Armed with the knowledge of a financial analyst, Charles Chanaratsopon knows what makes a successful business and how to manage that success. In 2004, he took that knowledge and applied it to an advantageous investment market and founded Charming Charlie, a women’s boutique and accessories store.
“I saw an opportunity, not only in an operating store but also in the realty business,” says Chanaratsopon, founder and CEO. “The capital or investment market was very frothy. So you could quickly develop shopping centers on leverage and build quickly.”
Deciding to break into the market for women’s accessories, Chanaratsopon saw an opportunity for big growth with little competition, and his plan has worked. Since 2008, Charming Charlie has been opening new stores at a furious pace, and today, it is one of the fastest-growing private companies in the country.
“The operating business had a lot of demand,” Chanaratsopon says. “A lot of customers were coming in and buying product from us. We had lines outside every day before the stores opened. People just loved the product. I wanted to figure out a way to grow even faster.”
For the last six years, that’s exactly what he has gone out and accomplished. He knew that with the right mix of employees, strategy and innovation, Charming Charlie could be big.
“From the very beginning, when we had three stores, I always thought we had the potential to be all over the country,” he says. “People always talked about how I had big aspirations and thought I was crazy, when at three stores, I thought we could be all over the country. Now we are all over the country, and I think we could be all over the globe.”
Listen to the consumer
Chanaratsopon saw an opening in the market for women’s accessories, due to a lack of stores that strictly focused on accessory needs instead of clothing. Only large department stores offered those products to women.
“Once we saw what the market looked like, we knew we had an opportunity to create a specialty store around it,” Chanaratsopon says. “We saw it as an opportunity that we could exploit, so we did.”
As Charming Charlie took off in the Houston area, Chanaratsopon knew he could grow the business quickly if he continued to offer what customers were looking for and wanted to see in the store.
“That thesis worked out and held very well for the first two or three years,” Chanaratsopon says. “As we opened stores, stores were very busy and business picked up. We went out and built another center and then another center and went out and did it again and again. As we focused on listening to the customer and building our team out, that was basically the steps for our success.
“The key thing is, you need to listen to your customers before you break into a market,” he says. “You can’t really go until you do a market feasibility or market study about what they need. Does it make sense for Charming Charlie to come; do they like the concept? We always explore to see what opportunities are out there before we do a big push. We test the different markets to see if the concept will work. Our concept is very portable, so we are able to now move quickly through the different markets.”
It’s all about making sure there is a net demand for what you sell, before you go out and start something.
“I think that is just moral hazard,” he says. “Whatever you plan, plan on not meeting it. Have a worst-case, base-case and an upside-case plan, because most of the time, it’s very unpredictable in the beginning. You have to mitigate the downside and make sure that you have contingency plans if things don’t go well in the beginning, because capital will be a constraint.
“In our first year or two as we solidified our playbook, we had a lot of key takeaways in ‘learnings’ and mistakes. So before we could go out and do a cookie-cutter approach, it took us a few years to make sure we had the right recipe for success.”
Everything starts and ends with the customer.
“My best advice is to go out and learn the customers, and make sure there is a need before you go out and build anything,” he says. “You survey your current customers and your noncustomers, and you ask them questions about what you can do better to improve. At the end of the day, our boss is the ultimate shopper. We just listen — that’s what we do. I don’t mean to make it sound so simple, but it is. We listen to what they need, and we do it, often. We spend a lot of money listening to their needs, and we try to give them what they want.
“We are not a tech company or a research group. We sell on experience and what we do is listen to our customer and make sure we deliver the best that we can, and that’s our mantra.”
Innovate and adapt
Growth in any industry naturally causes issues that must be overcome. The higher the rate of growth, the quicker a company has to adapt to that growth in order to succeed.
“You’re running at red line all the time,” Chanaratsopon says. “What I mean is when your car is running at 6,000 rpm, to get everybody used to running at that speed and understand what you’re doing is challenging. Not many companies grow this quickly, and that’s evidence that shows the percentage of retailers that can actually go out and do what we’re doing [is small].”
Charming Charlie has seen revenue grow from $9.2 million in 2006 to $51.9 million in 2009, a three-year growth rate of 463 percent. Chanaratsopon expects 2010 revenue to be around $140 million, and he realizes just how special his success has been.
“The odds are against you,” he says. “Five percent of businesses make it, and 5 percent of businesses only make it to $5 million. A very low percentage of businesses make it to a critical mass. So it’s very challenging to move at the current pace we are doing. It’s also very hard to change the mindset of your team when you’re managing three stores to now managing 100 stores. Your management team has to be open to change. When you don’t innovate and adapt to the business, I view it as binary. Either you innovate and you win, or you lose. There’s no common ground these days.”
In today’s economy, innovation and adaptation are very important to a company’s success. Chanaratsopon pointed to the examples of Linens ‘N Things and Circuit City, both of which went out of business within the last few years.
“That’s one of the great things about American capitalism,” he says. “You’ve got to be very sharp and very on, or there’s no room for you. You have to have the mindset to implement your information technology ahead of time and to plan for that is very challenging.
“You need an ability to split up what’s needed during your day-to-day part of the business. You also need to be cognizant of planning for the future and future roadblocks. You need to be able to set up radar or a systematic view for upcoming issues and be ahead of the curve. Have a cognizant view of how you spend your time between your short- and long-term strategy. Depending on what your long-term strategy is, set a blueprint to that plan and measure yourself constantly so you hold yourself accountable to your own business and personal plan.”
