Eric Lofquist and Magnus International Group Inc., go about business in a rather nontraditional manner. The 50-employee manufacturer of organic components for eco-friendly products does business through a very collaborative process where customers often agree to buy products before they are even made.
Magnus, which has annual revenue just shy of $100 million, is primarily a company that takes materials that are traditionally made out of petroleum and designs a replacement product based on renewable, sustainable materials.
“What it was in the beginning was we had an idea and you’d have to take it to the customers,” says Lofquist, co-founder, president and CEO. “Now it’s to a point where the companies we do this for think about it and they call us and ask, ‘Can you make this or make that, or have you ever thought about this?’ So now the information is traveling both directions.”
Smart Business spoke to Lofquist about how he has grown Magnus International through trust, collaboration, and planning.
Collaborate. It takes a little bit longer to grow when you’re developing new products and you’re looking to get those products approved and into production. One way we have found to reduce the time to get those out to market is to already have them presold. If we can make this for you, if it’s going to be around this price point, if it’s going to have these characteristics, are you a buyer?
What you end up doing there is you end up having a partnership. You’re an extension of theirs because you’re getting an agreement ahead of time and you’re telling them all your secrets, so you need to have someone you can trust and they need to be able to trust you too. They’re saying, ‘If you make that, yeah I’ll buy it.’ It’s really collaboration between two companies without there being a formal joint venture. It can be a little tricky at first, but once you get established and you do it a couple of times, then you build that reputation and that ability to move pretty quickly through the supply chain.
Have a plan. We have a good platform in place right now and 2012 is going to be all about new products and new brands all setting the stage for the next big growth spurt for us. Our current brands are going great, so it’s how do we leverage that and how do we do more of what we’re doing and how do we do more of that with the people in Northeast Ohio?
Anyone out there that’s been successful has to start with understanding what their customers want long-term. The deeper you get into their long-term plan, then the deeper you can get into your long-term plan. If your long-term plan doesn’t match up with what your customer’s long-term plans are, then you’re not going to meet your final objectives. We spend a lot of time understanding what the long-term objectives are and they change, so you need to be on top of them. At least on a quarterly basis you have to check if you’re still on the same path. It’s a constant check and balance on what they’re doing and what you’re doing and making sure that there’s no gaps and you’re working on what they’re working on.
We have a plan and we share that with them and they have a plan and they share that with us. That goes back to trust because the information that we are passing back and forth is very confidential information and it takes years to build that report up. Once you have it and you show that it can be trusted and sustain the deeper you can get into what they’re plans are and how you fit into them.
Trust your employees. We do things differently than the way most people do them when it comes to our business. We have to have people that are willing to look at the business not in the traditional way that new brands are developed and taken to market. Your employees have to believe and have that same trust. The door swings both ways on the trust because we’re asking for information and we’re provided information and it has to flow evenly both ways.
Over the years the key employees have really understood that and have looked at things differently than a traditional development market and it takes time. You can tell them all you want, but they have to see it and they have to feel it and they have to be part of it in order to buy-in and understand it. Then they can move it forward because you can’t do it all on your own. You have to have people that believe and have the same focus on the strategy.
HOW TO REACH: Magnus International Group Inc., (216) 592-8355 or www.magnusig.com
Mary Miller oversees a company that is responsible for cleaning 10 million square feet of office space in the Cincinnati area every night. To get that much business, you have to not only do a great job, but you have to differentiate your business from your competition. That is exactly what the CEO of Jancoa Janitorial Services Inc., a 320-employee commercial cleaning company that services large office buildings, is doing.
“Our business is better today than it was three years ago,” Miller says. “Back in the mid-’90s when employment was really low and we were short 38 full-time people, we knew we had to be more creative and ask different questions. You can’t just look at things and say, ‘This used to work yesterday.’ Nothing stays the same forever.”
It was this kind of thinking that led Miller and her team to create new programs that would differentiate Jancoa from its competitors.
Smart Business spoke to Miller about how to make innovation a part of your business.
Visualize the end in your mind.
