Erik Cassano

If most CEOs have to view their companies from 30,000 feet, Don Morel is probably in the stratosphere somewhere.

Morel, chairman and CEO of West Pharmaceutical Services Inc., has to pull back far enough to see sales operations in 35 countries and somehow process the sum total of the company’s daily operations into a form that can be consumed by employees on the ground, interacting with West’s customers.

“The difficult part is synthesizing that information into a few priorities that you can take an action on,” Morel says. “Once a month, we get together as a senior group and review what is happening in the marketplace, along with our financial results, and we spend a lot of time listening to what the sales reps and business development people are telling us about what is happening in the marketplace.”

In the monthly meetings, Morel brings in representatives from West’s marketing, operations, quality control and regulatory departments. It is a group effort to analyze the data and plot a course for the immediate future.

It’s a daunting task to take a global organization and focus it on a set of universal priorities, which is why Morel needs to build and maintain a communication strategy that emphasizes a straightforward approach, getting employees to understand the big-picture reasons behind the decisions that are made. It’s also why Morel needs to constantly find and develop new leaders who can help promote his messages throughout West’s worldwide footprint.

“The most important thing is that your strategy is universal and applies irrespective of the geographic operating region,” Morel says. “That means you need to find, develop, hire and grow people who have the same set of values that you do, and do it all around the world.”

Recruit top talent

Before you can develop leaders from within your ranks, you need to have the raw materials to work with. That is an issue that has to be addressed in your recruiting and hiring process.

Recruiting is not an exact science. No matter how much of a background file you compile on a job candidate, no matter how forthcoming the candidate’s references are, pulling the trigger on the right hire still comes down to little more than an educated guess.

Ideally, Morel says you want the opportunity to view potential recruits in real-life business situations to gauge their reaction to stress and juggling multiple tasks. But that is not an option in many cases. So you need to simulate that to the best of your ability in an interview setting.

“You get a pretty good flavor for a person’s abilities during the interviewing process,” Morel says. “You’re never 100 percent sure, but what I typically like to do, particularly for entry-level and younger candidates, is talk a bit about their upbringing, what things they think shaped who they are, what role their parents played. From there, you work more toward the technical skill sets.”

Younger management candidates will likely be well-schooled in their area of study, but perhaps lacking in versatility. Morel says you want to find out how willing and able they will be to diversify their skills and areas of expertise in your organization.

“If you have someone who is maybe in their first job, you might have someone who is savvy in one area, and you can identify that pretty quickly. Then you want to find out how broad-based they are by asking questions about what is in the news currently and whether they are familiar with it,” he says.

“We might ask a young college graduate what they think of health care reform and what they think the downstream implications will be. It’s not a right or wrong answer that we’re looking for. We’re looking for that clear indication of whether they are up to speed with what is going on in the world, whether they can think in a pressure-packed situation, which helps give us an idea of what kind of manager they might become.”

Demonstrate the big picture

To get people to be leaders, you have to get them to think like leaders. And that means educating them on how the puzzle pieces of the company fit together on a global level.

At West Pharmaceutical Services, which had $1.06 billion in 2009 sales, including $293 million in the fourth quarter, Morel puts the big picture in perspective by focusing employees on the end mission of a pharmaceutical company: producing drugs and medicines that help the end consumer.

“At some point, you, your family, your relatives or friends, will have used on them the products that we make,” Morel says. “So you want them to ask themselves if they would be comfortable administering this drug to a friend or family member, knowing that you made the packaging component that our customer uses to put it into the marketplace. You really want each individual to think from the personal aspect of how your product is going to be used ultimately. It does two things: It keeps everyone focused on their work, and it gives everyone a sense of pride that the work they’re doing is making a difference.”

You need to drill down as far as possible with your big-picture message. You can’t assume that there is a point in the organizational hierarchy where thinking like a manager is no longer relevant. The employees on the bottom rungs of your company are the people who likely have the most contact with your customers, and it is critical that they understand and reflect your company’s mission and values to the people who purchase your products.

“It can become quite easy for employees to become disassociated from the use of the products they make,” Morel says. “What you have to do is constantly remind them that what we produce goes into critical applications, whether it’s a component for a cardiologist or a drug packaging system that includes an antibiotic or a vaccine or a treatment for a cancer patient. At the end of the day, the work they do has a direct impact on someone’s life when it is consumed in the marketplace.

“That extends to all parts of the business, so we spend a lot of time reminding folks that whether they’re on the operations side of the business or the accounting side, every action they take has an impact on someone’s life.”

To reinforce the wide-angle message to employees, Morel gets out of his office at corporate headquarters and hits the road. He tries to get to all of West’s factories at least several times a year, and spends his visits interacting with employees on a personal level, promoting his vision for the company and doing a lot of listening.

“You give them a chance to ask questions, but more importantly, have a series of messages that are clear and consistent, so that everybody understands where we’re going,” he says. “When you deliver the messages, you try and relay back to them some local anecdotes that you’ve heard from the management team and employees at various locations. You want to tell stories that show how their job is one of the building blocks for the overall strategy of the organization. For us, it varies widely depending on the region we’re in. But all of those building blocks are very consistent in terms of supporting the strategy.”

Develop new leaders

To keep the momentum behind your vision for the future, you need advocates within your company’s ranks. In a perfect situation, every person at every location and level of your organization would be a complete self-starter who quickly embraces the mission and vision and never lets up.

But situations are seldom, if ever, perfect. That means you need to develop a support structure of other executives and managers who can continue to reinforce your messages when you aren’t present.

At West, Morel and his leadership team go through a succession planning exercise with the company’s board of directors twice or three times a year. For each management-level employee, the upper management team develops a profile of the person, including a detailed skill set, strengths and areas for improvement. Upper management then works with the manager to address his or her gaps and shortcomings.

“We form a plan to address those gaps and make sure that they have the skills to move on to the next assignment we have for them,” Morel says. “As we go through the process, it’s not only continual feedback from people in their current assignments. It is also keeping them apprised of what we’re thinking of them in terms of their next assignment, understanding where they want to go next as individuals and understanding how we’re going to fill in the gaps we think they have in their work experience. It’s a process you have to constantly tweak with help from your team and board of directors.”

Ultimately, you want to look for management candidates who can take bigger and bigger steps within a company, potentially rising to an upper management position over time. You identify your high risers by giving them successively more and more responsibility and seeing how they respond to the workload. Some people enjoy the added weight placed on their shoulders. Some find that they can only stomach so much. The only way you can separate the two groups is through putting your plan into practice.

“You’re trying to develop a group of individuals at the higher levels to take on broader management responsibility,” Morel says. “It’s pretty significant for someone going from their functional area of expertise and getting them to take on a broader piece of the puzzle, where they have to manage folks who know more about a subject than they do.

“You need to develop people who can take that next step. They might have a high level of skill in their own area of training, but then they need to meld those skills into a workable group that is going to execute against your business plan and strategy.”

Morel says the identification and cultivation of new leaders is one of the most important tasks on any organization head’s plate. You need to not just keep files on your up-and-coming managerial candidates, but you need to really get to know them, know where they excel and where they might have weaknesses. You need to know their personality attributes and flaws. And you can only gain that level of knowledge through spending regular time with them, both interacting with them and observing their behavior in a variety of different business situations.

“It’s almost a subject that you can’t spend enough time on,” Morel says. “It’s one where you need to interact with those individuals and get a very strong gut feeling about their capabilities. Then, you need to talk to the people you trust who are both above and below the individual in the organizational structure.