Hire smart, build smart
Since the founding of Charming Charlie in 2004, the company has grown to roughly 3,600 employees and has stores in 23 states. Continued success and the ability to keep opening stores in new markets, takes hiring more employees — and good ones at that. Chanaratsopon says the hardest part about getting the business up and running was finding the right people.
“This is a people business,” he says. “It’s hard finding the right team members to help you facilitate growth. There are a few things that are very challenging. No. 1 is finding the right people to help build a team. Whatever you do, be creative in the way you find people.
“We have gone through different people in the organization, and most businesses are team businesses, and without the right team, you can’t do it. You should overhire. If you think you have conviction in that your product or business will succeed, go out and get the best people that you can. Don’t be cheap on it.”
Start by focusing on attitude.
“You need to have people with good attitudes, specifically in a growing business. Attitude is half the battle. You also want people who have the same set of core values. A lot of people undermine that. When you have a small business that’s growing, you have to do many different things that you’re not accustomed to coming from a big retailer. People have to be able to adapt, and hiring on ability alone is not enough.
“My focus is trying to hire experts that are smarter than me in their specific function. I try to find people who are passionate about what they do and the business. I try to just give them the tools and support to help grow the business.”
A fast growth rate and an equally fast hire rate caused Chanaratsopon to adapt once more and create ways for his team to focus on common goals and visions.
“As you get more people, there’s a lot more people to build, as we call it, an ACA model with,” Chanaratsopon says. “That’s alignment, commitment and accountability. What we try to do now to achieve one goal is to find a team dynamic.”
In order to get his management team all on the same path and chasing after the same goal, Charming Charlie holds weekly one-on-one meetings and they build a company goal.
“That’s our road map to success or our blueprint to our business,” Chanaratsopon says. “That gets us all aligned and committed to the business, and we build accountability by having published goals that we need to achieve. It’s during these types of meetings that you need to follow up on your company goals. You need to make sure that people are executing to your goal. If I said, ‘Hey, I want to meet you in Florida.’ I’m sure you’ll get there. But if I said, ‘Hey, I want to meet you in Florida, and here’s a map.’ I’m sure you’ll get there faster. You need to have something mapped out. It may not be a perfect map, but you can change it along the way.”
One way that Chanaratsopon maps out his company’s future is by hiring ahead of time in order to acclimate new employees to the company and the goals it has set moving forward.
“Growth is challenging, but we weather through it by planning ahead,” Chanaratsopon says. “I invest in the future knowing that we are going to grow. I try to put our team players on early so that we can jell before we grow fast. A lot of people talk about what’s your capital budget plan. I talk about what’s my human capital budget plan. I need all these different team members to do this if we are going to open another 100 stores next year. I’m going to hire the overhead or infrastructure today, so we don’t have to do it last minute.”
Chanaratsopon emphasized that having fun and recognizing when employees do a good job are valuable aspects of creating a good rapport within your team. It also helps company culture to provide employees with ways to give feedback.
“Have a good feedback system,” Chanaratsopon says. “Your company is your customer. You want to survey about how your management team is doing. The same way you listen to customers, listen to employees.”
How to reach: Charming Charlie, (713) 579-1936 or www.charmingcharlie.com
The Chanaratsopon file
founder and CEO
Born: Houston, Texas
Education: I attended Loyola Marymount University in Los Angeles and received my MBA from Columbia University in New York City.
What was your first job out of college, and what did you learn from it?
I was a financial analyst at a bank, and I learned how to access money, how to put capital together, and how to understand a balance sheet and the ins and outs of financing businesses. I also learned about what makes a business work and what makes a business fail and the different metrics and how to measure against it.
If you could have a superpower, what would it be and why?
I wish I could fly. I always had dreams of flying as a kid. It felt pretty real in my dreams, so it would be pretty interesting to be able to fly around like Iron Man or Superman.
If you could invite any three people you wanted, living or not, to a dinner party, whom would you invite?
Rodger Federer, Warren Buffett and Barack Obama. I would be curious about how they think.
Throughout his career, Chip Bullock always envisioned creating a collaborative, team-based approach to architecture and engineering in order to get the best possible facility designs.
So when he became managing principal of the Atlanta office of HDR CUH2A, a $286 million integrated architecture and engineering firm, he wanted to realize his dream.
The problem is, people think in different ways.
“Architects and engineers come from two completely different backgrounds and approaches to solving a problem,” he says. “Architects like to explore problems until the last minute before they settle on a solution, while engineers love to solve a problem through a series of prescribed steps in a very efficient manner.”
If he could bring people together, he thought he could realize his dream.
“Great architecture and engineering is a fusion of those two approaches, so [I want to] try to help the architects understand more of what drives the engineers and help the engineers understand more of what drives the architects,” he says.
But the differences in approach to problem-solving weren’t the only obstacles he faced.
“We have a matrix organization, which has its pluses and minuses over a top-down kind of organization, but it often can lead to confusion about who’s responsible, who’s accountable and how to get things done,” Bullock says. “I seriously wanted to make an improvement over the current situation.”
He wanted people to work together and reach higher quality levels. He also hoped employees would have an experience they valued, and he wanted to raise the bar on projects so clients would rave about their work.
Bullock had seen what this looked like in previous organizations, and he thought if he could take a different approach to training, it may just be achievable.
“I knew that I needed to do this for the viability of this office,” he says. “I wanted to take it to a higher level. There wasn’t a training program out there that I could just take off the shelf. I had really been thinking about how to train people to be critical thinkers, how to express themselves in a way that allowed a free flow of communication and problem solving. … I knew there had to be a better way to do it than we were doing presently.”
So he set out to hire a consultant, have an initial program and then build a larger program from there so he could achieve his vision.
