhere?’ and to critique how well it was working and was it consistent with our competencies,” Fulton says.
In this case, the way to move into the market was by acquiring a bank based in that region. After doing that, Fulton and his team focused just on one area — relationship banking — because they wanted to differentiate themselves from the competition. Over the years, he’s used that same strategy when choosing new areas to enter, so he says it’s also important that you know your strategy and don’t try to sway from it.
“There are two kinds of strategies,” he says. “One is low-cost — ‘We’re going to beat the competition because we’re going to be cheaper.’ … The other strategy is, ‘We’re going to differentiate ourselves. We’re going to truly charge a premium because we’re providing a service that we think exceeds the competition.’”
Fulton wouldn’t even entertain anything that gravitated more toward the low-cost strategy, because he wanted to truly provide top-notch service and differentiate Comerica in the market. Over the years, Comerica added just 14 other businesses using this approach.
“They all started with the vision that there was existing and future opportunity always, then validated with research,” he says.
And each time someone floated an opportunity out there, he made sure to evaluate it for its long-term viability. For example, during the dot-com bubble, Comerica stuck to its principles and required that companies be backed by well-known venture capital firms, and that saved the company from being affected by the bubble burst. When many of its competitors were making nonrecourse loans for developers just to get deals during the real estate boom, Comerica didn’t do that.
He says, “It gets back to that consistency thing that you just have to make sure that you’re really sticking to what you know well and how you prosecute the market and don’t get caught up in the hour and the quarter and the month and the year because things are getting too frothy.”
Develop your people
It’s not uncommon for Fulton to spend 10 or 15 hours in a week working on talent management, which involves looking at both the results as well as the behaviors of his managers. It may seem like a lot of time, but another thing Fulton has learned over the years is that you have to constantly be looking to develop your people.
“If you really believe that retention is a real priority in your business, then you have to put together some type of talent management process within your organization,” he says.
One of the easiest ways to see who’s performing well is by looking at results, but often you have to look beyond those and at behaviors, as well. For example, do people follow that person because they have to or because they want to? Does the manager have good development plans in place for the people? What are people like with their employees? What are they like as speakers? What are they like with customers?
“It’s a variety of probing on what kind of development these people need,” Fulton says.
He says it’s also important to look at their bench strength — the managers behind the managers and other key employees under them. Sometimes one of the biggest talent development areas is helping managers simply develop the people on their bench.
It’s also important that as you evaluate your people, that you’re looking at where people can move.
“We’re looking at who’s ready now, who’s going to be ready in a year or two, who’s going to be ready in three to five years,” Fulton says. “We actually identify names there, and then we want to make sure that those people have special attention and development there.”
In order to know who’s ready, it comes down to having relationships with your managers.
“You have to get to know that person,” he says. “You have to rely on your managers to know that person. We see the results, and we can measure their results monthly in terms of how they’re performing.”
When it comes to programs for development, sometimes it simply requires internal training, but in other situations, Fulton will bring in someone with more expertise to work with that manager. Regardless of how you provide additional training, be sure to follow up. On an annual basis, Comerica reviews managers to see how they’ve progressed, and then most meet on a quarterly basis just to talk about how they’re improving. By having a process like this, it ensures that you have people slowly stepping up when they’re ready, which will help your business grow in a healthy way.
“I think if you’re steady, you’ll develop people, you’ll retain those people, and you’ll have a good plan you can stick to,” Fulton says. “We’re trying around here to hit singles and doubles rather than hitting home runs and then two strikeouts.”
By retaining your people, it also ensures you’ll make customers for life.
“One of the ways we retain customers is by having good employees that aren’t leaving every other year,” he says. “So our customers know our people when they call. They don’t have to start all over again with the explanation of what they do and how they do it. We’re already familiar with it, so retaining customers goes hand-in-hand with retaining our employees.”
How to reach: Comerica Inc., (408) 556-5000 or www.comerica.com
When Fred M. DeGrandis talks to his employees at the Cleveland Clinic Regional Hospitals about the best places they’ve ever worked, the answers aren’t what you might think.
“Quite frankly, never do they talk about facility, equipment and technology,” the president and CEO says. “They talk about who they worked with and how the people cared for them and they cared for each other and that they felt supported by those who they worked with. That’s the kind of environment that you want to create. You want to create the kind of environment that is, quite frankly, the best place to work.”
Creating the right kind of environment starts with the people you have in your organization.
“The foundation of innovation is about creating a team of people who work together, support each other and know that the depth of the support remains as they are proceeding through their journey of professional stewardship as well as achievement,” DeGrandis says.
The first step to getting great people is to know what you’re looking for. At the Cleveland Clinic, he needs people who will ultimately work well with others.
“You set ground rules to start with,” he says. “You set the standard that that’s the first requirement of recruitment.”
With the notoriety that the Cleveland Clinic has, attracting top professionals isn’t usually an issue, but trying to figure out if those people can work well with others is another issue altogether. To find people who are going to work well with others and support each other, ask them about their past experiences to get to the heart of what’s important to them.