Everybody has the ability to think of things they really want and to visualize how to see the future. At the same time, life brings opposition into our lives with walls to negotiate. The difference is taking the time to ponder the issue and devise ways to break through, climb over, go around or dig under — but to work through that opposition is when transformation takes place. It’s having the faith that knowing tomorrow absolutely can be better than today and being willing to do what it takes.
The more people ask the question, ‘What do I know that can create value for a company or for an individual?’ — that’s what really gets that motivation going and success starts happening. Too many people are sitting and waiting for people to give something to them and for things just to happen instead of going after it.
You have to begin with the end in mind. What is it you really want? If we were meeting a year from now or three years from now, what has to happen to be really happy? When you begin with the end in mind, look backward, ask those types of questions and you look at the dangers that you’re dealing with and different obstacles that are getting in your way, you start asking, ‘What would it look like if that wasn’t an obstacle or if we were to overcome that and moved on?’
Triumph over obstacles.
We look at obstacles or complaints that come in from customers or requests or suggestions that customers have to see what we can do to prevent that problem from happening again or what we can do to make it better to increase our productivity. You start breaking them down and looking at the results that you really want to have. What does that look like when you achieve that goal? You have to make a list of all the obstacles that are preventing that from happening and take those obstacles one by one and start putting things into place to overcome them.
Most of my people on my team have better answers on how to prevail over things or how to tweak our systems than I do, but so many employees think the owners or the bosses have all the answers. As management or a leader of a company it’s so important to ask questions and to shut up and listen to what your people have to say and to listen to what concerns they have because when you hear what’s really happening out there, there are a lot of possibilities for making things better and that’s when you change things from your competition.
Have a clear plan.
The challenge that comes is that it’s so easy to be seduced into possibilities that can lead you into areas that can get you into trouble. It’s so important to stop and have a plan. Every quarter we take the time to plan out what we want to have happen over the next 90 days. We also take a look at the previous 90 days and reflect on what we want replicated and what we never want to happen again. That’s a really important piece is to be able to take time to stop and have perspective and plan out what you want to have happen.
You also have to build a team of people that you trust are working within their talents and their skills that really creates an energy source of working together to achieve the results that you want to have.
HOW TO REACH: Jancoa Janitorial Services Inc., (513) 351-7200 or www.jancoa.com
Kevin Reddy has a reason to like social media. It’s because of those data points that the chairman, president and CEO of Noodles & Co., a fast-casual lunch and dinner restaurant chain, decided he had to bring the chain to Pittsburgh.
The Colorado-based company has more than 5,200 employees and more than 280 restaurants in 22 states. Two of its newest locations are Market Square and Oakland.
“One of the wonderful things about social media is the amount of data points and guest feedback that you get,” Reddy says. “That’s one of the reasons why we decided we needed to get to Pittsburgh because we’ve gotten quite a few requests over the years about opening in Pittsburgh. It got to the point where we couldn’t ignore it; we’ve got to go.”
In an industry that has seen a decline in restaurants for the past three years, Noodles & Co. has been seeing double-digit growth.
Smart Business spoke to Reddy about what makes the Noodles concept so successful.
Execute growth plans.
For any business to grow successfully today, you’ve got to be one of the better, stronger performers within your niche and within your segment. One thing that we’ve been successful at is we have a pretty simple, focused philosophy on creating a dining experience that we’re really proud of and it’s based on three things; really good food, served by genuine, nice people, in a friendly, welcoming place. That’s what we’ve been doing over the past five years and we just keep getting better and better and better at it.
It starts with being very objective and critical about what you’re currently doing well today and what you’re not doing well today and really understanding how the guests view the brand. It’s one thing if a management team believes something but if the guests believe something else, you’re never going to create that connection that you need to. You have to be very objective and truly understand your guest’s perception of your brand. You’ve got to be very honest and objective of what your system is capable of executing and how well they’re doing it. Once you assess that you can put the right strategy together and form the whole discipline around identifying what’s important, being rigorous in how you innovate, and having a slightly unreasonable expectation in execution.
Grow your infrastructure.
