JUser: :_load: Unable to load user with ID: 2549

When Bobby Harris launched an effort to bring management closer to the employees at his company BlueGrace Logistics LLC, he really wanted it to be effective. He felt the executives were getting a bit out of touch with the rank and file. So he started a “cubicle swap.” For a couple of weeks, executives moved their offices to cubicles and the dispossessed workers took over the executives’ offices. 

It worked like a charm. It provided the executive team and employees to learn about each other on a personal level, what they liked and didn’t like, and how efficiently the operations were running.

And in at least in the case of one high-profile executive (Harris) case, it got to be humorous.

“I had the IT maintenance guy take my office,” Harris says. “He loved it! It's kind of funny because he started playing the role, and he started wearing a shirt that said, ‘I am the CEO. Shut up!’ He got into character.”

While there were some funny moments, Harris was serious about the lesson he wanted to teach.

“I had been in a meeting, and I was listening to a lot of our executives talk about the things going on below them. I just thought it was interesting — the executives really didn’t know what was going on below their level. We were making policy about people who are the life of our company. We needed to make sure that someone, like their direct supervisor, knows what they were doing.”

As the cubicle swap was underway, the employees got to interact more with the executives and hear what was going on. Another thing that occurred was that the productivity level went up.

“It's kind of like if you've ever heard of the Hawthorne Effect: the more visible management is, the better the production from employees,” Harris says. “So that was a real positive. There was a lot of serendipity to whole project, and that is why we continue to do it.”

But most of all, it demonstrates how Harris is a big believer in his employees. Here’s how that concern constantly brings dividends to the $100+ million freight and logistics company with 135 employees. BlueGrace has grown by 7,378 percent in revenue from 2009-2011. And to top it off, it’s recognized as the 20th fastest growing company in the United States by Inc. magazine.

Invest at every level of employees

If you want to bat a thousand in terms of hiring and grooming the best talent, invest in your people at every level, Harris says. And there is no better time to start than at the beginning.

“When we hire people, one of the qualities we look for is if they are very sensitive and empathetic because our motto is we don't care how much you know until we know how much you care,” Harris says. “If you take care of your people, they will take care of your customers and they will also take care of people in general.”

To help support those ends, Harris and his team has set up a mentoring program for employees during their first six months with the company.

“It's for every employee, and we believe that if you are going to flatter us enough to choose your career to be here, we are going to invest in you,” he says.

The mentors are hand-picked by Harris and are people who he knows are very social, who understand the policies, are very professional, and are influential people in the company who will act as their proponent.

“It does two things,” he says. “There is serendipity to it for the people coming in. But where I've seen a lot of value is with the mentors. They love it; people like helping people. They are very flattered, they take you very seriously.

“Now I have a lot of people signing up saying, ‘Hey, I want to be a mentor.’”

While the role does not include a bonus, there is a benefit for the mentor.

“The mentors are people who want upward mobility so they see this as a way to the next level,” Harris says. “And their aspirations are well taken care of.”

Social media use reaps rewards

The more you can get inside an employee’s head, the more you can understand what motivates them. While Harris’ cubicle swap may have been a little more beneficial for executives than employees, he also uses another method that benefits both, but in a different vein, and it’s a big tool as a foundation for collaboration.

“The single best thing for us has been social media, specifically Twitter,” he says. “We have an open social media policy. For me, it is really important because again, I keep going back to making sure I offer the most for employees. It's very hard to get a job here. You have to take a lot of tests, you have to be the cream of the crop, but when you get here, I don't ever want to lose you.”

Harris feels that to keep workers motivated — and give that discretionary effort — social media such as Twitter brings big dividends.

“Once you get past 20 employees, you have the ability to know a little bit about your people in a real quick space of time,” he says. “So I can just open my phone, and in three minutes I can find out that Mary's son hit a home run last night in baseball.

“And conversely, they can see me: ‘Old Bob is not in; he's in Chicago.’ I can tell them about that restaurant I went to.”

With the knowledge about some aspects of a fellow worker’s personal life, it builds bridges on likes and dislikes, and improves the playing field for collaboration on business projects. But nevertheless, some people may think that it's unproductive.

“I would challenge them tooth and nail that the culture that we breathe makes us extremely hard-working,” Harris says. “The employees love the freedom aspect of the autonomy and the trust, and further, as far as a recruiting tool for people who have degrees or real good pedigrees, this is what they want. They love that kind of ability to do that. It has created a lot of bonds here.”

Problems with the use of social media can be avoided to a large extent if you first explain to employees how you hope they use it, Harris says.

“What I can do is let them know that we see what you are doing, and I think that for that reason alone, it really mitigates that kind of exposure to begin with. There's just so much positive going on and a lot of times, it has nothing to do with business.

“We don't dictate what they are supposed to tweet, but we do train them; we tell them how it works and how to be effective. Then we endorse and support it.”

Till the fertile ground

Once you support collaboration through a process such as social media, it behooves you to keep the ball rolling — a spinoff could grow in the fertile ground.

That’s what happened at BlueGrace. Its support of social media for employees led to an executive forum, in which employees meet with executives to have an old-fashioned “bull session.” Groups of four employees who have at least six-months’ service meet with executives once a week or every two weeks for 30-45 minutes.

“I have a group of my own and it’s composed of randomly picked employees,” Harris says. “We try to get people who aren't directly involved with the same department so it’s a mix.

“We just talk about anything,” Harris says. “It could be something really important that's going on in their life; it could be something like they had a great idea in the business place, it could be positive or negative, anything they want to talk about.

“They connect because it comes across like a little family. They feel very connected in the place. They also get a voice then. That helps us to get a lot of the best ideas that they have.”

It is a time commitment, however, but not one that can’t be worked into your schedule, Harris says.

“It is one thing for people to say it, yeah, you've got to listen to the employees, but everybody is busy,” he says. “Everybody is so busy; it is not just in my industry. You have to find an effective process and grind it out, find a way to make sure that you are touching those people.

“No matter how fast they're going, no matter how fast people are coming on, there are several ways of doing it. Those practices we found very effective, and it makes for a lot of happy people.”

How to reach: BlueGrace Logistics, (800) 697-4477 or www.bluegracelogistics.com


Invest in employees at every level.

Social media utilization reaps rewards.

Till the fertile ground.

The Harris File

Bobby Harris

Founder and CEO

BlueGrace Logistics

Born: I came to Florida in 1982 when I was eight years old, so I am more of a native of Florida. I was a military brat. I was born in England at a military base northwest of London. My father was in the Air Force.

Education: I have a bachelor's degree in psychology from the University of South Florida, which I just got two years ago. I went back to school. It was a lot of fun. Industrial psychology was one of those things that kind of intrigued me enough.

What was your first job and what did you learn from it?

My first real job was at Chuck E. Cheese’s. Oh yes. I did various things. I worked the cookline I was like a little waiter, I would do maintenance, whatever they needed me to do. If I learned anything, I guess at any level, professionalism reigns supreme. I don't care if you're an attorney, and I guess it's a little bit of my father raising me, I always made sure that my uniform looked a little bit nicer than everybody's else's, and I think that is one of the reasons why I was able to ... It was Chuck E. Cheese’s, and I was treated well and got more hours than others. That still holds true today, and it just amazes me what a professional image does. And the other thing I would say was I learned to trust people. I've always said that from beginning the quicker you trust people, the easier your job will be and the quicker you will excel at it.

Who do you admire in business?

I admire Richard Branson. His genuineness shows through. His philanthropy matches. I think he's done everything. He has been extremely successful and innovative. He has given back so much and yet he's had so much fun doing it. This guy has a ball. He's very easy to gravitate to.

What is the best business advice you ever received?

My mentor was Keith Huggins. He told me a little knowledge is dangerous. As a CEO, you're not going to understand everything that people do — to make assumptions off a little bit of knowledge is a very, very dangerous thing. If I understand something from soup to nuts and it's like in my expertise, I will have high level of conviction. But knowing something a little bit is far worse than not knowing it at all sometimes. You have to be really careful if you know little bit. I must use that quote every three days. For myself, my personal life, you never have the whole story if you don’t understand it from inside and out.

What is your definition of business success?

My definition would be wanting to come from work every day in a bad way while making sure that all your success is shared with your team, your vendors and your customers. My biggest thing is I don't want to be this really successful person alone on top of a mountain. As I get more successful, the people with me should get more successful too. We have such strong friendships. Those are the people who will go to war with you. I've never lost anybody in my leadership team, and it's a pretty big leadership team, 14 or 15 people, so it's like the Rolling Stones — we never want to break up. We always want to have this crew because it's effective. And it's a heck of a lot of fun. Business success starts with happiness. It really does.


Published in Florida

Amy Schultz Clubbs pays her employees hourly wages to volunteer at least 16 hours per year as a way of giving back — and doesn't have to look far to see proof that the volunteering pays big dividends. Actually, positive signs can happen at any time, nearly anywhere.

“We had a couple of individuals who through their volunteering with the Meals on Wheels program recently were able to help save a woman’s life when they went to the home,” she says. “The individual had fallen and couldn’t answer the door; they were able to get help and likely saved her life.”

The victim was afraid help never would arrive as she was lying on the floor after the fall. She later told them she was told she had suffered a mini-stroke. She couldn’t get up, and was frustrated, crying and scared.

Two provider relations representatives with Molina Healthcare who deliver meals in the Zanesville area knew something was wrong when the resident didn’t answer the door and her dog kept barking and tugging at the front window curtains. They called 911.

A firefighter was able to gain entry through a window. The resident was hospitalized but has since recovered. She has expressed her gratitude to the two volunteers and has even invited them into her home regularly, so they all could get to know each other better.

“It’s rewarding because you give back to the community,” one of the Molina employees said.

Clubbs agrees wholeheartedly. In fact, it’s one method that she believes is particularly successful with motivating Molina employees through its rapid growth since it was founded in 2006.

When she signed on with Molina Healthcare in 2007 as its chief financial officer when the corporation was opening an Ohio division, she moved quickly through the ranks to COO and to her current role because of the rapid growth of the provider of managed care services to Ohioans on Medicare and/or Medicaid. Molina Healthcare has become Ohio’s second largest care coordination plan with 240,000 members, and now has 460 employees and more than $1 billion in revenue a year — and expects to hire 225 more next year.

Here’s Clubbs’ prescription to deal with rapid growth and keep employees engaged to the fullest.

Track the life cycle

Many companies were founded by an individual who was passionate about a particular product or service and who wanted reach as many people as possible to tell them about it and make them a customer. Just as it was with founder Dr. C. David Molina and offering affordable, quality medical care for the needy. Once that was established, it was logical step to also offer a health care plan exclusively for government-sponsored health care programs for low-income families and individuals.

So the mission was clear from the beginning for Dr. Molina and it was just as clear to Clubbs when she became CEO a few years ago. Clubbs and her team took an empirical look at the entire process, to see if Molina Healthcare of Ohio was operating true to the corporate mission.

