Carolyn LaWell

Joe Gingo doesn’t remember how he stumbled upon his pattern years ago. What matters is it works.

During his more than 40 years of moving up the ranks of The Goodyear Tire & Rubber Co. and now as chairman, president and CEO of A. Schulman Inc. (Nasdaq: SHLM), the pattern he uses when it comes to tackling the challenge of a new position has withstood time.

“Every one of the moves I made, whether they were in Goodyear or when I came to Schulman, has been different and has represented its own challenge,” Gingo says. “The challenges are different, but I think how you overcome them is relatively the same. What you have to do is you have to develop a vision of the future state that you would like to have, a strategy of how to get there, clearly communicate that vision and strategy to your associates, and then empower them to execute the strategy.

“As I moved up to a bunch of different positions, each one became a little bit bigger, a little bit wider. But I always employed the same technique in how I overcame them.”

When you’re faced with challenges, you need to rely on past experiences — wins and mistakes — and let the information guide you.

When Gingo arrived at A. Schulman at the beginning of 2008, the supplier of high-performance plastic compounds and resins was being sold and it was losing money in the United States, while its overseas operations were doing well.

Here is how Gingo created a strategy that included turning around A. Schulman’s U.S. operations.

Ask and listen

Gingo’s background in manufacturing served him well when he arrived at A. Schulman. He quickly noticed the company’s U.S. focus needed to shift, and the profitable overseas operations could have the answers. His discovery came from asking, listening and observing.

“Any business or staff position I’ve ever gone into, I generally ask from the start for reviews with each of my division heads and their key people,” Gingo says. “I would ask them what their activities were. It would be a presentation on their part, but it was informal in the sense that we would talk about what they were doing, what their goals were, how they had been established.”

When you’re stepping into a new role, you really need to get a handle on how the company is being operated and where the top managers see their division or department headed. You can’t do that from behind a desk.

So when Gingo arrived at A. Schulman, he did what he’s always done. He met with the division heads and their top reports. He started in the United States and repeated the process in Europe, Mexico and Asia.

To get a complete understanding of each division or operation, you can’t rely solely on the information you gather from the team calling the shots.

“Whenever I’m in an office, no matter where it is, I make an effort to go out and introduce myself to people and just talk to them,” Gingo says. “They have a lot of good insight into what’s really going on. As a leader, you sort of get a colored picture of the situation. You really have to check the points that (management) give you with the people that are living the points.”

When you’re striking up a conversation with employees, you don’t need in-depth details. You’re mainly looking for trends in repetitive answers.

“You say hello to them, and then you say, ‘What do you like about this job?’” Gingo says. “The second question is, ‘What don’t you like about this job?’ Some people are hesitant, but some people are quite open and talkative. You begin to hear patterns. Patterns are things like several people say, ‘This is what I like.’ That gives you an overall view of what’s going on in that division or in that office.”

If employees aren’t warming up to your questions, ask them about what they do and what their day is like. Through the conversation, you should get some indication of what about their job or the company is important to them.

Remember, you’re asking, listening and observing venture is to get an overall understanding of the entire company so you can later strategize for the future. You can learn a lot from engaging people like your customers and suppliers. By asking the right questions, you can get a better indication of what your company’s strengths and weaknesses are.

“One of the ways is talking to customers, visiting customers and finding out what the customer likes about the company, what the customer doesn’t like about the company,” Gingo says. “You can talk to suppliers. Suppliers sometimes give you, ‘Well, here’s your company’s reputation. Here’s what we hear about your company.’”

Analyze the information

The ultimate goal of every business is to make a profit and to grow. Clearly, there are other aspirations to strive for, but fundamentally, that’s what every business has in common.

“The strategy has to be developed around what can you do to make yourself more profitable and what can you do to grow,” Gingo says. “Then you come back to core skills. You start out with, ‘Well, what am I good at, what do I do well?”

That question can be answered with the culmination of your information gathering and analyzing.

“You take all of those things and you say, ‘What do we do well? What is our core skill? What can we build on?’” Gingo says. “One of the ways to really do that is to look at your profitable divisions and say, ‘Well, what do they do that makes them profitable?’”

Gingo tends to look for an anomaly in all of his information and data to start his focus.

