Beads of sweat roll down a young runner’s forehead, while his mind wills his aching body forward, stride after stride, as he continues on his grueling run. Some miles prove easier than others, but even during those less strenuous ones, he pushes himself to perform better than he previously has and prepares himself for the more difficult, uphill miles he knows lurk around the bend.

While his fatigued body wants to collapse as the miles slowly go by, he cannot stop — there’s work to do, and athletes are always looking to improve.

This same mentality has driven Arthur Blank’s career and created his success as co-founder of The Home Depot (he retired from the home improvement retailer in 2001) and now as owner and CEO of the National Football League’s Atlanta Falcons. Just as athletes have regimens of exercises they practice to improve and succeed, so does Blank. He adheres to a handful of simple philosophies that create and sustain success when continuously practiced. “The whole notion that there is no finish line, which is a life philosophy of mine, reflects in the way you run a business, as well,” Blank says. “The day you think you kind of got it all figured out in any business is the day you’re going to get in trouble.”

Hire the best

When the Home Depot’s sales approached the $1 billion mark, Blank and his partner had lunch with a senior partner at Goldman Sachs, who told them that they’d need to change strategies when the company reached that magical milestone.

That didn’t sit well with Blank, who decided that if they continued hiring and promoting people who “bled orange” and bought into the culture, then the company could, indeed, sustain itself. “We didn’t let people get in the game, as we grew the company, that were just good at getting things done as opposed to good at living who we are,” he says.

Instead of hiring many hourly workers at lower wages, Blank went after the best and paid them more because their knowledge and skills would benefit the customers. But he also held them accountable for creating sales and customer relationships. “They are reflected on the operating statement as a payroll expense, but I’ve always viewed them more as an investment,” Blank says. “We’ve always had the mentality that if we invested in the very best people, not only would they produce the best re-sults for us in the near term but would have capacity for growth and decision-making as any of the businesses have grown.”

Listen

When Blank bought the Falcons in 2002, the Georgia Dome, the team’s home stadium, sat about 40 percent empty on game days, and empty seats don’t help propel athletes to victory or generate revenue. To find a way to fill them, he talked to people who didn’t attend the games. He knew he’d hear complaints, but it was the only way to pinpoint the issues and find ways to fix them. “A lot of leaders, they listen, but they don’t really want to hear the results to the answers and when the answers come, they find a way to reinterpret them based on their original perspective of what they think the answers should be,” Blank says. “They might give you their honest opinion of what they think you’ve got to do to improve your business, but then you put it through your own filter and look at it through your own rose-colored glasses, and you choose not to see it that way. You say, ‘That’s not really what they meant. They meant some other things,’ and you just believe what you want to believe.”

Blank says there are bright people throughout an organization, and leaders need to hear them out, as well.

“You don’t have to be a genius to do it — you have to be bright,” Blank says. “Anybody can be bright. Anybody can listen and understand that there are lot of great ideas out there. ... There are a lot of folk out there that don’t have titles that have an awful lot of good ideas.”

And when senior leaders effectively communicate with those nontitled people, businesses grow stronger. After speaking with fans, Blank identified ticket prices and parking as prime concerns. So he lowered ticket prices on 30 percent of the Georgia Dome’s seats and secured parking — including space to tailgate — for season-ticket-holders. As a result, 30,000 empty seats were transformed into a waiting list 60,000 deep for season tickets.

Forbes estimates the team’s 2006 revenue at $170 million, up from $120 million in 2002.

“It’s very dangerous in any business for a minute when you put yourself above the customer or above the fan or above your associate,” Blank says. “There’s an awful lot of bright folks out there, and they can lead you down the yellow brick road if you’re willing to follow, but you have to be willing to follow.”

Look to the next level

While at The Home Depot, Blank often brought in outside people to meetings, which sparked conversation afterward.

“That first meeting was weird,” the visitor would say to Blank.

“Why was it weird?” he’d ask.

“It sounded like the company was really in trouble. You guys were talking about all the things you were doing wrong.”

Despite The Home Depot’s successful track record, Blank always led with a sense of urgency, continuously pushing forward.

“The best executives that I’ve ever worked with have always had a lot of confidence and a lot of security, but a lot of insecurity at the same time,” Blank says. “They’re always concerned with what happens if the market changes. ... They spend time thinking about all the what-ifs as opposed to just what’s happening today.”

Leaders constantly have to assess if their team also thinks that way and can move to the next level. In the early 1980s, Blank had lunch with Charles Lazarus, who was running Toys “R” Us. “Give me a lesson,” Blank asked Lazarus. “Tell me what we’re going to have to do.” “I have to look at my company as we grow every year ... and challenge myself,” Lazarus said. “Can the people you have around you take you to the next billion? Those are going to be the most difficult decisions you’ll have to make.”

Blank has found truth in that as he’s often concluded that people who worked their tails off and got down in the trenches simply didn’t have the skills to move the business to the next level. “You constantly are pruning the tree around your senior management, making sure the folks that are still part of the tree are thinking in a similar way,” Blank says. “You constantly ask every year, ‘The people that have gotten me to this level, can they get me to the next level, or are there issues I need to deal with?’”

Blank says that when issues arise, look for a niche within the company where that person would succeed at the next level. If that person isn’t willing to change, then he or she may need to find opportunities elsewhere. “That’s your last resort, not your first resort,” Blank says. “You have a big investment in that person. They work their tail off and, typically, they’ve produced at a very high level.”

Lead by example

In the early days of The Home Depot, Blank had every person in his senior management learn the business from the ground up.

“The first three months, you’re going to be working in the stores,” Blank told the first legal counsel he hired.

“I’m an attorney,” the man told Blank, looking at him like he was crazy. “Why would you want me to spend three months in the store?”

“You’re not going to understand the legal issues that are going to come across your bow or the environment they were created in or be able to talk effectively to our associates about what happened in stores unless you actually have some of that experience,” Blank said.

And Blank himself didn’t have immunity. He spent up to 50 percent of his time walking around the stores, working with customers and talking to associates. When he returned and sat in meetings, Blank could communicate problems and issues from the front line that nobody else knew about.

He did the same thing when he acquired the Falcons, living in the dormitories with players during training camp so he could see first-hand the issues facing larger men. Then he took those problems into account when he built their new training facility.

To solve the parking woes identified by fans, he and his team spent five hours walking all the lots within a quarter-mile of the stadium searching for inefficiencies. “Great leaders have a lot of integrity, and they do what they say they’re going to do and they mean what they say,” Blank says. “They don’t feel like all the wisdom resides in their office and they’re happy to get out amongst real people and do real work and find out what the world is thinking about the company and the organization and what they’re doing.”

Give back

Under Blank’s leadership, the Atlanta Fal-cons Youth Foundation has given $6.4 million in grants to 194 nonprofit organizations across Georgia since 2002. And, Home Depot employees annually log tens of thousands of hours volunteering in their communities. “Part of a piece of fabric, in a general sense, you’re woven into the life of the fabric, and when a company weaves its way into the life of a community, it becomes part of the fabric of that community,” Blank says. “It becomes very hard to tear it out of the community, and you don’t want to tear it out of the community. It’s part of what makes the community unique.”

Beyond helping others, service creates employee loyalty and buy-in because they know their employer is a part of something more than financial reports. “They feel the company has not only a brain but has a heart and has a soul to it,” Blank says. “They end up going home, instead of feeling they were at a job all day, that this was not a job — this is part of their life experience,” Blank says. “This is part of what I am as a person — the company I’m associated with. “When you get to that point with an associate, it’s a very powerful place to be because without asking, without telling — and there aren’t enough hours in the day to tell and ask associates to do everything that you want them to do — they do it out of themselves for the right reasons. That’s a perfect environment.”

But leaders have to genuinely care about a commitment to service and view it as an opportunity instead of a responsibility.

“If you have a responsibility to do something, sometimes you do it, you’re not happy about doing it, but you do it,” Blank says. “If you have an opportunity to do it, and you still do it, that means you didn’t have to do it, but you did it for all the right reasons.”

Just as running plays correctly and cohesively allows a team to win, when an organization combines all of these business plays, it creates a financial victory. “Our philosophy has always been on doing the right thing and having the right kinds of standards, and that by doing that, we’d produce the financial performance that was important to the organization,” Blank says. “It wasn’t based on first producing financial results. It was based on a set of values — living those values, supporting those values.”

HOW TO REACH: Atlanta Falcons, (770) 965-3115 or www.atlantafalcons.com

Published in Atlanta

Wayne Huizenga is an entrepreneur and company builder who has found success on a grand scale. He led six companies to be listed on the New York Stock Exchange, with three of them achieving Fortune 500 status, was the first person to ever own three major sports franchises at one time, propelled unknown companies to become household names and was recently named the 2005 Ernst & Young World Entrepreneur Of The Year.

Despite the fortune he has amassed, the soon-to-be 68-year-old billionaire says it’s about the excitement of building something, not about the money.

“I don’t do this for money,” says Huizenga, who chairs Ft. Lauderdale-based Huizenga Holdings and owns the National Football League Miami Dolphins franchise. “It’s the challenge, it’s the excitement and it’s the ability to put something together to let other people make money. All the jobs that we’ve created, all the companies that we’ve created — a lot of people have made a lot of money.”

Huizenga has found success by recognizing opportunities, moving quickly to take advantage of them and putting the right people in charge.

 

Building momentum

While still in his 20s, Huizenga convinced the owner of a garbage hauling service to sell him a truck. Huizenga parlayed that one garbage truck and the score of accounts that came with it into Waste Management Inc. and grew it into the largest waste management company in the country in less than 10 years.

With Waste Management, “We made small acquisitions in different states around the United States,” Huizenga says. “It was just easier, faster and cheaper to go in and buy out a guy who was already established in a market, even if he was very small. Then we’d hire a bunch of salespeople to go out and do the internal growth.