“I recognized the power of bringing in expert leadership trainers for myself, my lead team and my project teams. I set to develop a scalable training program that would allow me to improve myself, my people, our service and, in time, allow me to implement my vision.”
Hire a consultant
The first thing that Bullock did to work toward his grand vision was to bring in consultants to help lead the charge. He says if you want to build a successful training program, then this is a key.
“Definitely [have] a face-to-face interview, references and direct conversation about what your expectations are and exploring how flexible they are on creating a training program that’s customized to the approach that you envision but being open to their professional advice at the same time,” Bullock says.
When you talk to someone you want to potentially bring in to your organization, communication is crucial.
“You have to be a good listener,” he says. “You have to make your points very concise and to the point.”
These conversations in the interview process are key because it helps you start building a relationship with that person and helps you know if you can really collaborate with that person.
“You really want it to be a professional collaboration that’s really right for both parties,” he says. “You really need to know where that person is coming from and (if their style of approach) will be compatible with the culture that you have. The biggest mistake somebody can make is to have a mismatch of personality or styles that would hinder the program.”
Bullock suggests that you ask open-ended questions of that person to see how they respond. These open-ended questions will give you the most opportunity for learning.
“Get that person to tell about their successes and failures with training programs,” he says. “I would ask about what their motivation was to be in that line of consulting.”
He says to be very careful in how you phrase your questions so you’re not giving away what you’re looking for in the way you ask it.
“A lot of people start off with answering the question they’re going to ask before they ask the question, which defeats the purpose,” he says. “I always go into something like that with a list of things I’m after prepared in advance, and I always frame them in a way that can’t be a yes or no answer.”
Lastly, Bullock says to look at the nonverbal cues when you’re hiring someone. Often, these can be a good indication of someone’s personality.
“Eye contact and body language are certainly very important ways to gauge a person’s interest and ability for creating a program,” he says. “For example, do they lean toward you or away? And are their arms crossed or open? It’s really good to be a student of kinesiology as it applies to the workplace. It’s probably the most important thing one’s going to do, so the more upfront one can be on good interview skills for picking a consultant, it’ll be the smartest investment you’ll ever make.”
Have an initial program
Once he brought his consultants on board, Bullock didn’t jump cherry-bomb style into the pool. Instead, he just dipped his toe in to check the temperature.
“The first step was to go through the individualized training with the consultant on leadership skills, which was a good way to gauge the consultant for their suitability for the bigger picture program that I had in mind,” Bullock says. “Being a cautious buyer and not wanting to risk everything all at once, I really wanted to gauge how well we could work together to test drive what they had to offer.”
The consultants led an interactive, eight-person leadership workshop with Bullock and a diverse group of people. The group participated in soul-searching exercises that pushed people to reflect on their own skills, but the program also paired those exercises with real-life assignments for the group to do with their staffs between sessions. Bullock says the combination approach allowed him to connect with people in the office in a completely different way than he had previously.
He says it was also important for himself to participate in this initial session, not just because he wanted to see what they had to offer but also to learn about himself.
“Put one’s greatest effort into understanding oneself better and understanding how you come across to your colleagues, overcoming your blind spots, building your effective communication skills and working to really understand others,” he says.
Through these sessions, Bullock learned that he has a tendency to speak over people’s heads and that he needs to simplify his language sometimes.
“This training program allowed me to synthesize everything I had learned from that academic approach in a true leadership setting,” he says. “Really, the key was the more things you can do to relate to others effectively, the better you have a framework to communicate and, more importantly, the more you understand yourself, then you build this great foundation that you need to learn to work with and understand others.”
Build a bigger program
As he went through the initial program, Bullock started to put together the larger training program that would help him achieve his vision.
“As I went through the program, I was looking to see what parts of it were scalable to my direct reports and how could I creatively use this training program at the project leadership level,” he says.
He would bounce his ideas off of the consultant so they could collaboratively create the next-tier approach for his direct reports and how they could implement a project-based training program.
“Being a firm believer in advanced planning, I laid out plans well in advance of the opportunity to actually implement it, so the approach was refined over a series of iterations and collaborations with the training consultant,” Bullock says.
The main element of training that changed was instead of getting all of the information you could ever need to know all at once, employees started receiving training right when they needed it.
“We give people skills on a just-in-time basis, not a training program that’s a download of information that you’re hoping you can remember in a week, a month, a year later,” he says. “It’s a combination of core skills and ongoing coaching and support as projects are delivered.”
Now, new employees come in and they have a day and a half of general, core-skills training, but from there, employees receive training on specific project types or issues just ahead of when they’ll encounter them. These additional training sessions are typically half-day to three-quarter-day sessions.
“I want this to really connect with the actual doing of the work, so we schedule them around key milestones in advance of the milestones, so we have a chance to work out solutions for the inevitable challenges that come in delivering large, capital projects,” he says.
As employees moved forward, when new problems came up, those would be considered for future training courses.
“In the early stages of, particularly, the project training sessions, we get everybody to chart out what things went wrong that created a problem,” he says. “In almost all cases, they were things that could have been avoided. Once we knew where those pitfalls (were), we could really focus on developing an approach that kept everybody focused on a positive future and positive outcomes, because we already knew where things were going to go wrong. If we know where things are going to go wrong, we can have a plan to help mitigate those things.”
As these programs have developed and grown over the past two-plus years, Bullock is seeing a clear difference at the firm.
