Like most people, Lizabeth Ardisana works in a building with office walls.
It’s an unfortunate thing for her because the co-founder, principal owner and CEO of ASG Renaissance LLC wants to understand what her 250 employees are doing and what they think about the organization, but the walls can cut down on her face time with employees. To counter that, she walks around to communicate her message and to get feedback from everyone at the professional services firm, which posted $25 million in 2007 revenue.
“You have to be able to listen to feedback, both positive and negative feedback,” she says.
Smart Business spoke with Ardisana about how she got over taking feedback personally and how to get employees to tell you what they really think.
Q. How do you create a culture where employees feel comfortable giving you honest feedback?
You have to create trust. It doesn’t happen overnight. Depending on what people’s previous experiences have been, it can be difficult to do. But, people have to see that it’s OK.
The data can be negative. Their feedback can be negative. But it’s not personal. It’s all about, ‘How do we make this thing better?’
The very first way you do that is take personal responsibility. The truth is, anything that is not going right in my company is my responsibility. I bear part of that no matter what the situation is.
Sometimes, I’m probably 99 percent the problem, and sometimes, I’m 5 percent the problem. But, I always have some responsibility for it. I think that you create that sort of environment by taking responsibility and sharing that responsibility.
Q. How do you get people to share information with you?
When you’re looking at a situation, it should be all about the data. I started years ago doing these surveys, asking people what they liked and what they didn’t like and what issues they had. You hoped that everybody will just actually feel comfortable discussing that with you, but sometimes, they’re not.
But you’d be surprised, like when you do a little survey, all this stuff comes up on the survey. The very first time I did that, I was annoyed. Like, ‘What are they talking about? What is that?’
I do a lot of marketing work, and we do a lot of market research. I said to myself, ‘Well, wait a second. This isn’t negative feedback. This is just like market research. Do you like chrome or black?’ It’s that kind of thing.
Nobody gets personal about that. Nobody says, ‘Oh my God, they didn’t like chrome; I’m dead.’ So, if you think about this as market research, then all feedback is good. But you have to sort of put yourself into that mind-set that every bit of feedback is good.
Q. How do you handle negative feedback?
The method of getting feedback to me is the same whether it’s a great idea or it’s a bad idea. You need to listen, which is hard for us all to do. But, you need to listen to the idea, you need to reasonably and fairly evaluate that idea.
Sincerely value the idea, and then you need to weigh it against a bunch of other factors. Not all ideas are doable. Not to say whether it’s a good or bad idea, but not all ideas fit into our business case or fit into the plans we have. It may be a great idea, but we just can’t do it.
I think if you value somebody’s idea, give them honest feedback. It doesn’t matter if it’s a good idea or a bad idea or an idea you could do or not do. The key is that you really thought about it. You gave it an honest consideration, and you gave somebody feedback as to whether or not it could be done.
Q. What advice would you give to someone who is not listening to employees?
You have to say to yourself, ‘If I prioritize all that I do in a day, what’s really the most important part of that? What’s the highest priority?’
The highest priority is the people. There are days when nobody lives up to that because you may say, ‘Sitting down and talking to someone is my highest priority, but I do have a client on the phone. I do have a stack of mail that needs to be read, I do have a bunch of financial grumble I have to go through, and you’re standing here in my office.’
No one of us can do that perfectly. If you’re doing that perfectly, you’ve got too much time on your hands. There are times when you feel like, ‘I’ve got something else I’ve got to do,’ and I think sometimes you should have to say that to somebody ‘You’re really important to me, but, I’ve got this killer thing on my desk at the moment. So, as much as I’d like to communicate right now, we’re going to have to wait and catch up to that.’
As long as you’re not doing that all of the time, people are pretty understanding.
HOW TO REACH: ASG Renaissance LLC, (248) 477-5020 or www.asgren.com
“It came down to an understanding that all of us pulling together, taking advantage of our myriad of different views and visions and ideas and capabilities and talents could take the organization much further than me as one person trying to do it all,” says the company’s corporate chairman and CEO.
That’s when he realized the importance of vision in leading the 500-employee commercial architecture organization, which posted approximately $70 million in revenue last year.
Smart Business spoke with King about how empathy and persistence are critical to communicating your vision.
Q. What are the keys to being a good leader?
You have to begin with a vision that invigorates the organization. If you can’t articulate and share with everyone a simple message about where you’re going, then it’s very difficult for employees to get excited about an organization. So, having an invigorating vision is important.
You have to be able to sell that. You have to be able to communicate enthusiastically to sell the vision and communicate it and repeat and get people to buy in to it.
You just have to be able to have empathy and understand how people are feeling about your message. It’s one thing to just sort of give directions or make suggestions. It’s something entirely different to understand how your message is being read and felt by your organizations. So you have to be empathic.
Maybe above all, you have to be persistent. Leadership is all about the sort of traditional follow-me kind of concept. If you keep changing direction or giving conflicting messages, it gets very muddy and difficult for people to understand where they’re going.
So persistence is really important.
Q. How do you show empathy?
Everyone learns differently. Some people learn from listening, some people learn from reading, some people learn from writing and combinations of all those kinds of things. A lot of people take a different amount of time to absorb and appreciate things based on their interest, their training, their background, their knowledge.
Particularly when you are trying to implement a change of some sort in an organization, you have to be persistent and, more importantly, you have to be watchful of how the message is being accepted and how people are embracing it. There is the natural, initial resistance for any change because people don’t like to upset their lives. So they are going to wait to see if change is for the best and if it’s going to last or whether you are going to give up on it.