“The plan was always to have internal growth, but in order to get internal growth growing quickly, it’s sometimes easier to go ... into a certain market and buy out a guy who had three or four trucks, and then you’d say, ‘OK, let’s grow this business now.’”

During one nine-month period in the early 1970s, Waste Management bought 133 companies. By 1981, it was the largest waste disposal company in the world. Blockbuster Inc., on the other hand, was built mostly from scratch because at the time, there were no chains to buy. When Huizenga and his investors bought into the company in 1987, Blockbuster had 19 stores with $7 million in revenue. When he sold to Viacom in 1994, it was a $4 billion enterprise with more than 3,700 stores in 11 countries.

Looking for a new endeavor, Huizenga recognized the opportunity to provide better service and better offerings than the mom-and-pop video stores were providing, but it meant acting quickly to seize the best locations to make customer access easy and to maximize visibility.

“In a Blockbuster video store, there is nothing proprietary,” Huizenga says. “Anybody can go open a video store anywhere, any time. If you want to have the best locations in a given market, you want to move quickly to tie up those locations. You don’t want a competitor to take the best location. The reason for moving quickly is to tie up the locations.”

Huizenga also created AutoNation, the first nationwide auto dealers. He developed a one-price strategy, hired management with the expertise to run the company and grew it to be the largest auto dealership in the nation, now with more than 400 franchises in 24 states.

He also formed the company Extended Stay America with an associate. In its first year, it opened 62 locations. The idea was to provide a no-frills service for people who needed to stay more than a few nights at a hotel. The rooms came with a complete kitchen, but properties have minimal lobby space and sheets are only changed twice a week to cut costs. When it was sold in 2004, Extended Stay America had almost 500 hotels in 42 states.

“Extended Stay America was fun because (we were) starting a new concept,” Huizenga says. “There were no extended stay hotels; there wasn’t anything like what we were doing. A lot of people were skeptical. We had to convince Wall Street that this was the way to go. That was a different challenge.”

 

Building a team

Huizenga says that he could never have achieved such success without the right managers. “The most important factor is people,” Huizenga says. “We hear it said all the time. It’s said so much that it goes in one ear and out the other. But really, people are the name of the game. That’s really the secret.”

It’s so critical that Huizenga repeatedly employs trusted veterans in new ventures. George Johnson, a franchisee and later president of Blockbuster Video, became a partner in Extended Stay America. Another Blockbuster veteran, Steve Berrard, heads Huizenga Holdings latest venture, Swisher. “If you make a mistake, you probably won’t know you made a mistake for a year, a year-and-a-half,” he says. “Then you have to quickly correct that mistake. Now you’re behind the eight ball because you’ve lost a year-and-half. Then you have to change culture and all that kind of stuff again.”

So Huizenga is very careful about who he brings into a company.

“Everybody I hire is smarter than I am,” Huizenga says. “A lot of people don’t want to hire people that are smarter than they are. I know there are a lot of things I’m not capable of doing, but that doesn’t stop me from hiring the right person who can get it done. “So, I’ve never been frightened by hiring people who are more intelligent than I am, that are smarter than I am. There’s a difference between being intelligent and being smart. People have to have both.”

And, of course, there are the requisite people skills.

“Leadership is the key,” he says. “You don’t have to know anything about the business. We’ve been in a lot of businesses that we’ve never been in before. (We) still built them up, and then you’ve got to hire the right people — like Mike Jackson (chairman and CEO of AutoNation) to come in. I could not do what Mike Jackson does. He knows more about the car business than I do.

“The best thing I could do was hire Mike Jackson.”

Jackson was an auto industry veteran and a great fit to lead AutoNation with his experience as managing partner of a group that ran 11 car dealerships before being named president and CEO of Mercedes-Benz USA. He had the hands-on management experience at the franchise level, plus the big-picture auto industry corporate experience necessary to run a public company.

 

Rental power

Huizenga has always gravitated toward service-oriented businesses with rental incomes. There are a lot of upfront costs for things such as garbage trucks and Dumpsters, but no one is going to run out of garbage any time soon.

“We like recurring revenue,” Huizenga says. “Before we look at the company, we look at the industry to see how big the industry is, how big could we be in that industry, if we were the first or second or third largest in that industry, what could or would our revenue be. That’s really how we start to determine whether we want to be in that industry or not.

“Then we’ll take a look at the company and see how many companies we can start with.” It wasn’t always easy to get everyone to buy in to that concept. Even the sophisticated investment community didn’t understand the Blockbuster idea; Wall Street kept insisting it was a retail concept.

“When you go in a store and buy a shirt, then that shirt has to be replaced on the shelf,” Huizenga says. “It’s a white shirt with a certain length sleeve and a certain collar size. You’ve got to keep the inventory just right. In the Blockbuster business, you rented the video, and two days later the guy brought it back — and you rented it again. It doesn’t take long to figure out how many times you have to rent it before you got your money back.

“All these retail guys that followed Blockbuster, they couldn’t figure that out at all. It was a whole new model that they had to come up with. We had to work with them to convince them of the model. Once they caught on, then it was good for us. Our stock went up 4,100 percent in seven years. Everybody made a lot of money in Blockbuster — all the employees, all the shareholders made a ton of money.”

His current company, Huizenga Holdings, is using the same formula for success that he’s always used. He’s looking for small companies that can be grown into industry giants.

“We’re doing entrepreneurial things,” Huizenga says of Huizenga Holdings. “We’re buying all kinds of things; most of them are private companies so we don’t have to talk about them. One of the companies we just bought is a company called Swisher. They’re based in Charlotte. It’s back to the rental thing again.

“If you go into a bathroom in any business or restaurant, there are toilet paper holders, towel holders, air fresheners, soap dispensers — we install those and rent those. Once a week, we come and service them.”

And once he builds that business, he may get out of that, as well. Huizenga tends to move on once most of the growing is done.

“It’s not the maintaining,” he says, “it’s the starting; it’s the building; it’s the growing. My wife calls it the chase. You just love the action; you love being in there making things happen, especially when people say it won’t work. When people think it won’t work, there’re more opportunities.”

Where there is the potential for exponential growth, you’ll probably find Huizenga right in the middle of it, trying to figure out how to take the company to the next level and looking for the right manager who can move quickly to get the job done.

“I like the challenge of building and growing and putting the organization together, putting the right people in,” he says. “To me, leadership is about finding the right people and convincing them they should jump on and follow the dream and make it happen. That’s the fun part for me.

“I’ve been very, very lucky to be able to find the right people along the way. You can’t do it by yourself.”

HOW TO REACH: Huizenga Holdings, (954) 627-5000

Published in Florida

Truett Cathy had just finished visiting with a kindergarten class and promised to send the students one of his books, signed, of course, by the author -- with his trademark addition of a biblical proverb.

"'I'm not going to tell you what it is,'" he told the children. "'You've got to look it up in the Bible.' The teacher said, 'I'm sorry to tell you we're not permitted to have a Bible in our schools'

"That's hard for me to understand."

And for Cathy, founder and CEO of fast food icon Chick-fil-A, it was harder to accept. The 83-year-old Georgia native had recently returned from the National Prayer breakfast in Washington, D.C., an event attended by President George Bush, Vice President Dick Cheney, their wives and a religious figures representing various denominations. And while the separation of church and state prevents public schools from promoting any religion and forbids school from using public money to acquire religious materials, that wasn't going to stop Cathy.

He purchased a Bible for every public school in Georgia.

"We got the support of the governor as well as the school superintendent to notify that these bibles were not bought by state funds but by Chick-fil-A, which is permissible," Cathy says. "It's one of the significant things I'm very proud of."

Cathy's belief is strong -- he became a Christian at age 12 - and he reflects on his faith when making business decisions.

"I see no conflict whatsoever in biblical principles and good business practice, whether you're Christian or not," Cathy says. "Biblical principles do work. So, I do try to base my business decisions, as well as my relationship to our people and to the public, on biblical principles, because it very well states, treat a person like you'd like to be treated. That's a message we try to get over to our young people as well as the adults."

In a business with many young and part-time employees notorious for their short tenure, Cathy makes sure his employees are treated well. Those who work 20 hours per week for two years are offered a $1,000 scholarship to the school of their choice. To date, the company has provided nearly $20 million in scholarships.

Operators who meet certain year-over-year revenue increases are awarded the use of a new Ford vehicle for a year. Following one particularly successful year, Chick-fil-A awarded 46 Lincolns. The company only had 250 units at the time, and the expense nearly bankrupted the business, Cathy recalls, with a small laugh.

It's hard to argue with Cathy's results. There are 1,125 Chick-fil-A restaurants in 37 states and Washington, D.C. The company posted revenue exceeding $1.5 billion last year. And from Day One, Cathy has refused to open his restaurants on Sundays.

"We're noted as the place that always closes on Sunday," Cathy says. "We've been doing that for 57 years, so we dare not vary from it. We find that people can spend all the money they've got in six days; it really doesn't take seven.

"It helps us attract a caliber of people that appreciate having Sunday off. Whether they go to church or not, it's the most desirable day to be off."

An entrepreneur's entrepreneur

Perhaps the only thing that preceded Cathy's devotion to the church was his entrepreneurial spirit, which first showed itself in a few bottles of soda pop.

He started his business career during the Depression as an 8-year-old buying six-packs of Coca-Cola for 25 cents and reselling them for a nickel a bottle.

"When I sold out, I'd run back and get six more and six more and six more," he says. "Finally, I accumulated the resources that permitted me to flag down the Coke truck and buy a full case of Coca-Cola -- 24 cokes for 80 cents. When you sell 24 Cokes for five cents apiece -- you made 40 cents. That, to me, was big business."

Born in 1921, Cathy was deeply influenced by the Depression. Through those formative years, he learned the value of hard work, but whatever he may have expected from life, Cathy says, he has received so much more.