“What we really emphasize is how people treat their direct reports and how they treat other people in the company. It’s easy to get somebody to do something for you when they work below you in the chain of command. It is a totally different issue when you need to use softer skills to work with someone who is not from your part of the organization.”

How to reach: West Pharmaceutical Services Inc., (610) 594-2900 or www.westpharma.com

Economic slumps can be found, quite often, in the details.

Don Cape has seen it firsthand in the behavior of his customers at Quick Lane Tire & Auto Centers.

Cape is national manager of Quick Lane, the $450 million car service brand of Ford Motor Co. with both dealer-based and off-site locations. During the economic slide of the past two years, Cape has seen how little decisions by customers can have a big impact on a business.

“One of the challenges over the past two years has really been getting customer traffic into the stores,” he says. “Customers that normally come in three times a year for service have been scaling back to once or twice a year.”

The routine auto maintenance that Quick Lane provides has become less of a necessity to customers looking to save a few bucks. Car owners who used to change their oil every 3,000 miles are now trying to stretch the interval to 5,000 miles and beyond. It’s less healthy for the car, but healthier for the purposes of balancing a household budget.

But Cape and the leadership team at Quick Lane couldn’t simply accept the situation as a negative side effect of the economy. They still needed to drive business. They still needed to open new locations and pull new customers into the existing stores.

Cape and his team needed to identify Quick Lane’s niche in the auto service market, and then put every location in a position to capitalize on that niche. The management team assessed the situation and recognized that if Quick Lane was going to continue growing, it needed to emphasize convenience and stay local.

With that in mind, Quick Lane fashioned a marketing philosophy called “own your own backyard.”

“In this service business, it’s really key that you focus on the consumers in a 10- to 15-minute radius from each location,” Cape says. “That is the sweet spot. We suggested a two- to three-mile radius around each location,and market to those people specifically. It was a bit different, because many times in the past, we had found that we were reaching out too far from each location, maybe spending money in a way that didn’t get maximum return for each location.”

To gain the best possible traction on a narrowly defined local level, Quick Lane’s management needed to let location operators make their own marketing decisions. Corporate management could provide a marketing template, but location managers were in charge of marketing to their own area.

It’s an approach that requires corporate management to take a backseat and do a lot of listening.

Take it to the streets

To reach a narrowly defined customer base, you need to go against the grain of widely accepted mass-marketing principles. You don’t want to cast the widest possible net; you want to home in with laser-guided accuracy on the customers you’re trying to reach.

Often, that means thinking smaller, not bigger.

“Sometimes, more marketing isn’t better,” Cape says. “It’s about being focused, being efficient with your marketing. To me, it’s not how much you’re spending but how you’re spending the money you have. As you get into a tough economy and cash and available marketing funds are reduced, you have to get smarter at it.”

At Quick Lane, smarter means knowing what corporate management can and can’t do. Corporate management can define what the company brand should stand for, can establish overarching goals and can work to keep the organization pointed in the general direction of those goals.

What corporate management can’t do is come up with a one-size-fits-all marketing strategy that will get customers into stores from Maine to California and all points in between.

Realizing that, Cape and the Quick Lane management team have given individual store operators a great deal of latitude in tailoring their marketing style to fit the potential customers who live and work within a 15-minute drive of the store. Store operators had one ground rule to observe: Convey the brand’s consumer message, “convenience with confidence.”

“We have a brand style guide where we make suggestions to store operators regarding how they brand and advertise,” Cape says. “We do provide a road map to be consistent and uniform, so that it supports the brand. But the road map isn’t a mandatory marketing program. We try to structure things in a way where there are choices. What we’ve found is that when the dealers have more choices than they could leverage at one time, they still find what is best for them.”

Cape says taking a big-picture marketing philosophy down to the customer interface level requires a balance. You can’t let each store owner or salesperson take your brand in a different direction, but you want to stimulate small-scale innovation and creativity.

To ensure continuity without stifling creativity, you need to communicate with your people and make sure you are giving them an opportunity to communicate with you. The representatives in the field need to know in what direction the company’s compass is pointing, and upper management needs a clear view of what is and isn’t working in the field.

“Your employees are the ones on the front lines dealing with consumers,” Cape says. “They understand what the consumers are telling them. In our case, they might understand why a consumer may not want to buy a set of tires at that moment. If your front-line people are listening to the consumer, they’re going to understand the consumer’s wants and needs.

“Then, they’re going to come back to you and talk about the trends they see, which helps you understand how to tweak things from a marketing, pricing and process standpoint. In the end, it’s all about serving the customer. If we can meet customers’ needs in terms of being timely, affordable and having a good consumer experience, they’re going to continue to choose us.”

Get everyone talking

You want front-line employees engaged in a dialogue with you but just as important is your ability to facilitate lateral communication between departments and geographies. Lateral communication is the primary avenue for a good idea to become a best practice throughout your entire company footprint.

Building a collaborative mindset that endures the distance between stores and cities is especially critical to Cape and the other leaders of Quick Lane, who bring together 570 store-level managers to find who has been succeeding the most in their marketing approaches.

Sometimes, a basic, no-frills idea gains the most traction, becoming a best practice because of its simplicity and effectiveness.

“There is an area in the Boston region where a Quick Lane operator actually approached a pizza delivery place,” Cape says. “What does pizza delivery have in common with our kind of business? We both serve the customers in our own backyard. What we do, in that sense, is exactly the same thing the pizza business does. So that operator actually went to a pizza delivery store and approached them about utilizing advertising coupons. One side was pizza coupons and the other side was Quick Lane advertising.

“That is what went on every pizza box that went out for delivery, and all you’re really doing is printing these fliers. It’s very cheap, but you’re still serving the local area, and we found that we got a lot of traction with that. As a result, now we have hundreds of Quick Lanes around the country doing that.”

To help facilitate the communication between store operators, Qui ck Lane maintains a business-to-business website. Store operators can access the site, interface with each other and use a set of marketing tools to help craft a focused message, in addition to other tips on selling, managing inventory and training modules.

“We’ve found that the forum gets used a lot and is an effective method for sharing best practices,” Cape says. “We help reinforce that with some other incentives and recognition for them.”

Quick Lane also makes use of field teams that monitor stores in a specific region, analyzing marketing data to find out what is and isn’t working well. The teams feed their data findings back to the corporate level.

If you consistently ask for new ideas, and set an expectation that your customer-level people will share ideas, you will build a culture of collaboration and accountability.

“I truly believe in a collaborative approach,” Cape says. “I’ve always said that 10 minds are better than one mind communicating to 10. In the past six-plus years I’ve been on the job, that has really been part of the key to success. It hasn’t been Ford telling us what to do. It hasn’t been a particular dealership that has it all figured out. It’s all about these Quick Lane operators doing business every day, about us providing forums and mechanisms to them, working with them to achieve their goals and do it in a quality way, a growth way.”

Grow strategically

To facilitate large-scale growth while still maintaining a local neighborhood marketing presence, you need to develop new stores to place in new neighborhoods.

To find new dealers and off-site locations that could potentially house a service center, Cape needs to take an approach that is equal parts sales and strategic planning.

“We really have two ways we grow,” Cape says. “One is our traditional way, where we communicate the strengths and attributes of Quick Lane to our dealers through all sorts of methods. They could be dealer events, regional meetings, or we might meet individually with dealers where we feel we have a good opportunity for expansion. You take a message, sell them and convince them to take it on as an active project.”