Infrastructure for growth starts with understanding the right risk tolerance level. It’s about funding, it’s about capital, it’s about expectations around growth and you’ve got to believe in your own brand to grow. For anyone to grow, you first have to look at real estate. You really need to understand who your guest is, what influences how far they’re willing to travel and how frequently they come. You’ve got to be able to define those areas that make up the key decision criteria. Understand those big blocks of demographics and how they influence sales within the range of your own concept. Then it’s how do you replicate it. When you’re growing fast, you have to have the analytical model down pretty tight, and then you’ve got to have the discipline to stay true to your site screen.
Enter new markets.
Every year we add two to three brand-new markets. We pick those based on what we can get on data. We try to find out which cities and states are thriving and growing and which are struggling. We picked Pittsburgh because Pittsburgh has done a phenomenal job in staying relevant and transitioning its economy.
You have to really understand the elements of your business and which ones are critical to replicating success because not all things are important equally. You have to look at what’s on the consumer side, on the operation side and then the real estate side. You have to willing to build those systems — the training programs and decision logic before you start growing. You’re always going to modify and get better, but it gets really difficult to build the ship as you’re sailing it and you don’t want to make fatal mistakes early on. What’s critical to the right real estate? How are you going to merchandise and market the guests? How are you going to make the brand relevant and make people aware of it so they’re going to try you? You can’t just chase a number for growth. You have to pay attention to every one of those details because they all have a chance to dilute your ultimate success.
HOW TO REACH: Noodles & Co., (412) 562-2191 or www.noodles.com
Vlad Shmunis built his company the old-fashioned way, one customer at a time. Starting with zero users, he’s grown RingCentral Inc. to deliver cloud-based business phone system solutions to more than 200,000 customers across three continents and employs approximately 500 people.
“It’s very clear that there is an amazing amount of demand,” says Shmunis, the founder and CEO of the San Mateo-based company. “It was at the right time, right place. So it’s just trying to hit it on all cylinders.”
To stay ahead of the competition in the business communications industry, Shmunis now looks to invest in areas that grow the business with new customers while also meeting the needs of current ones.
Smart Business spoke with Shmunis about how he invests in RingCentral’s long-term growth.
Invest in top performers.
As we’re growing, the focus is more the sense of the overall vision and culture understanding and making sure that everybody is on the same page. As far as the people we want to hire, how do we incentivize them? How do we keep them excited about what they do?
This is a constant quest. We try to have an A-team in every respect. We have well-accomplished people in the key positions. So that’s taking a lot of my time now and probably will continue for the foreseeable future as the company grows.
The slowing down of the economy did not slow our growth down and did not slow our customers’. The people that work for us have options. So how do we keep them here and productive?
Invest in infrastructure.
People understand that emphasis is on continuing to delight existing customers. So we’re not going to do anything that would jeopardize their well-being and in any way destabilize the service. We do invest a lot into the infrastructure, so we’re definitely putting our money where our mouth is. We’re running our own cloud. We invest a lot in the support systems — software and people most importantly — making sure that you have 24/7 coverage … that people will be woken up in the middle of the night whenever something serious happens.
These are people trusting us with their businesses, and if their phone line goes dead, it’s not a good thing. If things do happen, which is hopefully not a very common occurrence at this point, we have procedures that are well-defined.
Time of response is extremely important. So if there’s an outage, we will immediately post updates to the website to keep them up to speed. We are active in social media so we use Twitter. We use Facebook, our own website, anything we can to make sure that we’re not asleep at the wheel and that we’re still here and the service will be brought up as soon as humanly possible.
Invest in quality.
We make it easy for people to refer people to the service. But really the most important thing is that we’ve invested heavily into a product that will be liked. You can’t pay a person enough to have them recommend something that the person doesn’t like. The product speaks for itself. So we just make sure that it does what it’s supposed to. It does it well. It does it reliably, which is immensely important for our customer base. The rest takes care of itself.
The general position is saying, ‘Look, while we’d really to grow and take over the world and have tens of millions of customers, none of that is going to happen unless we keep our existing customers happy.’ One positive reference may bring you another lead. One negative reference can lose you 10 leads, if not more. Just continue the emphasis on quality of service.
Invest in your vision.