“We kind of started looking at what is the life cycle of the member,” she says. “Where does it start? We followed that through the entire organization — what does the life cycle through our organization look like?”

By following the life cycle, they were able to make sure that the right process and infrastructure was in place every step of the way to navigate the member through the organization.

At every point in the process, it is necessary to keep the focus on the relationship that is being developed.

“Molina doesn’t spend a large amount of money on commercials and billboard advertising because we really rely on the relationships that we develop with our community partners and with their provider partners as well really to educate potential members about what their health care options are,” Clubbs says.

The examination of the life cycle showed the depth of engagement employees will need to demonstrate — and the importance of how critical it is to maintain that engagement.

“The people who work for us are really passionate about what they are doing and the individuals we are providing services to, and so you need to really look to keep that passion in employees throughout the year,” she says.

“It was just getting the right people in the right seats of the organization, and really developing people from what started out as building infrastructure to moving toward more of an operations life cycle of the company, and really keeping people engaged in the organization as you do that,” Clubbs says.

As the Ohio division of a larger corporation, the entity had a template of sorts to follow when it was first started, but there was also a provision to adapt as needed.

“A lot of it we developed from scratch, and a lot of it we were able to leverage,” Clubbs says. “With building relationships, we were definitely able to leverage best practices from our other states — and the Molina story as well. The company has been around for more than 30 years.”

“We still run clinics today in many of our states, and are able to really leverage that history as we are building that relationship here locally as well,” Clubbs says.

Find the differentiator

Examining the role that employee engagement plays is critical in finding out what separates the winners from the also-rans.

“I believe it is our differentiator, and I really think it is how we have been successful in keeping our employees so engaged and keeping morale up while we have been growing so quickly over these last several years,” Clubbs says. “I definitely think it is a key. We really try to model that engagement at all levels of the organization here.”

Among the methods beyond the minimum that are frequently used by businesses to keep employee engagement high is the support of volunteerism. Molina Healthcare has put it in writing.

“Our volunteer time-off policy says we will pay people for a set number of hours every year when they volunteer in the community,” she says. “And once they do that, even though you are only paying for a set amount of time, people get more engaged and are more likely to go out and do it on their own as well.”

The company also has an employee activity committee that helps coordinate the volunteer opportunities for the associates. At least quarterly, the committee will have an employee appreciation event as well where the members show how much the company appreciates employees.

“We encourage people to not only volunteer their time but to give back through personal donations either monetary or things like having a personal care items drive for the food bank,” Clubbs says.

She also encourages her leadership team to contribute by being board members on community organizations as she herself serves on several boards.

“It’s another way that we kind of demonstrate our commitment to the community, that they are serving as well.”

Find a need and focus on it

If your company examines your flow life cycle, and you find a particular need that can be met that with some attention and focus, it can be a win-win for you and customers.

Clubbs and her team capitalized on what was common knowledge about the population it served: It was more vulnerable than others that may be served by a commercial plan. Members may have significant health problems as well as financial concerns.

Accordingly, if Molina could focus on care coordination, it would be a plus. Communicating with some of its members through outreach builds the relationship to a new level.

“We have community health workers who actually go out into the community,” she says. “They will go visit members in their homes to do health care assessments and things of that nature and to bring services to members in their home or other places of service, where they might not be able to get out and get those services as readily on their own.”

The company activity team and management receive sensitivity training that gives some background about common situations they may find, and it can help to solidify relationships. One of the big things they experience is the Beyond the Freeway Tour.

“They will take a group on the bus and take you around the local community, through a homeless shelter, through a food bank, through other places where the individuals that we are serving or are also receiving services, so that you can have that sensitivity to what a day in the life of one of our members is really like out there.”

Such as experience may heighten an associate to listen more closely and visualize what the member is going through as the member talks about concerns.

“I think a lot of times words are not exactly what the problem is or what the issue is, so really being able to listen and decipher between what someone is saying and what the issue really is and to make sure that you are addressing it and resolving it is really key to any success,” Clubbs says.

How to reach: Molina Healthcare of Ohio, (800) 642-4168 or www.molinahealthcare.com


Track the life cycle of the product or service

Find the differentiator from your competition

Look for a need and focus on it

The Clubbs File

Amy Schultz Clubbs

plant president

Molina Healthcare of Ohio

Born: Lawrence, Kansas.

Education: I went to Ohio University and received a bachelor of arts in business administration, majoring in finance.

What was your first job, and what did you learn from it?

My first job was serving soft ice cream at a Dairy Shed. I think what I learned from it was a lot of patience and customer focus. It was in Circleville, Ohio.

What was the best business advice you ever received?

The best advice I ever received was to ask for forgiveness, not permission. That honestly has helped me over the years of my career. It basically means, ‘Just do it.’ If you think it is the right thing to do, go ahead and do it. Don’t wait and ask somebody if it is OK to do. If it ends up being wrong afterward, then you can ask for forgiveness. But it is better to just go ahead and do it if you think it’s the right thing to do. That came from my regional vice president who preceded me as plant president, Kathie Mancini.

Who do you admire in business?

I mostly admire people who are really following their passion, their heart and what they do in the business world. There are a lot of women who I work with and for right now. Five of my directors are women, and if you look up verticals for whom I report to, the next three layers above me are all women. Every one of them is so passionate about what we’re doing here at Molina. They are smart and strategic thinkers. They are doers and they make things happen. So I love that. And I think that people who do follow their passion are able to have a bigger impact on an organization and still be able to make things happen. That’s what I admire. I’m just surrounded by them here.

What is your definition of business success?

I think in general, business success is really being able to grow a business profitably while achieving some sense of the greater good of the community. With Molina, our ability to improve health outcomes for the individuals to whom we are providing services to is for the greater good of the community. At Molina it is providing high-quality care to improve health outcomes in a manner that is cost-effective.

Published in Columbus


Mike Rotondo joined Tropical Smoothie Cafe Inc. as vice president of operations in 2008 — and climbed the corporate ladder about every two years. He became COO in 2011 and CEO in July 2012. While at Tropical Smoothie, Rotondo has focused on taking the company from the entrepreneurial enterprise created by its owners, Erich Jenrich and David Walker, to what he calls “the next level” — a more structured and systematically run organization poised for faster growth.

As a result of this transformation, when Rotondo was promoted to CEO last year, the private equity firm BIP Opportunities Fund bought a controlling interest in Tropical Smoothie Cafe. Jenrich and Walker remained on the company’s board, and BIP partner Scott Pressly became the company’s chairman.

Rotondo recently spoke with Smart Business about how he has steered the company through the transition from entrepreneurial company to mature organization with greater resources to grow.

Q. Looking back over the past few years, what do you consider the most important business leadership challenge you’ve faced?

My main challenge has been working with our company’s founders to determine the best course of action to move our brand forward.

Back around 2008, when I started with Tropical Smoothie, we were starting to see some negative signs. Obviously, it was a very tough time for the economy. Our comp sales were down about 6 percent in 2008 and down another 2 percent in 2009. The turnout at our franchisee convention was very low; we only had about 35 percent of our franchisees attend.

Some of our franchisees and area developers were starting to point a finger at us, saying ‘You’re not giving us the support we need.’

So we saw that we had to make some changes. On one hand, we wanted to keep all the good things that the founders of Tropical Smoothie had developed for the brand. But at the same time, we wanted to put systems and processes in place to mature the brand and professionalize it. It was about recognizing and celebrating all the great things the founders had done, but then taking it to the next level.

Q. What were some of the key systems you introduced to turn things around and to mature the Tropical Smoothie brand?

In 2008 and 2009, we were all about creating programs and increasing our visibility. We put out training programs; we put out marketing programs. We went out to the franchisees and met with them. My team and I made ourselves very accessible to the system.

We got rid of some people who were not meeting the culture and the needs of the business.

But the key thing was we started giving our franchisees new opportunities with training and marketing programs. This energized them, and at the same time, it made them more accountable because it put the responsibility on them to execute those programs.

Q. Did you make changes in the area of quality control?

Yes. For example, not long after I started in 2008, I was visiting our cafes with one of our key operations people, and I noticed that at every cafe they made the smoothies a little bit differently. Some put the ice in first. Some put the fruit in first. Sometimes they blended it a little differently or added something a little bit different.

What it really came down to, at that point, was that our procedure for making smoothies was about 80 percent art and 20 percent process. And I said, ‘We’re never going to get consistency if we do it that way. The average Tropical Smoothie sells about 50,000 smoothies a year. How many of those smoothies can we afford to go across the counters that are less than perfect?’ The answer is none.

So we came up with a program called One Perfect Smoothie. It was a full training kit. We broke it down and put processes in place so that you know how to properly prepare the fruit, how to build the smoothie the right way, how much of each ingredient goes in, which blender settings to use. We turned the procedure around so that it’s now 70 to 80 percent process and 20 to 30 percent art.

Our franchise community has embraced this program. They tell us it has improved the consistency of the smoothies, and it has helped them from a productivity and a food cost standpoint: ‘We’re blending our smoothies faster. We have more consistency. We’re going through fewer strawberries than we were before.’

Q. What other systems have you put in place to move the brand forward?

One process we’ve introduced is a brand audit for our cafes. At first it was just a 20-question checklist, but we expanded it into a full-blown audit. We look at the quality of the products, the hospitality level in the cafe, the cleanliness of the cafe and how well the brand is being represented in the cafe. It’s a four-hour audit and inspection.

We went from a very basic to a much more detailed and a much more mature process of evaluating the compliance in our cafes. As a result, we have cleaner, better-running cafes than we’ve had in the past. The customer surveys we do reflect that.

Another key aspect of the audit is that we use it mainly as a training tool for the franchisees. You never want this type of thing to be looked at as a hammer — ‘Uh oh, you’re having your compliance audit today.’ We look at it as a training tool. If one of our team is out there and they’re doing an audit and the franchisee is shorthanded, we’re going to put the audit down and jump in and start helping. We really believe that our main responsibility is to service our franchisees.

Q. Have you made any changes to your product mix?

We’ve streamlined our menu and, at the same time, put greater emphasis on our food offerings with a program we call our Focus On Food. We started this about two years ago. While we felt there was still some market upside with our smoothies, we felt that we had a lot more room to grow with our food offerings.

We had always joked that food is our best-kept secret — unfortunately. So we started focusing on it more. We started spotlighting some of our special menu items like our Chipotle Chicken Club Flatbread, our Chicken Pesto Flatbread and our Jamaican Jerk Chicken Wrap.

This has worked well for us. People have started to look at us as more than just a place to get a smoothie and a snack — they can also come to our cafe and have a terrific lunch. Since we started doing this, our food incidence is up 25 to 30 percent from where it was two years ago. By this, I mean the number of food items that we sell each day — how many wraps, how many sandwiches, etc. Our food transactions are up 25 percent from where they were two years ago.