"We're very grateful for the progress that we've been able to make at Chick-fil-A," Cathy says. "We hope we've proven success has several meanings, materially as well as other things. It's very important that we keep our priorities in proper order and consider what's important."

That is the approach Cathy adopted from the beginning, when he and his brother, Ben, opened their first restaurant, The Dwarf Grill, when the two returned to Atlanta following military duty after World War II.

"It was a very small place," says Cathy, explaining the origin of the name. "It had 10 stools at the counter and four tables and chairs. Back in those days, we had to work very hard. I was brought up to think the harder you worked, the more successful you would be.

"Some people say, 'The more successful you are, the luckier you are.' I say, 'Well, the harder you work, the more lucky you'll be.'

The two pooled their financial resources and, with a $6,600 loan, invested $10,600 into that first operation. That money purchased the property, building and equipment. The restaurant was open 24 hours a day, six days a week. The brothers alternated 12-hour shifts.

Though the pair did have some experience managing restaurants, owning one was altogether more difficult.

"Everything I had and everything I expected to have was at stake," Cathy says. "I didn't mind paying a temporary price to achieve those things, sometimes later to enjoy. I was single at the time. I was married to that business. I oftentimes spent 36 hours at a stretch without even sitting down, to eat or anything else, because I had to work on a very slim budget there as far as help was concerned."

In 1949, three years after they opened their restaurant, Ben was killed in a private airplane crash. Ben's widow received his share of the operation, which Truett purchased a year later.

In 1951, he opened a second restaurant.

Apprehensive expansion

Cathy was somewhat of a reluctant restaurateur.

"I didn't really want a chain of restaurants," he says. "I had two at one time, and I realized I had one too many then. But the Lord took care of that. One burned to the ground. It gave me the option to do something different."

The something different was a self-serve fast food restaurant. The restaurant was not as popular as the Dwarf Grill, so Cathy tapped the wisdom of Ted Davis, an experienced restaurant owner, who suggested he change the format to a Kentucky Fried Chicken. But for Cathy's insistence on not being open on Sundays -- something owning a KFC would require -- the world might never have known Chick-fil-A. Cathy leased the site to Davis and continued to operate the original Dwarf Gill.

It was around this time that he was experimenting with a fried chicken sandwich. The new menu item slowly started outselling his burgers. It was the birth of the Chick-fil-A sandwich. He licensed the product to other restaurants but quickly realized that he was unable to control the quality.

In 1967, 21 years after he opened his first restaurant, Cathy opened a 384-square-foot restaurant in the Greenbriar Mall in Atlanta. The menu was simple, just five items: potato fries, coleslaw, lemon pie, lemonade and, of course, the Chick-fil-A sandwich. The store was a success, and within four years, Cathy boasted seven restaurants, all in malls.

Cathy does not franchise his restaurants, and an operator needs just $5,000 to get started with the company -- money that is returned if the relationship is severed.

"A franchisee invests his own money and carries the whole financial risk in his business," he says. "There is not capital risk involved (in operating a Chick-fil-A restaurant), which gives him security. He must divorce himself from all other business interests to come aboard Chick-fil-A. It's not a part-time job at all. We expect that strong commitment.

"It's working real well. We have very little turnover among our operators, 4 percent. That's very, very small when you get up to the number of units that we have."

After nearly 60 years in the restaurant business, Cathy still enjoys his work.

"I'm here in my office every day I'm in town, says Cathy. "I still maintain the title CEO, but that doesn't mean I call all the shots. (There are) a lot of things they did that I wasn't aware of that proved good that I didn't think so in the beginning. I'm learning to rely on the decisions of other people for my business.

"I think the Lord has blessed me bountifully more than I ever deserve, and I think I maintain a reasonably good reputation. I don't have any regrets."

On those Sundays when Cathy isn't in the office, he can be found teaching Sunday school, something he has been doing for 49 years. It reflects his commitment to his faith and his family.

"I believe in the Ten Commandments; I think they were written for a purpose for us," he says. "I think it's strange that America was founded on biblical principles -- the freedom to worship as you choose -- and now it seems like you don't mention the name God unless it's in a negative way. The family was very important to individuals. But now, it's talked about very loosely. The quality of our homes is very important to a human being. You need a family.

"We're all created with an idea that we want to accomplish something that might be noteworthy in our lifetime. And we have that as a gift from God -- that we are created with the purpose of giving, the purpose of achieving and winning. I see nothing wrong with being successful and pleasing the Lord. I think He intends for us all to be successful. Sometimes we do it our own way rather than the Lord's way, but I think He has a plan for each and every life that He's created."

HOW TO REACH: Chick-fil-A, (866) CFA-2040 or www.chickfila.com

Published in Atlanta

The first thing Rob Enslin did was get on the road.

It was February 2009, and Enslin had just taken over as the president of SAP North America, the 10,000-employee, Philadelphia-based wing of global software solutions provider SAP.

The trouble was that Enslin was taking over the ship in the midst of a hurricane. The economy was faltering, and along with it, employee confidence was shaken as SAP swam against the economic current, attempting to build and maintain the customer relationships that supply the company’s lifeblood.

But in order to maintain a presence with customers, Enslin and his leadership team needed to ensure that employees across North America were not only on board with the growth-oriented vision and direction of SAP but also confident that the vision would be realized.

“I started doing town halls,” Enslin says. “I went to Chicago, Palo Alto, Dallas, Houston, and I just got in front of every employee with the same message and vision, just to let everyone know where I was. It was important that I got on the road, because when you try to communicate that type of message through a conference call, the dynamics of the interface are missing. People needed to see that I was absolutely sincere.”

Enslin needed to inform and encourage his employees, building their confidence in SAP’s future, and giving them the tools to help SAP’s leaders realize their vision: to turn SAP North America into a solutions-focused company that tailors its capabilities to meet customer needs.

Once he had the employees on board, he needed to connect with customers, discover their challenges and how to best construct SAP’s business model to meet those challenges.

“I had to show everyone that this is how we’re going to connect with customers, this is how they’re going to buy software, this is how we will be successful,” he says. “Internally, this is what we’re going to do to change, simplify our business model and do it really quickly.”

For Enslin, taking on his new role meant putting communication first. He needed to promote a message and stay on it and make sure that multiple groups with varying challenges and concerns were on board with him.

Connect with your employees

Enslin had to overcome a great deal of negative momentum when he took the reins of SAP’s North American operations. The economy was in bad shape, and employees were all too ready to believe the worst about the state of business, in general, and their jobs, in particular.

With that in mind, one of Enslin’s first and most essential messages to employees was to turn off the television, put down the newspaper and focus on the future, not the present.

“A lot of employees were really concerned about their jobs, about job reductions in the marketplace,” Enslin says. “People were concerned about where companies were going. There was a lot of negativity, so the biggest thing was really to have a positive approach to it, lay out how the plan was going to unfold over the year, lay it out in an articulate manner to the employees, and we did that from day one.”

Having a great communication plan is only the beginning when promoting a vision. Messages are made to stick in employees’ minds through hard work and repetition on the part of company leadership. And that’s exactly what Enslin set out to do.

In addition to traveling throughout SAP’s North American footprint, Enslin began to create interface opportunities with employees through periodic morning briefings and other frequent forms of messaging.

“Employees would see our messages when they first woke up in the morning,” he says. “Maybe not every morning, but maybe once a week, once every second week. It was all about clear communication from us as the executive leadership team, explaining the success we are having and how we’re facing our challenges.

“After three or four months, we got the message out, people understood our plan moving forward and started to understand how we were going to get there. From there, we needed to elevate our game. You do that by getting together with everyone on the sales team, vice presidents, managers, consulting, field leadership, and start to focus on an agenda.”

As upper management, vice presidents, managers and employees began to focus on the customer-centric vision, a dialogue began, and Enslin started to see the blossoming of another critical element in developing and promoting a vision: employee feedback.

Enslin wanted to personally gather feedback on his trips. He wanted to hear what employees were saying so he could harvest new ideas and correct misconceptions before the rumor mill could begin churning in earnest.

“The feedback was pretty incredible,” Enslin says. “As you’re on the road listening to employees, you start to break down pieces where you start to find the things that normally don’t show up on your desk. You start telling them why customers are buying in a different behavior and how we need to adjust. Once we got that type of feedback, we were able to make adjustments in a very short time. People were willing to give their feedback because they knew that action would be taken.”

When it comes to implementing your own communication strategy in times that are trying or uncertain, Enslin says that, above all, you need to have an unwavering focus on and belief in your vision. If you communicate your vision and strategy with confidence, chances are that confidence will rub off on your employees.

“First, make sure that they know your vision is rock solid,” he says. “Understand the reality of the situation, and the reality of the situation in 2009 was that people wanted to know the truth. You have to let them know the truth and explain to them the difficulty of the situation.

“It was an unconventional time. SAP America was growing at 15 to 20 percent; then all of a sudden the market changes.”

And when the market changes, your customers’ needs change. Which is why you need to communicate with customers in much the same way you do employees: buoying their confidence in your vision and strategy, creating a dialogue and opening feedback channels.

Connect with your customers

When you go to your customers, you’re really trying to get the pulse of what is going on in the markets you serve. Especially during challenging economic times, customers not only represent your financial support, they provide a wellspring of information on the condition of the market at any given time.

As Enslin settled into his role, he visited with customers and began to paint a picture of their evolving needs and what SAP could do to meet those needs in the coming months and years.

“I spent day after day listening to customers, understanding their problems and how they were trying to be successful,” Enslin says. “It’s just a matter of asking them over and over, ‘How can we help you?’” It’s getting from the customer’s vision to your vision, and to realize that, you have to move at incredible speed. You can’t become consensus-driven. You have to say, ‘We’ve made a decision, we’re headed in that direction, and these are the things we need to change in order to be successful. Once you do that and people start to see success, the rest will follow.”