The other growth tool is technology based — a program by which Quick Lane’s leaders can punch in an address and identify the growth potential for a store at that location based on a number of factors, including traffic flow, retail hubs, household income and population density.

To Cape, a good growth strategy boils down to finding where the soil is the most fertile for your product. And no matter how you conduct the research, in order to effectively market and sell your product, you need to have a clear view of the landscape you’re trying to enter.

“When you identify where the soil is most fertile, there is value in that because you can focus your resources on that geographical area,” Cape says. “You can form a more robust marketing plan for that area. For us, it is really about having a committed operator, a dealer that is going to grow and a back service center, providing them with the right resources and ensuring that they have the conviction and commitment we’re looking for. Overall, you want to balance your zealousness for growth with quality of growth, so that you can grow the right way.”

How to reach: Quick Lane Tire & Auto Centers, (800) 392-3673 or www.quicklane.com

Phil Cannella spends much of his time thinking beyond the walls of his office.

In an era in which many CEOs speak frequently about management by walking around, the CEO of First Senior Financial Group takes it a step further. He doesn’t just want to know what is going on with his team, he wants to know what makes them tick, both as employees and as people.

If you know what motivates your employees, you know what you can do to help them reach their potential. But it goes even deeper than that. Cannella wants each person at First Senior Financial to realize for themselves the factors that motivate them, the areas in which they are successful, and then begin to intentionally utilize those talents and skills to better both themselves and the company.

In order to do it, Cannella says you need to take a look at yourself and assess not just where you are, but the trajectory of your life and career. It’s not something that happens overnight. Cannella says he has been on such a journey for several years.

Smart Business spoke with Cannella about how to self-assess and find what truly motivates you and your employees.

What are some of the keys to motivation?

The way I motivate everyone, I start out by saying this, ‘We’re all going to take important steps in this life, but the most important step you’re going to take is one that you’re going to take by yourself.’

I’m talking about the final step you take when you step off this Earth. That is the most important step you’re going to take, and it’s a step that you’re going to take by yourself. You’re not going to be concerned about the money in your bank account anymore. You’re going to want your family around you, and you’re going to think of what you’ve done to help others in your life. That is the thought that will go through the thoughts of most people on their deathbed, particularly if they’re at all spiritual.

For people in my office who are not spiritual, I ask them this, ‘Do you know the difference between spirituality and righteousness?’ If you’re spiritual, you have a belief in God. If you’re righteous, you believe in doing the right thing. And I don’t care if you’re righteous or spiritual, but you have to be one of the two in order to work for this firm.

How do you sustain that level of motivation throughout your business?

That is the start of planting the seed, and I then nurture it. I let them know that if you make a mistake and learn from it, it stays a mistake. If you make a mistake and don’t learn from it, it becomes a failure. Many people try something one time, fail at it and then move on. The lesson I try to get across is that you don’t walk away. If you try something the first time and it doesn’t work out, you don’t do the same thing, you make an adjustment and adapt. If you are in a circumstance that you don’t want to be in, you change it to a circumstance that you do want to be in.

You have to believe in what you’re doing. Who is the best writer? The guy who believes in what he’s writing. Who is the best marketer? The guy who believes in what he’s

marketing.

What should a business leader rely upon as a source of motivation?

I’ve found out only recently in life who I am, what I am. And I can tell you how to find out who you are. You figure out what has made you successful. What you’re doing right now, if it’s making you money, paying the bills, you’re successful. You’re not sitting in the street with a cup in your hand. You’re not smoking pot, you’re not drinking at a bar. You’re doing something constructive, and that is success.

You were born with some special abilities, but you didn’t earn them and no one is going to point them out to you. But it is the special things you were born with that have gotten you to where you are today. If you can identify what has gotten you to where you are today, the special things that you have that you don’t realize yet, and stop using them unintentionally, start using them intentionally, you’ll reach your potential. But you first have to realize what makes you special and start using it intentionally.

If you’re at a social gathering, and people like something about you, you find out what that is and start using it. That is what I did at age 53, and I’m 55 now. I realized what is making me successful and started using it intentionally. All of a sudden, when I started using my natural abilities intentionally, guess what happened? I started reaching my potential, and I started to fully realize who I am now.

If you can figure those things out about yourself, you can change lives, and not just your own.

How to reach: First Senior Financial Group, (800) 722-9728 or www.firstseniorfinancialgroup.com

 

John Higgins needed to write a new history for Ligand Pharmaceuticals Inc. Which he did — in pudding. Well, sort of.

But first things first.

When Higgins came on board as the president and CEO nearly four years ago, he took over a pharmaceutical research company with nearly 20 years of experience in drug development. The company’s leaders had branched out into partnerships with other pharmaceutical companies, and in the process of ramping up their research and development wing, they also expanded other portions of their infrastructure, such as marketing and manufacturing.

The trouble was that Ligand was getting too big. The company was starting to become detached from the research specialization that had made it successful in the first place.

“We had very good products,” Higgins says. “We were selling a couple of cancer products; we were selling a pain product. These are very good medical products, but they were failures from a commercial perspective. Never did we achieve our sales forecast. What we were guiding to Wall Street in terms of our revenue projections, we were missing all of those objectives.”

Over the years, Ligand had overbuilt itself. The company’s cost structure was outpacing revenue streams, and there was no real hope of getting the numbers to line up without some drastic changes.

“Despite doing $180 million a year at peak revenue, we were never cash flow positive,” Higgins says. “At some point in the mid-2000s, before I joined, investors realized that this company has good assets. It has a good research base and great partnerships, but the equity promise was going to be obliterated. It was either going to be heavily diluted through future financing, or worse yet, run itself into the ground. So investors became active in the company, telling management to fix the company.”

That was the environment Higgins faced from his first day on the job. He needed to refocus Ligand on its core heritage business of research and development, remove unnecessary drains on revenue, streamline the company’s processes and perform it all while attempting to salvage employee morale — a difficult task to accomplish as Ligand pruned off departments such as marketing and manufacturing, reducing the work force from 650 to 90.

What it all meant was that Higgins had to work fast.

Take quick steps

It didn’t take long for the first stiff gust of change to hit Higgins. Within several months of taking over the top spot, nearly every member of his dozen-member management team left the company. Nine of 10 directors on the company’s board also stepped down.

Most of the high-ranking executives and board members were jumping ship due to the uncertainty of the company’s future direction. While change at the top is a fact of life with many new CEOs, Higgins saw a red flag: With a lack of confidence at the top levels of Ligand, the morale of the work force could suffer, and the company could spiral downward even faster.

“It was pretty obvious that there was a new CEO and new leadership, but there was a bit of uncertainty about how long it would take to make decisions about what areas we would fund and whether there would be any staff cuts,” Higgins says. “I realized I needed to very quickly figure out the two or three core things at the company that we were going to build the business around, then get the team in place that was going to help drive that business forward.”

It’s a process that should have taken several months in a company the size of Ligand. But faced with slumping morale and a cost-revenue imbalance, Higgins didn’t have that kind of time. Instead of taking two or three months, Higgins compressed the time frame down to two weeks.

“My thinking is that it was more important to move decisively and move quickly to get 90 percent of the plan in place than it was to take more time and try to get 100 percent of the plan buttoned down,” he says. “There are always midcourse corrections or some refinement that you are going to have to make under any scenario, so the need to move quickly and give certainty to the team was something that I thought was vital.”