The other piece that’s measurable for us is our combo incidence — the percentage of our transactions in which the customer is buying both a smoothie and a food item. As a result of our Focus On Food program, that combo figure has increased from 25 percent to 45 percent.

Q. What advice would you offer other CEOs faced with a similar challenge — the need to upgrade and mature their brand to move it forward?

The first thing I would say is protect the brand. Don’t get cute. Don’t try to change what everybody loves about the brand.

The second thing is, as you start to take on some of these challenges, you’ve got to have the right team in place. And sometimes you have to change the makeup of the team. You can’t be afraid to make those changes. You have to surround yourself with smart people, give them their marching orders, and then do the best you can to stay out of their way.

The third thing is communication. To mature and grow the brand, you’ve got to communicate. You’ve got to keep people informed at all the different levels — franchisees, support staff, investors — about what’s going on. You have to keep everybody on the same page: the process of taking an entrepreneurial business, maturing it, then getting acquired by a private equity firm and how to manage through that has been a learning experience.

The private equity firm is allowing us to do our thing, and while ultimately our brand hasn’t really changed that much, we’re much stronger than we were because we now have the processes and structure in place that a private equity firm will hold you to.

That has been huge for the Tropical Smoothie brand in terms of the resources that we have and the ability to bring in the people we need to keep moving forward. That transition has been incredible for this brand.

How to reach: Tropical Smoothie Cafe Inc., (770) 821-1900, www.tropicalsmoothie.com


Introduce systems and structure.

Make processes consistent.

Evaluate compliance through audits.

The Rotondo File

Mike Rotondo


Tropical Smoothie Cafe Inc.

Born: Chicago

Education: Illinois State University

Looking back over your years in school, what business leadership lessons did you learn that you use in your work today?

My major was criminal justice, so I took a lot of classes in psychology, sociology and counseling. I learned how to communicate with people on many levels, how to have tough conversations, how to listen and how to make sure they know you’re listening.

Tell me about an early job you had and the business lessons you learned from it.

In high school and college, I helped manage a store for a Baskin-Robbins ice cream franchise. This was back in 1982-83. I did payroll. I ordered inventory. I hired. I trained. Working at that Baskin-Robbins really got me going in this industry.

Do you have a main business philosophy that you use to guide you?

As a franchisor, I think the most important things are communication, driving the economics for your franchisees, and showing people that you care. Basically, everything we do is geared toward improving our people, our sales, and our profits.

What trait do you think is most important for an executive to have to be a successful leader?

If you want people to follow you, you have to be willing to get into the trenches. You have to educate yourself. It’s very important to be educated and informed about all the different disciplines your business is involved in.

What’s the best advice anyone ever gave you?

To ask open-ended questions — in other words, questions that have multiple parts and that make people have to think. You can really uncover a lot of important things by doing this. That advice was given to me by Chuck Bengochea. He was vice president of operations when I worked at Honey Baked Ham.

Published in Atlanta

When Gary Shamis, Bob Littman and Mark Goldfarb created the accounting and business consulting firm SS&G Inc. in 1987, the trio had a vision that defied the traditional accounting world.

Their radical idea: Focus on people.

“It was a real sweatshop kind of mentality for the profession,” Goldfarb says. “You worked 3,000 hours a year [eight hours a day, every day of the year]. We opened it up and created opportunities for people who worked part-time.”

That was the genesis of the partners’ philosophy that today continues to define how SS&G differentiates itself from the competition: Growth, client service and an employee-centric culture.

“All three work together harmoniously,” says Shamis, senior managing director. “If you have them all going and you focus on it, the results can be very positive.”

You’ll notice that absent among the three is the notion of operating with a generous supply of black ink.

“We always felt that partner profitability and things like that were going to be a byproduct of doing all the other things right, so we didn’t focus our business on enhancing the bottom line of the owners,” Shamis says. “We focused our business on cultural aspects that we thought would be good for our people, good for our clients and, in the end, what we thought would be good for us. It has really worked out that way.”

Today, SS&G provides various client service initiatives. Each of them is intended to make an impression.

“We publish stories about client service going above and beyond in terms of, say, driving through a snowstorm to deliver a tax return,” says Goldfarb, senior managing director. “We really try to make that part of the culture, so that when somebody calls, everyone knows here, you had better call that client back; if not immediately, certainly within the next business day.”

This mentality has helped the partners and their teams spark significant growth over the past few decades. From a small firm with about 10 employees, SS&G has grown to more than 500 employees at 12 offices in eight cities in four states, including new offices in Chicago. With annual revenue of $70 million, SS&G ranks among the top 100 independent accounting firms in the U.S., including being named the 41st largest U.S. accounting firm by Accounting Today.

Here’s how Shamis, Goldfarb and Littman grew the firm by emphasizing its differentiation and is taking steps to ensure SS&G continues long into the future.

Get the talent

Some professions attract more men than women; in others, it is the opposite case. Accounting had been a traditionally male-dominated industry until the 1980s, when it reached parity. In recent years, however, women have been rapidly joining the ranks. The U.S. Bureau of Labor Statistics for 2012 reports that 61 percent of all accountants and auditors were females.

So with an eye on whom and where the talent was coming from, SS&G years ago established a plan that fit lifestyle concerns and issues into the firm’s culture.

“Most of our offices are suburban,” Shamis says. “Many other large accounting firms are downtown. Suburban locations make it a lot easier for somebody who is female and raising a family to be more accessible to what she needs access to — school for conferences; and if she has a sick child she can get home sooner rather than if

[her office were] downtown — and it really became a focus on being able to try to hire these professionals who were women in their family-raising years.

“We have been able to get this incredible, top-notch talent, but we had to create an environment that was slightly different,” he says.

And this has opened the door to groom a lot of great female professionals

“We probably have one of the largest percentages of female partners in the accounting profession because of that,” Goldfarb says.

And, Goldfarb says, this has contributed to such a positive work environment at SS&G that it has become genetic.

“We are told all the time from people we hire that this is such a great, warm environment here compared to where they worked in a previous life,” he says. “It’s something that is really part of our DNA.”

With a powerful corporate DNA in place, you can then develop a culture that attracts talent by which you can grow a company.

“It’s important that everybody here understands the culture; it’s important that we follow it, we preach it,” says Littman, SS&G’s CEO. “Our organization is obviously about people. And to attract key people, you have to grow. If you don’t grow, you can’t find the talent and you can’t keep the talent. Growth has been important, and that is why we have been a Weatherhead 100 company more than 10 times.”

Be creative in your growth

Creativity comes in many forms. In business, you can as creative as you want to be when it comes to determining how to differentiate your company from the competition. SS&G looked at the kind of organic growth it had achieved over the years and took the entrepreneurial path.

First, the partners began to develop specialized divisions.

“We formed a wealth management business almost 20 years ago,” Goldfarb says. “Health care consulting, probably 15 years ago, payroll, 30 years ago [and] SS&G Parkland, which is our consulting division, was created last year.”

In an effort to strengthen this differentiation, SS&G opted to mold itself as a one-stop shop for clients and their financial service needs.

“Rather than referring to different service providers, where we had no ability to control the outcome, we created these businesses, which have been very successful and have grown dramatically over the years,” Goldfarb says. “But these businesses share the same culture of being employee-centric. All share the same client service culture and growth for the purpose of creating opportunities for employees.”

“Being entrepreneurial was really part of the vision of our firm for years,” Littman says. “We had an outlook that we could provide these other services that would fit for many of our clients. And it has been very, very successful.”

In addition to creating new divisions, SS&G also played a large part in creating an association of accounting firms. Shamis led the formation of the Leading Edge Alliance, of which SS&G has been a member for 10 years.

Leading Edge firms share best practices. Goldfarb says it has been an invaluable asset – not just to SS&G but to all the organizations and their respective clients.

“We like to think that that gives us a lot of credibility when we sit down across the table from a prospective client,” he says. “We can certainly be a better adviser, given all the things that we have done on our own.”

Develop a succession plan

While your company may have established a name for itself through differentiation, all the years of building that reputation can be lost in a flash if, for example, a new leadership team comes in with different ideas.

Enter the succession plan.

SS&G recently completed a reorganization of the firm’s leadership, and then spent more than a year preparing the company for the transition.

“It was announced some 16 months ago,” Littman says. “We have been planning for this over that time frame, and we will continue to plan and transition even after the target date.”

The plan signaled to SS&G employees that Littman, Shamis and Goldfarb were focused on the long-term future of the firm and intended to protect it from the confusion and disorder that often happens whenever there is a shakeup of any size.

Doing so also allowed the trio to help boost morale, motivation and satisfaction among employees since more than likely there will be other changes, such as promotions and movement across positions.

“This can be a real pivotal place (in time),” Shamis says. “(People wonder), How is this going to work? Is it going to be the same place?”

Also, by establishing a clear succession plan, it helps clients reduce any fears that the team they’re used to working with will still be there for them. Shamis says it preserves their trust and confidence that you will continue to provide the solutions you have promised — without interruption — and that you have your ear to the ground.

“The three of us, although we have executive roles, all have client relationships and all touch clients in one way or another,” Littman says. “So it’s not like we are that disconnected to the practice. We know what is going on.”

Under SS&G’s succession plan, Littman assumes the managing director role. Shamis and Goldfarb take on lesser roles, but remain very involved with the firm.

“I have been the managing partner for close to 30 years, and I’ve had a great run,” Shamis says. “It is a lot to give up, but I am starting to realize that there is a lot to look forward to in terms of Bob running this organization.”

And that optimism extends to how SS&G will continue to differentiate itself from the competition.

“I am really excited to see what this place is going to look like down the road,” Shamis says. “I think it is even going to exceed where it is today.”

How to reach: SS&G Inc., (440) 248-8787 or www.ssandg.com


Getting the talent is a priority.

Be creative in finding growth options.

Draw up a succession plan and live by it.

The file

Mark Goldfarb, senior managing director

Bob Littman, managing director

Gary Shamis, senior managing director

SS&G Inc.

Born: All in Greater Cleveland/Akron

What was your very first job and what did you learn from it?

Gary: My first job was in a place called Mr. Junior’s on Cedar Road in University Heights. I sold boys clothes. I think I learned if you work hard, and make the commitment, then good things will happen.

Mark: A caddy at Fairlawn Country Club. Certainly you learned etiquette and you learned service.

Bob: I was a tennis instructor. What I really learned from that was dealing with people, trying to help people.

What is the best business advice you ever received?

Gary: Try to work on your business instead of in your business. That was a big change for me and for our firm years ago. The firm allowed me to begin working on the business. And in that time frame, I think our firm has grown probably 600 or 700 percent.

Mark: People do business with people they like. Relationships are very important in the business world. That was from my father, Bernard Goldfarb.

Bob: I don’t want to copy off Mark, but relationships are really important to me as is taking time to get to know people and build meaningful relationships.

What is your definition of business success?

Mark: If you do a great job for your clients, and you treat your employees well, success will follow.