In the months after Enslin assumed his post, he and his executive tea

m began to debate over the best way to interface with customers. It had to be effective, and as important, it had to be cost-effective.

“We had an internal discussion over what we should do. ‘Should we do this thing; should we save the money? Is it going to help our business? Are people going to fly to Orlando to go to an SAP conference?’” Enslin says. “It’s amazing what customers will tell you when you ask them.”

What customers were telling Enslin was that the world of business was changing with the economy, and SAP would need to adapt, as well. As the economy bottomed out, customers were more focused on cost-saving solutions. Now that the economy has started to rebound a bit, SAP’s customers are once again starting to look for innovative, creative solutions.

“You have to make sure that you’re adjusting your business model to meet your customers’ demands,” Enslin says. “That’s step one. When a market is growing, you’re probably more focused on innovation. Where we’re at now is that customers have seen enough of the efficiency, enough of the employee reductions and capital restrictions. We’re to a point where the profit-and-loss sheets are starting to look pretty good and they’re asking how do we innovate again. So we’ve adjusted our internal business model, and now we’re working with our customers to say, ‘OK, let’s innovate together.’

“What I’d tell other business leaders is listen clearly to your customers on what they need, and then you have to figure out how to adjust your business model.”

The larger your business is, the harder it will be to adjust how you do business. You won’t be able to react to every ripple and wave you encounter. So you need to prioritize what types of services you want to provide and what metrics and indicators will serve as your call to action as an organization.

“When you’re putting together a longer-term vision, it maps around a couple of areas depending on what kind of customer signals you want to go after, what solutions you want to bring to market and how you bring those solutions to market,” Enslin says. “As you’re pulling in the long-term thinking, you need to know how the support services will be structured to actually cater to customers in the future. That is around HR, your financial department, how your contracting process works and how you enable the marketing process with the Web. All of those processes have to be aligned in order to match your vision.”

In a down economy, you sometimes have to make short-term compromises with your vision and business model, recognizing the market’s limitations while still keeping your eyes on the long-term prize of growth and a rekindled culture of innovation.

“The first thing you need to say is, ‘In this quarter, we need to stabilize the environment, we need to go to market, the customers are going to be spending, but they’ll be spending less, and that’s probably going to keep occurring through 2009 and ’10,” Enslin says. “Once you have that in place, what you next want to look at are the longer-term things that you want to work on. For us, our customers are significantly involved in SAP, and they want a relationship with SAP that is a three- to five-year relationship.”

Ultimately, you might need to modify your definition of success in the short term, focusing on short-term goals with your customers and creating company benchmarks focused primarily on incremental improvement.

“There are some things, as you go through this, that are so important,” Enslin says. “One, how do you measure the success of your business? Employees are used to measuring success in terms of growth, but we changed the way we measured success in 2009. We started to articulate to our employees how many transactions we were doing as part of a quota, our customer satisfaction, our partner satisfaction. We started to articulate how we were investing in the future. Once employees see that you’re investing in the future of the business and gain a sense of confidence in that, it’s amazing what you can do when you have that positive flow in the company.” <<

How to reach: SAP North America, (800) 872-1727 or www.sap.com/usa

Published in Philadelphia

What’s in a name? Quite a bit if you ask Daymond John, founder of clothing manufacturer FUBU and star of the hit TV show "Shark Tank."

"Having a strong brand, whether corporate of personal, always creates a halo effect," John says. "A lot of time that’s the only thing that separates you from everybody else."

Standing out from the pack as an original was John’s intent when he named his nascent company FUBU, an acronym for "For Us, By Us" that conveyed the business’ original, largely African-American target market.

John has since stretched the FUBU brand to reach a broader market and expanded into entertainment-related products and services. Yet, he has always remained true to serving the company’s core customer.

"It always comes back to the mission statement and the base," he says. "Like a building, if you have a weak base the building will crumble. Whatever the identity and the product you’re building, you have to stay true to that first."

John’s new book, "The Brand Within," hit the book shelves in April. In it, he explains how branding relationships have become integrated with everything we do – from buying products and services to determining which television shows we watch; what music we listen to; and the food we eat.

Smart Business caught up to John and discussed the importance of personal brands, how to nurture a company’s identity and why you better sum yours up in three words.

 

Q. How can a company benefit from having a strong brand?

In a tough time like this, when everybody is holding their purses and wallets very close, the people they will end up spending the money on are the brands they are comfortable with because the brand is portrayed as something that gives them a comfort level.

 

Q. Can that help a company accelerate its business performance and expand its offerings beyond core products and services?

Sure. Let’s look at electronics. While they haven’t branded it this way, I’m not certain that I would buy a BlackBerry television or anything else beyond a phone from BlackBerry if they offered it. But I would buy a television or handset or any product that Apple came out with.

Why? It’s the branding and years of coming up with innovative ideas. It’s the marketing. It’s that everything Apple comes out with works with each other. And, it has a cool factor – Apple reinforces its brand with great service and beautiful stores.

So you look at Apple and you look at BlackBerry and have to think about the difference. If BlackBerry created a TV, you would ask yourself, ‘Why would I buy a TV from them?’ BlackBerry is known for giving very fast, clear, precise information. So it’s not a far stretch for them if they decided to follow the same path with televisions. But because of the Apple brand you’ll buy anything that comes from them. BlackBerry is probably behind them in branding only because they’ve concentrated on one device and didn’t grow the brand beyond that.

[Read a blog on leaders like John investing in brand in a down economy]

 

Q. So should CEOs view their brand identity as an asset that can be managed, nourished, invested in and leveraged?

A lot of people or companies try to chase the market. If you chase the market, then you’re behind the market. If you’re chasing something, you’re saying, "They did it," by the time you come out with it, you’re late. So you always have to stay true to your customer base and what you created, but you have to come up with innovative ways and take those leaps and bounds and chances to improve the brand you have.

I believe that every brand should be able to be spoken about in three words. Whether it’s BMW – Fine German Engineering – or any other company, you need to be able to wrap up your whole mission statement and identity in three words.

 

Q. In your book you detail how people are brands just as much as companies are brands. What does that say about the power of a personal brand?

A personal brand is actually more effective than a corporate brand because everything starts with a person. Think about it. If Steve Jobs gets sick, the brand itself, the stock, goes down 20 percent.

When we’re on Shark Tank we judge those people between the time that they open those doors and before they open their mouths. Those people walk up to us and they stand there for about three minutes while the hot light and camera is on them and we’re staring at them. It’s very intimidating.

Some people get shifty. They’re quivering and sweating, and you feel like they’re lying already. Some people have this innocence to them. They’re smiling, they’re looking at people and they’re laughing. They’re nervous, but you can see a pure aspect in them. They say the same thing about juries when they see somebody walk into a court room. They either judge them guilty or innocent. After that, they just want to hear what convinces them of what they already think.

As a personal brand, you’re judged hundreds, thousands, and if you’re on television, millions of times a day. You’re selling every single action you take and every single word you speak. You’re selling yourself, and that is the brand you represent or own. That’s why that’s more important than anything else.

 

Q. So how can an individual strengthen his or her brand?

Are they being true to the base? A con man’s brand is stronger than anything else. He perfects all the things that let you put your guard down and put trust in him. Think about a con man. He goes out and concentrates on the things that you’re going to brand him with. He’ll make you say, ‘Oh, he’s trustworthy.’

If you’re a person who will go out and perfect things, you have to understand what it is you’re selling. Are you selling a service in the service industry? Are you selling people how have a need or desire for something? Are you somebody who makes life better from an economic standpoint or are you giving somebody a luxury that separates them from everybody else? Those are two different approaches.

The luxury approach, you’re going to brand yourself like this: You’re very manicured. The way you speak and the car you drive say things about you. All of those things are going to be very excessive.

If you brand yourself the other way, you’re going to be very economically safe and not buy high-end products that make it look like you waste money.

 

Q. One of the definitions of the word "Brand" that you provide is "a type of energy that radiates from an individual." How did you come to that observation?

All this is from the FUBU days. This thesis I have and the dumbed-down version of trying to explain to people that everything in the world is a brand is from what I’ve acquired my whole life of being out there.

 

Q. People don’t realize they’re doing it?

Yes. That’s the biggest aspect of the book. People do not realize that they’re doing it. I get approached by a lot of business executives who don’t carry themselves correctly or present themselves the way they think they are. And they don’t understand why people don’t support them. On the flip side, I s ee a lot of ventures where people get enormous amounts of money and I don’t think they’re as capable as the other people out there but they packaged it correctly when they sold it.

 

Q. You’ve offered an interesting theory about how companies balance intentional and unintentional marketing in their messages to consumers. What’s the difference?

There are brands that have traditional consumers. They don’t want to detract or scare away their traditional consumers but they want to grow their business and be attractive to another market. Let’s use Timberland as an example. It was built and marketed as the best boot in the world.

Timberland obviously was made for hikers and the like. The same goes for Northface and brands like that. Somebody buying a Timberland from a technical aspect – a mountain climber or a hiker – they’re going to buy one pair of Timberlands every year or maybe every two years. Why? Because it’s the best boot in the world, so you shouldn’t be buying it every week.

But if you want to get to the demographic of the popular culture, the 40 and under, the rap, Latino, etc., these people are the ones who make Nike such a huge company because they buy a pair every two weeks. Once they get it scuffed, they have to get a new one. So they buy from a fashion aspect. You can’t market to them like you would the core group because if you market to them, then what are marketing? The best boot in the world to get a scuff on? So, you have to do an unintentional marketing campaign aimed at them and give the appearance that they came after and sought out your company and grabbed your company.

