Storing success Featured

8:00pm EDT August 26, 2009

There’s no denying PODS Enterprises Inc. experienced amazing growth in the last 10 years. Under the guidance of co-founder Pete Warhurst, PODS grew from a start-up company in 1998 to a company with systemwide revenue of about $200 million in 2005.

But, it was time to take the company to the next level, which is where current president and CEO, Tom Ryan, entered the picture in 2008.

“The truth is, it was led by and grew through the typical entrepreneurial activities that you would see in a company,” he says. “When a company’s going through that pace of change and growth, it’s pretty usual for somebody within the business to say, ‘OK, I’m not sure how we are going to do X, Y or Z this year, so we are going to try a couple of different things.’ Maybe it’s 100 different new initiatives. If 15 of them stick on the wall, it’s 15 more than they had last year.”

Now, with 2,000 employees and about $350 million in revenue for fiscal 2008, that type of process isn’t the most effective way to generate more growth.

“It’s critical that you actually go through a pretty regimented process as to what initiatives you are going to ask people to execute on,” he says.

Here’s how Ryan is building a foundation to take PODS to the next level.

Surround yourself with talent

In order to position the company to go to the next level, Ryan needed to find the people that had the necessary skills.

One of Ryan’s first steps on the job was finding a good human resources person who would challenge him and his decisions, because Ryan knows he has a strong personality.

“I am very zealous and energetic, and sometimes that can be overbearing to folks,” he says. “I basically embrace my human resources partner to ensure that we instill a level of balance within the organization, which is facilitated by communication at all levels.”

You should look for someone who will formulate their own opinion and won’t agree with you all the time and who also will be discreet and build relationships with people.

“One of the attributes that I needed was somebody that was extremely discreet,” he says. “Because I expect that human resources leader is going to have somewhat of a Chinese wall. She’s not going to walk in and dime out the employee that just gave her information.

“She’s able to communicate things within the company. I also want the ability for this person to be a coach and mentor to me in terms of my emotional intelligence and leadership style and overall effectiveness within the organization. That’s going to be a function of the ability to push back. I really want a strong business partner within the organization.”

Use the interview process to find that person who will give it to you straight.

In the case of the human resources person, Ryan wanted input about himself from the candidate after the interview was over.

“I asked that person for an assessment of me at the end and what kind of advice would they give me and what were their observations within the first hour and a half that we met,” he says. “So, I put them right on the spot.”

Ryan didn’t have any preconceived notions about what that candidate would say.

“I just knew that I wanted to get their read and how quick a study they were and how comfortable they were willing to be candid with me,” he says.

When interviewing potential hires, including for the human resources position, Ryan looks for qualities that show job candidates have thrived in a team environment in the past.

“I also want people that are extremely self-aware,” he says. “So, I will ask them questions, and it sounds a little trite, about what are their strengths and why are they strengths versus anyone else that I might be looking for in the job. At the same time, what are their development needs and what are they doing about it.”

Don’t settle for a canned answer that doesn’t give any insight into someone’s personality. If a candidate gives an answer such as, “I’m an overachiever,” Ryan will be blunt and tell that person he wants more information — he wants the skeletons in the closet.

He’ll ask, “If I were to pick up the phone and talk to one of your biggest adversaries or your spouse or significant other, what would they say are your development needs and what are the things you really need to do about it?”

“Folks that I find are very willing and candid to speak about some of their development needs are the ones I want on the team because I want people that are self-aware and have the ability to grow and the willingness to grow,” he says.

Ryan is also a big believer in situational-based interviewing. You want to put the person in a hypothetical situation to see how he or she will handle it. Ryan tells the candidate what the company strategy is and what the critical success factors of the position are and then sees if the person will fit in at PODS.

“I will ask them … questions around their background and how does their background coincide with and their successful track record coincide with what I’m expecting because I am a huge believer in history is the best indicator of future success,” he says.

“Then, to make sure that I triangulate, I will also give them an issue we are facing in the business and ask them how will they structure themselves in terms of how would they define the issue, where would they go to get data, where would they go in the organization to solve the problem. That scenario-based approach is going to allow me to see how they think.”

Create an open culture

Taking a company to the next level requires a culture where people aren’t afraid to bring forth ideas — and Ryan has never encountered a business that he’s come into where people have been completely open and honest.