Bob: I certainly think similar to what Mark has said and that’s building relationships, creating an opportunity for other people in this organization so they can do the same and also being able to go to work, personally anyways, and have fun and enjoy it. It’s not a job; it’s a career.

Gary: I have a really narrow view of this and people know that. For more than 32 years, I have always felt that if you can be a little bit better next year than you were last year then that is going to drive success. I think constant improvement, the ability to continually try to get better, to not be satisfied with the status quo, has really been a huge driver for me.

Mark on the succession plan: It’s just been a tremendous ride for all of us the last 26 years. I will continue to be responsible for managing the firm’s Akron office, serve on the firm’s executive committee, chair the firm’s finance committee, act as the liaison to SS&G Healthcare and SS&G Parkland, develop larger business opportunities and continue as a client service partner

Bob on the succession plan: Mark and Gary are not retiring. This is part of the succession plan and they still have very, very important roles here with the firm to help execute certain growth strategies and still be involved in the management of the organization. We have viewed the succession as an evolution and not an event from the beginning. Gary will be actively involved in leading the firm’s growth strategy, including geographic and existing office. He will also focus on a restaurant initiative and other large opportunities.

Gary on the succession plan: I really think Bob has the abilities to drive this firm to even more successful and higher levels than we’ve operated at in the past. I just think that this firm happens to be incredibly lucky, blessed, or whatever you want to call it, to have Bob Littman take over the practice.

Published in Akron/Canton

Since January 2006, when Jim Weddle first took over the managing partner position at Edward Jones, he has kept a keen focus on growing the investment firm to new heights. In 2007 he and his team laid out a five-year plan that they updated in 2010, but that was a mere steppingstone to the vision the firm rolled out last year.

In January 2012, Weddle unleashed what Edward Jones is calling its Vision for 2020. Focusing on growing the firm in three key areas — financial advisers, assets under care and households deeply served — Weddle’s vision won’t just have Edward Jones reaching new heights, it might just be soaring.

“Today, in a lot of markets, we are not the top-of-mind choice,” Weddle says. “We don’t have the presence that we need. It’s going to take us several years to get there, but we think we’ve got the way to do so.”

Edward Jones is a leader in the financial services industry that serves nearly 7 million clients with the help of 12,500 financial advisers and more than 34,000 total employees. The firm reported 2012 revenue of $4.96 billion, a mere fraction of what is planned for the years ahead.

“There is a huge demographic opportunity, and we need to better position ourselves,” Weddle says. “We’ve put a lot of tools in place. We’ve put additional products and services in place to enhance the client’s experience and to enable us and position us to do an even better job for them.”

Here is how Weddle formulated Edward Jones’ long-term vision and is beginning to make it a reality.


Create your strategy

In January 2012, Weddle made a big deal of explaining the long-term vision to the team at Edward Jones, not just what the vision was but why it was needed.

“Laying out a long-term vision provides the opportunity and the potential to get everybody aligned,” Weddle says.

The early success Edward Jones has seen with its plan is due to a thorough self-analysis the company performed when it first decided to create this vision.

“When we worked on our five-year plan we did so with the guidance and assistance of two gentlemen, one being Jim Collins who wrote, ‘From Good to Great,’” Weddle says. “One of the things that he suggests is that you ask yourself three questions.

“The first one is, ‘What do you do better than anybody else?’ The second is, ‘What are you most passionate about?, And third is, ‘What’s your economic driver?’”

Weddle says that Edward Jones’ business model makes the firm the better than anybody else in the investment process.

The firm is most passionate about helping its current and potential individual investors live a better life.

And lastly, its economic driver is its financial advisers.

“It’s not easy to get your arms around the answers to those questions,” Weddle says. “We had a lot of answers before we got it right.”

The second adviser that Edward Jones used in its planning process is Michael Porter, a world renowned expert on strategy, who preaches that strategy is all about a sustainable difference.

“It’s about doing things differently or doing different things than your competition and making trade-offs,” Weddle says. “It’s about making decisions as to what you’re going to offer and what you’re not. Who you’re going to serve and who you’re not. How you run your business comes down to the choices that you make.”

Those two things, the three questions and the tradeoffs, are the core of Edward Jones’ long-term plan.

“If you haven’t gone through the process of thinking those things through, good luck,” he says. “I don’t think you understand who you are or what business you’re in, which means it’s going to be very hard to optimize your results. That’s the value of the planning process for us. Yes, it does bring alignment, but it also brings focus.”


Identify your objectives

In order to better serve existing clients as well as to land many more clients by the year 2020, Weddle needed to set reachable goals for the staff.

“We have identified three peaks, three objectives related to that vision,” Weddle says. “First is growth of financial advisers, the number and our presence in the marketplace.”

Edward Jones currently has more than 7 million client accounts and 4 million households. However, the firm has identified about 40 million U.S. and Canada households that look like Edward Jones’ best clients.

“There’s no way that we can possibly serve even a fraction of that number of folks without increasing our presence in the market,” he says. “You might think, ‘Holy cow, how can you possibly to do that?’ Well, by growing 5-6 percent a year gets you there.”

Edward Jones has grown by more than that rate in the past, and Weddle believes the firm can reach this goal with the help of a new talent acquisition organization that was put in place, revamped FA compensation and significantly updated training and support programs.

“We anticipate supporting a good number of new folks that will be joining us each year,” Weddle says. “We’ve got amazingly strong pipelines right now. We think we’ll grow this year by 700 financial advisers in the U.S. and 80 in Canada and that will be a good start on that 2020 vision.”

The second objective of the 2020 vision is the firm’s assets under care. When the vision was first laid out, the firm had about $600 billion. In 2012 it had about $660 billion-$670 billion.

“By the end of 2020 we’d like to see those assets under care be $1 trillion,” he says. “You get there by growing 10 percent a year. We added about $34 billion of net new assets last year, which exceeded our objective of $30 billion.”

The third objective for the firm surrounds its deeply served households. Of those 4 million households Edward Jones currently serves, it identified 1 million households that the firm has a current deep relationship with. The firm wants to increase this number.

“We want to drive our deeply served households from the 1 million we had a year ago when we rolled out our vision to 4 million deeply served households in 2020. That’s a 15 percent compound annual increase and we’re ahead of where we need to be on that. I know 15 percent sounds high when we’re growing our FA’s by 5 percent and our assets by 10 percent.

“The reason we have set it at that level is because so many of our existing households can be moved to what we have defined as deeply served. It’s not just new households, but it’s going deeper with the folks that we already have a relationship with.”


Drive your plan forward

Now that Edward Jones had gone through the self-analysis and identified its objectives, the next step was to begin to roll out the vision and communicate how the business’ various departments and segments are going to have to contribute to meet those goals.

“One of the outcomes of the roll out of the long-term vision was to then say to every division of the firm, ‘We need you to look at the work you do and bring a critical eye to it and identify those things that need to be increased or put in place that will help us to achieve the 2020 vision. We also need you to identify the legacy work that we’re real comfortable with and we do really well, but maybe doesn’t add the value that it used to,’” Weddle says.

“You outgrow some things. You can’t just add on and add on and add on. You’ve got to also abandon things that no longer deliver value to your chosen client.

Every division of the company has got to come up with its business plan for reaching goals of the vision.

“We challenge each other, but it also allows me, if I’m in operations, to understand what the service side is doing,” he says. “It creates alignment and synergies and often times opportunities for working in a highly coordinated way that eliminates some cost and enhances productivity all driven by the vision.”

The No. 1 key to making a strategy implementation successful is having the right people driving results.

“Your results will be no better than the quality of the individuals who make up your organization,” he says. “You have to be brutally honest. At times you will outgrow some individuals.”

Sharing the business plans, challenging each other and making sure that everyone is working on the same priorities and holding people accountable is crucial to success.

“One area is dependent upon progress being made in another,” Weddle says. “We just need to make sure that we’re doing an absolutely terrific job for each one of those individual investors that we help to reach their financial goals. If we can stay focused on that we’re going to have a lot of success.” 


  • Answer important questions about your business and its future.
  • Develop objectives to reach in a long-term plan.
  • Implement your plan with the right people and measures.


The Weddle File

Name: Jim Weddle

Title: Managing partner

Company: Edward Jones

Born: Elgin, Ill. He grew up in Naperville, Ill.

Education: Attended DePauw University and received a double major in psychology and business. He also got a MBA with a major in finance from Washington University in St. Louis.

What was your very first job, and what did you learn from it? I had a summer job in 7th grade where I worked Monday through Friday from 8 a.m. until noon for a gentleman who was a retired banker. He had a large property and I drove a tractor, cut the grass, pulled the weeds, painted the house and the barn and worked every day doing that. I learned that you make your own luck if you aspire to do or to have, there’s a way that you can go about making that a reality.

What is the best business advice someone has given you? I had interned here at Edward Jones, and I went out to Indiana where I established a new office and built it up. I had a mentor who was a very senior individual in our firm at the time named Jack. I remember confiding in Jack and he said, ‘What is your concern?’ And I said, ‘Jack, my concern is I’m 23 years old, and I look even younger. I’m afraid people won’t take me seriously.’ He said, ‘People will treat you the way that you act. If you act like a professional, they will treat you like a professional. If you act like you’re 23, they will treat you like you’re 23.’ He also said, ‘Prepare for every day, but do it the day before.’

Who is someone that you’ve admired? One was an accounting professor who had a huge impact on me. For his class he said, ‘You need to show up to class prepared or I suggest you don’t show up at all.’ He was teaching us how to be ready for the rest of our lives.

The second guy was a business adviser named Peter Drucker. We worked with Peter for 20 years. He helped us to understand very clearly who our customer was, what our value is, and the purpose of our work.

HOW TO REACH: Edward Jones, (314) 515-2000 or www.edwardjones.com

Published in St. Louis

When Flemming Bjøernslev took over as president and CEO of Lanxess Corp. and head of the North American region, he gave himself 100 days to get to know the company and the people. This January, the time was up — and by then, Bjøernslev had visited all 14 major sites in the United States and Canada.

“In my first couple days, I went out and took the pulse of the company to assess where we stood in order for me to prepare myself and the employees to take the company to the next level,” Bjøernslev says. “As an international corporation, we have global targets and the board at headquarters expects us to contribute to that target.”

He felt strongly about getting to rub elbows with the 1,500 employees of Lanxess Corp., the North American division of Lanxess, an $11 billion leading manufacturer of more than 3,000 products in the areas of rubber, plastics, intermediates (such as alcohols, acids and higher olefins) and specialty chemicals.

Bjøernslev came to Pittsburgh after serving as CEO of Lanxess Central Eastern Europe in Slovakia and now has the task of taking the learnings from his prior CEO role and transferring them to Lanxess’ North American business to continue to push the company forward.

Bjøernslev is optimistic about the current opportunities in the U.S. and how that will contribute to Lanxess’ business domestically.

“We are seeing a lot of manufacturing returning to the U.S.,” Bjøernslev says. “That gives me great comfort that the U.S. industries are moving forward to a better, brighter future, especially in the areas of mobility, urbanization, agriculture and water.”