“Data that sticks out either bad or good,” he says. “You think: Why is that occurring? What’s interesting about that?”

One of Gingo’s objectives was to return A. Schulman’s U.S. operations back to profitability. So he looked at the overseas operations that were doing well and asked a logical step of questions to figure out a new strategy.

“If I can do that well, for example, in Europe and I can do that well in Mexico, why can’t I do that well in the United States?” he says. “You begin to say, ‘Who are my competitors? Are my competitors different in the United States and Mexico?’ If the answer to that question is, ‘No, they’re not,’ that’s a clue to you that, ‘Hey, maybe I can do it.’ Second, ‘Do I make the same product that I’m making in Mexico and Europe in the United States?’ If the answer is no, ‘Well, what do I have to do to make those products? What kind of equipment do I have to bring in? What kind of technical skills? What new product support do I have to get? What kind of new products do I have to introduce?’

“Fundamentally, you look around, you see what you’re doing good and then look where you’re doing bad and try to figure out why am I doing bad there.”

Engage your team

Once Gingo has a better understanding of the bigger picture, he jots down bullet points and takes them to his team for input.

You generally don’t want a large group. That’s why Gingo sits down with only his direct reports.

“If you have somebody, even in a short period of time, that you begin to believe you have some trust with, you might even see them before that meeting and say, ‘Here is what I’m thinking. What do you think about that?’”

Either way, sit down with your direct reports and present your ideas in a written format. Writing your points not only makes them clearer but will provoke more of a response.

“There’s more reaction if I have words on a page than just talking, because your message sometimes doesn’t get across,” Gingo says. “You have your bullet points up, and you say, ‘Here’s the five points. Here is what I’m thinking about.’ Then you get reaction.”

One of Gingo’s mantras, which he learned from a former chairman at Goodyear, comes into play when he’s asking for feedback.

“The first time I came into meet with him he said, ‘Joe, it’s your opinion versus my opinion. We’re going to make a deal. My opinion will usually win,’” Gingo says. “He used the word usually. ‘But your facts versus my opinion, your facts will always win.’”

The facts have to be put on the table. Even though you’ve put in time and research to understand where you think the company should be headed, you need to listen to your direct reports and be willing to admit when your proposed direction might need to be shifted.

“It’s really important when you’re having a conversation about these little bullets, you let them know, ‘Tell me I’m wrong,’” Gingo says. “‘It’s OK. If you tell me I’m wrong and you have the facts that show me I’m wrong, then I’m going to accept the facts.’”

At the same time, you need to be considerate about your employees own ideas and opinions.

“You can’t shoot the messenger,” Gingo says. “Let’s say you’re in this meeting and somebody says something that is totally wrong, you know it’s wrong. Well, if you want to keep the meeting open and communication to go on, don’t shoot them down. You don’t show them how dumb he or she was.

“You try to diffuse it without embarrassing them because everybody around that room is listening. What is very key for me is when I think somebody is just totally off-base, I do not display it at all. Somehow say, ‘Well, that’s a good thought, but have you thought about this?’ You can in essence diffuse their own argument by the questions you ask them.”

When you’re having a serious meeting to strategize about the company’s future, you need to make sure that everyone has the opportunity to speak to the bullet points you presented. And not only that they have the opportunity, but they take advantage of it.

“No matter what the group is, certain people are going to say something,” Gingo says. “What you have to worry about are the ones who don’t say anything. Literally, you don’t leave that room until everybody has had a chance for input. If somebody says, ‘Yeah, everything is OK,’ then you challenge that but not in a negative way. You say, ‘What do you like? Did I miss something? Is that part good?’”

By listening to the reactions, you should be able to gauge whether or not you’re on the right track. If you get push back from a lot of your sources, you probably want to rethink the direction you plan on heading.

The main point is you need to be open and respect other’s ideas.

Gingo knew when he arrived some of his plants were running at less than 50 percent capacity. While A. Schulman was doing decent business, it was taking it at a loss. Someone in manufacturing presented him a program — a program based on facts — that would shut eight plans. It made sense. They shut them.

Two years after Gingo took over, the company’s U.S. operations turned around by nearly $18 million and was breaking even. The company’s revenue for fiscal 2010 was $1.59 billion.