So you have to market to your initial core – the hikers, etc. – and then you have to do a different type of marketing, such as incentives in the stores and things of that nature, where the public doesn’t think you’re marketing to this demographic that is not yours but that demographic spends ten times more on your product than your core, original market does. So there’s intentional and unintentional marketing, and you need them both.

 

Q. What about premium prices?

Most of the time, the reason why products have a premium price is because you’re paying for everything else – the advertising and licensing. So we have to roll that into the costs.

 

Q. How important is it to develop and launch a brand internally before going out to the marketplace?

There’s a little balance necessary. Internally, you have to make sure the pieces are in place. Is the product technically proficient in the area it’s in? Second, you have to set the margin and price on it and know what that magic price point is that makes it acceptable. We all have a magic price point. Then you get the DNA of it – the three words; what’s the message we’re putting out.

Then there’s that moment. If you’re a new company or a big company, there’s that focus group moment where you trickle it out to the consumer to hear about people who are not close to the product. You need to hear from those people that have no knowledge or love or couldn’t care less…you need to know if they’ll take $5 or $500 or $5000 out of their pocket and buy the product.

Because of the age we’re in, with transparency and Twitter and Facebook, you have to put that product out to see how the world gravitates toward it or goes away from it. That’s a fine line you have to walk as an entrepreneur.

 

Q. Are there warning signs you’re stretching your brand too far?

Yes. Once you put it out there in that space – and you have to find creative ways to put it out there these days – and people just don’t like it, support it, or against it or are appalled by it.

The days of focus groups where you bring people into a room and pay them $100 and you look and see what they say are over because you have the Twitters of the world. These people don’t owe you anything. You’re trickling it out there and putting out test balloons and seeing what happens.

You can’t have thin skin. People fall in love with their brands and ideas and don’t want to listen to anyone else and hear that they do have an issue. There are a lot of people who haven’t been able to do that in life or business. Egos have taken down way too many companies.

 

Q. When a brand or reputation becomes impaired or damaged, what are some ways to repair it?

We are in such a different time. You can attempt to repair it through transparency. Just stand up and say it. If Tiger Woods had just come out and said it immediately, it would have been a very, very, big bullet to bite. But it’s going to come out nowadays. There aren’t the days when reporters or brands had these understandings. The world is an open book. I think that you have to be honest, as quick as possible, to respond.

That really is the easiest way. Look at when it could have ruined Madonna’s career when the naked pictures came out. In the beginning, she was at the Lady Gaga stage of her career, and here this came out, she had these naked pictures. Madonna was asked about them and she said, "Naked pictures. So what?" That just stopped everything. The rumors were over and she moved on. It’s really about transparency.

 

Q. Is a complete rebranding worth the effort or can you take the same brand and just re-market the way people think about it?

It depends on whether you feel the brand you have has run its course. Generally, it works when you’re dealing more with a luxury item. I’ve done it several times with FUBU. FUBU had run its course and the price points were coming down, so I went and acquired a license for Fat Albert and I named it Platinum FUBU, and all of a sudden it shot back up. Now, that’s run its course and I’m naming it FB Legacy.

It’s like Mercedes. They have the 600. Then they come out with a higher number. It works with luxury brands. The insiders know the core of the brand is the same – the same FUBU guys, the same Mercedes – and they have an understanding of running the business.

But the trendsetting person comes at it from a different perspective – they see it as an improved brand: I don’t wear regular FUBU but I wear that new thing they have. I don’t drive the Mercedes because everybody had them and I started driving Bentley’s, but now I’m driving something else. This works well in the luxury product or service space.

 

Q. What should be done when a brand becomes tired in the marketplace?

You need to either pull out or reinvigorate it. Sometimes you pull out and give it a rest. That’s sometimes the best thing. The good thing about having a brand is that no matter what, when you come back, you already have millions and millions of dollars worth of advertising and marketing. It creates a vacuum. You actually become missed in the marketplace, and when you return you resonate with a lot more consumers than you might have resonated with before. It can be a very good thing when you pull out for a while.

 

Q. What trends are you seeing that affect the way people look at branding?

The two biggest trends right now are social media and product integration. Product integration is important because we’re in a world with TiVos, iPods and downloads and people aren’t seeing commercials that much. When they do, it’s become like wallpaper and you know it’s a paid advertisement.

So in order to promote your brand, you find smart ways to integrate products within the world, such as within music and television and art and entertainment. It doesn’t cost as much as advertising. It doesn’t look staged. And it resonates with the consumer because you’re placing it in something that is important to the consumer. Imagine integrating your product in other things that have a powerful effect on consumers. When you do that you can quickly grow your brand.

 

Q. What’s the one thing CEOs need to keep in mind when thinking about their corporate brand?

Does the brand get captured in three words? What are your three words? Figure that out and then communicate it throughout the organization. In corporations, you sometimes have to clean the slate and think differently, then start over. It becomes your mission statement and everybody needs to think along those lines.

 

Q. You were named a regional Ernst & Young Entrepreneur Of The Year a few years ago. Tell me about the experience of winning such a prestigious award?

I was the 2003 Retail Award winner in the New York City region. I was actually a national finalist and beat out by the JetBlue guys for the national Entrepreneur Of The Year Award. It was a great acknowledgment. When I went out there it was an impressive room of people and I was happy to get to that point. You meet a lot of great people out there and can learn a lot.

How to reach: Daymond John, www.daymondjohn.com

Published in National

You probably know John C. Bogle best as the founder of The Vanguard Group Inc. and creator of the first index mutual fund. Maybe you saw him named one of Fortune magazine’s four investment giants in 1999 or one of Time’s 100 most powerful and influential people in 2004.

But when you think of Bogle, you probably don’t picture a waiter.

Before starting the company in 1975 with 28 employees, 11 funds and $1.8 billion in net assets, Bogle spent his younger years serving tables. Today, when you ask the 80-year-old investment guru — who has served as the president of Bogle Financial Markets Research Center since stepping down as Vanguard’s chairman in 2000 — how leaders should act, he refers back to that experience.

“When you learn to wait on others, you’re learning important lessons about dealing with other human beings,” Bogle says. “You’re always going to act [kind and decent] to those above you, but you better act the exact same way to those who are under you in the pecking order.”

That stewardship carried into Bogle’s service-centered mission at Vanguard — which, as of 2009, has grown to 12,500 employees, 160 funds and $1.3 trillion in mutual fund assets — and continues to drive his leadership style today. While he acknowledges that guiding the course of an organization can be fun, he also recognizes it’s evanescent.

“You don’t run your company forever,” he says.

So he focuses on a kind of leadership that’s longer-lasting and more meaningful.

“I’ve been known to say, when I speak at business schools, that 100 percent of the leaders that come in and talk to these MBA classes say the first attribute of leadership is integrity,” Bogle says. “I agree with that, even as I point out that while 100 percent of the speakers at these things say that, less than 100 percent deliver it.

“I’m concerned about leadership in the wrong direction, leadership that is self-serving, leadership that has forgotten what fiduciary duty and stewardship are all about.”

Smart Business spoke to Bogle about three key traits good leaders exemplify.

1. Sense of purpose

Bogle begins his discussion of leadership by quoting Warren Bennis’ famous list of distinctions between managers — who have a short-range view and an eye on the bottom line — and leaders — who have a long-term perspective and an eye on the horizon. To Bogle, it all boils down to the single most important trait of leadership.

“Serving a sense of purpose, a sense of where we want to go and commitment to get there ethically — basically a strong moral compass — is an extremely important part of leadership,” he says.

Because you can’t lead without followers, the point is to inspire them with a common mission. So an important aspect of having a purpose is articulating it clearly.

“I don’t think we have nearly enough leaders who have an ability to take advantage of the power of words,” says Bogle, who takes communication into his own hands and looks to passionate writing, from Greek and Roman philosophers to the founding fathers to the Old Testament, for inspiration. “Writing a speech or a message to your associates is something that is extremely high on my priority list. It had to be my words, not written by the public relations department. It has to come directly from you.”

In Vanguard’s early days, for example, Bogle addressed his employees every time the company passed a billion-dollar milestone. Then it was every $10 billion, then every $100 billion. The point is that you get up in front of them and share where the company is and where it’s headed.

“You stand up and speak to them in your own words, a sort of state of the union address,” he says. “Write it in human terms; don’t make it too business-like. Write it. Prepare it. Let them know you’ve gone to the trouble of wanting to make sure they’re informed.

“I’m absolutely convinced people can spot a phony around a thousand yards away. So I guess I’d have to say that another attribute of leadership is, for God’s sake, be yourself.”

Q. What are the keys to communicating your purpose?

It’s to share your passion for the enterprise but also the mission of the enterprise. Here at Vanguard, my task is to create a company that was of the shareholder, for the shareholder and by the shareholder. You’d be amazed how many thousand ways there are to communicate that.

So it’s like, ‘Well, are you just going to repeat it again and again?’ I almost never repeat it in those words. You can express that commitment, service, stewardship in a thousand different ways. If you’re reading a little bit of history, you can also find quotations that are even better written than you can write them and use them effectively.

Communication, in many respects, must be repetitive. We all have short attention spans. But you can do it in so many ways and, in a certain respect, people don’t even know it’s being repetitive.

Q. How do you gauge whether employees are on board with your mission?

In a way, that’s a good question, and in a way, it’s a bad question. As I say in one of my recent books quoting Einstein, ‘There’s some things that count that can’t be counted, and there are some things that can be counted but don’t count.’ I think we can go off the deep end in trying to measure that kind of thing.

We do, of course, surveys of our shareholders. We participate in independent surveys. And we get the top scores there; that’s encouraging that our people are carrying out this mission. But it’s a confirming — it confirms your view of the facts [and] ... the reality of how people are reacting.

We do something we call Crew’s Views and ask our crew members, in an anonymous questionnaire, how they feel about their jobs, their futures, their careers, their opportunities, the management and the compensation. We do get a statistical feeling from that, but I still think personal feelings are the biggest important part of it.