Q. How do you know when you are being persistent enough?
Our staff members let us know that. Because of the kind of culture we have, we have an open-door organization. People can walk into my office anytime and give me feedback at anytime as necessary.
Now, not everyone is comfortable doing that no matter how nice of a guy I am. But, there are mechanisms where they can do that to their direct supervisor or they can do it to a peer who perhaps is more comfortable talking to leadership.
We do an annual staff survey to gauge how we are doing in our organization year to year. That gives us a measure of areas where we may need improvement or areas where we are improving or issues that may be arising. Just like we communicate on many plains, we also try to listen on many plains. We know when there are struggles or tugs of war going on in the organization or where personalities may be conflicting. Then we can work in a proactive, positive way with a staff to address those kinds of needs.
Q. How do you handle someone who is resisting the vision?
Initially, with patience, repetition, reinforcement and then, at some point in time, if you’ve done everything you can, and the individual is opposed, then you have to make a decision. They have to either decide to move on, or they have to decide to be a part of the organization because I think there is a limit after which an organization cannot put up with resistance that is disruptive to the organization.
If you don’t take that action, if you let a staff member get away with the opposition for an unreasonable period of time, then the other staff members are going to look at you and say, ‘Well, what happened to the big vision, to the message about change and the importance of that? Why is that person allowed to get away with it?’ Sometimes, that can be painful. You can have a situation where an individual might be very valuable to the client as far as the skills go.
But if they’re disruptive to the productivity of those around them, then you might have to throw the baby out with the bathwater.
HOW TO REACH: Harley Ellis Devereaux Corp., (248) 262-1500 or www.harleyellis.com
Don’t ever think you’re better than anyone else, advises Dave Morse.
The president of Morse Moving & Storage Inc. says that as soon as you start to get the feeling that you, as a leader, are more important than your employees, bad things will happen.
“Whenever you start, ‘Do as I say, not as I do,’ then, in turn, you can lose respect real quick from your team,” says Morse, who leads more than 200 employees at the company, which posted 2007 revenue of more than $15 million.
He says that employees will work hard if they see you working hard, which creates a fair environment.
Smart Business spoke with Morse about how to lead fairly and why if you can’t defend what you’re doing, maybe it’s not the right thing.
Q. What are the keys to being a good leader?
Being fair is a big part of it. Being fair with the people you are leading. Treat them the way you would want them to treat you.
Once you get to that point especially in a family business where you have to make some tough decisions that sometimes affect family when you are doing that, if you are doing them fairly, then the rest of the team realizes that, and it keeps your company strong as you’re moving forward.
Q. How do you ensure you’re being fair?
Before you make a decision, you think about it, and you think how it’s affecting people. You think whether you would think if you were in their position whether that decision was fair.
You’ve got to put yourself in their shoes as you are moving forward through it and be able to come and talk to them and tell them and communicate that to them that this is why you are doing it, this is why you think it is fair.
Q. Why do you think it’s important to allow people to express their opinions?
It brings a lot more ideas to the team. People are more open to make suggestions, bring ideas forward, etc. Whenever an employee feels what they say doesn’t really matter, they quit coming up with ideas. They quit wanting to put suggestions forward because nobody listens anyway. So it’s the combination of having [an] open door and, ‘I want to hear what you have to say.’
Q. What advice would you give another leader on how to be fair?
First of all, don’t try and hide things. Business is really about us working together and trying to get something to the bottom line, all making a living, working together, having an enjoyable time here while we’re working.
Each year, in each quarter, I take our financials up, and I’ll share them [with the] entire team, all the way down to the warehouse guys. They’ll see our business plan this year. So, ‘This is what we are planning on doing. Here’s how we plan on doing it.’
That starts opening the door. That starts opening it up for that communication process. If you have questions, when I e-mail it to the internal team, I say, ‘Hey, if you have questions on this, either ask me or ask one of my managers, and they’ll be able to explain because we have worked hard to put this plan together. And, here’s our budget for the year and here’s what we’re planning on doing.’
I think it starts there, and, as you move forward, and you keep from hiding things from employees and you work with them as a team, in turn, I think that opens up your whole company to where everybody is more comfortable in letting you know their opinions and feeling like they’re part of that, part of our common goal.
Q. Has being open ever hurt your business?
I don’t think so. Usually, when it’s a drawback is when you are trying to hide something. A prime example is an employee says, ‘It looks like you are making too much here or you are spending too much here.’
If I can’t explain it, maybe I am spending too much. Maybe I need to look at that. So, if you are open to be able to look at things like that ‘Why are you driving that vehicle?’ I’ve even had that come up when you’re showing financials to people.
Hopefully, I can defend what I do and what I’m working on. I think I should be able to answer employees the same way I’d have to answer my board of directors and have a good understanding on why I’m doing it.
First, I have to be able to feel comfortable with it. Once I’m feeling comfortable with it, then I might need to sell it to a couple of people.
HOW TO REACH: Morse Moving & Storage Inc., (734) 484-1717 or www.morsemoving.com
His father started the business in 1968, and Dunlap has seen the company grow from $99,000 in sales in the beginning to a company generating revenue in the hundreds of millions today.
Yet Dunlap isn’t completely consumed with touching every nook and cranny of the business. For example, when it comes to managing his far-flung telemarketing groups, a hands-off approach tends to work best.