His experience combined with his time spent with employees trying to understand the company contributed to that accomplishment.

“You have to get out,” Gingo says. “You have to have your pulse on your company and what’s going on good and what’s going on bad. That’s awfully hard from a CEO position because, for one thing, you have a lot on your agenda, so you just have to find time to do it. But truthfully, one of the most boring things to me is having to sit all day in my office.”

How to reach: A. Schulman Inc., (330) 666-3751 or

The Gingo File

Joe Gingo

chairman, president and CEO

A. Schulman Inc.

Born: Akron

Education: Bachelor’s in chemical engineering, Case Western Reserve University; J.D. University of Akron; master’s in business management, Sloan Fellowship program at Massachusetts Institute of Technology

What is the best business advice you’ve received?

It was a quote that I got in a training course, and it’s my No. 1 principle. It said, ‘The first job of a leader is to define reality. The second job of a leader is to provide guidance and support. The last job of a leader is to say thank you.’

Gingo on empowering employees: I always tell people who work directly with me, ‘Look, if I have to do your job for you, I have a tremendous cost-cutting program in mind and it doesn’t involve me.’ You really send a message. That doesn’t mean you can’t come talk to me, that doesn’t mean you can’t ask advice from me. But in the end, I’m not going to make your decision for you.

I remember some boss saying, ‘Here’s what I want you to do.’ The employee would come back and, fundamentally if you listened real close, what they said to the boss was, ‘Your plan failed, what would you like me to do next?’

They were never accountable; they always just did what the boss said. I won’t allow it.

I’ll tell people, 'In this situation, here are some of the things I’ve done in the past. But, in the end, it’s your decision. I’m not going to make this decision for you.'

John C. Orr learned the importance of partnerships from a boss and a shoeshine kid.

When Orr was director of manufacturing for The Goodyear Tire & Rubber Co.’s Latin America Division, every place to which he traveled with his boss, his boss would create a partnership — even with the boy shining shoes in the hotel.

“When he needed something, he would call the shoeshine kid and the shoeshine kid would get it for him,” Orr says. “The partnership was created because he spent some time talking to the guy; he gave him time and effort and created a relationship.”

Orr has tried to replicate his observations ever since.

“You have to build partnerships with your employees; you have to build partnerships with your customers and your shareholders,” he says. “To me, a partnership means communication, it means openness, and it means a willingness to tackle things.”

Never has that theory proved more important then in the recent economic conditions. As president and CEO of the manufacturer and distributor Myers Industries Inc. (NYSE: MYE), Orr has worked hard to strengthen customer and employee relationships and, in return, strengthen the company.

Myers’ net sales were $701.8 million in 2009 and were up 7 percent at the end of the first nine months of fiscal 2010. While part of that growth is due to the uptick in the economy, part of it is due to Orr’s three keys to managing during difficult times, which, not surprisingly, are all linked to strong relationships.

Help customers

Knowing that the recession was hitting most businesses hard, Myers tried to maintain constant contact with its customers to understand their situations and their needs.

“In a downturn, a lot of people try to do without,” Orr says. “They try to last longer with the same material handling products or our automotive and custom products. Talking with them and encouraging them to tell us what they need allowed us to innovate some new and exciting products during that time.”

In difficult economic times, good communication with your customers becomes even more essential as their needs and cost structure shift to deal with their own struggles.

“The worst thing you could possibly do is put your head in the sand and say, ‘Well, we’ll see you when things get better,’” Orr says. “You’ll be out of business as easy as that.”

One of the ways you can deepen that relationship, besides communication, is by being visible. And that isn’t limited to your sales team. Sure, Myers emphasized that members of its sales team should make regular calls and hopefully take orders on new products, but the company also pushed for its people to get past the purchasing desk and into the customer’s facility. Not only does it show that you’re interested in understanding more about their business, but it allows you to actually observe operations, see where your products or services might help and see where innovation may be needed with new products and services.

“Innovation starts with our people,” Orr says. “Our people have to get out there and find out what it is we can do to help our customers. They do that with feet on the street. It’s getting into their business; it’s looking at it with the idea that we have a different value proposition than perhaps what they’re using. Why not use reusable plastic containers that save you money on many trips, rather than using a cardboard container or a wooden pallet that gets two or three trips and then you have to throw it away?”

