Of Beef ‘O’ Brady’s 213 restaurant locations, Chris Elliott has eaten at 50 of them to date. He’s tasted every single item on the menu and is prepared to tell you what he thinks, good and bad. Yet that kind of honesty was harder to dish out last March when he joined the company as its new CEO. After eating at several of the restaurants, Elliott had the difficult task of sitting down with his franchisees to tell them candidly, your food isn’t very good.
“What franchisee wants to be told by a new guy, who they think doesn’t know anything about our brand: ‘Guys, I’ll be honest with you. The food is mediocre, and on top of that, the execution is very uneven from store to store,’” he says.
As a new leader, Elliott was also trying to build relationships with franchises in 23 states — consisting of more than 5,000 companywide employees. Understanding that they had faced several tough financial years prior, he knew that to execute a strategy that could reposition Beef ‘O’ Brady’s for growth, he first needed to win the trust and buy-in of his people.
“You have a new guy coming in, and the last three of four years have been very difficult,” Elliott says. “So it’s a matter of gaining the trust of the franchise community.
“I said, ‘This is what I see, and then based on my experience if we are going to move this business back to where you want it, back to where it belongs, back to where it deserves to be — we’re going to have to fix the food quality and we’re going to have to fix the execution. We get focused on those things and then we get after it. That’s what we’ve been doing in the last year.”
When you are a new leader trying to gain perspective on where your company stands, a good place to start is by talking to the people in the company who have been there and understand the brand’s history.
“The first thing I do is sit and listen to what people have to say about the past, what they are passionate about as far as the brand is concerned and what they think the brand is all about,” Elliott says.
“You have this sort of window of opportunity when you come in new to company to establish this trust level that makes people comfortable in dealing with you, which makes people more likely to try and implement the things you ask them to implement.”
Because the company is 99 percent franchised, right away Elliott decided to create a ‘franchise advisory council’ to consult with him on decisions. Made up of a diverse group of 15 franchisees nationwide, the council has been vital in helping him gain a range of opinions and insights on how the business operates.
“I try to get a broad spectrum of people’s input to make sure that we fully vet the ideas,” Elliott says. “Sometimes a good idea is not meant for a particular system. So it’s not only finding the right idea, but making sure that you can actually implement the idea within your system. That’s why, for me, the more people I involve up front, the higher the probability I feel that we’ve made the best decision we can make.”
Furthermore, people are much more receptive to changes when they don’t feel like they are being bossed around. While Elliott knew major operational changes were in order across the board, he realized he couldn’t lead those changes successfully from a corporate office.
“There’s a natural dynamic tension between franchise owners and franchisees,” he says. “We own the brand, but they own the business. They paid for that business. So if they don’t feel like they are getting good leadership, good communication, good ideas and good business results from the franchisor, then they feel like, ‘I’ve got to save myself.’”
It would take relationship-building and strong, two-way communication to keep people from jumping ship and get everyone in the company moving together in a new direction.
“The power of a brand is in consistency,” Elliott says. “It’s everybody on the same team, everybody on the same page, everybody running the same menu and executing at the same level."
By showing people you want and need their help, you build a foundation for trust that helps them accept what you have to say.
“You involve them much earlier in the conversation,” Elliott says. “Collaborate with them on how to do it. Don’t come and tell them how to do it. Collaborate with them so it’s as much their ideas as your ideas, and that carries a lot more weight.
“I like people to challenge the ideas that we come up with and I look at a lot of different points of view to make sure we didn’t miss something. Almost inevitably you will if you don’t have that kind of organization where you are collaborating with the people who are actually going to wind up implementing your plan.”
To find out how he could improve alignment and engagement of his team, Elliott held private meetings with all 30 corporate employees as well as with franchisees on the advisory council.
“I said, ‘Look, I’m just here to learn what the issues are, what the challenges are, what’s been happening and how do we get better,’” he says.
“The human relations aspect of any business relationship is huge. It’s e-mail. It’s picking up the phone and calling. It’s getting out into the field and being present. There’s a lot of ways. Basically, we call it engagement. It’s one of the four principles of our franchisees.”
Elliott also began checking in more frequently on communication between franchisees and the corporate office, setting a more stringent expectation about getting back to franchisees, answering their questions and solving their problems.
“There were some silos in the departments and now that’s gone,” he says. “Everybody is working with everybody, communicating with everybody. The increased communication builds trust but also holds people accountable.”
To convince people to take action on the company’s issues with food and execution, Elliott realized he also needed some hard evidence on where the company stood against competitors. To put the business’ strengths and weaknesses into a larger context, he and senior managers spent a lot of time initially studying the company’s competitors such as Applebee’s, Chili’s and Buffalo Wild Wings to clearly define the company’s niche in casual dining.
“You need to thoroughly understand the business that you are working in,” he says. “You need to really understand your niche.
“You benchmark your company against other successful organizations, and you demonstrate the benefits of the types of changes that you are proposing in ways that are meaningful to your employees, that would be meaningful to your customers and that would be meaningful to your franchisees.”
Elliott principally examined Buffalo Wild Wings’ restaurant concept, which is similar to Beef’s in many ways and offered some key insights into where the company could improve.
“We looked at them very hard,” he says. “We benchmarked sales volumes. We benchmarked the sales in day parts. We benchmarked the sales in particular items. We benchmarked everything you can think of, the initial investment, the profitability and all of that. It was a real eye-opener for a lot of our franchisees to see how other companies that are similar to us in a lot of ways do so much better in certain areas of their business.”
Then you look to your customers. In addition to working closely with his franchise council, Elliott visited many of the restaurants in person to try the food and listen to people’s ideas, concerns, attitudes and recommendations. He also communicated the importance of making decisions based on experience and data rather than just people’s opinions.
“Very early on I said to the franchisees, ‘This is not about what I want and this is really not about what you want,’” Elliott says. “‘What it’s ultimately about is what our customers want. So in any arbitration of what we’re going to do next, we’re going to let them tell us what they want to do next, what they like.’ That makes it easy for us to make a better decision. We always come to the table with the consumer data to support what we want to do next.”
The company has done more consumer research in recent months than it did in a whole year prior, using outside research firms to evaluate ideas, conduct segmentation studies and put on focus groups.
“Every time we have an idea to go out in the field and set up a field test, we test it for several months and gather the data and then come back,” he says. “That’s very time-consuming and it takes a lot of energy and a lot of resources, but that’s the only way to do it.”
Even if you get people to buy in to the value and vision behind making changes, winning them over long-term is a matter of proving to them that you can deliver success.
“When you come in and you say we’re going to do these things differently, and then it works, that helps build trust,” Elliott says.
“Once we have an agreement to move forward and are excited about where we are going to go, then it’s be persuasive. You can’t force a plan down people’s throats if you really want it executed. You’ve got to persuade them. That takes relationships. That takes communication. That takes some selling skills.”