Lanxess caters to all those areas and the current outlook has Bjøernslev excited that the business in North America will pick up rapidly, helping get Lanxess on the path to the next level.

Here is how Bjøernslev has come into a new role and put himself and Lanxess in a better position to succeed.

Take first steps

While Bjøernslev isn’t new to the CEO role by any means, he was still entering a new geography and new division of Lanxess when he came to Pittsburgh in October 2012. In his initial three-plus months, he had to familiarize himself with the business.

“In those first 100 days, I had to get to know the company and the people here in North America, which is Pittsburgh and our other sites,” Bjøernslev says.

He started with a couple of town-hall meetings and round-table discussions held department by department to interact on a more individual level with employees.

“I consider that extremely valuable to get to know the individuals and for them to get to know me and listen to what my vision is as we move forward,” he says. “I also visited all the major sites we have in North America. Again, we did a mix of town-hall meetings and round table discussions.”

Bjøernslev had a two-fold approach to his new CEO role, both internally and externally.

“The internal approach best practice for me has always been to sit down with the people and have them present their roles and responsibilities within the company in order for me to assess where we stand from a corporate point of view,” he says.

“The external part is presenting Lanxess to the outside world — customers, business partners and other relevant organizations we interact with.”

It is crucial that a new CEO put himself or herself out in front of the company’s stakeholders and offer the chance to get to know and understand one another.

“The key is to just take the hurdle of getting out there, getting to know the people, introducing yourself, introducing the company, introducing the target and tell a little bit about yourself,” Bjøernslev says. “That has been the focal point, and it is the best practice based on my experiences in previous jobs.”

Bjøernslev has learned that listening to the people who help drive the business every day is vital to understanding what direction to go in next.

“You have to listen to the people you are going to work with in the new position,” he says. “You have to watch the environment very closely and most importantly, listen to your gut feeling and be daring as you move along and make decisions.”

The worst thing a new CEO can do is hesitate in making those crucial decisions.

“We are all human beings and when you make a decision, you normally base it on experiences,” he says. “If you’re somewhat uncertain, human beings have a tendency to avoid making a decision. If you want to move forward in a new position, you have to make a decision, because avoiding a decision is not going to get the job done.”

Get to the next level

Lanxess is driven by innovation and technology paired with people excellence, both globally and locally. What Bjøernslev has found is that the company’s production and product base is extremely quick with regards to innovation, technology and the right ideas to make new products that will propel the company.

“At the end of the day if you take the people excellence, the topic of safety and blend that with the innovation and technology driven culture we have here at Lanxess, those are the keystones in order to create success that will take Lanxess North America to the next level,” Bjøernslev says.

When looking at what opportunities existed in North America, Bjøernslev saw the automobile market as a crucial player in Lanxess’ future with the ability to offer new products in rubber and plastics.

“The U.S. market is still the biggest market in the world for miles per person driven,” he says. “What I have realized over here is that Americans love cars. With our product portfolio within plastics and the fact that we are the leading manufacturer of synthetic rubber in the world, more than 50 percent of our turnover is generated in the automotive and tire manufacturing industry.”

Lanxess currently has an initiative it calls Green Mobility. Green Mobility relates to two major areas — lightweight construction of automobiles and green tires — which Lanxess hopes will drive the growth of the business and improve the auto industry at the same time.

“Car manufacturers are continuously focusing and forced to focus on reducing CO2 emission, reducing fuel consumption and that’s why they have to reduce the weight of the cars,” Bjøernslev says. “By using our high-performance plastics, you can reduce the weight of a car up to 30 percent. That is something that the Motor City is very interested in.”

The second area of interest for Lanxess is what it calls the green tire. The company has been supporting an initiative within the European Union, Brazil and Korea surrounding tire labeling.

“There is a requirement to label your tire as a producer based on three factors: rolling resistance, noise reduction, and wet-grip capabilities,” Bjøernslev says. “We are convinced that Americans who love to have a choice will be embarking on this tire labeling issue because so far in the U.S. you have never had the chance to decide what kind of tire you would like under your Cadillac, Ford or Chevy.

“We’re convinced this will be a topic for the U.S. industry in the future and we will support that.”

Bjøernslev hasn’t wasted any time in making decisions about where to focus the company moving forward. That decisiveness has been a result of listening to what is happening around Lanxess globally.

“First and foremost, you have to listen to your customers,” he says. “Secondly, make sure that you assess the entire value chain. You want to make sure that you reach out and listen to the customers of your customers. You want to make sure that you’re integrated in the right manner in order to cost-effectively and profit-effectively cater your products to the market.

“You have to make sure that you read the signs of your time, meaning the trends in the marketplace. You have to live in a global world. Today, it would be very risky to only focus on the U.S. or North American market.

“You have to take into consideration what the drivers are internationally, in Asia and in Europe, because although we sell a lot of products here in the U.S., we export to other parts of the world and vice versa.”

Bjøernslev says as time goes on, he plans to continue to focus on having the right set up in the company to get Lanxess to that next level of growth.

“We are cautiously optimistic as to future development,” he says. “What we have to do now is make sure we have the right organizational set up in order to cater our products to the market.

“What I found here was an excellent foundation. What we want to do is capitalize on that and make sure that we participate in the new market dynamics within the North American chemical industry and beyond … with the advancement of our products.”

How to reach: Lanxess Corp., (800) 526-9377 or www.lanxess.us


Get to know your employees and understand your company.

Listen to key stakeholders and the business environment.

Take your learnings and make decisions about direction.


The Bjøernslev File

Flemming Bjøernslev

President and CEO

Lanxess Corp.

Born: Denmark

Education: Bachelor’s degree in international management, FOM University of Applied Sciences, Essen, Germany

What was your very first job, and what did you learn from that experience?

I was a shop assistant at a green grocer. It taught me that hard work and dedication pays off.

What is the best advice you’ve ever received?

Never tell yourself that the target has been reached, because there is a big risk that you turn complacent.

You mentioned you are a car guy, what is your favorite car?

I am the proud owner of a 1969 Porsche coupe. I’m a Porsche guy but old Porsches.

Who is someone in business that you look up to?

I’m a great admirer of a man named Ferdinand Piëch. He is the head of the supervisory board of Volkswagen. Volkswagen is currently No. 3 in the world and the target is to be the No. 1 car producer. First with Porsche, then Audi, then Volkswagen, Piëch has continuously been building Volkswagen to be one of the leading car producers in the world and that’s been done with innovation and technology. I find it fascinating the consistency he has had in achieving the position Volkswagen is in today.

What has been your favorite country you have spent time in?

I have a bunch of favorite countries, but my takeaway lesson from traveling the world has been that the key is the language. I speak four languages fluently: Danish, German, English and Spanish. I speak half Slovak because my fiancé is from Slovakia. I have a couple of favorite cities: Vienna, Austria; Buenos Aires, Argentina; and I’m increasingly starting to like Pittsburgh, because it’s not a major city like New York, but it’s also not a village. It’s the right size and it has a lot of culture.

Published in Pittsburgh

Staying relevant. It’s why companies close old divisions and start new ones, why they introduce new products, make acquisitions, diversify their portfolios and invest in R&D. And for IT companies like Groupware Technology Inc., it’s the reason to complete one transformation, only to pause, and do it all over again.

The need to change was something that IT industry veterans — owners Mike Thompson, Scott Sutter and Anthony Miley — understood well when they acquired Groupware, an IT solutions provider that was on the verge of going belly-up in 2005. They recognized from day one that the company’s survival was dependent upon Groupware’s ability to transition outside its roots of

“systems and storage” and make a name in for itself in IT’s fastest-growing segments: big data, cloud computing, virtualization and data security. It’s a process that’s taken involved two restructurings in seven years.

“It’s a brand-new organization from the company that we acquired,” says Thompson, the company’s president and CEO. “We took a company that was doing at the time of the acquisition $1.7 million, and we turned it into almost $150 million with our company. We injected life into the organization by creating relevancy within the marketplace … and within the customer base.”

Here’s how Thompson and his co-owners have taken Groupware from struggling IT reseller into a leading systems integrator.

Look for an opening

Groupware’s broad customer base includes SMBs all the way to Fortune 500 companies. This means the company’s IT solutions must meet a wide range of technology needs. Delivering solutions that are on the leading edge of today’s systems and storage technology is the only way to stay relevant for customers.

“At the rate that technology is changing — it’s pretty amazing the acceleration that it’s going through — we need to stay in the forefront in regard to what technology is out there,” Thompson says. “It’s having business conversations with our customers to understand what pain points they’re trying to solve for and where they’re trying to take their business.”

Nobody knows the needs of the market better than your customer base. So one of Thompson’s first steps as CEO was to ask customers, “What’s going on in the marketplace?” and “Where do you want to take your business?” to see where Groupware should be investing.

“Understanding what’s going on around cloud computing, big data, next generation data centers and having the expertise to be able to deep dive into those types of opportunities and conversations with customers has allowed us to remain in the forefront,” Thompson says.

“It’s having conversations with our end users in regard to what business issues they are trying to solve and then understanding how we can help them solve those issues, and not just for today.”

What Thompson and his partners realized quickly is that businesses buying IT products also wanted in-depth knowledge and advice from their providers. They began working on a strategy to transform Groupware into a services-led business, which could provide both products and support for its customer’s technical capabilities.

As it turned out, the challenges in the down economy — more companies began seeking IT workarounds to help them manage with more limited resources —gave the company an “in” to present its new solutions and services to the marketplace.

“Customers looked to us to offset some of the reductions that they had in place because business has to go on,” Thompson says. “You still have to solve these business issues. You’ve just got to find new ways to address the business models out there.”

While competitors scaled back, Groupware doubled down on IT investments, including its service segment, which Thompson and his partners believed would propel demand moving forward. The company also invested heavily investments in its labs and engineering capabilities — especially engineering talent.

“Where there is change and uncertainty, there is opportunity,” Thompson says.

“As we went through it, we saw that people were going to pull back. Our opportunity was to go invest heavily to have resources available to [businesses] and to create value out in the marketplace that our customers could leverage from us to continue to be successful in their operation.”

Start tough conversations

By the time the recession began bottoming out in 2010, Groupware had nearly doubled its business, a sign that new investments were paying off. Still, the business transformation also forced Thompson and his executive team to restructure certain areas of the company to make room for those investments.

It was important to engage people in “adult conversations” about why the changes were happening and what they meant.

“I think too often we let niceness get in the way of the truth. You need to have those conversations and not delay the hard conversations, acting decisively based on that and moving forward. I’ve been in situations where the executive team has been slow to make changes and it became irrelevant really quickly by not acting and not executing. It’s critical to have those conversations and then act on them appropriately.”