Ask the basic questions to understand your customers’ needs and make sure you’re helping them focus on their cost structure.

“You have to always ask, ‘What can I do to help?’” Orr says. “That’s probably No. 1. No. 2, ask, ‘What is your objective? What are you trying to do? Are you trying to lower your cost? Are you trying to put a better product out to your customer?’

“To me, it’s really kind of common sense. What is it that we can do for you? We want to be here to help you.”

Your salespeople shouldn’t be the only ones asking those questions. You and your managers need to make an effort to follow up with customers and show what the partnership you have with them means to you and the company.

As the leader, you set the example. Orr tries to visit at least the company’s top 25 customers. For instance, Myers has been in Brazil for five years.

During a recent trip to a trade show in Brazil, Orr made time to visit customers. But it’s nothing for the managing director of the company’s material handling segment to be on the road five or six days a month calling on customers and listening to their feedback.

“What’s important about it is sometimes salespeople tend to want to bring back and give to management what management wants to hear, ‘We’re doing great; don’t worry about it,’” Orr says. “Then we start to see numbers that show our business is falling off with that particular customer. In some cases, the salesperson might not be doing the job. That reflects on us.

“It’s important that you understand and hear it from the customer directly: ‘How are we treating you? How are our salespeople doing? How are our sales engineers doing? How is the quality of the product? How is the delivery?’ It’s very, very important to make sure that that happens. By management doing it, we’re making sure it’s actually happening.”

A greater presence and emphasis on your customers during difficult times will pay off in the long run.

“It’s really about communication and making sure you have their hand with your hand and you’re walking forward together in trying to help get through the situation,” Orr says. “I’ve found that customers are really appreciative of that. Even if you can’t maybe do something for them, at least they realize that you’ve been there, you’ve tried. As things pick up, things get better, they remember that. I’ve found that we secure additional business down the road when things do get better, because you were there trying to help.” Keep an eye on cost

Myers’ costs were high going into the recession, because it was still running at full capacity. But as business started to wane and plants began running at less than maximum capacity, they took the opportunity to restructure, which meant closing facilities, laying off employees and investing in more efficient technology.

Depending on your industry, your cost analysis might be directed at people or the price of your product and, to no surprise, you need to constantly monitor whether reductions need to take place.

“When you get into a downturn, that has to be one of the top three items that just absolutely has to happen,” Orr says.

So when do you make a reduction or even an investment? Before the recession, Myers was analyzing making changes to its material handling and lawn and garden businesses, so management took a deeper look at the metrics and weighed the cost against the long-term benefits.

“First off, you have to look at an objective,” Orr says. “What is the goal? Is the goal cost, quality or what is the end all? Let’s take, for instance, cost. If you’re looking at cost and you decide we’re in a downturn situation, we have an excess capacity [and] we probably don’t need that capacity in years to come. If we do, we would buy new or better capacity or equipment. The analysis comes in around what is it going to take to make that change.

“All in all, there has to be a fundamental goal to why you go ahead and do it, because they’re not easy decisions and they’re not fun. Anytime you’re involving people in the situation where it might reduce your manning of your employment, that’s a very, very tough decision, and we certainly don’t take it lightly.”

While all of those steps are crucial in maintaining the strength of the company, you can’t forget the aspect of cluing employees in on your decisions or even involving them in the decision-making process. Clearly communicating an investment in technology is a plus compared to closing down a plant, but good or bad, conversation has to happen.

“It’s very important to communicate,” Orr says. “I’ve always found that people are more willing to cooperate if they understand why. Before we take on a project, we make sure in our businesses that we have communication, discussions whether they be meetings or whether they be one-on-one information-type meetings to explain to our people why we have to do what we have to do. In a lot of cases with those projects, we try to enlist ideas and thoughts from folks who are actually doing the job, because I think that’s where you actually get the biggest bang for your buck.”

In a time when you’re probably looking for more efficiency and making operational changes, directly ask your employees for ways to streamline processes and perhaps save money. You not only gain respect but also the cooperation needed from employees for the company to move forward and succeed.