Instead of ordering franchisees to switch from frozen to fresh marinated chicken tenders, Elliott convinced them to make the menu change by showing them the results of doing it differently.
“They went bonkers,” he says. “They didn’t think that was possible. So we actually had to go into the stores on Friday night during the busiest part of the night, set up a little station and do it to show the franchise community that ‘Yes, you can do this.’ And not only can you do it, they got to see how consumers reacted to the new product versus the old product.
“There are a lot of things that we did like that. We just recently changed out our burger. We had a good burger, but we went to a better burger. We went from a frozen steakburger to a fresh Angus burger. And that’s one of the reasons our sales turned around in May.”
After pulling the entire menu apart at the corporate office and spending about seven months fleshing out and testing ideas, Elliott estimates there are now 20 examples of ingredients or products that the company has already improved on or changed. The lunch menu now includes smaller portions and lower prices, and there is a stronger focus on efficient execution. Phase one of the main menu innovation launched in January 2011 with phase two implemented in August.
When one franchisee said to Elliott, ‘Why you would spend your time working on something that’s not broken?’ he tried to explain the problem behind that way of thinking.
“I said, ‘It’s not about it not being broken,’” Elliott says. “‘It’s about: Is it as good as it can be? Is it better than what anybody else has got?’ Because the way you’re going to get somebody away from these other customers is to have a better burger, not just a good burger.”
Today, the numbers speak for themselves. The company achieved positive comparable store sales growth in the first quarter of 2011 for the first time since 2006.
“It sort of opened up their eyes to the possibilities that exist out there when you do things a little bit differently,” Elliott says.
“That process of explaining why we were doing what we were doing and then seeing the results of it is beginning to get more and more franchisees on board.”
As people see the small successes add up, they can buy into bigger changes ahead.
“What people are seeing is we can effect positive change in a difficult environment, if we stick to our knitting, if we do some of the basic things better than other people are doing,” Elliott says. “That builds confidence in the franchise community and it also builds the willingness to not just listen to your ideas, but to get behind your ideas, push your ideas harder. It builds that bond of ‘Hey, maybe these guys do know what they are doing, and if we work together we’ll really get this thing on track.’”
How to reach: Beef ‘O’ Brady’s, (813) 226-2333 or www.beefobradys.com
The Elliott File
Beef ‘O’ Brady’s
Born: Montgomery, Ala.
Education: University of Georgia, BBA in accounting, 1977
What is one part of your daily routine that you wouldn’t change?
Having my Starbucks Grande Bold coffee before I get started.
Who are your heroes in the business world and why?
Any and all entrepreneurs. It takes guts, determination and a belief in your own ability to step out and be your own boss. Where would we be without entrepreneurs? I wouldn’t have this job.
What would your friends be surprised to find out about you?
I play guitar and sing a little.
If you could have dinner with one person you’ve never met, who would it be?
Dead — Abraham Lincoln. He was a great storyteller and master politician. Alive — James Taylor. I love his music, and maybe I could get him to show me his technique.
Favorite part of the job: The whole act of drawing on your experience, assembling a team and the data needed to analyze a problem, then developing a solution that you find out later actually worked. In short: problem-solving.
Elliott on hiring good people: I’ve been doing this a long time and I can tell you if you have really good people working for you, life is good, and if you don’t, nothing ever changes. You spend all of your time managing people instead of managing the business. So a smart executive will hire really good people so they don’t have to spend all of their time managing people. They spend their time managing the business.
Often I’m asked, “What is social media?”
For businesses, social media are where technology and social interaction merge. It leverages Web-based and mobile communication tools to allow for the creation of conversations and the content between consumers and brands. Social media channels such as Facebook, Twitter, YouTube, LinkedIn, Yelp and blogs are some of the tools businesses and consumers use to create and broadcast content and engage in social interaction.
These social media channels allow individuals and brands to shift fluidly between audience and author roles. Content generation and conversations within these channels utilize what is termed “social software,” to enable anyone without knowledge of coding to post, comment on, share or mash up content, and form communities around shared interests.
Think of an old-time malt shop at the mall. Conversations at these places typically took place on a one-to-one basis or within small groups. If a company wanted to “shake hands and kiss babies,” social engagement typically occurred one consumer at a time. The hope was that they’d leave the conversation empowered, with brand recognition, and wanting to evangelize the actions the company was looking to generate.
Whether the dialogue took place between brand and customer, within social cliques or simply on a one-to-one basis, someone would eventually break away and begin pollinating other conversations with the information they just gleaned.
Fast forward to what I’ve coined “the pollination effect.” Remember the shampoo commercial: “I told two friends, they told two friends, they told two friends,” and so on and so on? Harnessed properly, the pollination effect will create lightning in a bottle.
Don’t think that social media is going to be your business’ silver bullet. It takes time, dedication and strategy to create powerful customer relationships. Half the battle will be breaking through the noise bombarding your target audience for its attention. Today’s consumer has constant partial attention.
Imagine your target market. On the Web, they probably have multiple pages open, perhaps their iPod, TV or radio playing in the background, friends instant messaging and texting them, phone distractions, someone talking at them in person, browsing mail, and engaging on multiple social media channels — and you’re trying to attract their attention yourself.
Like a restaurant, social media has an endless menu of options. To reach your target market, the specials of the day change with hundreds of new social media channels developed daily.
The trick is figuring out which menu items will get your target markets telling their friends and returning for more.
Social media is public relations on steroids. Social media allow you to take your message directly to the masses and receive instant feedback. The tools to broadcast your message are endless.
Look at channels such as Facebook or LinkedIn. Sign up for accounts on most platforms and they’ll offer communication tools such as the ability to send e-mails to and from their platform, messaging, blogs, polls and content aggregation from other platforms such as Twitter.
To be successful, manage your time, have a solid game plan about what you’re going to say, whom you’re trying to reach and effective ways to reach them. Some platforms work well for one type of business and completely bomb for another. Blogs and LinkedIn typically work better for B2B businesses and platforms such as Facebook have higher B2C success rates.
To help determine the best platform for your business, research where the conversations relevant to your industry and target markets are taking place.
Adrienne Lenhoff is president and CEO of Buzzphoria Social Media, Shazaaam PR and Marketing Communications, and Promo Marketing Team, which conducts product sampling, mobile tours and events. She can be reached at email@example.com.
As The Wistar Institute has grown in size and complexity, it has outgrown its old management processes. President and CEO Russel Kaufman was overseeing a loose command structure with overlapping job assignments, which was fine for a smaller organization, but as the biomedical research center grew to $76 million in 2010 revenue, the lack of structure was leading to a lack of direction for its associates.
Kaufman saw that the old management system simply wasn’t going to work anymore, and the problem was only going to get worse as Wistar kept growing. So he and his leadership team set about remaking the organization to not only allow it to adjust to its current growth rate but accommodate future growth, as well.