“It’s tough to manage a telemarketing group in the West from the North because you are dealing with different issues day in and day out from a marketing standpoint, economy standpoint, weather standpoint,” Dunlap says. “So, we manage each of those tele-marketing departments within their groups.”
The managers in each location can make local changes as needed or can implement larger regional or corporate initiatives.
“We have the ability to constantly tweak those groups and give them the direction that we need from a corporate standpoint or from a group standpoint, whatever that direction is at that given moment,” he says. “So, it gives us the ability to easily shift gears into other directions and needs.”
It’s this type of selective delegation that has allowed Dunlap, president and chief operating officer, to grow the company from $239 million in 2003 to more than $370 million in 2007.
Here’s how he uses a combination of delegation, trust and clear goals to take CentiMark Corp. to new levels of success.
Delegate to grow
Dunlap says the only way to be able to have control over your markets and the flexibility to make smooth changes is to have good managers below you and to trust them.
“Delegation demonstrates confidence and respect in your management team,” he says.
“It’s extremely important. No one person is an expert in every aspect of their business. Managers bring their unique experience, their knowledge, their skill sets to the job. You have to be able to trust in that they are going to make the right decisions. I can’t sit here at corporate and obviously and effectively manage every single facet of the business across the entire country.
“You have to have good managers underneath you that you can trust and have confidence in that when you delegate something to them to manage that they’re going to get the job done, and you don’t have to check up on them constantly or on a daily basis. That’s huge. That’s key. One person only has so many hours in the day. Based on the sheer size of our company, 65 offices, I’ve got to be able to constantly delegate things to our management team and have the trust and confidence that they’re going to follow through and get the job done.”
Dunlap says delegation starts to become instinctive with the more experience you get in running a business. Yet, if you don’t have that gut feeling, he says you should get to know your strengths and weaknesses.
“When you know your strengths, you know what you are capable of doing because we aren’t all, as humans, capable of doing everything; nobody has that one given knowledge,” Dunlap says. “Then, know your weaknesses. ... And those are the things you should delegate to people who have strengths in that area that maybe you don’t.”
Dunlap says delegation and trusting managers is also important in growing revenue.
“They are a huge part of it, absolutely,” he says. “They are the ones out there in the trenches every day managing their groups, their regions, their profit centers. You have to have confidence that you have good people in place and that they’re doing what you want them to do or need them to do on a day-in, day-out basis.”
He says if you trust those around you, you will get much more accomplished.
“Again, it’s difficult for one person to have the time, especially in a large corporation, to be able to touch base with 30, 40 managers every day to ensure that they are doing what they are supposed to be doing,” Dunlap says. “You have to have people under you that you can trust, that are doing that for you on a daily basis, so you have time to be able to look at the big picture.”
If you have an environment where employees are afraid to approach their superiors, it will hurt your business.
“Once there’s fear to communicate, to me, that is a terrible thing,” Dunlap says. “If your employees are afraid to communicate with you, look at all the opportunities you’re missing.
“If they are afraid to communicate with you, boy, you lose touch with a lot of that stuff, which is a shame because there are things that employees offer that are certainly valuable. They are the ones out there day-in and day-out. What better conduit do you have than your employees for ideas and for solving problems?”
The only way you are going to tap into these resources is to create a culture of open communication.
“They have to feel comfortable in calling you or leaving you a voice mail, e-mail, whatever their means are, and you’ve got to be able to listen and acknowledge their opinions, comments, concerns, and then offer advice to them,” Dunlap says.
Creating an open culture involves not so much in what you say but how much you listen.
Dunlap recommends not using the phone or e-mail if you want to show an employee or manager you are actually listening to him or her.
“I bring the employees up to my office constantly,” he says. “A lot of them, if they have a question or a concern, they just come up. When you have somebody face to face with you, they obviously know that you are sitting there listening to them, versus a phone where you could just be kind of doing something else with them in the background, and then even further e-mail, where there is really no personal interaction at all.”
Along with listening to employees, Dunlap says you also need to be accessible.
“That’s really the key,” he says. “I think a lot of managers out there try to distance themselves from the employees for whatever given reason. Maybe it’s time or they don’t want to deal with the issues, and they make it difficult for their employees to communicate with them, or their employees are afraid to communicate with them. You’ve got to make it easy for your employees to communicate with you, and they need to feel comfortable in wanting to communicate.” Set clear expectations
When Dunlap needs to get a particular message across to his employees, he delivers it to his management team and trusts them to relay it down the line.
“I trust them that they will take that message, vision, agenda, whatever you want to call it, and push it through the ranks,” he says. “If they are having a hard time doing that, I expect them to communicate that with me, and I’ll work with them to properly get that message out there.”
When someone isn’t communicating the message, Dunlap steps in to remedy the situation.
For example, there was an instance where employees weren’t utilizing a specified travel agency to book hotel reservations for out-of-town jobs, even though that was Dunlap’s message. It was the job of the managers to communicat e that message, but since someone wasn’t doing it, Dunlap took it upon himself to make sure everyone understood the policy and procedure.
After finding out how little the employees were using the travel agency, he put out a written communication to all employees relaying his message because if you don’t fix the problem as soon as possible, it can lead to other issues.
He also dealt with the managers at the earliest opportunity. “If I have an issue from a management standpoint, an employee standpoint, I am quick on the draw with that,” he says. “I’ll pick up the phone, bring them up to my office, whatever I need to do immediately because the longer a situation goes on and it’s not addressed, the more it festers. The more it festers, the deeper the roots get, and the more it affects your team out there.”