“You talk to them about places that they have worked that they considered really good and why it was really good,” he says. “You ask them about their own experiences, and in some ways, it’s not that easy to tell. If it were, this would be something that would happen all the time. It takes time. Ask a lot of questions about what motivates them.”
For instance, in the health care field, he may ask them why they went into health care and why they would choose to take all their skills and talents and use them in that particular field.
“Many times, you can gain a lot of insight into a candidate’s ability to work on a team and their motivation as to why they’re in the particular profession that we are,” DeGrandis says. “It’s a helpful question in asking and having people understanding somebody as to what motivates them and what their passion is and how they’ll play as a member of a team.”
With the right people in place, you then have to support and foster their growth.
“The most important way to drive innovation and performance is to create an environment of support and collegiality between the players that are on your team,” he says. “By doing so, you foster an environment that supports risk-taking and provides the opportunity for innovation in terms of ideas, programs and services.”
DeGrandis recognizes that in order to serve the patients the best, his employees have to be happy in their positions.
“Understand that the first customer that you have is the person who sits next to you and works with you,” he says.
The motto throughout the hospital system is that they always put patients first, but the only way his people can do that is if they help and service each other first.
“In any endeavor, professional or otherwise, it’s accomplished by a team, so understanding and supporting each other creates an environment that a team can work in and excel in,” DeGrandis says.
To put together an environment like that, you have to do some soul-searching yourself.
“As yourself, are you working in the best place that you’ve ever worked yourself?” he says. “If not, take steps to make it that way.”
Begin to examine why the organization isn’t the best for you and why it may not be for employees, as well.
“Then begin to consciously and deliberately address the causes of why the organization or the moment or the department is not,” he says. “I think it’s a good question to ask all of the time, whether you’re coming into an organization or operating within the organization. It gives you a whole lot of insight as to what it is you as a leader need to encourage, to foster, to support and certainly to change.”
How to reach: Cleveland Clinic Regional Hospitals, www.clevelandclinic.org
“That was the best advice he could ever give me,” Denegri says. “If you have the right team, then you’re going to march right into the things that you need to.”
Now, Denegri serves as president and chief operating officer of Campero USA Corp., the U.S. franchisor and operator of Pollo Campero chicken restaurants. In his position, he’s responsible for overseeing all of the company’s franchises and expansion efforts in the United States, which is part of the $400 million worldwide operations based in Guatemala. Because the U.S. operations are smaller than the worldwide headquarters, he knows that people are even more critical, so he works to get the right people, test them out, and then simplify the plans so people can move forward.
“In a large company, when you change a player, it doesn’t really rock the boat that much, but we have a much smaller operation in the U.S., so to get the people that have all the characteristics that we’re looking for … it’s challenging, but it’s a little trial and error,” Denegri says.
Hire the right people
When Denegri was working at the Coca-Cola Co., Campero was one of his largest accounts, and he frequently met with the company’s CEO. Every so often the CEO would talk to Denegri about jumping ship from Coke and joining his team, but he always politely declined such offers.
Then the CEO requested an in-person meeting and said he would fly to Denegri.
“I really thought he wanted to switch from Coca-Cola to Pepsi-Cola because he never did that,” he says. “I always flew to him, not the other way around.”
He didn’t want to switch brands, he wanted Denegri to switch ships, and this time, he was successful.
“I thought I would never leave the company,” he says. “It was a great company. I was walking on clouds, but when I was given the opportunity to work for Campero and the opportunity to take it international, I didn’t really hesitate. I jumped ship right away.”
Denegri saw an opportunity to make a difference and to really be needed in a way he never felt at a large company.
“I use the analogy when I talk to my team about a carrier — those huge ships,” he says. “Do you know how many people are in a carrier? It’s about 5,000 people. It’s like a city on the sea. If you jump, many times, nobody will notice. This is more like a canoe. If you take a break to sneeze, you will make an impact on what’s happening. It’s the ownership, so you really feel the different kind of ownership.”
While it may seem like Denegri’s resume is irrelevant to hiring, it’s actually quite helpful, because he wants other people who will look for a similar opportunity and share his passion.
“You talk about (passion), but it’s really hard to know,” he says. “You look at their history, and you see what they’ve done. Then, we run into people who work for very large companies, and they have a good position, and they say, ‘You know what, I really want to leave this company to make a difference and come work for you guys.’ That’s the type of people that we look for.”
He says it’s also important to look for people who actually know about your brand.
“I interview them like I interview a franchisee,” he says. “So I say, ‘What is it that you like about the brand?’ I don’t want to hire anybody who needs to make X amount of money a year. We all need to make money. That’s OK, but that’s not the reason to come to work for us.”
In addition to knowing about the brand, Denegri wants to hire people who have ideas for it when they come in to interview.
“I ask them, ‘What would you do with the brand? Where would you take it?’” he says. “As far as anybody can do in an interview, they have their heart into these. The more they get exposed to the brand, the better it will be [for] the interviewing process.”
When you get a candidate that has the knowledge, then you also want to see how they react to the realities of your company. Denegri has his candidates visit one or two franchises so that they can understand what the company actually does.
Candidates go through about two weeks of interviewing with Campero, including three to four interviews with Denegri and another interview with each of his top executives. While it’s a lot of time, he says you have to do that if you want to be successful later.