How do you measure something like integrity? How do you measure something like commitment? I don’t know how you measure them. Does that mean they’re not important? No, not at all. They’re the most important attributes of all you do.

I hate this management consultants’ bromide: If you can measure it, you can manage it. What a horrible thought. Think of how our corporations are doing that: If you can measure their earnings, you can manage their earnings. I’m not happy with people trying to sell me something because they got a bunch of numbers — not that the numbers aren’t useful as a supplement. I want to be very clear on that. Particularly in the financial business, you can’t work without numbers. But numbers are the cart and not the horse.

Other than these formal surveys, [gauging commitment is] not an easy thing to do because you can really only do it anecdotally. So the only way you’re really going to get comfortable with how people feel is to talk to individuals.

I always hated the idea of employees so we call them crew members. We’re very nautical; you know, Vanguard was Nelson’s flagship in the Battle of the Nile, a great naval victory. You know, you can’t talk to 12,000 people. So you do it anecdotally. You do it regularly. You observe when you’re going over to the galley for lunch how people seem to be feeling. You

019;re standing next to people in line getting your sandwich; you chat with them — very unscientific. But at the end of it, I think you get a pretty good feeling of how things are going.

2. Humility

Bogle has built a mutual fund empire big enough to warrant an inflated ego. But he hates arrogance, especially in leaders.

“I don’t think you can build something without a large ego, to be honest with you,” he says. “You have to try and suppress it as best you can.”

Remember those followers you need in order to be a leader? They won’t follow blindly after a self-important CEO. They’ll be more committed to following you if you can bring yourself down to their level and adopt the idea of servant leadership, as Bogle does.

“Don’t think you’re a big shot,” he says. “That doesn’t get you anywhere. You’re just a normal, dedicated human being. I think those whom you serve will be much better, more loyal, more dedicated, more committed people in working with you.”

You can’t expect employees to buy in to your purpose if they don’t trust you. And you can’t expect them to trust you if you perch upon an ivory tower. So another key to being a good leader is being a humble one.

“The chief executive is an employee; let’s never forget that,” Bogle says. “A lot of times people think they’re the dictator of a corporation. I think if people would just realize that, they might have a little bit less ego wrapped up in all of this.”

Q. How do you suppress your ego?

What you do is, first, you mingle with those around you. You don’t sit in some isolated office high above the earth. You get out and be with your people. I’ve always thought the idea of an executive dining room was totally absurd and destructive to any idea of leadership.

You better make sure that if the executives get bonus compensation on the basis of how well the firm does, shouldn’t everybody? The worker should participate proportionately in the company’s success. I’m appalled when I see some of these companies where all the awards seem to go to the chief executive. Do you really do everything, no help at all? Please.

Q. How do you make everyone feel like part of the team?

It’s attitude. They will know whether you’re interested in them or not by who you are, maybe as little as a smile or a thank you or just a chat about last night’s Olympics, whatever it might be.

It’s not talking to the people around you, trying to go on a witch hunt — ‘What’s wrong around here and what’s wrong with your boss, what’s wrong with this, what’s wrong with that?’ It’s basically convincing them that you’re as deeply involved in the hard work of building an enterprise as they are. You’re not isolated in some ivory tower and nobody knows your name, nobody knows what you look like, nobody knows who you are.

We have a celebration for someone who’s been here 25 years. We have an Award for Excellence for individuals, about six a quarter each quarter, and I sit down and spend about an hour with each of those people, just trying to get acquainted. They then learn a little bit about the founder of the company, and I learn a little bit about them and the kind of people we’re hiring here.

3. Preparation

If leaders really are looking to the horizon, as Bennis said, it’s not for the scenic view. Good leaders keep their finger on the pulse of what’s going on around them as well as what’s coming around the bend so they can prepare their companies for the future.

Preparation, if you ask Bogle, combines awareness with foresight.

“The best leaders have to be looking around the corner all the time and not looking straight down the street,” he says. “Think about what’s around the corner often in terms of challenges and opportunities.”

Because what’s even worse than never getting a break in life?

“It’s a lot sadder when we get our breaks and haven’t readied ourselves to make the most of them,” Bogle says. “You have to be ready when opportunity knocks.”

Q. How do you stay prepared for the future?

First, you have to educate yourself every single day. One of the jobs of a leader is to learn, even as another job of the leader is to teach. Learning means not only staying up to date on what’s going on in the nation and around the globe — you can’t ignore current events — you also can’t ignore history. I just finished reading one of the great biographies of Alexander Hamilton by Ron Chernow, the struggles he went through to try and get America going down the right course.

So reading — but not just reading business stuff, which all of us do — but reading history and, where possible, even reading the classics. It’s amazing to me how much we can learn if you read Seneca, Fontaine, Socrates, Sophocles, Benjamin Franklin, Alexander Hamilton, John Locke: all the great thinkers of the Enlightenment. It’s an extremely important part of educating yourself.

So staying in touch with the classics, learning from history — that’s readiness, I think. You can never be totally ready. No one knows everything. But you do your best to make your mind a little bit bigger and a little bit better every single day.

Q. How does history prepare you for the future?

There’s this wonderful saying that says those that do not learn the lessons of history are condemned to repeat it. For example, for a nation, we look at the history of the Roman Empire and it finally collapsed. We should look at that and say, ‘Is that in store for the U.S.?’ Or in a much, much smaller way: ‘Is that in store for our company?’

To look at leadership as an isolated thing where you know more about your little, infinitely tiny, small company than anyone in the world — I’d rather know a little bit less about the detail and a little bit more about what’s gone before.

How to reach: The Vanguard Group Inc., (877) 662-7447 or www.vanguard.com

Published in Philadelphia

When Howard Schultz returned to the CEO position at Starbucks Corp. in January 2008, he set out to engineer a turnaround at the company he built.

“When you build something from the ground up and have so much at stake and you’re watching it drift, well, I had to come back,” says Schultz, who also holds the chairman and president positions. “It needed love and nurturing, and we needed to remind people of the cause of the company. I could not, under any circumstances, allow its downward fall to happen. I thought we could be a better and stronger company.”

Schultz discussed how he brewed up Starbucks’ plan for a revival at the Ernst & Young Strategic Growth Forum 2009.

“We were dealing with five simultaneous moments,” Schultz says. “First, we had to admit to ourselves and our people there were self-induced mistakes and own them.”

This included growing too quickly and holding too much real estate.

At the same time, the economy was beginning to crumble.

“There was a cataclysmic financial crisis, and we were a leading indicator of the recession,” he says. “We were navigating through a financial storm we didn’t understand.

“Third, for the first time, we had competition. McDonald’s became a player in the premium coffee market.”

While this was occurring, bloggers began using Starbucks as a sign of excess in the economy.

As if that weren’t enough, Schultz faced another challenge — preserving the Starbucks’ culture.

“I knew that the only way to exceed the expectations of our customers was to exceed the expectations of our people,” he says.

So Schultz started there, assembling 10,000 key employees — executives and store managers — for a retreat in New Orleans where he intended to build the foundation for Starbucks’ comeback.

“New Orleans served as a great foundation of bringing people together toward a common goal,” he says. “It gave people hope and understanding.”

Back in Seattle, Schultz communicated feverishly, working to explain to every employee why the company was underperforming and what his plan was for fixing it.

“I was constantly trying to put them in a place where they knew we cared about the performance and health of the company,” Schultz says.

Approximately 900 stores were slated to close — most of them were less than 24 months old.

“The rules of engagement had so significantly changed, and we had to change our strategy,” Schultz says. “It made me sick, but it had to be done. I stood naked before those employees [when we announced the closings] and told them it was the hardest day of the company. I was honest.”

Beyond store closings and employee morale, Schultz attacked each of the other problems individually.

“For the Web, we invested time and money in our online strategy,” he says. “Starbucks is now the No. 1 brand on Facebook. With competition, McDonald’s made us better. It also brought up fear and courage and taught us that competition is not a bad thing.”

While he couldn’t do much about the economy, Schultz did learn something else about navigating through challenging economic times.

“The battle plan was maintaining our core customer at any price. I realized that if you lose them, it costs a lot to get them back.”

Near the end of 2009, Starbucks posted strong financial results — top-line trends are up and costs are down.

“We took out $580 million in cost this year,” Schultz says. “Ninety-plus percent of that will be permanent and none of it is consumer-based. The turnaround is occurring today because of the beliefs in the value of our company, quality of our coffee and culture of our people.”

H. Lee Scott on building a better story for Wal-mart

H. Lee Scott has a simple philosophy on change: “There is more danger in not changing than there is in changing. If you don’t change, you will become irrelevant.”

That goes for one of the world’s largest companies, Wal-Mart Stores Inc., for which he served as president and CEO from 2000 to 2009. Today, Scott is chairman of the executive committee of the company’s board of directors. He recalls how he put the notion of change into action when Wal-Mart was on the receiving end of a litany of bad press.

“During 2004 and 2005, we changed the culture,” he says. “I learned a huge lesson back then: Until you turn sideways and let the energies of your opponents go past you, you won’t go anywhere.”

At the time, those energies led to accusations of Wal-Mart underpaying its workers and not offering ample health care benefits.

“You can’t just fight with facts,” Scott says. “So we changed tactics, starting with a call for an increase in the minimum wage. By doing so, we were able to deflect criticism that we didn’t pay people enough. Actually, we paid them more than the minimum wage but didn’t get credit for that. By changing strategy from saying what we did to calling for an increase in the minimum wage, it changed the conversation.”

Scott also called for renewal of the Voting Rights Act.

“Wal-Mart is the largest employer of African-Americans in North America,” he says. “Again, we didn’t get credit for that. But when we started calling for renewal of the Voting Rights Act, suddenly the minority groups stood up and took notice.”