We’re not trying to veer out from our main task, and main task is enterprise-level communications to small businesses. We’re not trying to bring them additional services. We’re not trying to be a generic cloud platform. We’re not trying to become a broadband provider or call center operator or any of those things. Many of our competitors might be going into those tangents under the belief that there is low-hanging fruit there, and maybe there is. But I believe in focusing.
It’s fairly rare to find a world-class football player who is also a world-class baseball player. People have tried. Most of them did not succeed at the other sport after owning one sport. I feel the same thing here. If you want to be really, really good at football, play football. If you want to be really, really good at business communications, do business communications. We’re at the size where if we are to retain our world championship status, we need to work really hard.
How to reach: RingCentral Inc., (888) 528-7464 or www.ringcentral.com
To follow the trends in the market, Marc Blumenthal decided that his company needed to broaden its product and service offering for customers. While it was easy to make this decision from an organizational standpoint, the real challenge was moving this idea from thought to reality.
“Everything tends to have a ripple effect,” says Blumenthal, the owner and CEO of Tampa-based technology services firm Intelladon. “Every little decision that gets made, I have to get a few dozen people to change the way they do things a bit.”
By implementing new ideas to drive growth, Blumenthal has led Intelladon’s expansion from a handful of employees into a 40-person company.
Smart Business spoke with Blumenthal about how he floats new ideas to take hold in the organization.
Build critical mass.
Usually I’ll bring an idea through some level of gestation. I tend to incubate things first a little bit from the team as a whole until I get some critical mass around the idea and some validation.
I might talk to some of our customers. I might talk to some fellow CEOs. I have a whole lot of people that over the last 25 years I’ve gotten to know and I can run things by.
Then I bring the team in. The benefit is that I don’t disrupt the team on every idea that ever comes up, because there are many more ideas that get generated that never even get evaluated and still fewer that actually get implemented. The penalty I pay is that I have to work backward to catch them up when an idea has reached critical mass and it’s time for them to get involved. But if I got them involved in every idea that came up, they would never have time to do their jobs.
Involve your leaders.
I usually will meet with the person who has the greatest knowledge of subject matter expertise on that topic and vet a few things with them along the way. Usually one member of the leadership team has a little more experience in the area I might be working on. I sit down with them over lunch or coffee and brainstorm a little bit, and say, ‘Well, what would you think if …?’ If the feedback is positive I will take it to my COO, who is really the guy that runs the company on a day-to-day basis. His name is also Mark, but I call him the anti-Marc. He’s the opposite of me. I pull him out of his comfort zone and he pulls me back. In the end, we end up in a good place between the two of us.
Present ideas with a purpose.
My approach has been for every 10 ideas that I have, I may only present two or three, and only one may make a lot of sense. Don’t present all of your ideas, because people have a tendency to think that all of your ideas are supposed to be run with. Ideas need baking. In the early days of the previous company, I used to throw out all these ideas and we’d have a brainstorming session with the leadership team. Then I’d come in the next day and a couple of people started working on some of them. I’m like, ‘What are you doing? That was just an idea.’ You have to be careful about discerning between what ideas are and what you are actually asking for. So I try to be very careful about what I put forth and when I put it forth.
Help people to run with it.
It’s really important to give the team the opportunity to change, refine and make the decisions to make it their own, what gets changed and what doesn’t. At that point, you can step away from it and it’s no longer your idea, it’s the company’s. It’s the team’s. Once that happens, you are almost assured of success.
I try and pull the team along a little bit. I try to be a little bit disruptive, but not too disruptive. I like to be the sand in the oyster. So a pearl forms because I’m rubbing up against them, pushing them a little bit. We end up being a little bit better, growing a little bit faster, trying a few new things that might not otherwise get done or get tried if I wasn’t pushing and pulling a little bit.
Part of that is I’ve learned that if you give the team the power to make great decisions, they elevate to that in most cases and they actually do a better job than I might do by infusing myself in a lot of decisions.
How to reach: Intelladon, (813) 814-2345 or www.intelladon.com
Before Zalmi Duchman founded The Fresh Diet in 2006, he’d been on the other side of the employee accountability problem.
“I was the guy taking the extra lunch and taking the extra break and kind of slacking off where I could as a worker,” says Duchman, the founder and CEO of the Miami-based fresh food delivery company with 160 employees and approximately $18 million in revenue.