“Where people might have promised to get something done and came up with an excuse when they didn’t get it done, they’re much more open to saying what they need to be successful in getting the thing done in advance, so we can find a solution to the problem,” he says. “One goal of the training program was to eliminate excuses to readily foreseeable problems that, if they were discussed in advance in the right setting, we could have a much better outcome.”
The training programs have helped increase client satisfaction because employees are more proactive about problems than before, and the programs also helped people understand elements of other people’s jobs, which has created the collaboration that Bullock dreamed of.
“The most gratifying part of my job is when I can see people self-initiate that exploration of solving problems together in a collaborative way,” he says. “When I realize that an engineer is talking and drawing the way an architect would and an architect is talking and solving a problem like an engineer, the end result is really better than either party could have come up with on their own.”
Establish your vision
Bullock was able to create a strong training program because he had a very clear vision of where he was going. But what if you don’t know where you’re going?
If a client came in and told Bullock to design him a building, the first obvious question would be to ask what kind of building. Knowing the kind of thing you’re trying to create is critical — a hospital is different than a research laboratory and a house is different than retail space. So if Bullock didn’t know what kind of project he was trying to create, he wouldn’t be able to design it.
In the same way, if you don’t have a vision of what you want your organization to be, then you can’t create any program or goal to get you there.
“Having a strong vision is really paramount in this,” Bullock says. “Having a dream to create a new culture is very rewarding, it’s very demanding.”
First identify what it is you want to create or change in your organization so you know what you’re working toward and then define how to get there.
“Have no fear of going down that path,” Bullock says. “To create a vision, it’s really important to find your vision in terms of the commitments and what they mean to you personally in very clear, simple terms.”
In Bullock’s case, he knew that he wanted to create a firm that could blur the lines between architecture and engineering to create the best designs, and that was his career ambition — not just something that if it got done, then that would be nice. His passion comes through to his team.
“It’s more than just buy-in,” he says. “It’s really driving home and enrolling people in the vision and getting them to commit that they’ll be there to make it happen.”
But most people won’t commit if they don’t know what’s in it for them, so one of the keys to establishing your vision is to make sure that people understand their own individual role in making that vision happen.
“You also have to make sure that people understand that there is a place for them to fit into the vision and that they’re a very important part of carrying it out,” he says. “It can be as simple as first writing it out and get it to the place where people can understand it in such clear, simple terms.”
How to reach: HDR CUH2A, (404) 815-1212 or
The Bullock file
managing principal, Atlanta
Born: Chattanooga, Tenn.
Education: University of Tennessee in Knoxville School of Architecture
What was your first job as a kid?
My first job ever was working for a commercial woodworking, fence and sign company, where we built very large, heavy-timbered wood constructions for commercial clients. I worked with heavy machinery, lots of heavy manual labor. I learned really quickly that there wasn’t any room for creativity on my part in that kind of job. My boss would tell me, ‘I figured out exactly the most efficient way to do this — you don’t need to think about it; you do it the way I’m telling you to do it.’ My boss happened to be a retired Lockheed engineer.
As a kid, what did you want to be when you grew up?
I had two lines of thought — I either wanted to be a road construction civil engineer like my grandfather, or I wanted to be a mechanical engineer that designed high-performance automobiles, and my third choice was an architect. I chose architecture because I liked to draw so much.
What’s the best advice you’ve ever received?
The best advice I’ve ever received is you’ll only get one chance to make your case for a change order, and only a fool would be willing to attempt to argue about the end result after that. That was my grandfather, who was the road-building construction contractor.
Singing from the same sheet. Following the same path. Reading from the same page.
No matter what idiom you want to use, Stan Johnson’s message is the same to everyone at Veteran’s Affairs San Diego Healthcare System: He wants everyone aligned on delivering the best possible experience to the system’s customers — its patients.
“That is really leading a culture change in terms of working with all staff, informing the staff of what it means to provide patient-centered care,” says Johnson, the director of the 2,400-employee, La Jolla-based health care provider within the U.S. Department of Veterans Affairs. “A lot of what we do was already patient-centered care. But it was really looking at redesigning our delivery of care so it is geared toward meeting and exceeding the patient’s expectations.”
Johnson says changing a culture can be challenging and exciting at the same time. You are excited to implement a new way of thinking among your team, but at the same time, there will be bumps in the road as you rebuild processes from the ground up and try to uproot habit-entrenched employees and attempt to show them that the new way is a better way. It can be much more easily said than done.
At the VA San Diego system, the leaders put a template in place by becoming an affiliate of the Planetree Alliance — a nonprofit partnership of health care organizations that advocates for care that is centered on an overall positive experience for the patient. The alignment with Planetree gave Johnson a path to follow when he assumed control of the health care system in 2009. But Johnson had to bring the plan to life every day and coach more than 2,000 employees to do the same.
He did it by involving as many people as possible in the decisions that would affect the system’s future. He sought out the opinions and ideas of not just his employees but patients, as well.
“You really need to look at your organization through your customers’ or patients’ eyes,” Johnson says. “What we’ve done with some of our system design groups is involve many of our patients, because you have to know firsthand what the expectations and needs of your customers are.”
Engage your employees
You’ve probably heard it countless times in your career: Your culture isn’t what you say it is; it’s what your employees believe it is. You can preach all you want on your organizational principles, but if you don’t follow those words with like actions, your culture is going to wither, and distrust will seep into the hierarchy of your company.
One of the actions you need to take is opening a dialogue with your employees. If you are preparing to point your company in a new direction or alter your defining principles in any way, your employees will need opportunities to speak with you in person.
Johnson and his leadership team create those opportunities by getting many people together for a few days off-site, free from workday distractions, where employees can feel enabled to speak up, offer feedback and share ideas.