Smart Business spoke with Kaufman about how to rebuild your company’s management structure.
What were the steps involved?
In this new model, I have one person in charge of science and one person in charge of administration. And having this structure where you put all this management under one person, it can be threatening to a lot of people. All of these people who had managed in the matrix felt like they had a group of loyal people who had reported to them, but now there is a new leader that everyone reports to on the administration side. Those internal loyalties they built up now won’t be as effective.
So it has been managing this process of getting all of our employees to understand that they should be loyal to the organization, not loyal to a leader. It is a very important concept, and one that we’re going to have to continue to work hard on.
That was the administrative side. The other step was to name a cancer center director, who became our scientific leader. I recruited that person, and now I have to transition authority to that person. The challenge was that I worked with many of our scientists for many years, and they’re used to coming to me with their problems. Now, we have a new leader, and it’s defining that person’s authority, defining that person’s responsibility, and making sure everyone knows what those roles are.
How have you ensured that people know their roles?
The approach we’ve taken is what I call clearing out space. In activities I’ve previously led, we still have those meetings, but I no longer participate. The new cancer center director has to take charge, and those meetings are a statement of the person who is in charge. We’re still working on it, but most organizations will go through these kinds of problems when they’ve had a leadership structure that is a loose matrix, and they have to put one person in charge of a new area.
Maybe people have worked with me and are comfortable with me, and I’m still here, but not in that capacity. If I went to the Moon for a year, it would fast track this process, because I wouldn’t be here. The new leader would be forced to make decisions, and everyone would be forced to go to him. As it is, if they come to me, I re-direct them to the leader of that area.
How do you train people to start accepting the new structure?
The way you do it is you look at benchmarks and gaps. You look at internal and external benchmarks, and then you look for gaps where you can improve. What we’re about to do is undertake a SWOT (strengths, weaknesses, opportunities and threats) analysis so that we can find the areas where we can be the most effective to close these gaps and improve our performance. I think that if you can get a group of people and really take a formal approach, do a formal SWOT analysis using formal group processes, and then aligning that with the institutional goals, you can make a lot of progress. You can take this organization that might be ossified, and really disrupt it, in a way, because people then start seeing results in front of them.
If I ask each of my departments to judge themselves, to look at what they’re doing, they’ll give me a list of what they’re doing and how well they do it. But the issue isn’t really how well they’re doing it, or whether those things are valuable or not. To me, the bigger issue is how do they fit into the bigger structure of the organization. Do they advance the organization through collaboration?
How to reach: The Wistar Institute, (215) 898-3700 or www.wistar.org
Dean Friedman remembers one client in particular:
“It was a 35-store chain of restaurants that had a really difficult time building a database and creating an opportunity to have a rewards program,” says the CEO of Real Integrated, an advertising and marketing firm with $28 million in media billings last year. “One of our younger people came up with the idea for an opportunity in this space, and we grew a database from under 4,000 to approximately 27,000 Facebook friends, which is now driving that restaurant’s business through weekly offers.”
It’s not the traditional way that marketing and ad agencies have done business, but it’s example of the need to keep your eyes focused on the horizon when running a business. As technology has become more prevalent as a mass-marketing tool, Friedman and his staff have found it necessary to not only implement new technology, but find more creative ways to use it, constructing customized solutions to meet client needs.
“We’re a traditional agency, and had been for 50 years, the last 20 of which I’ve overseen,” Friedman says. “We’re really good at what we do, we have a fabulous product, and people perceive us as a great local agency. But what wasn’t being perceived was all the digital efforts we had been making. As the transformation has been occurring in the whole media marketing world, we have evolved.”
To build an organization that can take advantage of new opportunities, you need to build an open culture in which the employees that spot new opportunities are empowered to bring them to management for consideration. As it pertains to technology in particular, Friedman says that means you need to give a voice to your technology-savvy team members.
“One of the great things I’m learning throughout all of this is to take advantage of youth,” Friedman says. “I’m 59, and I don’t have all the answers. A lot of people in my organization have more answers than me, and are on the front lines more than I am. So my greatest advice is to keep an open mind and listen to everyone. As we’ve listened to our people, we’ve developed and refined our forward-thinking mindset.”
John Ozdych, the firm’s president and creative director, encourages dialogue throughout all levels of Real Integrated, helping to promote an atmosphere where there are no bad ideas and change is viewed as progression, as opposed to upsetting the apple cart.
“Everyone has to be agents for change, stewards of change and technology,” Ozdych says. “They have to be looking across the Web, combing through what is out there and bringing it back to the agency. If a new technology has been introduced out there, we’ll ask which of our clients could benefit from this solution, and we’ll also invite our clients to show other clients what we’ve been doing for their business. So it keeps going back to having that open dialogue throughout the business.”
Getting your employees to think ahead is critical, but clients and customers also need to look at what’s next. Your employees provide your services to customers, but the customers are the end users.
“What I believe is happening, and what is critical in all of this is that our clients are realizing that not every idea has to come from the CEO, or the president of the client company. Instead, ideas can come from anyone internally. The ideas bubble up now. I don’t care where the ideas come from and neither do our clients. We want to keep building a culture where everyone can have an idea or a suggestion.”
How to reach: Real Integrated, (248) 540-0660 or www.realintegrated.com
Forward-thinking companies don’t just look to the future for their own benefit. Sometimes, they’re able to bring a client along for the ride, and open the client’s eyes to new ideas.
Bill Eubanks is in charge of co-op services for Real Integrated, and has a marketing relationship with Kentucky Fried Chicken that goes back to 1979. KFC has historically been extremely old-school when it comes to marketing practices.
“If there is anything I know, it’s that KFC has a plan that is exceedingly traditional in its approach to the business,” Eubanks says. “But as an agency, what has given us added juice is the way we’ve structured things here, the partnerships we’ve created with vendors on the leading edge, to begin to offer a traditional client very nontraditional ideas.”
Real Integrated recently developed a website called MyLocalKFC.com, in which KFC store operators can promote their businesses in a manner specific to the locale. KFC operators weren’t used to it, but the new concept has started to gain traction as store owners have seen the value in it.
“That’s the kind of thing we weren’t doing recently, until we really started to emphasize the way we communicate internally and the partnerships we’ve created with leading-edge vendors,” Eubanks says.
In late August, Smart Business sponsored the third installment of its Power Players luncheon series, which featured David Gilbert, president and CEO of the Greater Cleveland Sports Commission.
In the almost 12 years that the commission has been around, it has been responsible for bringing in 104 events to town, with an economic impact of more than $310 million.
“Most of them are the U.S. Jump Rope World Team Trials, the U.S. Taekwondo Junior Championship — not sexy events, but the common denominator in every one of those is they bring people to town,” he says.
And that’s the key. Bringing people to town means more people spending money in the region. The commission strives to bring as many events as it can to town, but to also run them better than the rest of the competition.