And, Wal-Mart expanded its employee health care benefits program.

“It was something we believed needed to happen,” he says. “We had more people who didn’t have health care insurance than we wanted.”

All of this changed public perception.

“As we became a better company, the criticism against us dropped off,” Scott says. “Today, we’re more acceptable to people than we were before. It wasn’t about telling our story better. We needed a better story to tell.”

Published in National

Last fall, Tony Alexander started to take notice of the banking and credit issues that arose around the country, and he knew he needed to keep an eye on his organization.

“Then, as the economic impact began to be felt more and more by our customers in terms of auto sales, steel and the other heavy industries and manufacturing that we provide service to — as their businesses were affected, obviously our businesses were affected,” says Alexander, president and CEO of $13.6 billion FirstEnergy Corp.

Instead of sitting idly by, Alexander took action. Priorities were examined, budgets were scrutinized and expenditures were cut. The end result was a reorganization that resulted in laying off 335 of the company’s management and support staff.

But even though some of the changes were drastic, Alexander hasn’t changed his leadership style.

Whether the company laid off employees, maintained its current status or experienced growth, Alexander would still make his rounds and communicate with employees.

“I’m really not changing my schedule,” he says. “I think it’s important for people to see as much of [the] senior executives as they can. The whole team has been stepping up to the plate and spending more time in the field. So, I’m planning on doing about the same as what I’ve done in the past.”

Because employees are so important, keeping them informed is vital no matter the status of the economy.

“It’s the same benefit that exists any other time,” he says. “In my mind, our most important assets are our human assets — our people. They are the ones that keep the lights on every single day for everyone. They are the ones that give us the resources to help in economic development throughout our service territory.

“Everybody understanding what the organization has to deal with, while not always pleasant, we are always far better off if we understand the issues that are being addressed.”

Here’s how Alexander relates to employees and communicates his message, even when times are tough.

Make the rounds

Alexander has thousands of employees spread across three states. The only way to really drive home any corporate message is to hit the road for one-on-one interaction with as many folks as possible.

He tries to spend about 40 to 50 days a year out in the field at more than 100 locations, meeting employees and communicating his vision.

“If you can get to as many big places, big shops, where there are multiple employees, we can get that message down through the organization, and that’s what’s key,” he says.

Alexander hits the major shops once a year, while visiting smaller line shops once every two years, eventually getting to everyone.

Because employees can sometimes be guarded when the boss is around, Alexander tries to make the visits as employee-friendly as possible. He doesn’t show up with prepared remarks or PowerPoint presentations. He shows up and talks to employees about safety, where the company is heading and how the company is going to reach its goals. Then, he opens it up for questions, which is especially important in tough economic times, because it gives employees a chance to get things off of their chests.

Oftentimes, Alexander gets questions that are site-specific, which are more appropriate for the local manager to handle. But, the questions and comments do give Alexander an overall sense of where the organization should be devoting more of its resources.

In addition, if you are out in the field enough and begin to build a relationship with your personnel, employees become more comfortable with you, and they can see your reaction when they tell you something.

“They can sense that things are changing,” he says. “Not that you can deal with everything. But that change allows them to feel more comfortable in terms of raising potential issues.”

Before Alexander goes on these visits, he will sit down with his communications team and they discuss what they’ve heard is on employees’ minds.

“If there are things we just don’t know about, they might ask me some questions just to get them in my head,” he says. “Basically, because they have a better feel for the organization on a day-to-day basis, they will pop some things to me that I ought to be thinking about.”

Recently, he’s faced questions about the restructuring, the economy and the overall state of the company.

Instead of dancing around the questions, he gives a straightforward answer, but he also admits when he doesn’t have the answers.

“Typically, when I go out in the field, I always have somebody from the communications group with me,” he says. “So, what they try to do then is accumulate that type of question so that we can either add it into an update or make sure we get the information back to the manager that can then communicate it to employees at that location.”

If it’s a broad enough type of question, Alexander might add it to the update that the company sends out to employees on a routine basis.

Having someone come with you who can keep track of questions and ideas will make the process much more effective.

“I was doing maybe two or three or four of these a day, and I couldn’t remember all the questions that are raised,” he says. “Unless somebody is keeping records that I can go back and evaluate afterwards, by the end of the day, I’m probably pretty tired. So, somebody is accumulating ‘OK, these are common issues or common threads that we’ve heard now in three or four different spots. Do we need to do something about it?’”

Explain the ‘why’

When Alexander first went out in the field as CEO, he got a sense from the line crews that the company’s fleet of vehicles needed to be replaced.

As a result, he set up teams of union and non-union employees and management to discuss what the new fleet would look like and what equipment they would need with it. After that, Alexander laid out a plan that the company would purchase a certain number of trucks over a certain number of years.

While the suggestions for the trucks had been incorporated into company plans, it was also important to let people know what was going on and why.

“Well, when I first told them we were going to do this, nobody saw a truck come into their line shop for a year because it takes a year to get them built.”

Alexander explained the trucks take some time to build, and they eventually began to flow in. Once employees saw that happen, they just wanted to know when the trucks would get to their department. Without an explanation of the process, employees will be left in the dark without answers.

“Now, when I go to the field, I am not hearing any questions about trucks anymore,” he says. “They saw the action, they understood, and they saw that their comments meant something, and that helped.”

While involving employees in the decision-making process is a great way to create buy-in, you also have to explain the reasons why something is or isn’t happening.

“It’s important for people to understand why they are doing things,” he says. “We spent a lot of time, not just saying, ‘This is what we have to do,’ but saying, ‘Not only is this what we have to do, but this is why we have to do it.’

“Sometimes, the answer is, ‘We have to do it this way because we just don’t h

ave enough money.’ But at least if you can sit down and explain it to them, they can understand that.”

Explaining the “why” also gives each person’s job a connection to a greater overall purpose in the company.

“All you can do is try to increase the level of communications so people can begin to connect how all these pieces and parts fit together,” he says. “Every job in this company is important. It all plays a role.”

When you motivate employees to give you input, you might be thrown many different ideas. Some of them may not fit the direction you want the company to go in, so you have to bring them back to the overall strategy of the company so they can get a sense of what you are trying to accomplish.

“I spend a lot of time with them on this because we make so many decisions,” he says. “At the end of the day, if the employees understand the direction you are trying to go in, it’s much easier for them to understand an action that you’ve taken and put it into context of where you are driving the organization.

“They might not agree with you, but they understand. That’s more important because they understand.”

It’s true that actions speak louder than words, but words still do play an important role.

“As you begin to lay out a strategy and you want your employees to buy in to it, they must see the implementation of it and they must understand how their role fits in it,” he says.

“If you are successful in those two components, you’ve gone a long way of engaging your employees. That’s really what you are trying to accomplish.”

How to reach: FirstEnergy Corp., (330) 384-5783 or

www.firstenergycorp.com

Published in Akron/Canton

In 2010, T. Boone Pickens will receive his first order of wind turbines, a step he hopes will set a new era of energy efficiency into motion. Pickens, the iconic founder and chairman of BP Capital Management and the star of his own commercials touting the “Pickens Plan” and the benefits of wind energy, is hoping to ride the winds of change to a more sustainable future for America.

Pickens is advocating for a commitment to wind energy production on a large scale through tax subsidies and other measures. This will interject more renewable energy into localized power grids, and Pickens estimates that 2,000 jobs will be created initially — and grow to 138,000 over time. He says committing to wind energy will get the U.S. out of the current economic downturn and will increase security while reducing costs. Although Pickens has made his fortune in oil, he says decreasing foreign oil dependency by creating a renewable energy network will place U.S. businesses in a better financial position. Smart Business spoke with Pickens about sustainability and how all businesses can profit from investing in it.

 

Q. How can a business improve its bottom line by investing in sustainable energy?

I don’t know that they can immediately. It’s going to take several years to get renewable energy into the system to a level that will make a difference. It will eventually lower the price of your power. It’s just going to take some time for that to happen. Other sustainable practices will suffice until then.

 

Q. Will the businesses that haven’t invested in sustainability now lose future benefits?

The hope is that a business won’t be able to say, ‘I’m on renewable, and my competitor isn’t.’ Hopefully, a more efficient power grid will be implemented and all energy sources will be incorporated. But you have to be planning ahead, and if you haven’t already, you have to start that plan today. To quote my father, ‘A fool with a plan can outsmart a genius with no plan any day of the week.’

 

Q. How can CEOs bettereducate themselves on sustainability in ways that will help their industries in the future?

They need to know we have to do something about our own energy and [that] there are several components to the plan for it to be successful. Sustainability isn’t just wind or solar. You’re going to have to get off the foreign oil, but wind and solar do not replace the foreign oil. Foreign oil isn’t used for power generation, so we’re going to have to put it together and use all of them to have a more sustainable business. Replacing foreign oil with natural gas will be step one. This should be something in businesses’ plans to work their way into understanding what the future holds. Using natural gas for transportation fuel will reduce the need for foreign oil.

 

Q. What will it take for the majority of businesses to operate at a sustainable level?

The government is going to have to show that they’re ready to go with different opportunities in energy. With that, they’re going to have to put a production tax credit in, which would show the world that we are behind wind and solar. When they do that and put a 10-year tax credit in, that will bring the manufacturers into the area to use the forms of energy and help better develop the process. But if things work according to plan, you’ll be getting your energy from a source that pulls from all energy sources and businesses won’t be able to pick and choose what they use. This source will include renewable, coal, natural gas and nuclear. This will come with upgrading to a national grid. You wouldn’t be able to identify which one’s which — it would be a single energy source that it is pulled from. A national grid upgrade could make energy efficiency 20 percent better than what it is now.

 

Q. Is the issue less pressing for businesses that were pushing for sustainable energy now that gas prices have decreased?

