When the economy took a nosedive throughout 2008 and 2009, John Zettel found that his best-laid plans weren’t going to work anymore.
The CEO of AVI-SPL Inc. had a business that had been, for years, focused on outfitting businesses and other large-scale entities with audiovisual equipment. But as the economy began to take a turn for the worse in 2008, Zettel and his leadership team started to see signs that the company’s core businesses might not provide the most stable foundation to weather the oncoming storm. Adjustments had to be made, and they had to be made soon.
Zettel and his team decided to put more weight behind the company’s video initiatives, which they felt would create a better buffer against narrowing revenue streams.
“Our core business is audiovisual equipment, and being the largest in the country, we already felt like we were in the boardrooms selling traditional AV equipment, like projectors and voice systems,” Zettel says. “Being in the boardroom where people began to adopt video more and more, we felt we had a natural lead into upgrading boardrooms. So this new area with video technology wasn’t an area that was a far stretch for us.”
AVI-SPL enlisted the help of outside consultants to redefine the company’s direction and formulate a plan for implementation. But the decision to find a new direction came directly from the top tiers of the company.
The process reinforced a basic business lesson to Zettel: Stick with what it is your company does well, but don’t become so rigid that you can or won’t make changes within how you employ your core competencies. You maintain that type of flexibility by making sure your employees are actively involved in shaping the company’s future.
“If a company has been successful, it means they are doing something right,” Zettel says. “So they need to see if how they’re doing it is relevant in today’s marketplace and whether it will maintain relevancy in the future. If it isn’t or it won’t, if they feel they cannot continue to capture share, they need to begin to look at other products that will provide that relevancy.”
Here’s how Zettel guided his organization through the challenges of change.Focus your people
To focus your company’s direction, you first need to focus your people and get as many as possible aimed in the direction you want to take the company.
At AVI-SPL formed from the merger of Audio Visual Innovations and Signal Perfection Limited several years ago Zettel had to unite a work force of about 1,300 employees on the common goal of serving customers in innovative ways that also made financial sense for the company.
“Our largest single group is probably our technicians and installation force,” Zettel says. “We also have a couple hundred salespeople, and between our installation force and salespeople, they’re at our customers’ sites on a daily basis. We rely on them to understand what our customers are after, what our customers are asking for, what they think would be helpful to run their businesses.
“I don’t believe in pushing technology, in having the customer simply swallowing technology that we’re feeding them. But we do need to take what the customers want and use it to offer the best solutions. You do that by keeping our sales force and operations people well trained and up to date on the newest and best things out there.”
To keep the dialogue pipeline open among customers, employees and management, you need to set the tone from the top. It is easier in theory than it is in practice, particularly as economic conditions change. When tough times hit, bad news tends to show up on your doorstep a lot more frequently than good news. In attempting to salvage morale and confidence, you might try to minimize the impact of negative news by downplaying it. Zettel says that is a common trap that business leaders can fall into a trap that can become a destructive force within your company.
“We kind of fell into the trap that a lot of companies fell into, where you kind of get cautious and slow down communication during tough times, if for no other reason than you’re not constantly being perceived by everyone as the bearer of bad news,” he says. “But we quickly realized that was not the answer. The answer is to be open and up front with your employees.”
It is possible to deliver bad news while still emphasizing a belief in a better future for the business. You can be frank, honest and still upbeat during difficult times. For starters, you should rally your most tenured employees around your message. If you can get the strongly rooted employees on board with your vision for the future, you will make it much easier for everyone else to follow.
“That is one of the advantages we have at our company,” Zettel says. “A lot of our employees are very tenured and have been with us for a very long time. So by talking to them and explaining everything to them, that we’re not where we want to be right now, but we do have a vision and belief that we’re going to be better in the future, we were able to get them to understand that this was a temporary pause in our growth plans.”Build up the culture
Whether you are making slight course corrections or taking your company through a radical overhaul, the strength of your culture will be integral to your company’s ability to recover from the change, and then flourish.
Your cultural principles need to remain solid regardless of how much uncertainty is orbiting the company. And a strong culture comes back to strong communication. You need to start by building a team of excellent communicators, who then facilitate an open dialogue with employees at every level of the company.
“Any company is only as good as the employees,” Zettel says. “So developing a good culture begins with assembling the right team. There is never really a point of perfection, but as long as the majority of the employees understand the vision, understand the purpose of the company, and you are fair and respectful of them, and understand the important role they play in making the company, it all starts there.”
You can state the foundational principles of a culture in verbal or written form, but your culture really starts with your actions. If you want employees to embrace teamwork, innovation, high ethical standards and efficiency, you need to demonstrate those traits from the top.
If you can put those cultural wheels in motion when times are fair and stable, there is a much better chance that the momentum will continue when things are murky and less stable.
“Your employees develop confidence in you based on your actions,” Zettel says. “That’s where culture starts with an attitude that shows everyone in the organization that we’re in this together, and we’re ultimately going to succeed together. But it absolutely needs to start with you, with your words and actions. There is nothing worse as a leader than to not live up to your words. You are probably better off just being silent than to say you’re going to do something and not live up to it.”
It’s a concept Zettel had to put into practice last year when, as part of refocusing the company’s direction in response to the down economy, he and the team needed to suspend some employee benefits.
“This year, we set as one of our goals to begin restoring some of those benefits,” he says. “So we communicated our vision. Our values and goals were communicated to our employees, and we had to live those goals. As we started to phase those benefits back in, our employees were able to see that we take the goals seriously.”
If your actions follow your words, and your words are straightforward yet compassionate, you will gain more followers and employees who are willing to buy in to your company’s direction. Employees who attain that level of engagement are more likely to take an active role in bringing their ideas to the table. In a challenging economic time, any good idea might be the idea that can help you save money or sharpen your company’s focus.
“It’s very dangerous to be sitting back at headquarters without your field generals giving input,” Zettel says. “You need to stay relevant, and you need employees to realize that their role in the company goes beyond just what it says in their job description.”
At AVI-SPL, concepts and policies flow downward, but ideas flow upward.
“Ideas flow upward through each of our divisions,” Zettel says. “The ones that show promise and merit will be discussed at the executive level, and we’ll meet weekly to discuss how the initiatives are coming along and any new initiatives that we might have to talk about.
“Responsiveness on the part of management is key, be it good or bad. You want to respond to employee ideas and give them feedback. There are ideas I thought were good, but when you explain it to our executive committee, there are still some things that need to be vetted out. When you explain that to the employee, they’re generally very understanding.”
Fostering a culture of teamwork and engagement means a faster reaction speed for your company when problems arise or when an opportunity presents itself.
“Now more than ever, your reaction speed as an organization is critical,” Zettel says. “I don’t think you have to be as crisp or as accurate when times are good. When times get tougher, you need to be on the mark. So it is critical that companies increase their nimbleness, and that all goes back to having your field generals out there, constantly communicating with you about what they’re seeing.”
If you can bring engagement, fiscal responsibility and a culture that stimulates ideas into the picture when times are good, your company can find itself on much firmer ground when times are bad.
It’s an approach that has helped AVI-SPL recover, with a new approach to the market, focused on new technologies. Last year, the company generated $418 million in revenue.
“It’s one of the things we talked about in our executive group in the past year or so,” Zettel says. “We are a big company, we merged and increased our size by about 30 percent, and we can’t do everything. We can’t come up with every single solution to every single problem. That is really where we began the process of empowering employees to recommend solutions. You want to have them involved in the solution, versus just complaining about the situation.”
How to reach: AVI-SPL Inc., (800) 282-6733 or www.avispl.com