“About 85 percent of our staff has been on a retreat where they begin to understand what patient care is,” Johnson says. “They begin to individually understand what they individually could look at to improve the patient experience. As a leader, you want to listen to their ideas and suggestions and start to implement things that come out of that, so that it starts to be driven by them instead of being driven by upper management.”
Of course, you can’t implement every employee idea in the name of strengthening or changing your culture. But you can offer feedback on all ideas that come your way, and you can implement the ideas that make the most sense for where your organization is at that point in time. If you don’t at least do that much, you can expect the dialogue, and the wellspring of ideas that comes with it, to dry up .
“You can ask and you can listen, but unless you actually implement some of those suggestions and react fairly quickly to their good ideas, that will dissipate or go away fairly quickly,” Johnson says. “People simply will not continue to give you good ideas and suggestions if you’re not listening to them and implementing some of them. So what you really want is a mechanism to allow your people to make some of those suggestions but also to follow through on your end with the action and implementation of providing feedback and recognition.”
Recognition is another key cog in achieving buy-in on any new initiative. If you want your employees to embrace new cultural principles, reward their good behavior and hold your high performers aloft as an example for everyone else.
It’s something that Johnson emphasizes on a regular basis throughout the San Diego VA system.
“Recently, our communications work group had a patient call center that is about 16 staff members who take a lot of calls, schedule appointments, and the wait time for those calls was longer than we what we liked,” he says. “So those individuals worked with our system redesign staff, flow-mapped the process to see if there were steps that didn’t really add any value to the process any longer, and they were able to make significant improvements in about a two-month time frame.
“Myself and our leaders in that area went to that work area and personally recognized them with an in-person thank you as well as a cash bonus. Many times, it’s a combination of the personal recognition and financial reward that really helps keep employees engaged on that level.”
Stay close to customers
As a business leader, it is imperative that you maintain close relationships with your customers. Without customers, you don’t generate revenue, you don’t turn a profit, your employees don’t keep their jobs and, eventually, you go out of business.
With that in mind, you need to develop avenues to build and maintain customer relationships. Johnson takes it a step further, utilizing the vast amount of military technical training that his organization’s patients have absorbed, by encouraging patients to get involved in various initiatives throughout the system.
“One of the system redesign efforts right now is focused on communication, and a subset of that talent is telecommunications,” Johnson says. “We have a couple of individuals who use the VA for their care, and they have an area of expertise in telecommunications. They’re kind enough to volunteer their time to work with our work group.”
If you always keep it front of mind that your customers are your reason for being, you will be much more apt to seek out their opinions and input on how you run your business from a service standpoint.
“That is the key, to have constant feedback from the people you take care of,” Johnson says. “That is what we’re here for. You have to make sure you’re meeting their needs. It’s not just what we think they’re asking us for, it’s finding out what they’re truly challenged by in using your system.”
As with any other aspect of your business, customer interaction needs leadership with an eye toward continuous improvement. No matter how good you think your system is, no matter how well you think you stay in touch with the people you serve, it can always be done better, and you and your leadership team should constantly seek ways to build a better customer service mousetrap.
“It’s like anything else when you’re in a leadership position,” Johnson says. “You continually work at it. You take nothing for granted. Just because you’re doing something well now doesn’t mean that you’re not continually looking for improvements, how you can be more efficient and effective with what you’re doing. Just because it’s working well now doesn’t mean it can’t be done better.”
Johnson takes the reins when it comes to driving that mentality throughout the organization, but ultimately, he wants all of his employees to become self-starters in delivering an exceptional patient experience.
“It is the responsibility of every single person on our staff,” he says. “We’re here to provide a service to veterans who have served our country. Each one of us, each individual who works with the VA San Diego Healthcare System, can make sure that the patient experience exceeds their expectations. That is what we’re trying to instill in our patient-centered care and affiliation with Planetree, to make sure all staff understand that and can individually make a difference. That is why we want everyone to view it as their responsibility, all the way up to me.”
Once you have systems in place to allow for engagement of both employees and customers, you need to keep watering the ground with frequent communication. Johnson views continual communication and cultural reinforcement as one of the biggest challenges before him each day.
The challenge of delivering good communication each day is complicated by the fact that you can’t be in all places at all times. You have to have a network of managers and electronic interface points that allow you to keep your messages in front of both employees and customers when you can’t be there in person.
“Communication is another one of those things that you’re always striving to do better,” Johnson says. “What we try to do is communicate in multiple ways. For instance, we have electronic message boards up in elevator lobbies at clinics. We use them to share updates on what is going on at the facility, new information that we want to share, whether it be patient satisfaction or how we did with a recent survey.
“You’re also getting that information out there through e-mail, social networking sites like Twitter and Facebook, many different ways. Different methods of communication work for different people, and you have to use them all to communicate your strategies and your benchmarks that you have set or that have been set for you.”
But even after you’ve rolled out a new direction for your company, even after the meetings and dialogues with employees and customers, communication remains a two-way street. Feedback from multiple channels is the only way you can ensure that your message is reaching the people you want it to reach and if they are buying in to the message.
“You’re always kind of surveying people, both formally and as you talk with people throughout the day,” Johnson says. “We think we might be doing a good job of communicating, but until you hear it from your customers, patients or staff, you probably haven’t done a good enough job yet.”
How to reach: Veterans Affairs San Diego Healthcare System, (858) 552-8585 or www.sandiego.va.gov
The Johnson file
Veteran’s Affairs San Diego Healthcare System
Born: Bloomfield, Iowa
History: I joined the Navy and came to San Diego in 1972. I did my boot camp here and served here. I was in the Navy for four years, and they were kind enough to support my education and training, so after that, I went back to Iowa and earned a bachelor’s degree in business administration and a master’s degree in health care administration from the University of Iowa.