Groupware has now gone through two restructurings since 2005, a transformation process that’s involved rearranging certain departments, eliminating remote offices and consolidating operations. These strategic moves have helped drive the company’s investment in “rack and roll” solutions — complete technology solutions designed to be rolled into the data center and quickly put into production, generating higher returns for Groupware.

For Thompson, the ability to have honest conversations with team members has helped him keep the company accountable to progress, but also to earn employee respect. People prefer to do business with people that they like, but they’ll also follow a leader who they respect, he says.

“We need to have those hard conversations and get everybody on board with the investments that we want to make as an organization,” Thompson says.

“You can move too quickly, but if you set the goals and hold accountability level, you can make minor changes to that if you need to, or you can pull back.”

That said, building a dialogue with employees is also important in helping you monitor your investments. Strong internal communication gives you a continuous feedback loop to know where your investments stand and what kind of returns they are generating so that you can know when to pull back.

“It goes back to where you place your bets, making bets and then understanding the return, setting expectations associated with those bets and managing toward that,” Thompson says. “If you don’t see the return or you don’t see the return coming, you need to be able to take those resources back and double down where you do see return on those investments coming from or where you believe you can get a greater return.”

Share in excellence

Today, Thompson continues to invest heavily in the company’s core competencies — networking, security and storage — as well as its services practice, its fastest-growing division. Smart investments combined with open and honest communication are two building blocks in a foundation that helps Groupware stay relevant with customers, and the marketplace.

The third is collective ambition, or a shared commitment by employees to the company’s success.

“I’m a firm believer in building winning teams, having the right people in the right positions at the right time,” Thompson says. “Then you’ve got to empower them to go out and execute.

One way Thompson drives collective ambition at Groupware is by creating an environment where employees want to come to work.

“I’ve always felt that it’s our job from a leadership perspective to put our employees in a position to be successful,” Thompson says. “When they drive home that night, we need to give them a reason to come back in the office the next morning.”

What makes a great work environment? At Groupware, it comes down to living the company’s three core values every day.

“The great thing about this transition is that we’ve remained true to our core values of customer service, excellence and fun,” Thompson says. “My belief is that you keep those core values intact and you create an environment where employees can be successful and understand the consistency of the model that you’re bringing to the marketplace.”

An example is the fact that Groupware invites every employee in the company to its national kickoff — an event that many businesses limit to their sales teams.

“It’s customer service,” he says. “It’s the pursuit of excellence and it’s having fun. Those three complement each other.”

Getting employees together for the kickoff is about showcasing the company’s values and vision; but it’s also about “getting everybody to fill part of the success of the company,” Thompson says.

Driving this culture is also why Groupware expanded its focus on collective ambition in 2010, when it rolled out a corporate program around the concept. The goal of the program is to help employees understand their role in serving the purpose of Groupware and better explain to employees how all departments participate and work in harmony to help the company succeed.

“Once you have buy-in and you have collective ambition by multiple individuals in the organization, you can propel the business in the direction that you want to take it,” Thompson says.

How to reach: Groupware Technology Inc., (408) 540-0090 or www.groupwaretechnology.com

The Thompson File

Mike Thompson

President and CEO

Groupware Technology Inc.

Born: Mountain View, Calif.

Education: USC undergrad; MBA Regis University

Leadership philosophy: I don’t shy away from the fear of failure. That actually makes me work harder, and I take those challenges and adversity head-on. I’m a classic example of ‘productive paranoia.’ I’m always looking over my shoulder, always working hard and always trying to better myself to make sure that I can keep moving in the right direction.

What would you do if you weren’t doing your current job? 

In some capacity, creating an environment and opportunities for others to grow. Leadership and mentoring have always been important to me.

What is one part of your daily routine that you wouldn’t change?

When I’m not traveling, taking my kids to school in the morning. Discussing ESPN Radio with my son while my daughter tries to sing over the conversation and dance free of her car seat always starts my day off in perspective.

If you could have dinner with one person you’ve never met, who would it be? 

Cassius Clay. I’m a huge boxing fan. The man who became Mohammed Ali was a personal branding genius and his endless confidence and brashness are endlessly fascinating to me. 

What do you do to regroup on a tough day? 

If I can, go do something with my son, shoot hoops, play catch and so on. It gives me a half hour or so away from my phone. Practice, form and fundamentals messages, repeated to him over and over, are great reminders for me as well.

What do you do for fun?

Get out on the water: wake surfing, boating, being out on the water with friends and family. 

Published in Northern California

The view from Beth Mooney’s office on the 56th floor of Key Tower in downtown Cleveland overlooks Cleveland Browns Stadium, the Rock and Roll Hall of Fame and Museum, Jacobs Pavilion and the Lake Erie shore — attractions that are part of what makes Cleveland special and reasons why Mooney loves this city and is proud that KeyCorp can call it home.

Mooney, chairman and CEO of KeyCorp, one of the nation’s largest bank-based financial services companies, with assets of approximately $87 billion and more than 15,000 employees, came to Cleveland in 2006 to lead the bank’s more than 1,000 branches. Her appointment to the CEO role in 2010 was a historic one since the move made her the first woman CEO of a top-20 U.S. bank. The announcement received national attention.

“I knew it was significant, and it wasn’t lost on me particularly from when I started in banking in 1978,” Mooney says. “It wasn’t lost on me that within a generation how transformational that was for our industry and within Key how significant it was, but it came with a degree of notoriety that I don’t think I saw coming. The world kind of took pause and noticed that banking, an industry that has long been heavily dominated by men at the top, promoted its first woman.”

While the move created big buzz, Mooney had to quickly focus on the job at hand since KeyCorp had been struggling to make a profit the previous few quarters coming out of the recession. One of the reasons she won the CEO role was her knack for developing and driving a strategy and her ability to get people to follow her. The company needed a new approach, and Mooney was ready to answer the call.

“Part of the process with the board when they selected me was to challenge me with what would be our strategy,” Mooney says. “How would Key differentiate itself? How will you make a competitive advantage? How will you know you’re winning with clients? There was a lot of dialogue around strategic vision. We just really need to stay the course, be rigorous, execute the strategy with focus and discipline and I needed to position us for that journey, reaffirm our strategic message to our employees, to our investors and find a way to capture that and bring people with us.”

Here’s how Mooney is focusing on building better relationships, providing great customer service and making sure her legacy as the first woman CEO of a top-20 U.S. bank leaves a positive and memorable mark.


Believe in your abilities

When Mooney started her career in banking, she didn’t think she would one day become a bank CEO. However, as she developed her skills and grew in the industry, she began realizing that the top spot could be within her grasp. She consciously sought opportunities in her career that would keep pushing her further.

“I was in it because I didn’t know that I would ever truly be a CEO, but that I wanted to go as far as my ambitions would take me,” she says. “I’ve made a lot of choices in my career and taken jobs, challenges and moves and very diverse opportunities in order to build what I call the best tool kit I could personally have and try to balance that with how far my abilities would take me.”

Throughout Mooney’s career, she has identified working well in a team environment, bringing out the best in others and accepting constructive criticism as some of the most important skills to have.

“One of the most critical skill sets is the ability to be effective in a team and work within environments where it’s groups of people solving problems, creating opportunities and driving business success that you have to think of yourself as a successful participant in a team and be able to exert pure leadership,” she says.

“As you get the opportunity to lead and get increasing responsibility, don’t lead with your differences; lead in a way where you bring out the best in others. You’re known for being a problem solver. You’re known to be somebody who is encouraging, coaching, mentoring, yet disciplined and delivers results.”

In Mooney’s career, there have been many role models and people who have mentored, coached and helped her get to this level.

“I have had a lot of bosses, both men and women, over the years who have invested in giving me opportunities — the stretch assignment, the difficult assignment because they believed I had a lot of capability,” Mooney says. “I tell people to take a tough job or take an assignment that’s outside your comfort zone so people can see you in a different light and realize that you’re scalable, nimble and can adapt to new situations. Never stop investing in your own abilities and your own learning.

“One of the things I’ve always said in interviews in my life whenever I was being considered for another opportunity … is I will always take the chance on my own abilities. If you give me this opportunity, I won’t disappoint you. Then work really hard to make good on that.”

Mooney says she is in her dream job, and as the company’s first female CEO she wants to make KeyCorp the best company she can.

“I want to do this well because I would like my legacy to be that this was a successful time for Key, for its clients, its communities, its employees, its shareholders — that it was transformational to our industry at a point in time and that it was a headline,” she says. “Hopefully by the time I’m done, it’s a footnote because there will be others who have risen to this level. Whenever you get that recognition and the spotlight is turned on you, I think it needs to bring out the best in you and that’s how I’ve internalized it as an extra obligation to do what’s already an important job well.”


Build better relationships

Mooney’s first steps to get KeyCorp back on track were to understand what would return the bank to profitability. She started with a focus on the company’s clients and consumers and sought to understand what they wanted from their bank.

“From a challenge point of view, what we were doing is still unique within the industry, which is a real firm focus on being very targeted about your clients and being disciplined about doing business with people that you had relationships with,” Mooney says.

“So staying very focused on our value propositions we’re going to build relationships, we’re going to do it in very targeted ways with clients who we know and appreciate our capabilities. We’re going to be clear about giving advice and solutions and not be product-pushers, and at the end of the day we have to give great service. So it was a little of back-to-basics, but with a whole new level of accountability and rigor.”

The best example of how Key showed its loyalty to its customers was when the Durbin Amendment was put in place in 2011. The legislation, which was part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, limited what banks could charge for debit card activity.

“It took a huge stream of revenue out of the banking industry,” she says. “In our case, it was $60 million in revenue that went away. The last time I checked that was real money. The different banks started talking about no longer being able to offer rewards programs along with your debit card and were probably going to have to charge a fee. So you had to make your plans for what you were going to do because it was a significant revenue difference.”

The company stepped back and ultimately came to the conclusion that it should ask its customers how they felt.

“We have been building this notion of listening to our clients, being insight driven, i.e. what do they want and need?” Mooney says. “What do they value and what will they pay for? When we [asked our clients] what we heard was don’t nickel and dime us. They feel that adding a fee was nickel and diming. What they wanted was for people to recognize and value that they have a relationship with us, and if we have a relationship that should be meaningful to the bank.”

Key decided to reorient its products around the notion of relationship building. The bank not only didn’t pull its rewards program, but expanded it, which was the opposite of what other banks ended up doing. It even landed KeyBank on the “ABC Nightly News.”

“When [ABC] listed the banks that weren’t charging their customers’ fees, Key was prominently displayed, and I got a sound bite where I said, ‘We asked our clients. They didn’t want to be nickeled and dimed. They wanted to be valued, and we went for reinforcing ‘Bring us your relationship and we will reward you’ versus going the fee route.’” Mooney says.

“That is value-spaced, relationship-based and that is a commitment to an extraordinary service. That is trying to find solutions that fit the needs of your clients and positioning yourself to be different in the market. I look at that as one of those examples that you can point to that says something is different at Key.”

In order to differentiate your business from others in your industry you have to be able to use your relationships to your advantage.