During Orr’s years running manufacturing plants, he realized no one knows the job and knows how to do it better than the person actually in the position. Orr brought a process with him to Myers that analyzes work. Called “Block of Work,” the company even has a room dedicated to walking through the process.

“What’s interesting about it is that you actually get the people who are doing the work involved in it,” he says. “It’s a brainstorming session, and they put up on the wall little 3-by-5 cards that are each pieces of the work that they’re doing. What you find is that when people look at it that way they understand sometimes, ‘Gosh, I may be doing some things I don’t really need to do. It’s an extraneous step in the process, so we can eliminate that.’ One of the things we’ve found is we’ve improved the efficiency of our operations by using that particular Blocks of Work technology, which allows people to have input.”

In the end, your cost structure and employees’ ideas on how to make a process run smoother come back to the metrics by which you understand your business.

“You need something to drive your business,” Orr says. “If you don’t have objectives or goals, you’re certainly not going to get there. … You’ve got to have metrics and you’ve got to be able to analyze how the business is doing with those metrics and analyze the parts and pieces of it, whether it be people, whether it be equipment, whether it be safety. You have to have something to measure. If you measure it, you’ll move it.”

Watch the cash

One thing Orr is proud of is Myers’ balance sheet. While the board of directors pushed the focus, Orr and his team made sure they held on to the company’s cash in recent years. Holding on to your cash means making sure you’re collecting from people who owe you money and you’re making wise investment decisions.

“Sometimes people are out looking for acquisitions or they’re spending money on equipment and they haven’t necessarily thought it through,” Orr says. “When you’re in a downturn situation, there might be something that is appetizing, but we believe at Myers don’t go to the grocery story when you’re hungry because you end up buying a bunch of stuff you don’t need.”

Another decision, which has positioned the company to add shareholder value and reinvest in capital in the long term, is using the last few years to pay down debt.

“We’re cautiously optimistic that the economy will get better in 2011,” Orr says. “We feel we’ve gone through this recession and we’ve learned a lot about going through it. If it happens again, and usually the economy does cycle, we’ll be even more ready and prepared to defend ourselves.”

How to reach: Myers Industries Inc., (330) 253-5592 or The Orr file

John Orr

President and CEO

Myers Industries Inc.

Born: Akron

Education: Bachelor’s degree, organizational communication, Ohio University

What is your definition of success?

I think success in my particular case is seeing that Myers is succeeding, that our people are succeeding, that we’re meeting our objectives and our goals. What I want to do is make sure that we return the shareholders their investment. It’s been tough the last two years, quite frankly, because of the economy. But success shows up every day. When I see people with a smile on their face, they’ve done something well or they come up with a new order or they’ve created a new product, then I feel successful.

What was the last book you read?

It’s called ‘Healing Hearts’ (Dr. Kathy Magliato). It’s a memoir of a female heart surgeon. I read it because I have a daughter who is a third-year resident anesthesiologist at Virginia Commonwealth, and I’m always amazed at what she has gone through — 36-hour (shifts) and that kind of stuff. I can never get her to tell me what it’s like, so I read this book because that is what this book is about. It’s about this lady’s life as an intern and a resident. It was interesting because she was a resident at Akron General Hospital and I’m on the board at Akron General. She was very, very successful. I think there are only 1,000 female heart surgeons in the United States. I’m proud of my daughter because that’s what she does all day long; she’s in those types of surgeries and trauma surgeries.

Saturday, 19 February 2011 23:47

Jack O'Neill makes decisions at DHL Express USA

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.”

Constantly communicate

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.”

Educate employees

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.”

Follow up

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

The O'Neill fileJack O'Neill

Vice president of operations

DHL Express USA

Born: 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.

Wednesday, 16 February 2011 16:09

Creating a mindset

Weatherchem Corp. considered itself a sustainable manufacturing company long before Jennifer Altstadt arrived. But when Altstadt, the president, began using the buzzword “sustainability,” she received some pushback.

“We had a few managers talking about, ‘We have a lot to do to take orders and ship our products; we don’t have time to be tree huggers,’” she says. “That has the wrong context that sustainability is something you do separate from business. With the training and the discussions that are involved, sustainability is how we do business; it’s not separate from business.”