In Dunlap’s case, employees may have drifted away from following other policies.
“You want, in essence, everybody being on the same page,” he says. “Again, it’s from the top, it’s communicating that message to keep everyone on the same page and to keep everybody clear on what our direction is. When you have everybody kind of pulling the sled, or whatever you want to call it, in the same direction, it makes things easier to be successful.
“When you’re not communicating a clear vision or a clear message or you don’t have direct lines of communication with your managers or employees, everybody kind of starts to do their own thing. So I really feel that with me being a good communicator, with the open-door policy, with the employees being comfortable in calling or communicating with me, it makes it easier for me to keep everyone informed and keep things moving in the right direction.”
HOW TO REACH: CentiMark Corp., (800) 558-4100 or www.centimark.com
Perry Miele likes to roll up his sleeves and get involved in the day-to-day operations of Budco, but he also knows that it’s his job to look at the company from 30,000 feet.
Miele says that, as a leader, it’s important to help out in the organization where needed because doing so shows that you are committed to every part of the company.
But Miele, who serves as chairman of the marketing servicescompany, says the pitfall is that you can get involved in so much detail that you forget everyone is expecting you to get up to 30,000 feet and show each person where you want to take the company strategically. You need to rise to that level and make those decisions with all the information that you’ve gathered at ground level, says Miele, who led Budco and its 600 employees to 2006 revenue of approximately $100 million.
Smart Business spoke with Miele about how to make the tough decisions and about the benefits of working up close with employees.
Make the tough decisions. As leaders, we have to be ready to make decisions and not be afraid to make mistakes.
I think good leaders are not afraid to make the decisions and, in doing so, are not afraid to make mistakes. If you make 10 decisions, yes, a couple of them are going to be wrong, but the key is you made it, and what that does is that sets a great tone with your team that they’ve got someone in charge who knows where we’re going and is willing to make the decisions to get us there.
To be decisive, I think, first of all, you need to gather as many of the facts that you can, but don’t get caught up with analysis paralysis. Get your information and get enough on the table that you think you can make a decision. Part of that means also listening to your senior managers. Then, based on what you’ve gathered, your experience yourself, the view from your senior management team, you’ve got to make a decision.
Lead with passion. I’ve met a lot of people who are bright and capable but demonstrated no passion about the business or what they work at. Passion is infectious and also what inspires the managers and employees that work with you.
It comes naturally. The people who have become leaders, the good leaders ... you look back and you’ve found that, that individual, man or woman, has been passionate about what they did. They believed in the product, they believed in the company. Then, what they did was, they let it out, they let everyone know that they were passionate about it. What happens is it really fires up and inspires those who work around them, and they want to go the extra effort because they look at their leader and they see the effort and the passion that person has put into it.
You have to inspire the team around you so that everyone feels the same emotional commitment that you do. If I can get my entire management team to have the same emotional commitment that I do as a leader, then I think I’ve been successful from demonstrating the passion I have for the business.
Motivate by leading by example. If you are not willing to roll up your sleeves and get down and sweat out the details with your front-line employees, then anything you say or do is just rhetoric that they’ve all heard before.
If I am willing to get down and figure it out with them and get involved in a problem at whatever level and whatever effort it takes, if I’m willing to spend a weekend working out a problem with them side by side, then they really believe you are passionate, they believe you are committed, and then you’re now beginning to take the steps that help you lead change and motivate people.
If you’re going to preach that, ‘We need to improve products and be innovative,’ then your team has to see you spending time with clients and listening to what kind of things they’re looking for, then actually participating in developing and brainstorming ideas to improve that product. They need to see right then and there, talking about it, working in committees, trying to solve those problems versus just pontificating about an idea and innovation and then disappearing.
Focus on the client. Your key focus on everything you do should be driven by the clients’ needs and providing them with innovation without being asked. As a leader, what most of us try to do is try to keep all our employees and managers focused on, ‘What have we done for our client today?’
No. 1, we’ve worked hard and built into our culture, created an innovation culture, to the point of awards have been designed and created, peer-to-peer awards. We’ve built it all the way down into every level of the organization how people get rewarded and how much pride is taken in the innovation.
The second point is, I spend a lot of time with clients in finding out how we are doing with our products, with the service, and I bring the information back.
The third thing is, we begin most of our key operations meetings, and the first question is, ‘What are the clients saying today about our product? What’s the feedback?’ We open the meeting with those kinds of issues and questions and begin with, ‘How are the clients doing; what is their feedback?’
HOW TO REACH: Budco, (888) BUDCO-40 or www.budco.com
Chuck Frank said it’s vital
that you lead by example
and that employees must see that you’re willing and able to do the work yourself.
“You have to ask yourself, if
you are going to ask others to
do it, would you do it yourself,
and would you be able to do it
to the best of your and the
company’s abilities?” says the
president and CEO of AHS, a
$34 million full-service provider
of materials handling solutions
with nearly 50 employees.
And he says the things that
you ask your employees to do
must be realistically achievable, and you must be there to
Smart Business spoke with
Frank about how to deal with
the challenges of leading by
example and how to do so
without stepping over the line.
Q. Is there a system to
leading by example?
There is a process you have
to go through. You have to
understand what you are asking of others and put yourself
in a situation and determine
how it’s going to affect others.