Higgins compressed the time frame by immersing himself completely in the project.

“It was a process that was just very intense and hands-on,” he says. “I was brand new at the firm; I had no loyalties to anybody or any program. I brought my own areas of operating expertise, but the benefit I had was I didn’t have loyalties or baggage that connected me to any particular program. I could come in with a clear mind in terms of what is the core foundation, what are we doing well, what are the elements of Ligand moving forward?”

Higgins conducted a number of meetings with senior management and held additional discussions with the board of directors and investors. He gauged everyone’s areas of interests and what they wanted to see from Ligand moving forward. Based on the dialogue from those discussions, Higgins and his leadership team began to formulate a future for the company’s core research businesses.

Communicate, then buy some pudding

As the situation surrounding the upper management team began to stabilize, Higgins began to turn his attention toward communicating with the rest of the employees throughout the company.

While communication with managers, directors and stakeholders in a time of transition needs to be intensive and detailed, you need to take a different approach when mass communicating your message to hundreds or thousands of employees.

At Ligand, Higgins communicated with straightforward language and chocolate-flavored foodstuffs.

Employees want straight talk that centers on where the company is going and how it will affect their jobs. That is exactly what Higgins gave to his employees as he began to rebuild Ligand.

“Just by nature I’m a very straight shooter and a very candid person,” he says. “I told employees that what they should expect from me is some very direct perspectives on their business — what I like and what excites me, and frankly some things I found troubling. I shared with them my view for why this company should be proud and why it will continue to have reasons to be proud.”

Higgins encouraged feedback through the provided channels, such as e-mail and through the managerial chain of command.

“We really had an open dialogue, and I would challenge employees by asking for their thoughts and input, so they realized that everybody has a voice and can be a leader in their own way,” he says. “But I also told them, ‘If you bring me a problem, you need to bring me a solution. I’m not looking for people to just complain or tell me what they think is wrong. I’m looking for constructive participants.”

Open and candid communication, even when communicating bad news, is key to building and maintaining trust with employees. Your employees will likely handle bad news, delivered in a straightforward manner, a lot better than they’ll handle silence or vague sound bites from management.

But Higgins wanted a little more message reinforcement for his employees. He wanted them to realize that he was serious about the company’s new direction and serious about the need for everyone’s involvement — as well as an acknowledgement that trust and total unity wasn’t going to happen between employees and management overnight.

“I went to the local grocery store and picked up a whole shopping cart of chocolate pudding along with a note that outlined some of the messages from the meetings we had,” Higgins says. “I wanted them to see that the proof is in the pudding; that I don’t expect you to be with me today or right this moment, but if you generally understand what we’re talking about and the path forward, I invited them to come along for the ride and start to see evidence of how this company will transform itself.”

Encourage dialogue

As you are moving through your communication steps in a time of transition, you need to listen and act decisively. Make an impression on your employees, not just with your words but with your willingness to listen and react to what your people are saying.

“If you’re in a situation where you need to restructure and rebuild a business, you have to listen to people,” Higgins says. “And listening doesn’t always mean agreeing with them. You don’t have to always agree among yourselves, but you do have to listen. You have to really hear out angles and perspectives, the potential downsides. You have to play out the chess game, mentally run through scenarios. And the only way you can do that is by listening to people.”

When weighing new ideas or a future direction for your company, you need to be a convincing devil’s advocate. A part of listening is to offer opposing viewpoints and see if an idea can withstand criticism.

“Set up a scenario where you think you have a perspective or view on how something should play out, take the alternative view and ask your team why you shouldn’t do this. Some people will share their perspective without prompting, but I don’t drop it until I’ve worked out the whole thing. You need to ask questions and challenge people, really have a vigorous, interactive dialogue, almost to the point where your colleagues think you really aren’t in favor of this. You get to that point, and often that is the point where it crystallizes and you want to make the idea happen. But before that point, you just keep testing it.”

Ligand had to shrink to become healthier and more focused. From peak revenue in the $180 million range in the middle part of the just-completed decade, Ligand generated revenue of just under $39 million in 2009. But the company is back to focusing on its original core business of pharmaceutical and biotech research.

And the result has been a company of people who are much more engaged in the company’s mission and feel a strengthened sense that their work is contributing to the company’s overall goals.

It goes back to the proof in the pudding. You can communicate at great length, but employees have to see how their jobs help the company as a whole.

“Whatever the projects and assignments are, in order for people to get back and do their daily routine, they have to be personally excited about what they’re doing,” he says. “They have to continue to be engaged in what they’re doing. They have to believe that the research and projects they are performing are worthwhile and are going to help the company in the long run.”

HOW TO REACH: Ligand Pharmaceuticals Inc., (858) 550-7500 or www.ligand.com

If you are in any type of business that requires you to cast a wide net to reach clients and customers, you have probably become aware of the Internet’s usefulness as a marketing tool.

But it goes deeper than that, says Michael Westafer, president and CEO of Roger West Creative and Code, an eight-employee subsidiary of Roger West LLC. Westafer says that with the increasing variety of options for Internet marketing and promotions, you need to craft a strategy that will yield maximum results for your business.

Smart Business spoke with Westafer about how you can utilize your Web site, blogs and social media to increase the profile of your business and how to train your employees to increase their handle on Internet marketing trends.

What elements make for a standout Web presence for a business?

What makes a good Web site is that in a short period of time, you really need to know what a company does, how they’re different from everybody else and have clear paths to predefined goals. You have to go beyond just the text and stock photos to what is the messaging, what is the identity of the company. What do you want to do and where do you want to go?

How do you message what you are and where you are going? It kind of goes with the brand and identity and basic marketing. Who are you, what are you, what makes you different? It’s the internal questions that set tone of all your marketing materials. What makes you different? Is it quality, customer service, price or how you are competing? The Web site needs to talk about that. If it’s quality, the Web site and marketing and everything end to end should be top notch. If it’s customer service, you should have testimonials and customer quotes. Your Web site is part of the messaging that should be going throughout all of your marketing materials.

How can business leaders find the type of Web fixtures that suits their needs?

The big thing is where is your target audience and who is your target audience? Who are you trying to reach? If you’re in the business-to-business market and your target is the directors and top-level executives, where are they, what are their typical search patterns? You need to do some research and find out where you need to be, because you need to be where they are and where they’re looking.

For instance, I read some stats that said over 50 percent of Fortune 500 clients block Facebook and Twitter. They block employee usage of those services during the day. If you’re targeting B-to-B clients, I’m not sure if spending your money on Twitter is the best thing, because the executives you want might not be on Twitter or Facebook or any other social media sites along those lines. You have to find them in the places where they are.

How can you train employees to become more adept with new networking technology?

It just depends on the type of employees you have. There are all kinds of different people, and they learn all different kinds of ways. I find that giving them time and challenging them, taking them out of their comfort zone, giving them some time and supporting them through it, that tends to help people along. For example, if you have a special project that involves a new technology. You might help them and walk them through it, maybe giving them a project and reinforcing them along the way.

I really put pressure back on the employee, because they want to be challenged. They want to learn and ultimately succeed. After a couple of projects, they should pick up what you want them to learn. Then they can start doing it on their own.