“I would start with the basic premise that the more you can understand about what your client wants, needs, values or what will differentiate you is an incredibly powerful strategy,” she says.

“The power of unleashing the ability to take that which you provide and build it, package it and deliver it in a way that really resonates with what your client wants, to me, is probably the only truly valid growth strategy over time.

“To the extent that you believe that you can build something — if you build it they will buy it — is a lost strategy these days because we’ve come to an age where choice and knowledge about choices, the rapidity of change and the ability to switch has probably never been higher.

“Retaining loyalty and building relationships takes a different value proposition and takes different work. It has to be rooted in what your clients want and need and finding proactive, robust ways where you find those outlets to listen and understand is a linchpin of a successful strategy.”


Form a strategy

The strategy of relationship building and customer service initiatives at KeyCorp go back to before the recession hit. However, as the recession increased pressure on the banking industry, those strategies gained importance.

“Even before the downturn we stepped back and said, ‘What are the things we want to be known for?’” Mooney says. “This goes back to 2007 and we said, ‘We better get really, really good at customer service because at the end of the day nobody truly stays loyal to a product, nobody really stays loyal to a location, a brand; they stay loyal to people and they stay loyal to how you make them feel.’”

KeyCorp looked outside the industry at how others were delivering service in order to better grasp how the company should move forward.

“We looked to Lexus and Ritz-Carlton and really calibrated how we trained our people, what we asked them to do and how we measured them,” she says. “We put in customer satisfaction surveys and all sorts of things to ask what sort of experience you received. You need to teach your people this is what service looks like, and this is how it feels to the client and then you call the client and ask them did they indeed experience you that way.”

Through that kind of training and initiative, KeyCorp got its customer satisfaction levels up to what most community banks experience.

“In the last two years, the slope of that line has accelerated to the point where the Holy Grail in service has always been the local community bank,” she says. “We’re right at the level of the service that community banks have give,n and we’ve really gapped out from our competitors.”

“You’ve got to decide what it is people want. Learn from the best in the industry, not just your business. Create a way to train people to it. Test that it’s happening and then recognize and reward so it becomes a virtuous cycle within your company to make giving great service part of how people get up.”

For any strategy to be effective, there are a few critical factors that you need to make sure you do.

“For a good strategy to be great, there is only one way and that has to be the consistency of execution of the strategy,” Mooney says. “First, you have to start with clarity of the strategy to the people who have to implement it. Your employees have to understand clearly what your strategy is. What’s your strategy and how are you going to differentiate? How are you going to compete and what does winning look like?

“Secondarily, it’s the consistency with which you execute that strategy over time and that your ability to focus on execution is done with rigor and accountability. Then make appropriate course adjustments, but do so with consistency.

“I don’t think there has ever been a great strategy that wasn’t executed over time with rigor, with accountability, with clarity, with buy-in, with recognition, with reward that is meaningful to the client. This whole notion of ‘It’s a journey, not a destination’ that you have to stay with it over time and people need to understand it and believe that it’s real and get up and know what’s expected of them and do it over and over and over again, to me, it’s that clarity and consistency and the disciplined, focused execution that makes a difference.”

The course of implementing a strategy takes a lot of hard work by everyone involved, but the CEO has to play the most crucial role.

“The trajectory, the pace, the rapidity and the tone and feel of [a strategy] is uniquely a CEOs role to help shape that, to help give it a face and something that your employees can follow, your clients can understand and your communities can appreciate,” she says. “Then ultimately create the shareholder value from those strategies that will make it rewarding for them to invest in your company. It’s kind of unique being the bearer of it as well as the driver of the strategy.”


Gain buy-in

No matter how good a strategy sounds or how good it looks on paper, it will not succeed unless you get buy-in from your employees who have to ultimately be the ones who do the work.

“The first cornerstone for how do you get followership in a strategy has to be the simplicity of the message, the consistency of the message and you can’t communicate enough,” Mooney says. “Every chance I get it’s here’s who we are, here’s how we compete, here’s how we’re going to be different in the marketplace, here’s how you help us win. It’s consistency of messaging. Then what I hope I do effectively is, ‘I hope I’m very authentic. I’m very genuine. I’m very down-to-earth, and I put things in terms people can understand and can see themselves as part of.’

“So there is this constant, clear messaging and consistency of communication that you have to get protocols and rigor around where the content is compelling and understandable and you see yourself in that strategy.”

Another way to get people to follow you is to truly show your company how much you care about its well-being and success.

“I think the other thing that is unique to my style is that people know I’m passionate and I believe in what we’re doing,” she says. “I value our employees. I believe in our clients and our community. I’m committed to our shareholders, and I think there’s a bit of a rising tide in the messaging that people want to go with that.

“It becomes something that they can rally around. The rigor around making sure those messages are done continuously and reinforced doesn’t happen by chance. There is a whole protocol and operationalizing of that messaging to make sure that it is not just ad hoc, that it is indeed consistent, clear and inspiring.”

Today, KeyCorp is continuing to leverage its relationships and devotion to customer service. Since the downturn, the company has reported eight straight quarters of profitability, and it has further plans to keep growing.

“The cover of our annual report captures it well; it says, ‘Strong, Focused and Building Momentum,’” Mooney says. “I feel like with eight straight quarters of profitability Key is solidly back to profitability and that what we need to do as a company from here is to build on our momentum and the sources of where we’ve been able to grow our business and return to profitability – and just be relentless around doing so.”

To ensure the continued success of your business, you need to not only focus on relationships and service, but on new opportunities as well.

“You need to do both grow your core and do the things you do well as well as seek to always do new things that are additive to your business model, but with a keen sense of prioritization,” Mooney says.

“If you try to do everything, you do nothing well. You have to be disciplined in what you prioritize, ‘planful’ in what you choose to execute, and then rigorous in how you measure and hold people accountable for what you’re doing. Those three stages of attributes need to be part of a constant vigilance making sure you answer those three questions and then it becomes a virtuous loop.”



  •  Never stop investing in yourself.
  •  Build relationships and leverage them to succeed.
  •  Use strategy to deliver a consistent, clear message.

Learn more about KeyCorp at: 

Facebook: https://www.facebook.com/KeyBankCommunity

Twitter: @KeyBank_Help 


How to reach: KeyCorp, (216) 689-5580 or www.key.com

Published in Cleveland


Doug Tozour firmly believes that if you’re not really good at something, you shouldn’t futilely bang your head against the wall trying to do it out of sheer pride or a refusal to accept defeat.

It’s a lesson he learned after 10 years of unsuccessfully trying to build a new business unit at Tozour Energy Systems.

“I got into the residential air conditioning distribution business and tried all kinds of things to build that business,” says Tozour, the company’s founder and CEO. “By distribution, I mean you buy product from a supplier and you inventory it and then resell it. For 10 years, I bled trying to make it work. And in the end, I realized I’m not a distribution guy.”

Tozour Energy Systems was launched in 1979 and is now a leader in the heating and air conditioning industry for customers who have large buildings to maintain. The 190-employee company has done work for such clients as Comcast Center in Philadelphia, Ocean County College in Toms River, N.J., and Petway Elementary School in Vineland, N.J.

Tozour Energy has built a strong reputation by understanding its strengths and routinely devising innovative solutions to help customers solve their heating and cooling needs. Tozour’s past experience helped him understand the value of finding something that you’re really good at and then focusing on providing the best experience you can to every customer in that realm.

“When we leave a job and call the client or anybody asks the client how we did, if they say anything other than I want Tozour Energy Systems on my next job, we failed,” Tozour says. “That’s the ultimate measure of the job we did.”

Here’s a look at how Tozour built a culture that empowers employees to do great work and provides the motivation to continue reaching higher.

Get involved in hiring

You need to take a lead role in identifying and hiring the right employees to represent your company and provide exemplary service to your customers.

“You don’t delegate to your B and C players,” Tozour says. “You really make sure your A players are in the search, doing the search, talking to people. The minute you delegate hiring down below the top performers, you really do risk hiring more of what the interviewee is. The key is to get your best people involved in the process.”

Tozour works very closely with Kevin Duffy, the company’s president, to find those employees.

“We spend a lot of time trying to figure out what people are really good at and trying to get them to do more of that and then building teams around that,” Duffy says. “That helps us a lot organizationally.”

Testing is an important of the hiring process along with interviewing and feedback from references and referrals.

“If we’re hiring for a sales role, they go through the Sandler sales aptitude testing,” Duffy says. “We do testing of personalities to see how they will work in a team environment. We work hard to understand what their core personality is like. Do they have a tendency to make excuses? Do they step up and take ownership? It gives us perspective on what kinds of questions we should ask so that when they do come on board, we have a sense of what they are all about.”

Tozour says hiring the right people is about a lot more than just finding someone who can do a particular skill.

“People come in many stripes,” Tozour says. “The people we want are the people who in their heart, really want to be exceptional. Those folks live on challenge. They want change. You hear the cliché, ‘Don’t change. Leave it the way it is.’ That’s not who we hire.

“We tell them day one when they come into the orientation that we promise two things: Challenge and change. The day we don’t deliver on that challenge, you come see me because either we’re screwing up or you’re in the wrong place.”

In order to stay on top of your hiring, you need a strong HR department that can help you by understanding the kind of people you want to hire.

“We have a full-time human resources person whose main role in life is sourcing, finding, interviewing and developing great people,” Tozour says. “We want people who are creative, inquisitive and always questioning how we can do it better.”

You can also use your PR or marketing team to help make your hiring efforts more fruitful.

“One of the great things we’ve done in the last few years is get our PR engine working to get the word out about some of the great things we’re doing in our community and some of the great innovations we’ve got in the marketplace,” Duffy says. “We’ve got people knocking on our door constantly and the best compliment is we’ve got our employees inside that are constantly recommending and referring really smart people because they know we set the bar high.”

Be a leader

There is a big difference between management and leadership and those who fail to understand the difference will find it tough to grow their business.

“Management is the cold, hard facts,” Tozour says. “Here’s how many visits we made, how many proposals we made, how many orders we sold and how many solutions we provided.

“Leadership is the ability to inspire people to do stuff they might not do if left alone. Management is important because it’s all about measuring, quantifying and evaluating the results. But if you’re going to be a great company, it’s all about leadership.”

Effective leaders are proactively searching for both the good and the bad about how their organization works. Duffy says Tozour Energy spent time last year developing a dashboard system to help people understand how certain activities led to certain outcomes.

“Each of the business units developed a set of about five dashboard activities that we then meet about and discuss every Monday morning,” Duffy says. “We meet for a half hour to review how what we are doing will lead to results. Those activities on average resulted in close to 15 to 20 percent business growth in each of the business units for those who implemented it and followed it.”

One thing a dashboard does is provide tangible proof that people are responding to your leadership.

“Doug always says to me, ‘Look over your shoulder to make sure somebody is actually following you when you start these innovations,’” Duffy says. “It’s something we challenge all our leaders to do. Make sure it’s not just you, but that your team is following.