Is it going to be in their comfort zone or out of their comfort zone? Do we have the
resources, the ability, the skill
set? There’s a lot of thought
and preparation that goes into
any task or initiative that we
put out for ourselves or for
There’s a lot of thought, a
lot of prework. A lot of,
‘How’s this going to affect us
12, 18 months, three years
down the road? How is it
going to affect my personal
and professional goals?’
I put a tremendous amount of thought into making sure that
what’s being asked is realistic.
Q. Has leading by example
ever backfired by setting
Only in the fact that I think
people can accomplish an
awful lot, and sometimes, I
think people can accomplish
maybe more than they think
they can accomplish. If I put
myself into that situation and
say, ‘You know, it seems reasonable to me. It seems like
something I can do; it
seems like something I
Perhaps I don’t take
into consideration the
individual that’s being
asked. Maybe they are a
little different than me.
Maybe it’s kind of something that is a passion of
mine but not a passion
As I’ve progressed in
life, I’ve come to the realization that obviously
not everyone has the
same goals and same
drive that I do. As the
owner of the business,
you’ve got to factor in
Q. How does setting
the example help the company?
People realize and understand that if they are being
asked to do something
because of the process that we
do follow, that they don’t have
to ask the traditional questions
of, ‘Would you do it?’ Or
they’re not behind the scenes
or talking to other associates
saying, ‘They keep asking me
to do these things, and yet
they don’t do them.’
They understand that if they are having an issue with it, if
they have a client situation
that is going to be difficult, I’ll
be glad to sit there, I’ll be glad
to go do it, I’ll be glad to do it
myself. So I just continually
say, ‘I’ll be there for you, I’ll
support you, I will do it, and
it’s the right decision.’
Q. Have you ever stepped over
the line between leading by
example and micromanaging?
I’m very cautious about that.
We have others we have >empowered to be in a position, and it happens probably
less and less because, again,
earlier in my career, I probably would have done it more
But the realization is, you
can’t empower people, ask
them to do something, and
they go about doing it their
way and, if you disagree, you
go to their direct reports and
say, ‘Hey, I know you said to
do it this way, but this is the
way we’re going to do it.’ You
lose credibility with your
leadership team. You lose the
confidence in them having
confidence in yourself.
Has it happened? Yes. But
again, it’s a conscious decision to make sure that every
day I am thinking about making sure I’m not doing that.
Q. What are your tips for a
leader looking to be a role
model to his or her employees?
You have to ask, ‘What are
we asking; what is the task at
hand?’ I’m a big believer in
that you have to have a goal.
You have to have the expected outcome, and then you
have to have short-term goals
to get to your long-term
You have to have action steps
to accomplish your goals. It
has to be date-sensitive, then
you just have to make sure
it’s moral, ethical, it’s done
with integrity, and it’s for the
betterment of the organization and, ultimately, the betterment of our clients. If you
ask those questions and you
listen and you explain and
you have a plan, it works.
What’s most important is to
hold yourself accountable. If
you say you are going to do
something, do it. If you are
going to set a date, meet the
HOW TO REACH: AHS Inc., (513) 351-6500 or www.ahs1.com
That’s why the CEO of real estate company McKinley Inc. stresses education, which he believes is a driver to becoming a top-notch executive. And to emphasize the importance of education, the company which posted 2007 revenue of $167.1 million gives raises to reward employees who participate in classes.
That investment in education not only rewards his 717 employees financially, it also shows them he is sincere about their personal development. And Berriz doesn’t just encourage his employees to learn; he says he is also constantly learning in the classroom, both as a teacher and a student.
Smart Business spoke with Berriz about how to inspire employees and how he balances giving positive and negative feedback.
Inspire your employees. It has a lot to do with a CEO’s view or a leader’s view of their business.
You often hear companies who say they are customer-centric or they are focused on their customer. But the reality is you have to be people-centric because what you can’t do in my job is touch every customer. So you have to make sure you touch every person that’s with your team.
For us, I focus first on my people, and if I do a great job with my people, I’m trusting they’ll do a great job with our customers. I take a different view than maybe what is traditionally out there in the management world today, which everybody is talking about focusing on customers, focusing on customers, focusing on customers.
I believe if I focus on our people, they’ll, in fact, focus on our customers. For me, No. 1 is team, No. 2 is customers, and No. 3 are shareholders. I figure if I have happy people, they’ll have happy customers, and those happy customers will produce happy shareholders.
Don’t only focus on the negative.
You often see supervisors who only point out the negatives in people. I have a rule of thumb: For every one negative, you better be doing five positives. If you aren’t doing that, you aren’t doing your job.
You don’t take the time to celebrate what people are great at, but yet you are willing to talk to them about what they are terrible at. You want to be open and honest with feedback, and feedback is certainly a gift, but everybody looks at feedback as a negative thing, and you’d better be celebrating the positives, too.
In our company, all the key people are connected by BlackBerry. When something happens positively in this environment here, you’ll see in our company dozens of e-mails that go out throughout the day. [It] may be a sale, it may be a financial transaction, it may be a variety of different angles in the company from different departments and different perspectives, but there is something positive being said about Frank or about Joe or Sally or Jane.
Jane may have done a couple things wrong in the last quarter, but these great things she is doing right now, we’re celebrating.
Be open and honest about failure.
I often discuss what I did wrong. I tell everybody what I did wrong. I’m very quick to point out when I made a mistake and what I think I should have done differently now in retrospect.