What is the best business lesson you’ve learned?
Listen to the patient. Involve your staff and your customers in your improvement efforts.
What traits or skills are essential for a business leader?
The key is to develop good working relationships, be transparent and treat people fairly.
What is your definition of success?
For me, it boils down to hearing firsthand from our customers that we’ve done an outstanding job for them.
When the announcement came in November 2008 that DHL would discontinue its Express domestic services in the United States, there was a lot of uncertainty.
The division was asked to reduce its operating costs from $5.4 billion to below $1 billion, a decrease of more than 80 percent. Ground hubs would be closed and stations reduced from 412 to 103. It called for the loss of 9,500 jobs.
The one certainty was the end result of all the changes: return DHL Express USA to the company’s core competency of international shipping.
Difficult decisions are usually made when you’re going through a restructuring process. But as details are fleshed out, you and your employees can’t lose sight of the future.
Jack O’Neill understands this. As vice president of operations, he oversees all Express operations in the United States, including, air, hub, gateway, security, customs, engineering, fleet and customer. He led operations through the realignment, which included relocating its hub in Wilmington, Ohio, to the Cincinnati/Northern Kentucky International Airport.
Additionally, O’Neill had to ensure his 2,300 operations employees stopped thinking about domestic products and services and learned the world of international shipping. In understanding the new direction, the company assumed the philosophy that every employee was a salesperson there to meet customer needs.
To accomplish the task, O’Neill used communication, education and reinforcement of the message and culture.
“It’s really an education. It’s awareness, it’s training, it’s making sure that everybody is engaged in understanding what it is we’re trying to provide to our customer base, what is the real priority and the objective of the organization,” he says. “With that, you engage each and every employee in every facet of the company and make them understand … everything that they do impacts the customer experience.”
The realignment was a major change for the organization, so management’s top priority was getting employees on board.
It should be no surprise that when you’re taking on a large initiative, communication is imperative from the beginning to the end.
“Even when you think you’ve overcommunicated, you probably haven’t communicated enough,” says O’Neill, who spends time in the field every week talking to employees.
O’Neill and the senior leadership team attacked communication from every angle. There were e-mails and bulletins, town-hall meetings and personal conversations. They found the best way to communicate employees’ roles in the realignment was in person because it allowed for providing clear information and receiving feedback.
“You really need to define the objective and your objective really needs to be crystal clear for that message to be concise,” O’Neill says. “If there’s any ambiguity in that objective or any ambiguity in the way you present that, the audience is going to have a hard time interpreting it and understanding it. Then you get mixed learnings or understandings out of that message.”
If multiple members of your leadership team are speaking to employees, you must make sure that the same message is being communicated.
Before conducting town-hall meetings, O’Neill and his team met to discuss their message about international shipping and customers. The company’s communications team helped craft the message and included a set of questions expected to be asked and answers of how to respond.
When you’re tackling complex issues, you need to be prepared and honest with your communication.
“Sometimes it’s a tough message, but you need to deliver those tough messages and be upfront about them,” O’Neill says. “In doing that, you gain the trust and confidence of your employees that you’re being forthright.”
Direct employee conversation is twofold, though. Town-hall and staff meetings are not just about what you want to say but what employees want to communicate.
O’Neill has been in town-hall meetings where employees can’t get enough questions in and others where the audience is silent. If he doesn’t get any questions right away, he starts talking informally about a topic that interests that particular group and asks for their advice.
“Once you ask them for advice on a question that relates more importantly to them, they begin to talk and open up about what we can do to help them,” O’Neill says. “Once that conversation starts to go, you generally get people feeling more comfortable, you get them feeling at ease, because they really feel like you’re there to learn something about them and how you can help them.”
Knowing employees are the crucial link to customers’ wants and needs and that employees need to be properly educated and equipped to do their jobs, O’Neill and the senior leadership took the feedback from the town-hall meetings and discussed it as a group. To better organize the information, they would provide the feedback to a point person who would consolidate it. O’Neill and the other executives would then prioritize the ideas as “easily actionable” or “needs more research.”
“It’s important if you really want the people to engage and rally around the organizational pride, in our case international shipping, you have to provide that closed-loop feedback cycle,” O’Neill says. “If you’re going to ask the employees for suggestions, we need to make sure we circle back and implement them or tell them why we’re not going to do it and make sure they understand the logic behind that.”
Once its determined if the idea is actionable or not, the feedback is either communicated by the direct supervisor or the senior leadership team in the next town-hall session.
“We communicate not only current events but, ‘These are some of the things we’ve heard from you, and these are some of the things we’re doing about it,’” O’Neill says. “It gets the ownership and buy-in that we really are listening to them. It’s one thing to listen; it’s another thing to really hear and understand what they’re saying.”
In communicating with employees, you need them to rally around the change.
As part of DHL’s realignment, all Express USA employees went through training to become a certified international specialist. Everyone from the front-line employee to the senior management team was required to attend classroom and online sessions geared toward international shipping, trade facilitation, processing shipments and clearance activities — all things that, at the end of the day, can affect customer service.
“Each and every employee needs to rally around their roles, what their responsibility is, how it aligns with the overall objective and how they really do impact the customer even though it may not be clearly visible,” O’Neill says. “(Training) is something we have undertaken that helps us make sure that everybody understands their role in satisfying the customers’ needs.”