“Really, it’s no different than any other business,” Gilbert says. “How do you try to find out what a customer’s needs are and do what you can to make your business better.
“Where we’ve set the mark in the community is the ability to service these events better than anybody else in the country.”
Out of about 250 sports commissions across the country, the Greater Cleveland Sports Commission is one of the largest with 14 full-time employees and has become one of the top three or four sports commissions as a result of its service excellence.
This level of excellence has allowed it to secure two major events for the region — the 2013 National Senior Games and the 2014 Gay Games, which combined should bring more than 30,000 people to the region. Additionally, the organization has hosted several major Olympic qualifying events and expects to see more of these major events in the future.
“It’s very much about building a reputation,” he says. “More often than not, now our leads come directly. Instead of us going out and begging people – it certainly still happens — regularly — but we get calls saying, ‘Hey you hosted [this] and did a great job, would you consider hosting [that]?’ That’s helped a great deal. It’s developing relationships with individual organizations.”
How to reach: Greater Cleveland Sports Commission, (216) 621-0600 or www.clevelandsports.org
What are the ingredients to help you grow your business? I recently discussed hyper-growth with Michael Holthouse. He founded Paranet, grew it rapidly and sold it to Sprint for $375 million. He is now exponentially growing Lemonade Day, the flagship program at his nonprofit, Prepared 4 Life. Here is what you need to do to achieve hyper-growth within your own company.
Passion and purpose
Passion and purpose are the foundation of your business. Ask yourself and your team, why are you in that specific business? If your primary answer is making money, then you may grow in the short term but long-term, sustainable growth will be a challenge. Find your passion or find another business.
“Our passion at Paranet was to invent a new paradigm in the computer-networking world. It drove us,” Holthouse says. “And, our purpose at Prepared 4 Life is to help America’s youth develop business and entrepreneurial skills.”
Clarity of the business model
Understand and articulate with absolute clarity your core management philosophies that detail your business model and approach. If your core philosophies are ambiguous, achieving hyper-growth will be excruciatingly difficult.
“I strongly believe in a decentralized organization,” Holthouse says. “It is a business model that allowed us to produce rapid growth.”
Big, audacious vision
While your passion and purpose must create a sense of commitment, your vision must create excitement.
“I like fast-growing, high-impact organizations,” he says. “We set an audacious but achievable goal of reaching $100 million in revenue in five years. We needed a vision that inspired people. Everyone wants to be part of something bigger than them.”
Hyper-growth is rarely a linear path. You will have to be opportunistic and nimble. Your strategy must dynamically respond to ground realities and execution data. A stale strategy will kill hyper-growth. If you are clear about the business model and are nimble in your strategy then you can bring the right products to the market at the right time.
“Our strategy to find an intersection of interests with other entities such as schools, community and religious organizations has allowed us to grow LemonadeDay rapidly,” he says.
Scalable work processes
Hyper-growth involves rapidly scaling up your business. Small cracks turn into gaping holes as the organization grows. Therefore, you must ensure your work processes are well designed and consistent with your mission and vision. The interactions and handshakes between the teams, the roles and responsibilities, the expectations and accountabilities must be crystal clear.
“We held everyone accountable to predefined goals and gave them the authority to achieve the goals based on their talents and drive,” Holthouse says.
Hyper-growth is not for everyone. It takes a different mindset. The willingness to not just survive but thrive on change. You must hire the right people who understand hyper-growth, want to excel in that environment and have the desire and the wherewithal to succeed. The right culture provides the energy to help the organization self-propel itself to great heights.
“If you are going to reinvent an industry, hire the leaders in the industry — the eagles. Eagles fly one at a time, they are majestic, they soar; ducks you will find a dime a dozen,” he says. “Eagles are A players. They will help create the right culture.”
The focus on making it happen makes all the difference. Fighting the distractions, the ambiguities and the confusion and making relentless progress toward their vision are the hallmarks of companies who achieve hyper-growth.
“To be successful say what you are going to do, do it when you say it will be done, do it for the price you said, and if you do that consistently, your customer will never leave you,” Holthouse says.
Ravi Kathuria is president of Cohegic Corp., a management consulting, executive coaching and sales coaching firm, and he is president of the Houston Strategy Forum. He has been quoted in the Wall Street Journal, Barron’s, WorldNews, and featured on CBS Radio and the BusinessMakers Show. He is the author of the highly acclaimed book, “The Coherent Company, The Struggle for the Next Level.”
The co-founders of CHR Solutions Inc., a provider of technology and business solutions to communication services companies, come from very different backgrounds. James Taylor, chairman and CEO, grew up in Missouri and Arun Pasrija, president and COO, grew up in India. Regardless of their varied backgrounds, they run their 550-employee company in absolute agreement.
“You’ve got to go through and clearly agree on the core spirit of the
organization, the mission, values and philosophies,” Pasrija says.
It is through collaboration on the culture of the organization, the growth of the company and treating people with dignity and respect that they have built the company into a $50 million business.
“As part of being process-driven or process-centric, you need it to be part of the culture of the organization as you grow to be able to create size and scale,” Taylor says.
Smart Business spoke to Taylor and Pasrija about what has been crucial to the growth of their company.
Make mergers and acquisitions.
Taylor: We began to acquire technology services companies that had a common vision and mission and shared our philosophy of the world and were looking to be part of a bigger team to help us execute in this marketplace. We viewed it as a mosaic.
We recognized that to create this beautiful picture we needed to fill in certain pieces, whether they were clients, technology, locations or talented people that would help us execute. When we made acquisitions, we were simply looking at things to help us fill in part of that mosaic and create that size and dominance in that marketplace.
Pasrija: We ask two fundamental questions as we look at a merger or acquisition and we need to answer with a definite positive. One is what’s in it for our customers. Is this going to add additional benefit to our client base? If we can’t answer that with an immediate yes, then we’re going to pass. The second is what’s in it for the employees on both sides. It has to come across as this is better from a professional growth perspective. Those two questions … have to be answered in a resounding, ‘Yes, there is benefit.’
Taylor: If it’s good for the clients and it’s good for the employees, it will be good for the shareholders. There are a lot of deals that are focused on the shareholders and not the employees and the clients.
Align your culture.
Taylor: The first thing you have to do is write it down. You have to have agreement on it. It is so important to get people together. If you don’t communicate, people will create their own communication. You can’t communicate too much and you have to write it down and articulate it.
Pasrija: When you look at the whole integration, there are things that you look to do right away, but there are other things that might take nine months. Those are the things you can’t force to go any faster. The actual culture will require time to get gelled. Part of the cultural integration is that we have certain core philosophies which are nonnegotiable. There are certain core values of the organization and a core mission and all of those we share. You have to create the clarity of purpose, the clarity of accountability and the clarity of the core values.