I think people need to know that I am as vulnerable or as able to do things wrong [as they are]. So, I think it’s important to celebrate that situation, and also, I think they can learn from it. They can learn from a mistake that I made so we don’t do it again.
I may be an example of the mistake, and if I can hold myself out as that, that’s good. One, it makes me vulnerable, which is good. Two, it points out maybe they can learn from our mistakes.
Show your employees you believe in them. You have to allow people to fail and you have to give them opportunity, so you have to let them advance in our company, and we do that.
I personally can’t touch 717 [employees], but I have 11 people on my executive committee, and there are 45 officers in the company. I can definitely touch the 11 and the 45, all of which touch the 717. So it’s not just about me, but it’s about the 11 people on our executive committee and the 45 officers that we have running the business.
I’ve just got to make sure that culturally, the 11 and the 45 are walking the walk and really doing things that I am talking about every day and doing every day in my own way, and they are going to do it in their own different way. But they need to be doing that, too.
If you are a leader in our culture and in our company, the price of admission in our environment is to be enthusiastic, is to be celebratory, it’s to make people feel good about themselves, it’s to make people understand the value they have to the organization.
HOW TO REACH: McKinley Inc., (734) 769-8520 or www.mckinley.com
When Australia native Geoff Dyer returned to the United Statesafter a trip home in 1983, he found out some surprising newsregarding his company. His partner in Lifestyle Family FitnessInc., the business the duo started in July 1982, had voted him outof the venture.
The company had seen some success after 12 months of operation, and Dyer says his partner thought he could run things on hisown, even though he had no previous experience in the fitnessbusiness.
“Any business that is well run looks like it runs on autopilot,”he says. “But, as you well know, there’s always a good manager.A business will run in their absence.”
After 18 months, sales started to decline. In 1985, after somenegotiating with his former cohort, Dyer bought out his partnerand took back control of the company.
The company slowly grew to eight locations by 1998, then Dyerreceived an offer to sell the company the following year.
Unsure of what to do, he went to his friend, Stuart Lasher, foradvice.
Lasher said he would be interested in investing in the company ifDyer changed the way he managed it, especially if he reorganizedthe leadership structure.
It was the start of a beneficial partnership.
Dyer wanted someone like Lasher on board because he hadexperience growing other businesses.
“I’ve always been a believer you surround yourself with thebest talent you can,” Dyer says.
He also recognized the blind spots that being a founder of thebusiness can create.
“I think you run the business on a shoestring, and you don’t really have the wisdom or experience to go out there and make significant hiring decisions,” he says. “When I took on investmentcapital, which was in 2000, one of the first recommendations tome, well the first caveat, was hire a CFO. And going from a bookkeeper to a CFO was a quantum leap in the way we ran the business from the financial side.”
It was the first of many changes Dyer made to take LifestyleFamily Fitness to new levels of success.
Forming a team
Going off advice from Lasher, who became chairman of the company after investing in it, Dyer began assessing his current executive management team.
“The recommendation was to envision where our companywould be in three to five years,” he says. “If we were going to be a50-club company, who is it that was running the company back in2000 that could run the company in 2005? We concluded that wereally didn’t have a lot of depth and experience in multiclub management. We were a small company with small-time managers.”
Because Dyer knew the team he had in place would not take himto the level, he began to look for what he referred to as “A” players who had experience managing multiple locations.
But in order to attract those types of people, Dyer knew hewould have to spend money to draw the best talent.
“The people at the top are going to require a significantly greaterinvestment than the people that don’t have as much talent,” hesays. “You’ve got to be willing to spend money to make money.”
To back up his point, Dyer invested about $1 million into hisexecutive team, which was quite a stretch considering the company’s revenue in 2000 was only $12 million.
“That was significant,” he says. “Significant for me because I wasn’taccustomed to spending more than $75,000 for a bookkeeper.”
Because the pickings were slim within the fitness industry, Dyerlooked outside the fitness world to find those leaders who hadexperience managing multiple locations. Whether it was managingmultiple restaurants or retail stores, Dyer wanted an executiveteam that would not be overwhelmed by the growth.
Dyer used headhunters as well as referrals to assemble that firstmanagement team of five or six people.
During the interview process, Dyer looked for leaders he hadchemistry with and who enjoyed being around each other.
“I think there is a mentality that comes with top-notch people,”he says. “They think quickly, they are decisive and strategic, theyhave a personality that people like to be around, and I think theybring experience in whatever role they might end up taking withthe company.”
Dyer says that as a company grows, it is vital to have a solid teamaround you.
“As you build a bigger company, you’ve got to have an executiveteam that people want to follow,” he says. “That becomes criticalbecause that is the culture of the future. One person onefounder or entrepreneur plays a significant role in a small company. When your company becomes big, that founder or entrepreneur becomes a very small part of the operation. So, you want tocreate a leadership team that thinks like the owner and [that] people want to work for like the owner.”
He adds it’s critically important that the executive team has anequity position in the company, which the company accomplishesthrough the issuing of options.
“So we have an option pool in our company, and by issuingoptions, they have stake in the company and they manage it like itis their own,” he says. “That’s ultimately what you want is to havea multitude of people with ownership mentality.”
Culture and retention
At the same time that the new executive team was assembled,there was also reorganization at the level below the executiveteam. The dual changes led to some struggles in the companybecause people needed to learn new roles.