With any new technology, it comes back to why we’re using it. First, you have to describe to your employees how it’s going to be used, why it is important. So you kind of get the buy-in from the employees. Secondly, you have to have either some resources or have some type of training or support in place for people. A lot of the newer technologies are user-friendly and easy to learn, but it helps to have some type of process in place to show everyone that this is how you do things, you do X, Y and then Z, just to have some rules in place.

What are some of the main ways a business can utilize blogs in particular?

Blogs and news feeds are both really good for messaging and a good component to have on your site. The personal messaging that you can get from blogs is a great way to open up communication with people. When you’re building a Web site, it’s kind of a one-way communication. You’re talking to someone who is looking at your site. But a blog is a two-way communication where people can comment back on your stories. And it’s very important that they can comment back and open up that communication. You can put a little personality into the blog as well. If the CEO is very charismatic, it’s nice to have a CEO blog, where he or she can write on it every week and add a bit of personal flair to the corporate environment. It’s another way to open up and really differentiate yourself from the other companies.

How to reach: Roger West Creative and Code, (813) 433-1869 or www.rogerwestcreative.com

Before you can understand how to best build and run your business, you need to understand your situation.

Since becoming the chairman and CEO of PMSI in December 2008, Eileen Auen has been reading the lay of the land that surrounds her and the 600 employees at the provider of solutions for the workers’ compensation market. From that, she has set about building a business and culture that can react to the changes in the market terrain.

“I think a good leader needs to have a very clear sense of purpose and vision and needs to communicate that very well throughout the organization,” Auen says. “You need clarity on where you are going and where you need to go. You need an absolute focus on the customer, and that varies depending on what service you’re in. Once you have all of that in place, build an execution-oriented culture — a culture of people who do what they say they’re going to do, who will honor their commitments and deliver what the market expects.”

To make it happen, Auen has formed a tight focus on the type of people she hires, how they’re trained and how she communicates the vision and goals of the company with them.

In addition, she creates an environment where employees and managers are enabled to both speak up and listen to what is going on — creating a culture that values different opinions, ideas and allows for constructive criticism from subordinates, peers and superiors alike.

Build a team

Your company needs a compelling mission. But in order to keep that compelling mission alive and thriving, you need employees, particularly at the management level, who will embrace and promote the mission.

At PMSI, Auen wanted her staff to place a renewed emphasis on customer relationships and customer service. It was one of her top priorities after taking over PMSI’s top post, and she made an early decision to hire customer-service-minded leaders with complementary skill sets.

“Here at PMSI, our mission has really been trying to restore the luster to what was an industry pioneer, a company that had lost its way and had gone through a series of ownership structures and changes,” Auen says. “We really needed to go back to our roots, refocus on the customer then re-emerge in the marketplace. If you’re going to do that, you have to understand the mission and the kind of people you need to get there. You need people who are industry experts or functional leaders, whether it be in sales or operations or wherever your key holes are. You try to understand that, and you try to bring together the people who have the right brand of skill sets. Most of all, you need people who are energetic, tireless and enthusiastic and really focused on excellence.”

To find those types of people, you have to recruit them. Then you have to learn how to spot the right kind of candidate during the interview process.

Auen observes one hiring rule above all others: When it doubt, don’t make the hire.

It’s better to take a little longer and make the right hire than to hire someone simply to fill a hole, and then realize a short time later that you made a mistake.

“You need to be personally focused on recruiting,” Auen says. “Not just through interviews and sourcing people but making sure you do all the references yourself. I personally reference everyone I hire, both formally and informally through industry contacts. You also need to have discussions on both a formal and more informal basis with management candidates. Do it in both formal and informal settings so that you can get a feel for whether you can really work with the person.”

When evaluating executive-level job candidates, Auen meets with her executive team prior to the interviews. The meetings are aimed at ensuring that every member of the team is in lockstep with regard to the questions that need to be asked of the candidate, and the qualities that are needed for the position.

After the interviews, Auen and her team meet again to compare notes and impressions, developing a final consensus on whether to pursue a given candidate.

“You need to meet and come up with a series of traits and skill sets that everyone is looking for,” she says. “Nobody has everything. What you find is that you get a slate of candidates and one person might have a really strong sales orientation but they might not be a good manager. Another person might be a good manager but not as good in another area. That’s why you meet before and then meet again afterward, to really dig into personal references and find out whether someone is a good fit.”

Once a new hire is made, Auen and her staff put the new manager through what amounts to a weeklong saturation bombing on all things PMSI — company policies, culture, goals and objectives, and how the newly hired manager fits into the larger puzzle.

It can be a bit much to absorb at one time, so following the intense first week on the job, each new hire is given the several ensuing weeks to put what he or she has learned into practice. After a few weeks of hands-on experience, one of PMSI’s established executives checks in with the new person.

“You meet with them again once they’ve gotten their feet under them and you go through a new set of observations,” Auen says. “You tell them, ‘Here is what I see, here is where we need to go, here is where we’re going to focus.’ Then you let them go off on their own, build their team and you check back with them periodically.

“I like to talk with the new hires and with all of our people frequently. I want to hear what they’re thinking, give them an opportunity to understand all the various challenges facing the company.”

Formulate a vision

Once you’ve built a team, you need to give your people something to accomplish. You need to let them help you build and grow your business.

To do it, you need a well-defined vision for where you want the company to go and get everyone on board with it. The first step is to formulate the strategy, a task Auen has helped perform on several occasions in her prior career as a consultant.

“The strategy process doesn’t need to be hugely formal, but it needs to have all the classic elements of planning, where you say, ‘OK, what is the market doing, how does the market look, how am I positioned against the marketplace, what are my strengths and weaknesses, how are the competitors doing, what are the needs of my customers?’” Auen says. “You pull all of that together and figure out where you think the sweet spot is strategically as you move forward. Once you have that, you do a classic gap analysis of where you’re going, where you are now and how do you get there. Out of that, you build a set of priorities for the organization. You state where your focus is for this year and everything you need to do to realize that focus in some way.”

As you formulate your vision and strategy, you need to be gathering employee support as part of the process. You bring employees and managers along by allowing opportunities for input and, in some cases, criticism.

If you are met with a great deal of criticism when you roll out your vision for your company’s future, it might be a sign that either you’re not on the right track or that you have made some hiring missteps by bringing in philosophically divergent people. But you should have some differing opinions and clashing perspectives. It’s a sign that you have free thinkers on your team. If you don’t have some people who think differently, it can be as bad or worse than having a management team that is ma

rred by constant infighting.

“What you’ll find typically is the organization agrees on 80 percent of what needs to happen, but you’ll need to make some judgment calls on the other 20 percent,” Auen says. “Usually in a group discussion setting, we’ll talk through differing viewpoints and what is important. Hopefully that can drive a consensus for the last 20 percent. If you can’t, you have to make a call as the head of the company, then be able to explain why you made that call and move forward from there.

“Usually, if you get reasonable people into a room, you can drive through discussion and come up with a sense of agreement. But if you can’t, you have to do what you think is right, and at least people know that they’ve been heard, that they’ve had an opportunity for input.”

Even if you can’t drive 100 percent consensus on all issues, you can increase your chances of building consensus on key issues by setting the ground rules for discussion and debate ahead of time. If you want people to drive toward consensus and compromise, communicate that to everyone on your team at the outset of the first strategic planning meeting.

“You have to start out by letting everyone know that this is a drive for consensus around the organization’s priorities,” Auen says. “But the bottom line that you have to communicate is that we are going to come out of here with a definite set of priorities, and if I have to make some calls myself, I will, and everyone needs to support that final decision. It’s one of the basic rules of team leadership. It’s great to disagree, but once you’ve set a direction, you really have to hold together as a group. If you can’t do that, it violates your clarity of purpose and vision.”