Taylor: We spend a lot of time on culture and organization. Every month, we do either a company chat with all of the employees in the company or a ‘lunch and learn’ to educate them. Every meeting we start off with our basic sheet that talks about why we’re here to help our clients succeed, our mission, our vision and our goals. We do that so we can make sure people align with them.
Pasrija: You have to make sure you collectively come up with what are the right performance measurements. As long as you can make it analytical and where you can actually measure that’s going to help you make decisions. There are two kinds of measurements. One is your financial results. When you look at financial results for a month, the month’s already gone and all you can do is learn from that history. There are other indicators called leading indicators, for example, the sales pipeline. That’s a leading indicator of what the sales might look like in the next quarter. You have to make sure you can focus on a few critical indicators.
Taylor: Pick three [indicators] in every area and keep it simple. If I give you 53 indicators, you can’t track 53. What are the three most important? Could there be some places in business that have five? Absolutely. Could there be some places that have one? There is a general rule that if you’re in the three-to-five range you’ve got a pretty good feel for what that activity is.
We all have visions of grandeur and visions of what we want to create and build and do, but you’ve got to be careful that there’s reality set into how you’re going to get there. That doesn’t mean don’t dream big. It doesn’t mean dream audacious, but you’ve got to figure out what the dots are to connect to that point.
HOW TO REACH: CHR Solutions Inc., (713) 995-4778 or www.chrsolutions.com
Crime doesn’t pay. Protection from crime, on the other hand, has paid off in a big way for AlliedBarton Security Services LLC.
The 55,000-employee company bucked the downward trend during the recession, growing from 2006 revenue of $1.2 billion to 2010 revenue of $1.7 billion. Chairman, president and CEO Bill Whitmore attributes the growth to a selective, informed approach to business, along with a dusting of opportunism.
“The good news for our industry is that during an economic downturn, there is a focus on crime,” Whitmore says. “There is a concern with protection, a concern with preventing workplace violence. Those things still exist, and a company like ours is here to fill that need.”
The seeds for AlliedBarton’s winning approach to business in a recession were planted in 2007 and 2008, when Whitmore and his team formulated a strategic plan. Whitmore’s team didn’t know the depths to which the economy would sink, but they controlled what they were able to control — the markets they decided to pursue and how they reacted to whatever the markets and the economy, threw at them.
“When we sat down and wrote the plan, we saw a couple of things that we believed would happen,” Whitmore says. “One is that contracts in our industry would be consolidated. They were, and we put together a national accounts team that works with customers embarking on initiatives. That program didn’t exist in 2007, and now it is roughly $400 million of our run rate. The strongest pipeline we have in our company is for those clients that are looking to consolidate.”
To make a strategic plan strong and accurate, you need alignment. That means you need your plan to fall in line with the vision and cultural values you promote as a company, and you need a team that is willing to embrace those values and work toward the goals outline in your strategic plan.
It’s a task that requires you to be equal parts cheerleader, lookout and air traffic controller.
Get focused on goals
Every item in the AlliedBarton strategic plan is tied to a goal, which in turn ramps onto the overarching goal of the organization, which is to protect the people, property and assets of clients.
With goals ramping upward, the responsibility for achieving the goals has to be communicated downward and tied to goals and incentives that directly impact each of the 55,000 AlliedBarton associates around the country.
“Goals get translated into an annual performance plan, goals get translated into compensation metrics as basic as performance planning documentation for individuals, which is then cascaded into the company,” Whitmore says. “Then we sit down and measure people on how they did against those goals and how well we did as an organization. That’s the accountability part, that we hold people accountable for doing it.
It’s a mentality that is shaped by management from an employee’s first day on the job. From the beginning of the first day, employees are schooled in the company’s goals, strategy and values. They are given a copy of the company’s cultural primer, “Dare to be Great.” The booklet is often referenced by Whitmore in conversation, and employees are expected to know its contents.
With “Dare to be Great” providing the template and Whitmore providing the guiding hand and reinforcement, the culture of accountability has taken root throughout the expansive AlliedBarton footprint.
“The one thing I’m very pleased with is we’ve had a number of examples in the last few years where people in our markets would kind of light up in various ways,” he says. “They would say to us, at the account level and regional offices, that there is a leader who is not living up to the standards that we as a company expect. We expect more out of our leaders than this, and we know that you on the corporate level do as well.”
If an employee, particularly on the management level, is not knowledgeable about the goals and values of the company, their technical competency matters less. Technical skills can be learned, and in management-level positions, is often a job prerequisite. Values and a willingness to work as part of a team toward common goals are far more innate to each person.
“Anyone can learn the software and technology of the job, but you want people to lead,” Whitmore says. “I was interviewing a woman for a senior position recently, and I brought the ‘Dare to be Great’ book with me. I showed her what we’re all about, what we’re hiring for. She had the technical skills, we was a seasoned executive, but I told her if she doesn’t believe in what is in this book, don’t come with us. You have to reflect on whether this is in your heart.”
Continue the challenge
Employees stay motivated to strive for goals when they are constantly challenged by management to test the boundaries of their capabilities. It’s something Whitmore has kept in mind as he has continued to fashion a future direction for AlliedBarton.
“One thing I always try to be clear about is that ‘Dare to be Great’ is exactly what it says,” Whitmore says. “I’m daring you to do something great. I’ve had competitors say to me, ‘You guys think you’re great,’ but that’s not the idea. We’re the first to admit that we’re not perfect. With 55,000 employees, not all of them does the right thing or gives 100 percent every day. It’s about challenging everyone in the organization to be great.”
Whitmore says that mindset should be at the core of every leader’s thinking, if a company is to stand any chance of growing and thriving.
“It is at the core of everything we do in leadership,” he says. “You walk in every day and say to your employees, ‘I want us to be better and better.’ I’ve been here a long time, and I come to work every day trying to think of ways that we can better this business today. What can we do differently? What new thing can we try? How can we enhance what we do? And that’s generally the feedback we get from our clients, as well — that our managers come to work each day asking how we can improve our service, better improve and develop our security officers.
“It’s fundamental. I don’t care if you’re running a single McDonald’s restaurant or General Electric. You have to come to work every day and challenge your folks to do better.”
Developing a culture of continuous improvement is so integral to the process of strategic planning, Whitmore says he has trouble separating the two when it comes to explaining how AlliedBarton does business. Without driven, motivated employees, your strategy will never bear fruit. Without a strategy as a structure, your employees will have nothing on which to focus their efforts.
“It’s just at the core of everything we do,” he says. “In order for us to meet our goals, in order for us to build our business, none of it is going to happen without the desired culture in place. You can say you’re going to be anything you want. Without the culture for it, you just can’t do it. We could just work on selling contracts and making money. But one of the reasons you see us going from a small regional company 10 or 11 years ago to where we are today is our belief that the financial results will happen if you do all the other things well.”
To point your company in a given strategic and cultural direction, you need raw materials in the form of good people.