Dyer says a big challenge came between 2000 and 2002, when thecompany split a general manager’s job into two separate roles.That led to a lot of fighting between the two parties at that club.
But Dyer made it clear that the company would stick with the planit developed, and he had faith it would work.
“I think people like to believe if they resist it that you’ll eventually go back and do things the way they were before,” he says. “But,we were clear we were going to stay the course and it was goingto work, and eventually, they understood and agreed.”
Reaching that agreement can lead to employee retention, whichDyer says is important because retention of employees results inretention of customers.
“It’s critical, particularly when you’ve got a service business thatrevolves around people like ours,” he says. “So, you naturally wantto retain your employees so that you retain your members.Members identify with the people. So ... if we have high turnoverin our employees, we are at risk of losing our membership, aswell.”
Dyer says the company would continually receive data from theInternational Health, Racquet and Sportsclub Association on howto be the most effective at retaining members.
“In the fitness industry, member attrition or loss of members issomething the industry has been fighting for years and years, andone of the key strategies to retaining members is to retain youremployees first,” Dyer says.
“If we can get our employees to build relationships with ourmembers, they will look forward to coming to work just as muchas our members will look forward to coming to work out.”
Dyer says it’s simple face-to-face communication that keeps therelationship between the employee and the customer strong.
“The easiest way is to just call every member by name,” he says.“We go out of our way to try to get everyone to know the membersby name and then build the relationships from there. We arealways identifying ways for the employees to get to know themembers, but the easiest way is to get out there on the exercisefloors with the members and pick up the weights and go throughthe locker rooms and doing locker-room checks.
“Doing the things if you had a party at your house is the examplewe use. If you were a good host at a party at your own home, whatwould you do? The bottom line is you would make sure everyonewas talking to one another and feeling good about the partythat they’re attending.”
A significant amount of capital is also invested in trainingbecause Dyer wants to promote from within the organization.
“We have a decentralized approach to training where we putthe training out there in the field,” Dyer says. “But we continually invest in our people to provide management-leadershiptraining programs so we can continually have a full pipeline ofpeople ready for the next growth opportunity.”
It’s also important to send the message to all your existingleaders that there is going to be an opportunity for them to stepup and take on more responsibility in the future of the company.
“If we continually pull people in from the outside, it can beextremely demoralizing to our existing pool of people, and wedon’t want to do that,” he says. “So, whenever possible, wewant to try to promote from within. Plus, it keeps the culturealive. You bring someone in at the top that worked for a different company, they’ve got preconceived ideas, and they’re typically not going to be the way we do things, and you become adifferent company.”
The next chapter
Looking back, Dyer says the company still would have beensuccessful if he hadn’t essentially started from scratch andmade the changes he did. He can see having maybe 20 clubsstrictly within Florida, instead of the 51 in four states that arenow open or in the process of opening. However, if he didn’tface the struggles in the early 2000s, the company wouldn’t benearly as big as it is today.
“We’d probably have much stronger competition than we currently have,” he says. “I think we were quick to fill out the market.” he says.
Lifestyle’s success has been rapid. It posted revenue of $35million in 2004, $54 million in 2005 and $80 million in 2006, andit now has 2,400 employees.
But now it’s time for Dyer to take the next step with a completely different set of challenges.
Dyer relinquished the CEO title after 25 years, becoming vicechairman of the board in October of 2007, to President ToddBright, and now, he must go through the process of letting gowhile continuing to play a role in the company, which he wouldlike to take public.
“I’m 57 years of age, and I don’t want to be working at thispace when I’m 62 or 65, and it was an opportunity for me tospend some time with my boys before they go to college,” hesays. “They’re both in their midteens, and I just want to put myfamily first at this point in my life. But I still go to the officeevery day, I’m still involved in all the strategy and all the realestate trips and everything else, I just don’t have to deal withthe day-to-day at the moment.” <<
HOW TO REACH: Lifestyle Family Fitness Inc., (727) 456-3100 or www.lff.com
Dan Movens will remove hurdles for his employees, but he is also willing to give them a lot of leeway to solve problems themselves. The CEO of Caraco Pharmaceutical Laboratories Ltd. empowers his employees to be experts in their areas and will let them go as far as he can, as long as it doesn’t hurt the business. But when he sees one of his 500 employees going in the wrong direction, he will step in to help solve the problem. And while he says some people would call him a micromanager first and a hands-off leader second, it’s a style that’s worked for Movens as he has led Caraco to revenue of about $117 million for fiscal 2007.
Smart Business spoke with Movens about how to set examples and expectations.
Be approachable to employees. It’s an open-door policy, and we are in it together. I mean, we are basically together to mentor each other because there might be something I might learn from someone else there’s life experiences every day.
I basically wave them (in), literally. ‘Come on in, and let’s talk this through.’ My personal focus is, one, execution and taking down barriers and hurdles, and I think the expected outcome is that we are going to work together to solve this problem.
And also, having the employees that I work with [also] have an open door with me to walk in and give a view on how I think something could be different.
The company is made up of all levels of employee, and you try to remove the ‘we’ and ‘they.’ And the only way you can remove the ‘we’ and ‘they’ is to become part of the ‘they.’ So, you really have to be part of the organization. Check your ego at the door so to speak, and be part of what each person is trying to accomplish.
Basically, go out to the staff and have a town-hall meeting about what the company has done, what the company plans to do, how they’ve met their goals and expectations and trying to be part of how they think on a day-to-day basis so I can take the smallest issue and solve it.