That’s why in running his own company, Duchman understands the importance of creating a culture that motivates people but still keeps them accountable for progress.
“By realizing that I’m too laid back, I’ve been trying to find that middle ground,” he says. “I don’t want to be this strict company and not a fun company, but I don’t want to be this company that’s not getting anything done because everybody is partying all the time.”
Smart Business spoke with Duchman about how to create this middle ground by improving communication.
Have an open-door policy.
As long as the managers or myself or the other executives are sitting at their desks or they’re online or they’re on their BlackBerry, and they are in real time responding to issues and not pushing it off 24 hours and 48 hours, that will go a long way in making sure there is communication, because you’ll nip it in the bud right away. If you see there is an issue, you can narrow it down to how did this issue happen and who didn’t communicate. And sometimes it’s not a communication issue, but a lot of times, it is.
I don’t come into work in a suit and a tie every day, but I make sure that I’m here. I make sure that there’s an open-door policy. I make sure that everybody knows that even if your title is customer service, at the end of the day if you have a food request or if you have a suggestion in marketing, everybody wears ten hats. Because the guys upstairs and the executives, we don’t just stick to what we do and we all put our hands into everything else, I think that that’s created a culture where people know that if they have an idea they’re not going to be shunned. They’re not going to be told to shut up. It’s very, very open and everybody feels like the business is theirs and they feel like it is one big family. They feel that if they think there is a problem they won’t be scared to say it.
There’s no question that being more involved in day-to-day projects and having a better handle on it and making sure that everybody’s communicating every day has turned into growth, dollars and cents. If you’re on top of the situation, then people can’t really slack off as much. They have more of a drive if they know that the CEO is going to get down to the nitty-gritty instead of asking once or twice a month about projects. It’s also establishing weekly meetings and establishing better lines of communication. It’s definitely helped the projects move faster and the overall quality of the team is better.
I want to have that culture of it’s not based on how long you sit at your desk but what you accomplish. But at the end of the day, you have to have a median. Just managing projects better, keeping a tighter ship by using software online like Basecamp or project management software, that allows me to see that the communication that’s being given is actually being followed. So making sure that I have my hand in more of what’s going on has helped make the workplace smaller in a way.
Be proactive on issues.
When there are very few problems, it means that the communication is flowing and it means that people are talking to each other. If there is a problem, it’s almost always going to come from communication, because this person didn’t tell the correct person or this person thought that they could do this themselves and didn’t bring it to someone else. So I feel that monitoring on real-time basis, especially in a business like ours with so many moving parts — if you’re monitoring the issues of the day, you’ll know right away if there are communication issues.
Usually what would happen is that a company would be in a bad place and then they would realize that, oh my God, we’re in a bad place and it probably happened because no one is communicating and it got out of control. I would tell them to stay positive … and deal with it. Don’t continue to put it off. Establish weekly meetings. It’s a lot easier to talk about it than to implement it, but I feel like you ‘fake it till’ you make it.’ So even if you’re in that bad place, just make a decision that this is going to change and it’s going to change today.
How to reach: The Fresh Diet, www.thefreshdiet.com or (866) 373-7450
As a former client of Quest Fore Inc. Ken Cuccinelli had always known the company had great people and produced a great product. That’s why when the company came up for sale in 1999, he jumped at the chance to lead the 47-employee strategic marketing company forward.
Cuccinelli, owner, chairman and CEO, liked what he saw in his new business. However, there seemed to be something missing. The company needed processes in place and a strategic direction to help guide it.
“What they needed was better processes and financial controls as well as a strategic plan,” Cuccinelli says. “They were working mostly on a project-to-project basis. The first thing we wanted to do was move the company from being a project company to more of a strategic partner with our clients.”
Cuccinelli helped the company grow to that next level by adding direction.
Smart Business spoke to Cuccinelli about how to implement a strategic plan and add more value to your business.
Develop a strategy.