Finding the right people for the job at AlliedBarton — regardless of what the job is — means finding people who have a high emotional IQ.
If your IQ is a measurement of your capacity for head knowledge, your emotional IQ is a more ambiguous measurement that takes the temperature of your softer, people-oriented skills and traits.
“We mean people who are good at dealing with individuals, who are willing to take responsibility, who are oriented around growth and can make a connection with people,” Whitmore says. “People who can show leadership skills.”
Whitmore and his leadership team promote teamwork and attempt to heighten the collective emotional IQ throughout AlliedBarton through the company’s training and continuing education programs, where leaders emphasize the concept of building a collaborative culture around the company’s strategic goals.
“Sometimes I get complaints because we have too many people working on different projects,” Whitmore says. “But I like it because it’s what drives our culture. We have a class here called ‘212,’ which is a reference to the Fahrenheit temperature at which water boils. I once went around asking people how long they had been coming to the classes, expecting them to talk in terms of weeks and months. But one person had been going for five years. The person was a former operator who had moved over to the sales side, and one of the reasons they kept coming back was the number of people who stepped up and volunteered to guide and advise.
“Those are the types of things that become voluntary when they become a trait of your culture.”
Whitmore likes large numbers of people working together on projects because he feels it is critical to the culture to have people in different disciplines and locations working together toward common goals and developing a mutual understanding of what is happening in the departments and locations of their project-mates.
“You get interdisciplinary groups of people working together on projects, processes and initiatives, and that breaks down the silos that can develop in an organization,” Whitmore says. “But I’m not going to kid you, it’s work to do that. You get someone who works in, say, El Paso, and because of what they do, they get very inner-focused. It is something we have to work on all the time, because if we let that go, everything else won’t work as well.
“It’s all because in any business culture, the number one thing — and it’s been said over and over again — is teamwork. If your company is made up of leaders who can work together for a common cause, and who are there for each other in good times and bad, I think those are the companies that survive.”
How to reach: AlliedBarton Security Services LLC, (484) 351-1300 or www.alliedbarton.com
The Whitmore file
Born: King of Prussia, Pa.
Education: Bachelor’s degree in business, Philadelphia University
What is the best business lesson you’ve learned?
Be curious. The world is changing, so don’t get tied into what you do every day. Ask why people do things a certain way. As part of that, do a lot of reading and keep yourself intellectually stimulated.
What traits or skills are essential for a business leader?
Integrity, honesty and being highly communicative. And do what you said you would do — walk the talk.
What is your definition of success?
I think if we meet all of our plans, then it is a win-win-win for customers, employees and shareholders. That is what I define as a success.
Barry Davis’ company, Crosstex Energy Inc., had always been extremely successful since he started the midstream energy service business in 1996.
“We averaged a compounded annual growth rate of about 100 percent a year,” Davis says. “It was an incredible journey and everything was up and to the right.”
The company continued growing — going from $1.8 billion in revenue in 2006 to $2.6 billion in 2007 to $3.5 billion in 2008.
“One of the key learnings for us in this experience is whether it’s personally or as a company, sometimes our greatest strengths can become a significant weakness,” he says. “It was in our DNA to grow and be very growth-oriented. If you grow at 100 percent per year for every year for six to eight years, at some point, that gets difficult to manage.”
By 2008, the organization was showing signs of stress from the rapid ascent.
“We were thin organizationally, and that includes people and processes,” he says.
Then the financial markets began to come apart. Crosstex had a number of natural disasters hit, including a fire at one plant and a hurricane that affected its Gulf of Mexico operations. Then there was a significant downturn in commodity prices that dramatically slowed the company’s development activity.
“We had built an infrastructure with an anticipation of continued growth,” Davis says. “All of those things came together to create the perfect storm and a period where we had to regroup and really step back and reset the company, if you will.
“Had any one or two of these things happened in 2008, we would have been fine, but when you compound several, it became quite a mountain to climb.”
It was unlike anything the company had faced and was going to be incredibly difficult to overcome.
“[It was] two years of the most challenging period we may ever face as a company that really became a fight for our life as a company,” Davis says.
Talk to customers
One of the first steps Davis took to turn things around was to solidify relationships with customers during this time. The company had done so well for so many years, news of its trouble sent shockwaves throughout its customer base.
“In the middle of 2008, Crosstex had one of the most successful stories in the midstream business in the last couple of decades,” he says. “We had great good will in the industry, so we had a lot of people who were pulling for us and wanting to do everything they could. Most people were just shocked because they had seen, for a dozen years, that everything had been so positive and were just confused by what had happened, so it was important for us to share what had happened.”
So he went out and started talking to them about how their troubles had come about but also how they were going to solve the problems.
“We spent a lot of time with our customers and trying to ensure their confidence that we were going to be there and we were going to be able to provide the services they had contracted us to buy,” he says.
Davis went out and met with other CEOs to share his plan and the confidence he had in the organization going forward. He would also talk to them about how they could be helpful in that plan.
“People want to see the confidence and see into the eyes of the guy at the top,” Davis says. “Are you demonstrating that you’re going to get through it, and do you have a plan? Are you committed or are you wavering in your commitment? There was never a wavering.”
He says very few of the top executives sold any of their holdings in the company, which was a further demonstration that he had confidence in the company so the customers should, too.
“We’re emotionally invested, and in a time of challenge, it’s usually more powerful than financial conviction,” he says. “It was important for our key customers to see that all the way to the top.”
Davis decided this was also a great time to look at ways to cut costs.
“We had a lot of expense in our organization that was focused on growth,” he says. “We immediately reduced all of our resources that were being spent outside core areas. In our physical operations, we essentially took away everything that wasn’t necessary to run the business — any idle equipment, anything being spent on unnecessary things.”
They also renegotiated contracts with key vendors. The entire industry was in this mode, so they were sensitive to the battle Crosstex was fighting.
“Every organization, in tough times, has certain places to look,” he says. … “There are always things we’re investing in for the future and when tough times come, it’s all about the now. What do we need to be spending right now? For a period of time, let’s cut out the cost of the future.”
When all was done, he and his team were able to drive out $20 million in costs from the business in 2009.
Another big thing Davis had to do was trim the portfolio. The company had six major assets and it wanted to get down to three.
“It was straightforward and logical,” he says. “We needed to sell something of size.”
Its treating business was attractive to the industry. It had been started as a grassroots business in 1998, and by 2003, it was the largest treating business in the industry and had the No. 1 position in gas treating. It was sold, as were some smaller assets.
Make the tough decisions
The bigger challenge in this was parting ways with the people associated with those assets. Some of the people went with the assets that were sold, but he also had to do a reduction in force because of the reduced operations.
“In our company life, we had to be able to look back and say we did that with great excellence,” he says.
As such, they planned it thoroughly and executed it well.