By handling that, by being grounded, if I’m approachable, I’m going to find out the littlest thing that’s wrong with the company and I can move it forward. Get rid of the suit.
I grew up within the framework of being an employee first, and my biggest goal is, if I could have an impact on the business, if I could actually influence in a positive way the outcome of the business, that was my only goal.
Set expectations. We set goals. Of course, we have an annual budget process, and in that, you define projects you are going to get accomplished and sales objectives and market share objectives and how we are going to improve everything.
We have a meeting with the operating heads every two weeks, where we sit down and talk through issues that are stopping us from obtaining our goals and work through the problems on a routine basis. Tactically, handling your issues routinely is something that we do fairly well as a company, and basically, bringing all the department heads together so they can see how they impact one another.
I think that many people are trained to be compartment thinkers, and they really understand they are very good at their own department and, in fact, I would qualify them as an expert in their own department. But, I don’t know if they necessarily see how they impact each other and how their area services the company and the ultimate impact of their decisions on the other departments that help the company run.
So, I think that some of those hard lines, or silos, if you will, are taken down in those meetings, and I think that they see how they can actually influence the outcome.
Communicate your message to everyone to avoid confusion. You have a company such as ours that’s growing at 45 percent, currently. Last year, we weren’t the same company. You would-n’t manage the company in quite the same manner as you are managing it this year. Last year, you were a $117 million company. This year, you’re over $150 million. Two years ago, you were only $80 million. So, you definitely have to change and adjust and continue to manage the business much in the same framework, but it’s always changing.
Human nature is people aren’t used to change, so you have to get a little closer to the organization in order to always get that comfort zone back because you are always changing.
No one can ever believe you are going to have everybody on board. Unfortunately, I am a big believer that there is going to be a few naysayers in every group.
Every meeting might be thought of differently, or someone thinks the meeting is going a different way. So, you always have to reach back for clarity. If you continue to follow up on what you say and never let people down and, again, go back to those expectations, there are less and less of those naysayers because pretty soon, people are basically getting on the bus with you, rather than just believing that you’re just doomed to failure.
You continue to fight that with a progressive action.
HOW TO REACH: Caraco Pharmaceutical Laboratories Ltd., (800) 818-4555 or www.caraco.com
Sure, conducting formal interviews is a necessity, but sometimes, it’s good to take a potential employee out of the work environment.
Chauncey C. Mayfield, president and CEO of MayfieldGentry Realty Advisors LLC, says that if he is interested in hiring somebody, he meets that person for a drink outside the office. He finds that doing so allows him or her to relax and gives Mayfield a better idea of who that person is.
“In a social setting, even though you are talking to a potential employer, in a social setting, people tend not to be as guarded,” says Mayfield, who oversees the real estate investment management company, which has about $1 billion worth of assets under management.
Smart Business spoke with Mayfield about how to be a team player while leading the team and how to communicate that team concept to employees.
Q: What are the keys to being a good leader?
First and foremost, for me at least, is you’ve got to set a clear direction what are you trying to accomplish, how you intend to get there, what gives the people around you confidence that you have both the personal acumen, professional acumen as well as the resources to get where you are trying to get to?
The second thing, I think, you have to demonstrate that you’re not simply a leader but a team player who happens to lead the team. My leadership style is to demonstrate to my team I am capable and will, in other words, get my hands dirty with them, right beside them.
The last point about leadership, I believe, is you have to be able to pick a team where people clearly understand the strength of the team is in the whole, not in the individual. Absolutely no one individual will, in every single circumstance, dictate the success of the team. My responsibility on a day-to-day basis, and I say this almost daily, my job is to protect the whole, not an individual. An individual that is running counter to the success of the whole, it’s my job to deal with.
Q: How do you monitor the strength of the team?
It first begins with fit. I interview every single person that comes to work for us. I don’t care if it is the receptionist or the chief investment officer.
I spend time, and what I am trying to determine is, I’m trying to understand how you would fit within our organization. What I am looking for is your ability to work within the team. I look for, ‘How important is it to you to be singled out as the reason we’re successful? How important is it to you that you need ongoing confirmation of your worth?’
Because that, in my opinion, is an individual player. So, I start with fit to see if you fit within the organization.
And if we’ve picked the right person, then by virtue of the assignments people are given, you can tell whether or not they are working individually, working within the team. The way you do that, the way we monitor that, is that not all the assignments come from their direct report. The assignments may come directly from me.
The second thing is that the direct report, while he or she has responsibilities for the group or for that division, I interact with the people under them directly. I do not delegate my interactions with people.
Q: How do you make employees understand they need to be team players?
What we try hard to convey is that if you were to envision our environment as a basketball team, while you may be on the starting five, the guy you are defending may, in fact, be a better player than you, and there is just no way you can stop him from scoring. You can do one of two things. One, somebody can come in off the bench and help, or you can switch players. So [you say], ‘You defend that guy; I’ll switch over to this guy.’ The most important thing we want people to understand is there may be a task that may not be your strong suit, and it’s OK to say, ‘I need help.’ You don’t get penalized for it.
You get penalized, in fact, if we fail, and then you said, ‘I really wasn’t cut out to do that task anyway.’ We encourage people to say, A, ‘That’s not my strong suit,’ or B, ‘I simply need help in order to make the deadline.’
HOW TO REACH: MayfieldGentry Realty Advisors LLC, (313) 221-1270 or www.mayfieldgentry.com