The important part of having a strategic plan is if you don’t have a plan, you don’t know where you’re going. If you’re just searching for the perfect wave, you might get lucky and find it, but you may not. Unless you have a plan and a direction, those day-to-day decisions that we each have to make if you’re not matching them to where you’re ultimate goal is, you may be taking yourself in the wrong direction. That doesn’t mean that a strategic plan doesn’t need to be looked at and revised at all times, but the bottom line is, you’ve got to know where you’re going or any path will get you there.
The real challenge people have is, they mix up strategy and tactics. That has been one of the elements of what we’ve been trying to help people understand. A strategy is more of a higher level of what we want to attain.
It gets to be a three-fold input. You have to talk to your employees because they see and hear things you don’t see and hear. The second thing is, you have to try to meet with your clients without any goal of selling, but just listen. How’s everything going? How are we doing? What could we do better? What do you foresee as your upcoming issues? In five years, what do you think is going to impact your business? You are trying to extract that information.
The third thing is to try and listen to what your competitors are doing. Maybe they’ve seen or heard something you haven’t and you can pick it up. Then you have to try and bring those three pieces together on a regular basis.
Measure your plan.
If you can’t measure it, you can’t manage it. The strategy doesn’t need to be complicated and it doesn’t need to fill tons and tons of books, but it needs to be the direction where you want to go and it needs to be understandable by everybody involved in it. When that happens, you’ll find that employees and staff will come up with the right kinds of programs, because they’re going to see how it’s going to get them closer.
A good strategic plan has three elements: it has a competitive analysis, it has an internal analysis, and it has a market analysis. Each of those has to be done to have a good strategic plan. Who are your competitors? How do you rank against your competitors?
We actually funded a third party to talk to all of our clients to see how we were doing and clients who we didn’t win bids on to do a lost-order analysis. We found out from that study that we had competitors we didn’t know about and people we thought were competitors were really not competitors. People really need to know who truly they’re competing against.
Know your value.
Value is a function of benefits divided by cost. You need to, from a strategic point of view, truly find out what your value is by knowing what your benefits are. You’ve got to talk to the clients. Look at each of your customers and study their business a little bit and see where it’s going. Is there consolidation going on? Is there technology advances going on? Be aware of what they are and see how you can help them get through those changes because change is pretty tough on a lot of companies.
There are three steps in any kind of selling process or in any relationship. The first one is people have to be aware that you exist. The second one is, they have to have a favorable opinion. The third thing is, they know now that you exist and they like you, then they’ll change behavior. So many people try to go into the behavior change piece right away. If you think of your own dating or relationships and things like that, it’s a multistep process.
HOW TO REACH: Quest Fore Inc., (412) 381-6670 or www.questfore.com
Barry Wolfson joined Tervis at a time when the company was expanding nationally, increasing sales and enjoying double-digit revenue growth. From the outside, it was a CEO’s dream. Internally, the company’s 700 employees could barely keep up.
“When your business is growing 60 percent a year, it’s everything you can do to just focus on running the business day to day,” says Wolfson, CEO since 2010.
“I just think that there wasn’t an opportunity for anyone to say ‘Hey, we need to step back for a moment,’ because there really wasn’t time to step back.”
By restructuring the business in a way that allowed it to scale, Wolfson has helped the company — known for its tumblers that “keep hot drinks hot and cold drinks cold” — manage the demands of fast growth.
Smart Business spoke with Wolfson about the keys to scaling a fast-growth company.
Set your timeline. There were things that we put on the timeline that we said, ‘In 2011, we need to get these things done.’ There are other things that we’ve started to work on during the year and say, ‘OK, now over the next five years, where do we see the company going and what are the capabilities that we have to put in place to get there? So there were short-term things — less than a year — that were very critical for us to do… and then the other is developing this longer-term vision and strategy for the company. Phase one was a little bit of an Extreme Makeover Tervis edition as we just put in place the basic capabilities to support growth. But the phase that I’m in with my senior management now is a little bit longer-term vision in terms of what products and markets do we want to focus on.
Take a forward-thinking approach. This is not something that happens in one day, that you go from ‘This is the right way to do it’ to ‘You can’t do it this way.’ It happens over time.