“Be very clear and generous in the exit process, meaning the severance that you give people, the time you give them to find other jobs, to be generous in the support you give them in finding those other jobs,” Davis says. “Be quick and decisive in the process — these are things that need to be done in a short time frame and not drug out over a period of time. It needs to be as deep and as broad as you can think — don’t make multiple reductions. One time needs to get it done. Be generous, be supportive and do it in one time, and be very caring in the execution.”
They made the cuts in one day. Davis personally met with almost every affected employee.
“I had the opportunity to visit with them and share the emotion of the challenge we were going through together and express some good intentions for the future,” he says. “It was like family, and it was like part of the family was being left behind or separated.”
Those kinds of situations are never easy to handle, but he says there are ways you can do it so you can, in fact, look back and say you did it with excellence.
“First of all, focus on the person,” he says. “It is a relationship, so you have to focus on the person. Second, be very diligent in the planning process because the execution is critical at the time, in the moment. You have to have a great plan. Then, thirdly, be real. Be a human, be transparent and be loving. That’s a word we don’t use often in business, but I think everything really comes back to that and to love the other people just like they are family.”
As Davis met with people, he was shocked by the support employees had for each other and the amount of care they were showing for each other as opposed to themselves. This care and concern inspired Davis.
“The good news is that whatever negative emotion we experienced, for 12 years prior, we were very full as an organization and prepared emotionally to deal with a downturn,” he says. “It was the relationship, the culture, the bond that we had that allowed us to endure during that time.”
In 2009, Davis and his team began to define the future state — the end they had in mind. But he involved the people and asked them what was important to them. Recurring themes came up.
“One of the things that was always at the top was to be on the winning team,” he says. “For the 12 years, they felt like they had been on a winning team, and in the downturn, that was something they didn’t feel, so it was very compelling for them to get back to a point where they could feel like a winning team.”
As he moved the company forward, he applied lessons he learned in the middle of this crisis.
“What we learned was to manage our strengths and be more conservative in our growth,” he says. “Secondly, we learned that one of the things you have to protect most dearly is your balance sheet. We actually had too much leverage — too much debt.”
Crosstex repositioned its balance sheet in 2010 and reached a number of milestones.
Revenue increased in 2010 to nearly $1.8 billion after the decrease in 2009.
“This is where we did some of the best work we’ve ever done in our 15-year history,” Davis says. “What we did is what we’ve always done well … we simply executed everything in our plan. The market supported us in rebounding. As a result, really in a very short period of time, in 18 months, we went from the lowest point in the downturn to being repositioned.”
And this year the company announced several major growth plans, including increasing its core from three major areas to five.
“As we entered 2011, we felt it was a turning of the page to focus on the future,” Davis says.
On top of the financial success, he’s seeing a change in morale, as well.
“We’re right now at an all-time emotional high as a company,” Davis says. “The energy has returned and has grown dramatically because of the success we’re experiencing as a company.”
While they were challenging years, Davis knows that they’ll also be good ones in the story of Crosstex and sees the company’s biggest challenge ending happily ever after.
He says, “I believe we’ll look back on those as two of the richest and exciting years for our company and the richest chapter in the story of Crosstex.”
How to Reach: Crosstex Energy Inc., (214) 953-9500 or www.crosstexenergy.com
The Davis file
Barry Davis, chairman, president and CEO, Cross Energy Inc.
Education: Bachelor of business administration degree in finance from Texas Christian University
As a child, what did you want to be when you grew up?
I always wanted to be part of creating something, and my entire life I have been. I started with creating businesses — a lawn-mowing business, and ultimately in college, I started, ran and staffed baseball camps in the summer. I’ve always been about building organizations, so as a kid I wanted to be a part of creating something significant.
What inspires you to create businesses?
I think it really is about the story. I like to be a part of creating a story. I like the life that comes from doing that with other people. I believe what we have here at Crosstex is a great community of people who are doing life together. I’m driven by growth because I want to keep adding people to our team.
What’s your favorite board game and why?
I don’t play board games. One of my favorite games is the ring game that we play at my lake house. It’s a ring-on-a-string game that I love to play with family and friends at the lake, and it gets very competitive.
If you weren’t in your current position, what would you be doing?
I would be spending a lot more time in ministry. I love sharing with people the life and I love sharing the experience of more life with people. I could do that with spending more time in ministry. That goes back to the Crosstex story — our mission and right in the center of our mission statement is to improve the quality of life for our employees. On our doors, every employee has ‘more life’ boards. On those boards are represented what more life to us means. We have pictures, quotes, family stories, whatever it is that represents more life to you. You could say I’m already full time doing what adds more life, but I would do that in other places.
In April, J&J Snack Foods Corp. announced that it had a deal in place to acquire several frozen-food product lines from ConAgra Foods. The acquisition added up to $50 million in annual sales for Gerald Shreiber’s company, but it also added new production facilities in North Carolina and Oregon, new people to integrate and new inventory to manage.
But as the economy slowly crawls out of the pits of the worst economic nosedive in almost 80 years, the acquisition is a reflection of Shreiber’s philosophy on running a business: Don’t be afraid to take a calculated risk in the name of growth.
“We have expanded our business almost every year,” says president and CEO Shreiber, who bought the company that would become J&J Snack Foods at a bankruptcy court in 1971, and grew it to $696 million in net sales last year. “Sure, we’ve been through three — or four or five — economic downturns, and we know it’s occasionally going to be bumpy out there. But we’re not going to manage our business out of fear, we’re not going to crawl into a hole and wait until it’s over. We’re going to expand our niches and expand our portfolio of products.”
Lean economic times may prevent you from spearheading across-the-board growth. You might find that certain areas of your business are treading water better than others. But you should, if at all possible, look for the select few growth opportunities that still make sense for your business, and capitalize on them.
At J&J Snack Foods, finding those growth opportunities means listening to customers, allowing team members to innovate, and maintaining a business structure that is always ready for growth and expansion.
“It is tough to grow a business and maintain levels of profitability when you’re faced with cyclical adjustments with respect to the economy and sales,” Shreiber says. “The fact that we’ve been able to meet those challenges speaks volumes for our people, our customers, our partners and our suppliers.”
Serve your customers
With a portfolio of products that includes cookies, soft pretzels and frozen beverages, Shreiber’s company has felt the pinch of consumers reining in their spending on trips to the supermarket. As more consumers stripped their shopping trips down to the basics of meat, vegetables, bread and milk, snack foods became expendable items on many families’ shopping lists.
“We realize that our products are not mainstay items,” Shreiber says. “They’re not meat and potatoes. They’re impulse items; they’re treat items. All of our items are not part of the everyday shopping experience.”
As shrinking budgets altered the way consumers spent, Shreiber and his leadership team have had to find new consumer touch points. They’ve had to look past the traditional concept of selling snacks in packages in a store aisle.
Customer feedback pointed Shreiber toward spaces where consumers were more likely to buy snack foods — such as sporting events, theme parks and schools.