That way of thinking won’t work because we’re importing almost 70 percent of our crude oil now, regardless of what price we pay for it. If you’re paying $70 a barrel, it’s half the cost it was, but the percentage of imports remains the same, and I perceive that to be the most critical problem that the country has from a security standpoint. We’re relying on half of the oil we import coming from the Mideast and Africa, the two most unstable places in the world.

 

Q. Why should businesses care about U.S.dependency onforeign oil? How does the dependency directly affect them?

The price of oil will continue to go up, and businesses won’t have any choice but to pay the price. By using sustainable energy from the U.S., there won’t be a price hike. There’s been a yo-yo effect over the last 40 years that started in the ’70s. When the price of gas runs up, they over-supply the market, drop the price and any idea about using renewable is stopped. You can look back and the pattern is the same except the price never goes down as low as it was before. So now you’re working off a price that was up to $140 a barrel, which is now down to $60 or $50, but do you like paying $50 a barrel knowing the price is going to go back to at least $140 at some point? You don’t have any control over your destiny using foreign oil. As a businessperson who sees a fuel that runs cleaner, is domestic and creates more jobs in America, I would say that certainly beats buying foreign oil. With foreign oil, the money’s gone, no jobs came with it, no taxes were paid, and it didn’t help the economy. It’s just a drain on us.

 

Q. Why should businesses care about the Pickens Plan?

Businesses should see the Pickens Plan as a great opportunity to take advantage of cheap gas and oil. This is a once in a lifetime deal for us. Cheap oil has caused us to be addicted. Every time we talked about renewables, every time we started up new U.S. drilling, the Mideast oversup-plied us and drops the prices. If we don’t do anything more than what we’ve done in the last 40 years, then in 10 years forward, we’ll be paying $200 or $300 a barrel and we’ll be importing 75 percent of our oil. And then we’ll be broke. You can’t think the future is foreign oil. The future is sustainables. Businesses also need to consider plans that aren’t just for their business, but a way to improve America. That’s part of good business practices.

HOW TO REACH: T. Boone Pickens, www.pickensplan.com

Published in Dallas

It was 1964. Drayton McLane Jr. was a young executive working

in the grocery distribution business of his father, Drayton McLane

Sr., and still years away from the worldwide business mogul and

Major League Baseball franchise owner he would become.

What was then known as the McLane Co. Inc. was still a small

family operation based in Cameron, Texas.

But McLane saw the potential of his father’s company, if his

father and the company were only willing to take a risk.

“We were in an old distribution center that had been built by my

father, who had been in the business since 1922,” McLane says.

“We needed to build a new, modern distribution center, and to do

it, I felt we needed to move to another city about 40 miles away.”

The company had no debt, and McLane needed to convince his

father to assume a large amount of debt in addition to uprooting

his business from Cameron to move to the larger city of Temple,

Texas.

McLane told his father that the company could never reach its

full potential where it was and that any short-term adversity would

be worth it to position the grocery distribution business for

increased growth down the road.

“We were the largest employer in town, with about 100 employees, and it was going to be hard on them when we moved as well

as for my father and mother, who had lived there all their lives,” he

says. “That’s on top of going into debt pretty heavy to build this

facility. But that’s what we did, and in 1966, we opened our new

distribution facility in Temple, and that’s what really opened the

doors for our business to grow.”

McLane, who now chairs the McLane Group — a private holding

company that does not disclose revenue — says a tolerance for

risk is one of the toughest traits to build in a businessperson, especially when you’ve achieved success and feel like you’re on the

right track. But, he says, the greatest business leaders always see

the potential in their companies and have an eye toward what

might be in the future. You’ll never achieve your full potential in

business without taking risks and cultivating a work force that is

willing to follow your example.

It’s what has helped take McLane from small-town grocery distribution executive to the highly public helm of the Houston

Astros, where as chairman and CEO, he has overseen the most

successful era in franchise history.

What follows are some of the lessons he has learned about leadership in his decades-long business career.

Spread the passion

Leaders are teachers. Without an ability to teach, McLane says you

will never get your people to see eye to eye with you, understand

your vision for the company and feel the passion you feel for the

business.

For McLane, teaching starts with getting his employees involved in

shaping the company’s future by posing problems and letting them

come up with their own solutions.

“You have to teach people your business, what the problem is or

what you want to accomplish,” he says. “You sit down in strategy

sessions, you outline it, and you tell them, ‘Here is what I think are

the objectives.’ Then let people spontaneously talk about it, maybe

go home knowing we’re going to meet at 8 o’clock the next morning

and figure out just how we’re going to do this. When I do that, I’m

always amazed at the big ideas people come up with.

“You have to give them free rein, this is what enterprise and entrepreneurship is all about, people with new, fresh ideas. Let

them feel a part of that, but also let them feel a pride in not just creating it but achieving it.”

But McLane says involvement in shaping the company’s future

should also come with a sense of responsibility and accountability.

Growth on a personal and companywide level doesn’t generally

occur when you arbitrarily throw stuff against a wall to see what

sticks, so employees given the opportunity to create must be given

parameters and then held accountable for staying within those

parameters.

The parameters should fall in line with what you want to accomplish as a business.

“In a large business where you have a number of people working

for you, you have to identify what your objective is and what you

want to accomplish,” he says. “Is it products; is it services? You

have to identify the objective, what it is you want to do and what

it is you want to produce. Then you have to sell people on the goal,

what it is you want to achieve. Then the last part is the toughest

word in the English language, and that’s ‘accountability.’

“Imagine you’re back in college, and, on the first day of class, the

professor says, ‘I’ve got great news. At the end of this semester,

everybody is going to make an A. But I still want you to buy the

book, read the lessons, do the homework and be in class every

day.’

“Now, if I knew I was going to get an A regardless of what I did,

I might not try very hard. But that’s not how they do it in the U.S.

educational system. You have exams, term papers and homework

to determine your grade, so you’d better do the work if you want

to graduate. You have to be accountable in school, and, in business, it’s the same deal.”

Make time to connect

If leading starts with teaching, McLane says teaching starts with

communicating.

A good leader must be a good communicator — a job that is

made exponentially harder if your business is spread throughout

multiple countries as is McLane’s business. But there is no excuse

for inadequate communication.

“That is just the job of a leader, being in front of people,” he says.

“Our company has a lot of people, about 9,000 employees spread all

throughout the country, so I have spent a lot of time going to different

divisions, talking to employees and getting to know just about everyone by their first names.”

As your business grows, it increases the importance of having

competent leadership beneath you. You can’t be in all places and

communicate with everyone on an as-needed basis the way you

might have been able to when your company was smaller, which

means you need to be able to know what to delegate to others,

who to delegate to and when to do the delegating.

Knowing how to delegate the operational tasks you used to perform will free up your time to get out among your employees on a

regular basis.

“Delegation is when you can clearly, clearly show someone or

groups of people what needs to be done,” McLane says. “You can’t

do all of the details as your business grows. You have to have the

skills and ability to pass on the responsibility to the people who

handle the day-to-day work, then hold those people accountable.

“Then, you free yourself to be upfront. You have to be that

upfront leader, be able to communicate with employees, walk around and see what kind of job they’re doing, and if they’re doing

a good job, to praise them.”

As your business grows internationally, the ability to free up your

time through delegation will become essential when it comes to

communicating on a personal level with your employees. Between

traveling for business matters and traveling for baseball matters,

it’s something McLane says he has learned firsthand.

“I recently returned from eight days in Poland, where we have a

grocery distribution system,” he says. “I visited almost all of our

employees there just as I do in the U.S., and we have almost 450

employees in Poland. Just like in this country, you have to take the

time to communicate, express your thoughts and ideas, and learn to

listen.”

Use your perch wisely

McLane bought the Astros in 1993. At the time, the team hadn’t

made the playoffs in seven years and was facing sluggish attendance figures in the obsolete Astrodome.

McLane took the reins of the Astros with an eye toward

improving its fortunes on the field and at the gate. To that end,

his ownership regime has had some success, winning division

titles in 1997, 1998, 1999 and 2001 and a National League pennant in 2005, marking the franchise’s first World Series appearance. He also worked with city and county officials to fund and

build Minute Maid Park, the club’s home since 2000. Since moving to their new digs, the Astros have topped 3 million in season

attendance four times, placing them among the top draws in

Major League Baseball.

But the prospect of on-the-field success isn’t the only thing that

attracted McLane to the Astros. McLane also wanted to affect the

community at large, and the highly visible perch of Astros ownership provided him the perfect opportunity to increase his involvement in community programs.

“We bought the Astros to make them a champion but also to get

equally as involved in community programs,” he says. “We have

one of the most extensive community involvement programs in

professional sports. They go to over 3,000 events in the Houston

area every year. That kind of involvement ignited everybody.”

The importance of community involvement as a business leader

is something that McLane learned from his father, who partnered

his business with the United Way, the Boy Scouts and Girl Scouts,

and with American Red Cross blood drives.

“It’s really one of the great features of America and American

business, getting involved in philanthropy and giving back, both

financially and with services,” McLane says. “I saw my father do it,

and as we were in business, I found it makes you feel great about

yourself and your fellow employees in the company when you get

really involved.”

McLane says community involvement should be an extension

of your commitment to running your business the right way

and not taking shortcuts. You must decide what you want your

business to embrace as its core values, and then drive those

values to every person.

“I learned early in my business career that the most important things in business are honesty and integrity,” he says. “So

set your values, hold everybody — and yourself in particular —

accountable for integrity and honesty. That’s where most businesses go wrong. They try to cut corners and not do the right

thing.

“But if you dedicate yourself to your job, if you are really

excited about your job, your company, the people you work

with and your customers, it will show. You can overcome

almost any problem when you have a feel for what you do, a

passion for what you do, and you want to be the best.”

HOW TO REACH: Houston Astros, www.astros.com; McLane Group, www.mclanegroup.com

Published in Houston