The senior leadership team was actually the first to go through the certification, as should your team if you’re implementing a crucial companywide program.
“If we go through it first, we get a chance to assess the training and (evaluate) it,” O’Neill says. “By doing that, we can make sure that training is going to deliver what we really want it to deliver as an organization. What were our priorities when we first said we need to develop and deploy that training? Does it, in fact, meet those objectives?”
The second reason for the leadership team to partake in training is employee buy-in.
“You really have to walk the talk; as a leader, it’s one of the traits that is most critical,” O’Neill says. “If you deploy a major training platform and the senior leadership team doesn’t go through it, it sends an indirect message that it’s not that important. If you go through it, you send a couple of messages. One, you sponsor that training because you went through it yourself. Two, you send a critical message that it’s important for the organization to have that training.”
Along those same lines, the Express division’s training staff trains operations managers, supervisors and directors to deliver some of the programs to their employees.
“We support that, because it does make the training more believable,” O’Neill says. “If a manager delivers training, that manager has to support that training. He also knows what message has been delivered with that training with his employees versus a trainer coming in that works for another function. The messaging might not be the same as what the manager might deliver. Something might be skipped; something might be missed.”
The final aspect of company training is testing. O’Neill, along with every Express employee, had to score a 98 percent to become a certified international specialist. The test included questions like shipping requirements to clear customs and international capitals — essential information needed to send a customer’s package.
“Testing gives us knowledge of whether or not the employee really understands,” O’Neill says. “Do they have the information, and did they really hear it and understand it? Do they know how to apply it on their job? If you test them and they fail the test, then chances are, they’re not going to do their jobs the way they were intended to be done. What that means is we’re going to have delays in shipment processing. We’re going to have delays in service. Our customers aren’t going to appreciate that too much.”
You can communicate and you can educate, but that doesn’t mean employees understood the message.
“We think people hear what we say or interpret what we write, but it’s not necessarily the case,” O’Neill says. “You really have to listen carefully to see if people have gotten the message. If somebody hasn’t gotten the message, they’re going to create their own message and usually that’s not the message we want them to give. Listening and having some feedback mechanisms to make sure the message is clear and everybody does what needs to be done is crucial.”
How do you make sure employees heard what you said? You ask them point blank.
“‘What are our priorities? What are we focused on?’” O’Neill says. “You have to ask them those types of questions to make sure that the message has been heard.”
And you have to constantly reinforce your message. When O’Neill went into the organization a year and a half ago, employees couldn’t tell him the company’s core competency. Today, without hesitation, they say international shipping.
Another way to validate that your message has been heard is engaging with employees in their work. O’Neill and his senior leadership team spend days on the road with their couriers visiting customers or sitting next to customer service agents in the call center.
“We get to experience firsthand what our front-line employees are doing, and does it really support the message that we delivered?” he says. “Does it support the direction that we need to go in? Does it support the training we provided them? You really have to inspect what you expect.”
Because there can be a disconnect between top management and lower-level employees, O’Neill has found his staff members are appreciative when he spends time with them and they’re willing to share feedback on what can make their job easier and the tools they can use to better serve the customer.
If you’re spending time with your employees, though, the main thing to look for when it comes to whether or not they understood your message is engagement.
Since the realignment, DHL Express USA has seen more engagement from customers and employees. The business has stabilized and is actually growing. Returning to its core business has meant an improvement in services, which has translated into greater customer retention and growth. For employees, it has given them a sense of confidence in a strategy moving forward.
“The employee that is engaged in the organization has an interest in it,” O’Neill says. “You can tell when somebody is just doing a job because it’s a job, and that’s OK. But we really want people to be engaged in the organization. You know they’re engaged if they’re asking questions. You know they’re engaged if they’re performing the job the way they were trained to do the job. You know they’re engaged if they have a good relationship with the customer. Once again, that customer touch point is so critical, so it’s those types of things that we really try to observe.”
How to reach: DHL Express USA, (800) 225-5345 or www.dhl-usa.com
The O'Neill fileJack O'Neill
Vice president of operations
DHL Express USABorn: Saugus, Mass.
What was your first job?
The first job I ever had was actually a salesman in an electronics department of a department store. It was an interesting job for me, because I never sold anything nor did I know anything about electronics at the time.
What did the experience teach you?
I learned that sales and marketing are critical to success. In this department store in the electronics group, we sold a set of stereo headphones, and we used to sell them for $9.99. They were low quality; it was the cheapest set of headphones we had. We couldn’t sell them. We couldn’t get them off the shelf.
We were having a sale one weekend, so we thought we would put an ad in the paper and try to get them sold for $5.99 and deplete our inventory. In printing the ad, a mistake was made. The mistake said this was a set of stereo head phones, normally sold for $19.99 on sale for $15.99. Oddly enough, the first day of the sale — we must have had 80 sets of these headphones in the store — they flew off the shelf. Customers came in; they thought they were getting a great bargain.
The whole positioning of how a consumer hears a message to me was definitely one of the learnings I took out of that role and that particular experience I had.
What is your favorite part of your job?
I enjoy being on the front line. I don’t enjoy sitting in business meetings. I don’t enjoy that part of the job; I know it’s a necessity. I’m an operations person at heart. I grew up in the business unloading trucks as my first job within the logistics industry. I really have appreciation for the front-line employee and what they do for the organization.
I once balked when asked to do a presentation on leadership. My response was that leading was just something I did rather than thought about. Lucky for me, one of my employees began citing examples of where I was vocal, even prescriptive, about how we at Cbeyond make decisions, achieve results and treat each other. She pointed out that I fiercely protected the culture that makes us unique, was deliberate about norms that we create and was extremely thoughtful about the people who are asked to join our team. She was right.