When you are in senior management, you have to look a little bit further down the road and say [what’s] fine today are the things that we need to do differently. It wasn’t necessarily changing every aspect of the business. Tervis has been a successful company for 65 years and so it’s a matter of saying ‘Hey, what can be preserved the way that we’re doing things and what needs to happen differently to be able to continue to grow profitably, and grow in a way that makes sense for all involved?’
Allocate resources. It was first huddling with my senior management team…then between us prioritizing here are the things that we believe in our experience and at our level that we needed to do and the time frame of doing them. We went through that process, identified a number of things that we needed to get after, and then it was a process of saying, ‘What are the resources involved in doing this — people and investment capital?’ At that point, it’s engaging with the ownership of the company and getting their support in making the investments that we needed to make both in people, systems and plant equipment.
Build a deep bench of talent. You look at how fast we’ve grown — there are many, many people in the organization who have not been here very long. So continuing to develop a culture and the key people in the organization is something that I spend a lot of time on. Generally, besides the culture, it’s continuing to develop intellectual capital that’s required in the business. Develop people from within with additional skill sets and complement that with bringing people in from the outside that can give us different perspectives on the various levels of growth and business that we are trying to achieve.
Think sustainability. Sustainable growth will come from us continuing to reach out to a wider audience of potential customers in various different markets and geographically. Staying very fresh, relevant and innovative in our product offerings is something that again fuels growth.
You have to be very intentional about the growth. We don’t see growth for growth’s sake. We want to be a strong consumer brand out there in the marketplace that is a high value brand. We don’t want to grow just to sell more tumblers. … Resisting that growing for the sake of growing is extremely important in a business that has the opportunity to grow.
How to reach: Tervis, www.tervis.com or (888) 508-8859
John Bauer has had a long career background in the food business, so much so that in 2011, he was appointed to the U.S. Agricultural Advisory Committee for the benefit of his expertise. As global trade in agricultural products has increased, keeping up with the nature of the industry today takes a certain set of skills. These are also skills that Bauer has been honing over the last 34 years.
“We had boom times and had some recessions, but the situation now is all together different,” says Bauer, president and CEO of Basic Food International Inc., an established, Fort Lauderdale-based supplier of canned, frozen and packaged food products worldwide.
As import and export figures rise, staying competitive in the industry has become increasingly about a company’s capacity to operate effectively on a global scale.
“We have to learn and we have to really be ahead of the curve as much as possible in order to remain a factor in our business,” Bauer says.
Smart Business spoke with Bauer about the keys to success in the agriculture industry.
In the future, it’s going to be survival of the fittest in our business and in any business. You’ve got to be able to withstand, to compete and to develop.
But globalization is a definite plus. We have open borders and every country practically has open borders. There are fewer restrictions.
The emerging markets, but also countries in Latin America, are going to be great countries and great markets.
It’s one world. It’s like one country. We’re in touch any minute of the day with whoever we want to be in touch with in any part of the world. It’s an unbelievable situation. I talk at night to my suppliers in Vietnam and in China, and early in the morning I talk to buyers in Europe or in the Middle East or South America.
Form strategic alliances.
The business requires strength. We’ve been approached and we are approaching other firms similarly situated as we are for strategic alliances, and we work together and cooperate. There’s no use competing with one another. You have an affluence of competitors at this time. Some of them will disappear naturally and others will be forming groups with others and will become bigger and larger and more effective.
We are looking for potential partners that we can either acquire or work with. It will cut down the expenses and the competition.
Everything is going at a very fast speed. Everything is speeded up and the volume has increased accordingly.
We have locations in Fort Lauderdale and Miami and in Guatemala, so altogether we have about 50 major employees and we are constantly in touch with a system of communications. The system uses the Internet, talking on Skype, conferences.
You have to provide a lot of guidance. You have to instill in them a lot of confidence. You have to instill in them the desire to learn and to get ahead and to be very thorough in everything you do — to think of all the possible danger points where you may have a problem.
It all requires a tremendous attention to detail, our business in particular, because we have shipments where one container of merchandise is $100,000 or more.