“Wherever I’ve gone, you always encounter a certain amount of hierarchy and a certain amount of undue respect for senior leadership, and I say undue because there is a certain amount of deference that it creates a gag order inside of people’s minds — ‘Oh, I can’t say that to that person. He or she is the division vice president or the president or something.’”

It was up to Ryan to set the tone and get word around the company that he was a normal guy who wanted to hear what people had to say.

You have to let people know you want to hear their ideas. Otherwise, they won’t come forward. Ryan backed up his words in his first couple of weeks by making the rounds with customers, franchisees and employees and asking them a series of questions. He did so to compile enough information to form a vision, but he also wanted to create an open environment.

“The series of questions was me just getting to know people and letting them talk and listening to what things are on their minds,” he says.

Questions revolved around what employees thought were the core strengths of the business and where were the weaknesses or areas for improvement.

He also wanted to know what employees would change about the company and if they were concerned that he would change something they considered a core strength or a diamond in the rough.

“It really does send the message that you are listening,” he says. “You are actively listening, and you are proactively wanting their advice in terms of what they would do with the company and what advice they would give me to help me be successful . I don’t mean individually but for the overall enterprise.”

You need to spend time upfront getting to know people and getting insight into their point of view, which Ryan’s questions helped accomplish. You also want to send the message in the culture that you want feedback.

“It’s really trying to create that open-air environment that people can recognize and understand that they have an ‘obligation to dissent’ is one of the terms I use around here,” he says.

However, you can’t just ask the questions and expect to get answers. The next layer to that involves presenting yourself in a certain way. You want people to see you not only at a business level but also on an interpersonal level.

For instance, when Ryan does a skip-level meeting with people from different departments, he goes around the room and has all of the employees say how long they’ve been with the company and to share something people didn’t know about them. You, as the leader, also have to share something personal.

“When you share something personal with somebody and you speak from the heart, then they get a chance to get comfortable that ‘Here’s what I’m about,’” he says.

Ryan will share something about his management philosophy or something about himself, such as the fact that he’s taken cooking classes for fun.

“These other environments, whether it’s skip-level lunches or town halls, … I get an opportunity to interact with people and they get a chance to see that I am just as human as they are,” he says. “I am very overt about spending time with folks to let them know I have weaknesses and, when I provide information or ideas or something like that, they’re not always going to be good ideas.”

While being upfront with employees will create more of an open dialogue between you and them, it may cause some managers to feel undermined. You need to stay in contact with those managers if you’ve heard something from an employee who works below them.

“I go back to the manager after I meet with their people and share what things were discussed,” he says. “I tell people right out of the chute that I am the most apolitical person you’ve ever met. So, if I find some information or a nugget or something like that, I go back and share it with them.”

Ryan also doesn’t use names of who he heard something from when speaking with a supervisor or manager.

“We do maintain a level of confidentiality because once you dime somebody out once, then you close off the information flow,” he says.

“You say ‘Look, I’ve heard this from a couple of folks in your department, and it’s something you might want to look into,’ but I never name names.”

You also need to be clear that you do not intend to try to take responsibility from managers or supervisors, and you only have what’s best for the company in mind.

“I’ll go back and say, ‘Look, my intention is to create this open-air culture, but I’m never going to go over your head and take a decision about your department. … I’m never going to take that away from you. I’m going to come in and give you ideas or give you some feedback based on a skip-level meeting or a town hall or something like that. If you are in the same meeting, I’m going to let you answer the questions instead of me.’”

Overall, whether you are looking to get the ball rolling on a new culture or you just want to make your culture more open, remember to listen.

“Demonstrating that ability to listen is going to build and facilitate open and honest communication,” he says.

Then, use that trust to show you want employees to dissent.

“(It’s) creating an era that it’s OK to push back and circulate your opinion,” he says. “When you create that open-air environment, you are more likely to get to the bottom of issues and some of the deep-seated problem areas because people are going to be willing to show up and say, ‘Look we’ve got an issue.’”

As soon as you create that environment where people feel comfortable to give constructive criticism, you open a lot of doors.

“We’re more likely to uncover issues more quickly and get to the bottom of things to solve some of the problems that may be plaguing us,” he says.

How to reach: PODS Enterprises Inc., (866) 229-4120 or www.pods.com