While I did not have leadership defined in a PowerPoint, I was adamant about certain tenets that had served my career well. It was a challenging, but powerful, experience to put those lessons on paper, and I am humbled to share some of those with you.
I don’t think of a leader as the guy with all the answers but rather as the catalyst for influencing others to overcome obstacles, find solutions and live their opportunity. Leadership, for me, is informed by my faith, by the successful family, friends and co-workers I have had the privilege to know, and by the places where I hated working coupled with firsthand observations of leaders who squandered their opportunities by creating self-serving environments full of bureaucracy, back-biting and blame. My lessons in leadership come as much from what I never want to become as they do from the excellence that I aspire to daily.
For now, I’ll share two fundamentals: integrity and listening.
Integrity is nonnegotiable, and as a leader, you’d better model the behavior you expect.
Do what you said you would do. People have to trust you, and they have to count on you. Be careful of judging importance by the size of the promise. Responding to e-mails is as essential as delivering results. If you are going to be known for it, it has to be consistent.
View things objectively, not personally. What is the best decision I can make with the information I have, regardless of the implications to me? Viewing things objectively builds credibility, and it sets you up for doing the right thing even when it is hard or unpopular. Practice this one and it will serve you well when times are tough.
Admit mistakes and ask for help. Leaders aren’t expected to know it all. It’s whether your team and your peers can trust you to find the right answer, to own up to unexpected or unintended consequences, and to change course when circumstances merit it.
“Listen to your customers and your employees, and do what they tell you to do” is a mantra that I share often. Leaders listen.
Establish feedback loops. Be relentless about seeking the good, bad and the ugly. I reach out in customer and employee surveys, offer my e-mail to customers and have ongoing “lunches with Jim” with employees. It isn’t always pretty, but I hear what we should start doing, continue doing and stop doing.
Appreciate intellectual curiosity and reward gutsy, confident input. You want people who will stand up and be counted. Robust, honest discussion helps us arrive at the best decision — and then, once made, it’s all hands on deck — we own it together.
Trust moments of clarity. Take the time to truly listen to others’ opinions and encourage others to do the same. You’ll find, often, in those discussions that moments of clarity arise; listen to them, and act on them. None of the stuff above matters if you aren’t using it to make yourself or the organization you lead a better place.
We need more leaders than ever, and they’re not going to fall in our lap. Modeling the behavior we expect and listening to our constituents are fundamental to us being the best leaders we can be and in growing our leadership of tomorrow.
Jim Geiger is the founder, chairman, president and CEO of Cbeyond, a company that provides IT and communications services to small businesses throughout the United States and also provided the world’s first 100 percent VoIP local phone network.
When Jeffrey M. Mintz stepped into the role of managing partner at Jackson Lewis LLP in 2006, he was starting a new chapter in the firm’s history by succeeding someone who had been in that role for 25 years.
“The immediate challenge was related to the transitional process itself,” says Mintz, who stepped back into the partner role late last year. “We had a 25-year status quo.”
He had to quickly develop confidence internally with about 50 employees and externally with clients that, while there was a new leader, everything was still going to be strong moving forward.
Smart Business spoke with Mintz about how to transition your organization into new leadership.
How do you develop confidence with people?
It’s very important to presume capability. Doing so creates new opportunities for the people who work for the firm, which results in experience, and experience breeds confidence, and that creates client appreciation. If you focus on the opposite — inability — it becomes self-fulfilling and provokes negativity and it erodes morale.
What I was able to explain to our staff was our record demonstrates that when we focus on what people can do, they do it. When the individuals do it, we succeed as a team. We were starting from an expectation that they were going to succeed. That drove people immediately in the right direction.
What was one of the most important things for you moving forward?
I knew you have to listen effectively. If we listen effectively and are aware of others and their perspective, then you’re much more effective at developing the road map to get you from point A to point B, C and D. I also recognized the importance of effective two-way communications and developing people and their personal stakes in the success of the business. I think responsiveness is very important and people tend to react and contribute more effectively when they’re viewed as a meaningful player and participant.
What’s the key to effective listening?
I look before I talk. When I walk into a client’s office, I’m very aware of the surroundings. You can learn a great deal of what a person feels is important. Ultimately, you’re going to pick up on what the individual may find powerful and persuasive by looking around to see what’s on the wall or the credenza or what’s not on the wall or credenza, how the desk is set up, and what the furniture looks like and the order of things — or the lack thereof.
That provides a great deal of context and information, and it’s very meaningful messaging without a word being spoken. If you can pick up and read those nonverbal signals, it will enable you to listen and see beyond the spoken word when the client is reacting, and then you can better tailor your tone and the substance of your remarks to try to accomplish the end objective. Effective communication involves effective observation and listening much more than effective articulation.
What advice would you give other leaders taking over in a new role?
It’s important to be realistic and to recognize that there’s no one-size-fits-all approach with respect to the individuals on the team. Don’t hesitate to make the tough decisions after listening to everybody. It’s more important to be confident and to be intelligently aggressive and take chances after doing your risk-reward analysis, but failure to take chances and use intelligent risk will preclude the organization from moving forward. Sometimes conflict is unavoidable. If you avoid conflict, you’re credibility will be undermined. People want responsiveness even more than they want the answer that they want to hear, and that’s very important from a good leader. A good leader has to be consistent and somewhat predictable in terms of the format and the approach you use as opposed to the message that you deliver.
How to reach: Jackson Lewis LLP, (404) 525-8200 or www.jacksonlewis.com