He says, “The more time I spend with them now and the more money I spend with them upfront, the better it’s going to be, and it’s going to save us at the end of the day.”
Test people out
Just like the world was watching and grading every move that the president made during his 100 days in office this year, Denegri does something similar to make sure the people he gets are going to be effective.
“In 100 days, if somebody is not really delivering and they’re not going in the direction we feel they should be going, we’re going to have a conversation,” he says.
When people come into Campero, Denegri shares his expectations.
“I try not to write seven pages to say something that I can say with one sentence, …” he says. “Things need to be simple. Focus on simplicity and execution. … Once I make sure that they have it, there’s no excuses.”
He says that in order for your people to be successful, you have to give them the authority to do their jobs to see how effective they’ll be.
“I don’t micromanage,” Denegri says. “So when I hire somebody, I’m going to delegate to him and I’m going to give him the keys and my wallet and say, ‘You drive.’”
Once he sees them doing OK with the initial drive, then he reclines his seat even more by giving them responsibility for their quarterly budget.
While they’re driving, he may tell them where to go, but he’s not going to be a backseat driver to get them there.
“They have the green light and the room to maneuver and do the things they need to do, but they know that, at the end of the day, I expect very specific things from them, and they will give them to me,” he says.
He says that everyone has evaluations, and while those are important, there are also other ways to see if someone is being effective in your organization. For example, if the franchisees come to him excited about something they implemented as a result of a suggestion from one of his people, he knows that person is positively affecting the organization.
You can also tell in how franchisees handle questions about problems.
“I go into somebody’s office and say, ‘Tell me what happened last week with sales,’ for example, just the way they structure the answer, you can tell if they have been thinking about it, if they’ve been doing research and if they care,” Denegri says. “As opposed to someone telling you, ‘We’re 12 percent up or 5 percent down,’ that’s not what I’m looking for. I’m looking for the heart and the pulse of the business. Only a person who really has their mind into this can give you that.”
For example, in the tough economy, someone may say that it’
s just a tough market, but Denegri doesn’t accept that. He wants to see someone applying critical thinking to find a better solution.
“Excuses are not good,” he says. “If somebody said, ‘I made a mistake,’ I like that. ‘You know what, I made a mistake,’ or, ‘I forgot about it.’ I can accept that. Excuses are bad. … We’re just pushing all the time to make it happen, and when somebody’s not, it will stand out. It’s easy to spot. It sticks out like a sore thumb.”
If you see that someone isn’t performing in a position that you hired him or her for, then try giving that person something else to do, but don’t keep trying.
“If somebody doesn’t really get it, we put them in a position where we don’t give them that much responsibility, and then we extend the three months to six months,” Denegri says. “If they haven’t got it by then, then it’s not going to work. We can’t afford the luxury of having someone for two years to see if they’re going to get there.”
When you face those situations, an honest conversation saves time and resources on both sides.
“It’s not only the best for us,” he says. “It’s the best for that person, too, because they deserve to know where they are and what they’re doing wrong, and people that don’t really get it that easy, many times when you have to terminate somebody, you know it’s for the best — even their best.”
Get to the point
Once you’re confident in your team members, you have to move them forward, but oftentimes plans and goals get pretty convoluted.
“People really try to write a book on how to get from your office to the parking lot,” Denegri says.
He says that you have to do some reverse engineering to simplify things down.
“Plans can look very sophisticated and complicated, and at the end of the day, we can translate it into a very simple working document,” Denegri says.
One way to do that is to get to the meat of the issue.
“People have a tendency to talk fancy,” he says. “I don’t know if you’ve been to the doctor and he will give you a very long and sophisticated term and it scares the living ice out of you, and so you’re like, ‘Doctor — what’s that?’ It’s a bruise. ‘Well, OK, I’m going to leave.’”
In order to stop overdiagnosing the bruises in business, Denegri says you have to get to the essence of what’s important.
“People like to be fancy and make things seem a lot harder than what they are, but the way that my mind works is I can sit through a four-hour presentation, and I’m thinking about what are the three things that are really going to take us there,” he says. “They’re always very simple — simple to identify and isolate.”
He says this is particularly effective when you sit through long, drawn-out PowerPoint presentations.
“When people talk for too long and try to throw too many PowerPoint presentations at me, I go, ‘OK, so at the end of the day, what is it?’” he says. “I think they call it the elevator spiel. When you’re with a sharp mind and you have your 40 seconds with somebody in an elevator, what are we going to do next year? Somebody that really knows, in that 40-second or 60-second elevator ride, he’ll tell you where he’s going to take the company next year.”
For example, Denegri says Campero’s business plan is probably 147 pages long, but at the end of the day, he knows that he needs to focus on driving traffic, franchise profitability and consumer convenience. He says all the rest is extra gravy.
If you’re not quite sure after you’ve read something or listened to a presentation, then don’t be afraid to speak up.
“After a three-hour presentation, I’ll say, ‘Tell me the three things that you really need to happen to get there,’ Denegri says. “Then people will really tell you what they think.”
How to reach: Campero USA Corp., www.campero.com