You’ve got to be aware of what the new regulations are, labeling regulations, regulations in countries to which you ship, and you’ve got to familiarize yourself on the importance of food products and imports. You’ve got to know what the requirements of USFDA are. Whatever we buy for the United States, we go and inspect the plants. We make a very thorough analysis of their products and their raw materials so as to assure that we are getting product that is produced and shipped in accordance with the standards that we require, both federal, state and for ourselves.
It’s gotten a little bit more complicated, because we’ve got a lot more products to deal with. We’ve got a lot more regulation to deal with and we have a lot more uncertainty to deal with, especially from the point of view of sanitary controls and regulations pertaining to food processing, contents and ingredients. So it has evolved.
HOW TO REACH: Basic Food International Inc., (954) 467-1700 or www.basicfood.com
When Antonio Torres looks at the building and construction industry he sees opportunity. He knows that it’s not what it used to be, but as president of Syntheon Inc., a building science company, he also knows that if you don’t sit on your laurels you can accomplish great and new things.
Torres has taken advantage of the economic times and has used that to find new opportunities within Syntheon to continue to grow the more than $20 million, 200-employee company.
“This is an industry that can change and is an industry that hasn’t changed in a very long time,” Torres says. “It’s a tremendous opportunity and a great place to create jobs and a great industry for the U.S., and I’m very pumped up about delivering it in a new different more efficient way.”
It is that excitement that has allowed Torres and Syntheon to think about the business in different ways.
Smart Business spoke to Torres about how he has grown his company by taking advantage of opportunity.
Be creative. In a company that’s multinational, you end up shifting resources around to the high-growth areas and minimizing the resources in the lower-cost areas as much as you can do that. That’s one good lever that you have. The other thing is, this is a good time to do the development for new products. If you think about the construction industry at the peak, the amount of work that was done on the fact that you could sell everything you made or every contract you signed, kept all your workers busy and your manufacturing plants running at full-tilt. That did not allow for any new development. Now there is a little bit more bandwidth for those manufacturers or contractors to take a look at what’s new out there and integrate that into my options as the economy begins to turn.
The other thing is just keeping everybody focused on the longer-term vision rather than the short-term issues. Especially in a company like this one where what we’re trying to get to requires significant resources and aspiration work, and we’re not where we want to be. Having people focused on the capabilities that need to be developed internally has also been important, and it’s a good time to do it, because there is not external pull for business.
Take advantage of opportunities. The challenge is of course what situation your company is in. If you can afford it, the best thing to do is identify your lead users. These are customers that are very willing to be the first out in the market with a new product, new idea, or a new system, and then work with them closely to pull the technology out of your company.
It gets your customer motivated and then your employees see that even during more difficult times, there are people out there trying to make a difference and trying to change the world, or at least improve it, and everybody stays focused on the future rather than the present. You have to focus beyond tomorrow, especially when we’re in the times that we’re in, because it will get better. We have to be ready when it gets better with different offerings and different capabilities than the ones we had when we got into the quagmire that we’re in today.
Focus on growth and focus on the longer-term vision. Look outward from your company. I think that many times, especially in bigger companies, we tend to internally focus and internally develop answers that while they may be quite advanced and very capable, may not meet the needs of the consumer. You have to get out of the company.
Balance your culture. One culture, I’ll call the growth culture, and the other, optimization culture. The growth culture really looks at what the customers are doing, where codes are going, what’s the government thinking, and how is (the industry) implementing this. That culture really brings a lot of richness to your ability to develop the appropriate right products. The problem with that culture though is that they don’t like to close; they don’t like to implement. They are inquisitive and want to find out what’s happening.
Then you have the optimization culture that says, ‘Hey, enough inventing, enough ideas, we’ve got to sell something. If we don’t sell something, we’re not going to be around.’ So there is a natural tension within a successful company where you have enough of the growth culture people and enough of the optimization folks to keep the company growing.
A lot of the focus of the CEO has to be to protect both of those. If you don’t protect the growth people, they all get fired. They’re seen as inefficient and not creating any value. If you don’t protect the optimization people they’re seen as too narrow-minded, not enough capability, hard to deal with and so on. The CEO has to establish a balance and that’s the key for an innovative culture in a growth culture.
HOW TO REACH: Syntheon Inc., (412) 490-4252 or www.syntheoninc.com