“Now, we’ve developed a big presence in sports venues, from high school all the way to the professional ranks,” he says. “We have a big presence in sports, leisure and entertainment. With schools, we’ve had to reformulate several of our product lines that were being sold to school and education systems. We’ve had to eliminate most of the sugars, reduce some of the fats and reform some of our standards. But we’ve done it, all the while maintaining our sharpness and edge.”
The traditional method of soliciting customer feedback has been to collect it in the field, utilizing a salesperson at the customer interface point, talking to consumers and store operators about what they want and need. However, like the heads of many large companies, Shreiber has formalized the system beyond that.
“It’s a matter of getting good feedback, good marketing, good interactivity and good integration between our marketing people and our salespeople in the field,” he says. “Today, our research and development department likes to measure the opportunity that is being requested. We operate 12 plants throughout the country, so in that situation, you have to know where the request came from and start to get a reading on how you can best implement the thought and idea. That process has allowed us to invent new products, expand our product lines and development. I believe a good company has to take the box, shake it up and down, and reinvent itself from time to time. That’s where customer feedback comes in. They’re the people who are buying our products every day, somewhere, in some venue.”
Invest in growth
Even as the economy has faltered and Shreiber’s team has had to get more creative about finding new sales avenues, Schreiber has still maintained a willingness to invest in his company’s future. It is a major reason why J&J Snack Foods has remained in growth mode each year, regardless of the economic climate.
You might not always be able to invest large sums of money in large-scale growth initiatives, but if you are able to save what you can and carefully select the time to strike, you can still make a move with a lasting positive impact for your business.
“You do have to budget,” Shreiber says. “I like to say we’re flexible, but we’ve also been very conservative over the years. We don’t spend more than we earn, we’ve eschewed debt and stayed solvent. If you don’t shoulder a lot of debt, you give yourself more flexibility. We’ve had the availability of both cash and credit to look at expansion.”
Growth opportunities can help you expand on an existing area of strength, or can help you broaden your product offering. In Shreiber’s case, he’s looking for product lines that can supplement his company’s existing portfolio.
“If you look at a good football team with good management, they’ll find the missing pieces,” Shreiber says. “The good teams will do it constantly all the time. It’s a matter of making your resources fit properly. Occasionally, we’ll look at a dozen to 15 things before we think we’ll have found something that fits us — the right company, the right location or the right portfolio of products.”
Investing in new growth also means investing in the people involved. Shreiber refers to it as “installing new batteries” in the people, particularly if growth means acquiring a new business unit.
“We want to kind of give them a new energy,” he says. “That’s the whole point of installing new batteries. In the case of the recent ConAgra acquisition, we brought our key plant people to visit us here at our headquarters just before we closed on the business. We had two or three days of sales and strategy meetings, and had some of their other people visit our facilities.”
Shreiber’s staff and the incoming unit leaders collaborated on a series of lists, between 10 and 12 items in length, each with a 100-day goal in mind. At the end of the fiscal year, Shreiber and his team reviewed the progress against the stated goals.
“Above all, you’re looking at how this product line fits in with what we’re doing, how you’re getting the message out to existing customers in areas that you weren’t operating in before, and how we’re getting it out to new customers,” Shreiber says. “I’m cautiously optimistic about our situation with this acquisition, that we’ll get this to work and be on to the next challenge in a relatively short period of time.”
Investing in growth also means investing in the support structure to accommodate growth. Though a self-admitted computer novice, Shreiber has invested heavily in IT support over the past decade — an effort to make his company more efficient, more scalable and a better conduit for information.
“If nothing else, that technology gives the CEO good, concise, clear information all the time,” he says. “So you can’t be afraid to grow and invest in your company, and that is something I encourage other CEOs to do. Even though we area a public company and answer to shareholders, I’m still the controlling shareholder and as long as I’m around, my mantra will never change.”
Plan for growth
Even if growth isn’t an option right now, if you want to grow again at some point, you should continue to operate with growth at the center of your long-term plans. That means fashioning a strategic plan with aggressive yet realistic goals and ensuring that you don’t backslide on the principles that made your business a success to begin with.
“Sometimes it’s a little more difficult if gas reaches $4 a gallon,” Shreiber says. “People drive less. If they drive less, they go less often to the places where we sell most of our products. So we are often challenged that way. That’s when you’re looking to ensure that your merchandising remains a priority, that you’re taking a good look at the locations where your products are delivered and that you’re delivering good value to the customer and, ultimately, the consumer. It’s almost like a running train. All of the cars are connected in there, and if something comes loose, there is going to be an issue. As the leader, you have to be the supreme conductor to make sure nothing comes loose. If it does, you make sure that someone reconnects it right away.”
Shreiber tries to plan for the short-to-medium term, but refrains from looking five-to-seven years down the road. Too much can change in the economy and in the industry in half a decade to accurately assess the plan of action.
“If you plan for five or seven years from now and you get everybody following that plan like a book, there are things that can happen in the short term that can affect that,” Shreiber says. “You want to be able to respond and react to opportunities, so our long-term planning stays within three years.”
Every business is different. Each business has its own market to serve, its own processes, its own structure and different methods of management. But the same principles of facilitating growth apply no matter what product you make or what service you provide. You have to know what your customers want, know what your business is set up to provide, and you have to continually invest in initiatives that will help spur growth.
“Every business is different,” Shreiber says. “We turn over our inventory 12 to 15 times a year. If you’re in the auto industry or heavy construction, maybe it’s a little different. But we’re buying our raw materials, packaging and ingredients on a regular basis. You have to invest in the business and invest in the opportunities you find, as opposed to throwing a cover over yourself because of the recession. Good companies are impacted by the recession, but you get through it by doing more things more often, and doing them in a better way.”
How to reach: J&J Snack Foods Corp., (856) 665-9533 or www.jjsnack.com
In addition to his business career as founder, president and CEO of J&J Snack Foods Corp., Gerald Shreiber is also an animal enthusiast and lifelong supporter of animal rights organizations in Philadelphia and southern New Jersey. Supporting animal rights causes has become one of Shreiber’s passions, and Smart Business recently spoke with him about it.
As a child, I always had an affinity and love of animals, particularly dogs, but certainly all animals including horses, cats and rabbits. I would find homeless dogs, bring them home and fib to my mother that they just followed me.
At 11 or 12 years old, I would clean horse stalls to ride for free. I always believed there was some magic in communicating with dogs and that I had some of that magic. Later when my career flourished, I felt a responsibility to give back and do what I could to help animals.
The Shreiber Animal Foundation Enterprise is a corporation organized and operated exclusively for charitable and educational purposes and for the prevention of cruelty to animals. I also support organizations such as the American Anti-Vivisection Society, the National Humane Education Society, the North American Wildlife Park Foundation, PETA and the Pennsylvania SPCA.
I believe animals should be treated with respect and dignity at all times and I support those causes that share my beliefs.