There are two conditions where you generally draw the line between trying to build a consensus and exerting your executive decision-making power: when the issue isn’t moving toward consensus after hours and hours of meeting discussions or when everyone has reached the point of mental exhaustion. It’s a point that varies among companies and leadership teams, but as the person at the head of the table, you need to recognize the warning signs for your group.

Live the strategy

Once you’ve built the team and the strategy, you need to continually revisit the groundwork you’ve laid, making course corrections and adjustments as necessary.

Auen says a strategy needs to be a living document that grows and morphs with your company and the needs of the markets you serve.

Whether you re-examine it every month, every quarter or intermittently throughout the year, regular strategic checkups are the key to keeping your strategy current and your people in tune with it as conditions change.

“You need to be talking to people all the time,” Auen says. “You need to be talking to your consultants in the field, customers, competitors, your sales team, your account management team. Everyone who is out there, you need to be talking to them all the time, listening to them and collecting data.

“It’s very easy to become internally focused, so you always need to recreate this sense of what the market is telling you. Because the market will tell you what is going on, what you need to do, and you have to make sure that monthly or quarterly everyone is listening and helping to re-evaluate your plans to figure out where you want to go.”

How to reach: PMSI, (877) 275-7674 or www.pmsionline.com

Rich Kalenka says there is no magic formula.

Over the past two years, many businesses have been trying to find their way out of the economic recession that latched onto the business world in late 2008 and has only recently begun to loosen its grip.

Kalenka is the San Diego managing partner for auditing and professional services firm PricewaterhouseCoopers LLP, and he is in the unique position of running a local office that is advising clients on how to manage their recoveries, while also managing PricewaterhouseCoopers out of the economic nosedive. The experience has given Kalenka and his leadership team an extensive background in what it takes to navigate your corporate vessel into calmer waters.

And what it takes is good eyesight, an ability to listen and a dose of common sense. Recovering from the recession is more about scanning the markets you serve and having patience than about finding the masterstroke that will cure everything.

“We have a full complement of people who have worked closely to get through the downturn and into the uptick where we’re experiencing some positive results,” Kalenka says. “It’s what we’ve done across the entire world. In some cases, we’ve increased investments, not just maintaining the status quo. For example, we’ve increased our resources in the life sciences area.”

Until the economy fully recovers, your ability to grow might be limited. But you can still take advantage of the opportunities that do come your way by listening to clients and customers, keeping your employees abreast of market conditions and having a well-defined strategic plan that lays out how you want to maintain and grow your business, both now and in the future.

“For us, it’s really gathering intelligence from the clients we serve and hearing what their expectations are for the future,” Kalenka says. “That goes along with our own economic analysis and making sure that we’re in sync before we make those investments.”

Assess the market

Before you can react to any market conditions in an effort to improve your company’s recovery, you need to find out what your customers are dealing with.

At PricewaterhouseCoopers, Kalenka and his leadership team conduct environmental assessments of the markets they serve. Much of the information comes directly from clients.

“One of the things that we’ve been doing with a lot of our clients is an enterprise risk management assessment,” Kalenka says. “It’s actually more along the lines of assessing strategic opportunities and challenges. Clearly, every company wants to grow and do so in a way that avoids large operational and strategic risks. So it’s really understanding the competitors and what they’re doing in the same market conditions.

“Essentially, it’s envisioning the next multiple steps of chess moves on a chess board and planning to succeed around that. It’s really a strategic vision that needs to be assessed for what could go wrong. You have to assess things like market conditions and supply chain issues, then plan accordingly.”

The assessments are ongoing and continually updated based on how the markets of clients fluctuate. The assessments are dictated from the top levels of Kalenka’s team, but associates throughout the organization are given opportunities to provide ideas and advice.

“It’s a top-down approach, but there is a lot of input on the assessment,” Kalenka says. “We get a lot of that input from working directly with our clients and understanding what their strategic plans look like. We assess those, and if we see large opportunities on the horizon that our clients are pursuing, we structure it so that we can be in a position to help them execute.

“It’s really gathering intelligence from the clients we serve and hearing what their expectations are for the future as well as our own economic analysis and making sure that we’re in sync before we make those investments.”

But no matter how you do it, whether you construct a formal plan for gathering information from clients and customers or start out by informally gathering information through casual interactions, the bottom line is you need to stay close to the markets you serve in order to gauge the needs of your customers and begin to read how they’re recovering from the recession.

“Ultimately, the most valuable piece of intelligence is really talking with your customers, understanding what their plans and pain points are, if any,” Kalenka says.

Join hands

Once you’ve scanned the landscape of the markets you serve and have begun taking initial steps to aid in your recession recovery, you’re going to need to develop the tools and relationships necessary to see the recovery through to completion.

For Kalenka, that means fostering collaboration, both between his office and clients and between clients who can form mutually beneficial working relationships.

Kalenka says collaboration can act as a way around a shortage of investment capital. When you don’t have the money to grow, find other companies or organizations with which you can partner. Together, you can take advantage of common resources, and potentially generate investment funding for both parties.

“Collaborating is a good risk-mitigating alternative to not having enough capital or experience,” Kalenka says. “For instance, a lot of [pharmaceutical] life sciences companies might be good at research but not good at commercialization, and we’ll have a network of companies that are experts in both ends of that spectrum. So from time to time, we try to assist in collaborative efforts to bring together successful product candidates with companies that are successful in bringing them to market.”

In other industries, collaboration might take the form of outsourcing of tasks that aren’t part of the company’s core competencies.

“It might mean outsourcing IT or business processes to reduce fixed costs or reduce the capital requirements of the business,” he says. “That way, a business can focus on those core competencies of bringing a product to market or whatever it might be.”

In order to find the right collaborative partners, you need to handle the process much like you handle strategic planning: You need to develop a set of standards that everyone in management agrees upon, then ensure that those standards are uniformly enforced when you and your management team head into the field to find potential partners.

“The selection process should be a thorough and objective process that includes a whole checklist of objectives and requirements that would apply to the specific outsourcing requirements,” Kalenka says. “Around IT, for example, there is a whole host of issues around service levels and response times as they relate to security and access to data. You don’t want to be creating additional security risk and privacy risk around data.”

Bill Molloie, who is in charge of PricewaterhouseCoopers’ life sciences program in San Diego, says the local business community has shown a strong willingness to collaborate, particularly during the economic downturn.

“I am amazed by the level of collaboration that takes place with organizations that, if you were on the outside looking in, your initial reaction would be that they are competitors,” Molloie says. “There is an enormous amount of collaboration in San Diego that is to the benefit of everyone because it creates success. We look at those opportunities and make sure that we have resources that can support those opportunities in that community.”

Manage risk

As you are piloting your company out of the recession, you might have the temptation to forego a smooth, gradual approach to recovering in favor of the home-run swing — the off-the-wall idea or all-in opportunity that could slingshot your company back to high profitability.

There is certainly room for risk in business. You probably didn’t get to where you are without taking some risks — maybe even some sizable risks. But risk is still something that needs to be carefully managed. Risk management needs data and brainpower, not gut feelings and Hail Mary heaves.

Kalenka says risk management is the most important topic being discussed in boardrooms today.