“This dashboarding activity was transformational for the organization. It takes everybody at every level to actually be implementing and doing it and utilizing the process to drive the results.”

There is another difference between leadership and management that effective presidents and CEOs need to keep in mind.

“I paint the picture,” Tozour says. “I paint it as clearly as I can about where we want to go, where we’re headed and a little bit about how we’re going to get there. Then I try to get out of the way. Kevin’s job is to get us there. Unlike a lot of companies, I’m trying not to reach down through the organization too much.

“I’m going to tell you where we want to be. Then I’m going to expect you to staff it properly and to be the one responsible for motivating and inspiring people to do the day-to-day things that need to be done if we’re going to get to this vision.”

Broaden your view

Tozour and Duffy value what their employees do on the job, but they encourage those employees to pursue opportunities outside the business that bolster their skills.

“About four years ago, we started reimbursing for MBAs and encouraging everyone on our senior leadership team to go back to school and start on an MBA,” Duffy says. “We put our money where our mouth is. What we started to see are people who were focused perhaps in a sales role then understood how they fit into marketing and all the business functions and the financial side.”

Tozour wants people who have the tenacity to pursue further education and training and the desire to get involved in leadership opportunities outside of the company.

“We’ve got guys who are coaching semi-pro teams and we’ve got people who are working in all kinds of nonprofits,” Tozour says. “It’s really exciting to see the involvement that you would never know about if you just met the person. You’d say, ‘Yeah, he is a salesman or a service guy.’ They are coaching teams and making stuff happen. Life is much broader than where you work.”

The lesson is that in order to get people to really give their all for your business, you have to be willing to do the same for them.

“If our individuals don’t have an opportunity to grow and develop, the company is going to be stymied,” Tozour says. “That’s going to go all the way through the company.”

How to reach: Tozour Energy Systems, (855) 486-9687 or www.tozourenergy.com


The Tozour and Duffy Files

Doug Tozour, founder and CEO

Kevin Duffy, president

Tozour Energy Systems

What has been your biggest leadership challenge?

Tozour: The biggest challenge, and it’s always the challenge, is finding really good people who can carry out the vision or can lead the charge. Everybody wants to claim that they have got expertise and what not. But finding expertise with leadership capabilities, that’s always a challenge.

What is your definition of success?

Duffy: There’s a quote that I live by: What we do for ourselves dies with us. What we do for others remains immortal. That’s a real focus. When we can deliver financial success, it gives us the flexibility to do great things for other people.

Tozour: What is success to me? First of all, it’s being able to look back and see the results of our labor. To have the financial wherewithal to do whatever I choose to do going forward. To absolutely improve the life of others by giving back. And to have grown enough that I have wisdom that I never thought I’d be answering the questions you’re asking me.

How do you help your leaders grow?

Duffy: It’s common for companies to develop their vision for five years out. But we took it a step further. We analyzed what does that organization look like? What are the gaps? What are the leadership elements we’re going to need in 2015 to be that company? We went to about five different people in the organization and said we see you as a future leader here. We’re going to start challenging you with specific assignments to broaden your development.

As we grow, we have organizational leaders we’ve brought up and trained and developed so that they are ready to assume a leadership role.


Don’t delegate hiring.

Inspire people to do more.

Encourage continuous development.

Published in Philadelphia

A lot of people gave money to help Silverado Senior Living Inc. become a national leader in providing care to people with memory impairments. Fourteen years later, Loren B. Shook felt like it was time to give them a return on their investment.

“We made stock options to many staff members through those years,” says Shook, the company’s co-founder, chairman, president and CEO. “No one got paid anything. All of the money we made went back into expanding the company. At some point, we needed to monetize peoples’ investment.”

In addition to Shook, his co-founders, James P. Smith and Steve Winner, and those staff members, investments were also made by the private equity firm Riordan, Lewis & Haden. This funding was instrumental in building a company that has 2,800 employees and provides invaluable care to senior citizens who need it across eight states.

“A lot of people think it’s just about the money, getting the equity and the debt partners,” Shook says. “But money is just part of it. The bigger part is what kind of partner are they going forward with you?

“All of them understood the vision of the company, which was to give life to our residents in our assisted living communities, our clients in home care and our patients in hospice. The vision is to give life to their families and give life to each other as associates and colleagues in the company.”

Shook knows all too well that without money, none of it would be possible and that Silverado Senior Living would have never gotten off the ground. But the financials have never been his focus and he strongly believes that is a key reason why the company is so successful today.

And so it was through that prism that Shook and his team set out to find a way to provide a return on past financial investment while simultaneously strengthening Silverado for many more years of meaningful patient care.

Find your soul mate

One of the best options that the Silverado team initially came up with was to take the company public. But as they began to look at what that involved, they quickly soured on the idea.

“Every year, you’re spending $1.5 million to $2 million for accounting and legal fees just being a public company,” Shook says. “You’re taking up a lot of time for the CFO and CEO that could otherwise be providing service more directly to our customer base.”

Soon, their thoughts turned to Health Care REIT, a real estate investment trust that had been working side by side with Silverado since its inception.

“REDIEA is an acronym that stands for Real Estate Development Investment Empowerment Act,” Shook says. “It was very new. Health Care REIT had done one REDIEA with an LLC corporate structure. We’re a C-corp. It was a very detailed process. It took a lot of action to overcome a lot of hurdles that had never been addressed before.”

One of the biggest hurdles in any business deal is the relationship between your company and the financier you want to partner with. Shook flashes back to 1996, when he and Smith were looking for financial support to start Silverado.

“Whenever I started a meeting with a potential financial partner where there was equity or debt, I always started the meeting by telling them what the vision of the company was,” Shook says. “If they didn’t have an interest in the vision and the purpose, the meeting was over because we were not in alignment.

“A lot of experts in raising money would say, ‘Don’t do that. Go down the path of return on investment, the capital you need and the numbers.’ I never believed that was the right way to start a meeting because it’s more than just about the numbers. No one I met with was upset that I started the meeting that way.”

The fact that Silverado had built an established relationship with Health Care REIT over the years made it a lot easier to move the process along with the REDIEA. But that relationship only developed because Shook and his team took the time in the beginning to find partners who shared their vision.

One of the most important things you can do to help you find that kind of partner is to talk to people who have done business with the investor in the past and ask what happened when trouble arose.

“Tell me the hard times you went through and what it was like,” Shook says. “I want to know that I have a partner that has the experience and has been through the ups and downs and is going to be by my side when we’re going through difficult times.”

As Shook looked to finalize the REDIEA deal, he wanted to make sure there was alignment and a shared vision, just as there had been 14 years earlier.

Lean on your culture

As the REDIEA deal was being consummated, Shook was also very aware of his staff and the responsibility he felt to keep them appraised of what was happening. But he also felt confident he had established a track record of trustworthy leadership.

“The culture has to be there before big decisions come about,” Shook says. “You don’t create the culture at the time you have a big decision where you need people to be confidential and you need people to come to you and say, ‘I heard what you said in the conference call. But here’s what I’m worried about, Loren.’ You have to have that kind of open trust in the company. That has to be there before those issues come up.”

Shook shared what was happening with his senior leadership team and asked them to keep it from going public since the deal was still being finalized. He shared the good parts of the deal being discussed with Health Care REIT and the cons.

“There’s always a negative side to everything we do,” Shook says. “Here are the pros, here are the cons and here are other alternatives of what we could do to capitalize.”

Shook reiterated that there was no pressure being made to enter into this kind of deal from anyone.

“Riordan, Lewis & Haden wasn’t saying that you have to recapitalize the company,” Shook says. “They were very patient. It was just the right time and the right thing to do.”

Shook says finding employees who can thrive in your culture and have trust in the way you do things requires a similar approach as when you’re doing your due diligence on possible lenders.

“Our vision is to change peoples’ lives,” Shook says. “So people who work within a company like our’s, in order for the culture to exist, would have to have an alignment or purpose in life with that. Their individual purpose in life doesn’t have to be the same purpose, but it needs to be something that is compatible with the major purpose of the company.”

In order to stay healthy, a culture needs to be such that it can allow people to leave without creating a big problem. Even the strongest culture has people who sometimes lose their connection to the organization.

“Lives will change,” Shook says. “Where it was the right place to be before, maybe it’s not anymore. We want people who get more than they give out of working at Silverado. We want the company to get more than it gives out of having that person work with us. If both are positives, it’s a tremendous source of energy coming together. If one is negative, there is a drain on that energy and a drain on that company.”

Believe in what you do

With a strong relationship with Health Care REIT and a strong culture that trusted in its leadership, Silverado was ready to make a deal. The $298 million partnership closed in January 2011.

“Technically, we did sell the company,” Shook says. “But all of us investors, including Riordan, Lewis & Haden reinvested a great deal of money back into the company. I personally reinvested 50 percent of my proceeds back into the company.”

Silverado is poised to continue growing with seven new communities under construction, joining the 23 communities, eight hospice offices and five home care offices already up and running. Another hospice office and home care office are also in the process of opening.

“Before we started in this industry, people said the model we pursued would not work,” Shook says. “They said we would be bankrupt right away because they couldn’t connect the things we do. They would say it’s either a medical model or a social model and they couldn’t understand how both could happen.”

Shook is confident the results have proven those critics wrong.

“People who invest in business want to make a difference too,” Shook says. “If you get a good return on your investment and make a difference in peoples’ lives as well, then you will win attracting that capital to your company compared to somebody else who is just giving them a return.”

How to reach: Silverado Senior Living Inc., (888) 328-5400 or www.silveradosenior.com

The Shook File

Loren Shook

Co-founder, chairman, president and CEO

Silverado Senior Living Inc.

What’s the best business lesson you ever learned?

One of them is to understand my own strengths and bring in people who have strengths that I do not have. In other words, I don’t want to spend my energy trying to do things that are not my strengths. I’m good at seeing things that can happen that are disparate or ideations, or seeing things that people don’t see and then connecting them.

I can put together the big picture deals like a REDIEA, but I’m not good at the details. Tom Croal, my CFO, he’s good with the big picture. But he’s also terrific with the details. There are enormous numbers of them and he’s very good at that. So I have a CFO who is excellent at that and I’m not.

Shook on value: People will pay for what they value, and I should not impose my financial limitations on them. I don’t know their means and I don’t know what they value. I couldn’t afford to have a person living at home 24/7 taking care of a loved one. So one would think, ‘Who can afford that and why provide that as a service?’

Well, nonsense. We have a number of people we take care of at home 24/7 and there are plenty of people who can afford that. It’s expensive, but it’s not a problem for them. If they can afford it, they should be able to have access to that service.

We’ve taken someone’s mother with Alzheimer’s on a cruise to Mexico. We staff it 24/7 and make that cruise possible and she has a great time. Don’t put your limitations on what other people want.


Vet your financing partners.

Stick to your culture.

Don’t give in to doubt.

Published in Orange County