“I’ve never seen many boards agree or come up with the same definition of risk tolerance or risk appetite,” he says. “It will really vary depending on the growth objectives of the company. The more aggressive the growth strategy, the more risk appetite that the company has. There is always a calibration that takes place, which is the result of a series of discussions between the management of the company and the board.”

When analyzing whether an opportunity contains too much risk, you once again need to go back to the ground level and take a look at the market and the resources that you will have available to try and turn the opportunity into a reality.

“If you’re looking at expanding into a market to approach the consumer or end user of your product, then it’s clear that you need to look at the forecast demand for the product,” Kalenka says. “A lot of the expanding I’m seeing is into foreign markets, and it’s sort of a combination of being able to utilize local production capabilities around research and development, at the same time being able to access the local market.

“I have a client that just expanded into Brazil. They bought a factory and acquired production talent, and clearly Brazil is a large, growing market and an opportunity from a consumer perspective. But they looked at the size of the consumer market as well as the labor force, the cost of doing business and the quality of manufacturing that they expect coming from that local marketplace. Those are all important considerations, and each of those can be flexed depending on the need of the company that is expanding.”

You also need to consider the legal and tax-related ramifications of making any thrust into a new market.

“There is a basic set of requirements, such as the regulatory environment, the tax burden that might be put on your company and the international tax structure, all of which might need to be taken into consideration.”

There is no uniform definition of what qualifies as too much risk for a company — which is why you need to go back to your strategic planning process and, as part of your assessment phase of a given market, define your risk tolerance levels before attempting to seize any opportunity.

“There isn’t a lot of money to be thrown around right now, so what we typically see is a definition of risk tolerance established early on in the strategic planning process,” Kalenka says. “It’s the larger risks that push the risk tolerance level, and that’s when you have the biggest need to discuss how it’s going to be mitigated. But there really is not a one-size-fits-all answer.”

How to reach: PricewaterhouseCoopers LLP, (619) 744-8000 or www.pwc.com

It’s something that you probably don’t want to think about

very often, but it’s an issue that needs to be addressed just the same: What

will you do if an incident occurs that jeopardizes the safety of your

co-workers?

Steve Bernstein is the managing partner for the Tampa office

of Fisher & Phillips LLP, which employs 240 attorneys nationwide. He has

coached numerous clients on how to deal with workplace safety issues — from

chemical spills to fires, natural disasters and violence in the workplace.

Bernstein says the ability to respond effectively begins with

having a well-scripted plan for incident reaction as well as preventive steps

that comply with Occupational Health and Safety Administration guidelines.

“It starts with a cultural perspective,” Bernstein says. “If

you don’t have a plan in place to demonstrate your commitment to safety from

the top down, you’re not likely to get it done. Some of our clients make the

mistake of going from A to C — in other words, going right to front-line

supervision and equipping them with enough information to get by. I have other

clients and businesses that have a dedicated safety manager with responsibility

for safety compliance.

“That’s great, but those things in a vacuum aren’t going to

get you where you want to go, unless you have a commitment demonstrated from

the upper echelons of the organization. From the CEO on down, that commitment

needs to be there and ideally it needs to be demonstrated to employees through

vehicles of communication.”

You need to piece together a compliance and response plan that

fits the needs of your business, but there are some elements that need to be in

any business safety plan.

“You can’t really pull an off-the-shelf safety program, but

certainly there are elements that need to be in every safety program,”

Bernstein says. “It includes training, communication, recognizing hazards and

evaluating them, and labeling hazards. But it starts with sitting down with the

folks who are out there on a regular basis and outlining a program that fits

the realities of the workplace.

“There has to be accountability and measurable results. You

start by setting objectives that are meaningful because vague objectives and

standards are hard to measure. Ideally you designate one or a group of people

to carry out those objectives, and you hold them accountable if you fail to get

there.”

The best lessons you can learn from are the lessons learned

from actual incidents. As you are putting together a safety plan, carefully

study incidents that have happened at other companies, preferably in your

industry. Review how the leadership of those companies responded and take the

lessons they learned into account when formulating your own plan.

“A crisis reaction plan is an important part of any program,”

Bernstein says. “You start by closely examining disasters or incidents that

have occurred in other businesses in your industry and using that as a model to

try to frame a scenario that most of your work force would relate to, and you

can drill them on it.

“There is a lot of scenario planning that can go into this,

but it needs to be real for these employees, so it should take into account

true life incidents that have occurred.

There are outside firms that can help you construct a plan,

but I’d caution against relying too heavily on outside help because chances are

they’re not going to know your business as well as you do.”

How to reach: Fisher & Phillips

LLP, (813) 769-7500 or www.laborlawyers.com

As the general manager and chief operating officer of Evolve

IP LLC, Guy Fardone makes the technological needs of other companies the focus

of his business.

His 55-employee communication service solutions company, is

based in the Philadelphia area, has assisted many different clients in building

telephone and Internet solutions that meet their specific needs as a business.

Fardone says you need to look at a number of factors when

deciding what type of communication system you need for your business and when

it might be time to look at upgrades.

The evolution of your business is chief among the reasons to

upgrade your communication infrastructure. If you’re going to branch into a new

market or attempt to improve efficiency, you’re going to need the communication

platform to get you there.

“There are a couple of different times to look at doing an

upgrade,” Fardone says. “Among them, when you’re moving, expanding or looking

to deploy new types of technology to achieve a desired purpose. It could be

about increasing productivity, doing things faster or better, or if you’re

looking to downsize your IT staff or redeploy the staff.

“Right now, a lot of companies are redeploying their IT

staffs. It’s one of the biggest things we’re seeing. Have them outsource the

mundane, day-to-day stuff and redeploy them into a more strategic niche, such

as revenue generation or cost reduction.”

When you do decide the time is right for an upgrade, chances

are, you’ll need systems that work together. Your phone and Internet services

need to work in tandem and be able to serve not just employees at the home

office but your staffers in the field, as well.

“The big topic right now is unified communications,” Fardone

says. “That’s new technology specifically dealing with telephone systems and

desktop applications, merging what your telephone system does with what your

computer system does, so that your customer relationship management systems and

applications are more integrated with your phone system, e-mail and call

center.”

Ultimately, you want to simplify the communications process

and make the systems you install as user-friendly as possible.

“It’s about streamlining and converging,” he says. “Your three

biggest tools that pretty much everyone uses is the telephone, the PC or

laptop, and the PDA. Unified communications takes all three of those and merges

them together so that they can use them seamlessly to better serve their

customers and generate more revenue, to do things better and faster, and

hopefully less expensively.”

But the most important question you can ask yourself about a

communication upgrade is the first question you need to ask yourself as a

business leader: What is your business, and where do you want to take it?

“The first thing I always say is, ‘What are your objectives?’”

Fardone says. “Sometimes people want to upgrades for sake of upgrading, but the

main question is, ‘What are your objectives? What is the plan to achieve the

objectives? How (is) the service provider or vendor or partner going to help

you achieve your business plan? What are the potential risks and challenges?’

You should identify those upfront and identify the ways to mitigate those

challenges upfront.”

How to reach: Evolve IP LLC, (610)

964-8000 or www.evolveip.net

Friday, 26 March 2010 20:00

Weird science

Whenever Dr. Stanley Crooke feels the weirdness levels start to drop at Isis Pharmaceuticals Inc., there is a problem brewing.

“We always say that whenever I feel the weirdness start to go down around here, I go out and recruit for weird,” says Crooke, founder, chairman and CEO of the prescription drug producer.

In this case, “weird” isn’t a pejorative term. Recruiting for weird means recruiting for the creative game-changers who can devise and develop the next great products around which Isis can build its future.

Building and sustaining a company takes finding and retaining the right people for the job. If you have a company that thrives on new products and new ideas, that means finding innovators. Crooke says recruiting innovators takes a willingness to accept different personalities and maybe even some eccentricities.

You need to be willing to accept some quirks or different thought processes among your employees if you want to bring in the different perspectives that can lead to the creative moments you seek.

“You need to accept that innovation is the heart and soul of what you’re doing,” Crooke says. “Recruit the people who can lead it, accept that they’re going to have quirks, build an organization that appreciates all of that, and give them the room to lead. Above all, brilliant leaders are central to all innovation, and a culture that accepts brilliant leaders will be different.”

It’s an approach that takes an open mind from management and constant communication that focuses on the vision and core values of the company. Crooke has used that approach to grow Isis from a start-up pharmaceutical business in 1989 to a 260-employee company that generated $107 million in 2008 revenue.

Set the ground rules

As a company that emphasizes science, Isis has a business model that is academic in nature. While your business might not be heavy on science or academics, there are still some lessons that are applicable in any innovation-focused environment.

In short, you need to accept people but interrogate ideas. That means you let employees formulate ideas and bring them to the company’s decision-makers, and you go over those ideas on a microscopic level, but you don’t pick apart the person who came up with the idea.

“When you build an organization that accepts creative personalities, it needs to start at the top,” Crooke says. “Set only the definitive rules that are required. Have as few rules as possible.”

It’s a reactive form of leadership that allows employees to form ideas without fear of having them immediately shot down but still allows leadership to weed out the ideas that don’t fit with the direction of the company.

If you’re a leader who is used to being proactive, it’s an adjustment to back off and give your people freedom to come up with ideas and respond to the material they give you. But it’s the only way that you can clear a path for stimulating innovation.

“Every idea is fair game to turn upside down and see whether you believe it,” Crooke says. “That’s whether it comes from me at the top or somebody else. With every idea, it is appropriate to be aggressive and really interrogate it. But again, you have to make sure that you’re interrogating the idea and not abusing the person.

“When we fail in this organization, it’s always the same set of characteristics: intemperance, intolerance and impatience. When I go home at night and feel like we haven’t achieved what we need to, we’ve been inappropriately impatient or our behavior hasn’t been as clearly supportive for the individual while we’re interrogating an idea. So the challenge is to be sure that people know that the only way you succeed is to nurture and support people while mercilessly beating up and interrogating ideas.”

At Isis, Crooke has helped establish multiple forums in which the company’s leaders walk the line between supporting people and rigorously examining ideas. Isis’ management team routinely holds specialized meetings open to everyone in the company, in which employees can ask questions about a specific idea or initiative. The company also holds scientific meetings for the company’s innovators to interact in a group setting. Those meetings are ongoing every week.

“The key is that people feel like they’re getting the truth, both when things are going great and when there are problems,” Crooke says. “People need to feel like they know they’re going to get the truth from management, which is why, especially in an innovative environment, communication has to be constant and forthright about issues, successes and disappointments.”

Focus on a higher purpose

To attract the best innovators to your company, you need to give them a reason to want to work for you. That starts with building a compelling vision.

At Isis, Crooke has continually focused his work force on the company’s reason for being: developing and producing medical drugs that benefit patients. From there, he backs up the validity of the company’s mission with evidence of progress and evidence that its products produce a beneficial end result.

“First, it’s the quality of your aspirations,” Crooke says. “Second, you need evidence that is clear and tangible to you and that you can make clear and tangible to others, that you are progressing, even if you’ve had a setback. It really boils down to a reason to exist and proof that you can make clear to people that you are progressing to the ultimate goal.

“The third factor is just force of will. Especially when you are facing a difficult time in your business, you need to have a driven leadership that just won’t give up. That is where leadership really matters.”

Crooke says many companies don’t have a truly compelling vision for the future, something that is going to differentiate the company in the eyes of creative, innovative people — something beyond just making the most money.

“It’s great to want to make products and make money, but we’re motivated by the good that we can do, the extraordinary opportunity that we have to do good work and benefit the common good,” Crooke says. “You need to remember that there are all kinds of higher purposes for an organization. Generally, companies that succeed, whether they be automobile manufacturers or software manufacturers or whatnot, do aspire to a greater purpose that is about more than simply making money. On Wall Street, the greatest people really have a vision that is more than getting the biggest bonus. All the successful businesses find a way to display value that is beyond simply making money.”

Finding that reason for being is a key factor in not only recruiting the best creative and innovative minds, but it’s a reason why they stay at a company. Even if you can’t offer the highest salaries in the industry or the biggest bonus checks each quarter or year, you still stand a much better chance of keeping your best and brightest idea generators by showing them the ways in which their work extends beyond the walls of your office building.

“You need that consistent set of goals and aspirations to keep people around for long periods of time,” Crooke says. “Of the original 30 people that were here with the company in 1989, we still have 15. There is inevitable turnover, because people simply are going to find other opportunities and leave. But we’ve had a lot of senior-, middle- and lower-level leaders who have stayed the course. That’s what assures consistency. You know who you are, what you’re doing and you don’t deviate from that.”

To keep that higher purpose as an area of focus within the culture at Isis, Crooke has kept his messages in front of employees as often as possible, and he has done so in plainly spoken language that can be received by employees in all areas of the company.

“Our scientific meetings are for our scientists, but we also have a lot of nonscientists out there,” Crooke says. “Most of what is worth understanding is understandable, so you try to stay away from jargon as much as possible when you’re talking to a broader audience.

“It’s mostly vocabulary and how you use it. A lot of things you are trying to explain are easily understood if you just reduce it to common English.”

Aside from meetings, you need to keep your organization focused on a day-to-day basis. That means getting out of your office and engaging your employees whenever you can. It’s an example Crooke has set at Isis, and he expects his managers to follow.

“I don’t foster face-to-face communication, I demand it,” Crooke says. “People behave as you behave, they’ll do what you set the example for. Communication is always better if you treat people with respect and give them the attention they need. That’s why I want everyone around here to be extremely forthright with what is going on. The common purpose is better-served if you and your managers are highly communicative and extremely forthright.”

The same holds true for communicating with people outside the organization. Investors, customers and clients need to know what your company stands for, what purpose it’s serving and how it intends to fulfill that purpose. Investors and customers may not be immersed in your corporate culture every day in the same way employees are, but they still want to know that your company possesses a definition of purpose and a strong culture that will allow you to deliver on the promises you make.

“With investors and those outside the organization, just like employees, what gets them interested is the scale of the dream and opportunity,” Crooke says. “What is required to explain why a particular disappointment occurred doesn’t diminish the value of the progress already achieved. So you communicate that just like you did to your people, and you do it in broadly simple terms that anyone can understand. For us, those are the challenges that depend on good communication skills and ability to convey science in a way that is exciting and not complicated.

“That’s what we need in an organization of science: for the leadership to take all of those elements of progress, which span many disciplines and span thousands of experiments, and summarize those against the long-term objectives of creating the technology. We need to point out what the progress is and why that points to a future in which we’ll have better success.”

How to reach: Isis Pharmaceuticals Inc., (760) 931-9200 or www.isispharm.com