You, your managers and your employees all have to buy in to the idea of implementing sustainability initiatives in order for your company to see any success. So when you suggest forming a company mindset around sustainability, your staff has to recognize the direct link.

“Where we focused first was internally,” says Altstadt, who has about 100 employees. “You can get caught up in the, ‘What does it mean to the outside world?’ It goes beyond the scorecard that large customers might be asking for. To begin, you really have to look internally and create the basics. A basic recycling program has to be in existence. Start small, start simple and see where that goes.

“It’s really been the employees who start to come up with the ideas, and it’s listening to employees where they want to take it. Are they interested in doing more with the community? Are they interested in doing more with wellness? With that mindset, then as you are just doing normal operating, buying equipment, you think, ‘How do we do it a little more different?’ We do start thinking about energy and long-term effects.”

Your employees can’t just show interest, they have to take ownership in the initiative. Instead of forcing ideas, ask them where in the business they think efficiencies can be found. Along with direct conversation, put in place feedback mechanisms specifically for sustainable ideas.

“No. 1 is you just have to listen,” Altstadt says. “That sounds simple, but you have to make time to be available. It’s simply making sure that it’s not only I or the management team that agrees that this is something important. We listen to the ideas. We do have a formal suggestion box that we take seriously. Our vice president of operations, for the most part, is the person who reads those and makes sure they’re implemented.”

No matter how you’re gathering employee feedback, you have to provide individuals with suggestions or a response. Altstadt is informed of who made a suggestion so that she can personally take time to thank that employee.

With a response, Weatherchem also provides small recognition for the idea, usually a gift card for groceries or gas between $25 and $100. The instant recognition encourages employees, even those beyond sustainability, to participate with the suggestion box.

Weatherchem’s sustainability initiatives include going landfill free, making all recyclable products and using a chiller that uses naturally cold air from outside to cool its manufacturing space. The chiller generates energy savings of about 40 to 45 percent compared to previous equipment.

To keep ideas and momentum going, you also need to set measurements where possible and update employees on the progress being made.

“The word ‘sustainability’ makes people feel good. It’s not about cost cutting. At times, that’s one of the benefits, but when you talk about leaving the world a better place and what can we do to help ourselves and help the world, it’s something that makes people feel good,” Altstadt says. “So involvement becomes natural.”

How to reach: Weatherchem Corp., (330) 425-4206 or

Find a champion

Glimpsing at the positions companies are hiring for these days, many of the titles include sustainability manager or sustainability director.

Whether you’re a large company that can hire a full-time employee to implement sustainable measures or a small company increasing your commitment as you grow, you need to have a champion or champions if you want to see continuous improvement.

“You do need a dedicated resource, especially at the very beginning of the program,” says Anna Frolova-Levi, a vice president at Weatherchem Corp.

That resource may be a person or persons. Depending on the size and structure of your company, as long as every top and middle manager has bought in to the program, designating a single person might not be necessary.

The main reason for dedicated resources is that, before you can implement any processes, there are the responsibilities of research, setting metrics and explaining to employees what a company culture based on sustainable measures really means.

Either way, putting people, time and funding behind projects is usually a signal to employees that the focus is important to the company.

“It’s all about people in the end,” Frolova-Levi says. “You have to bring people with you to get excited about the whole concept.”

Thursday, 06 January 2011 09:25

PEDCO E&A Services Inc. bridges the gap

Jerry Doerger wasn’t surprised when young employees began working on projects while listening to iPods and texting on cell phones. After all, he has four millennial children, and he sees the multitasking and embracement of technology every day.

“What I have been able to recognize and to accept is the different working philosophies and the different working patterns between the baby boomers and the millennials,” says Doerger, vice president of the engineering and architecture firm PEDCO E&A Services Inc. “I’m living with it at home, so I understand it a little bit better. I’ve started to work with some of the senior-level managers who have grown up with [the idea that] you go to your quiet room and you study or you go to your cubicle and you get your work done. That’s not how things are happening with the millennial generation.”

There is a good chance your employees span multiple generations. Baby boomers and the younger millennial employees see work and life in different lights, yet, many times, they must work together to accomplish one task. The question becomes how do you bridge the gap to ensure a successful employee base and a successful company?

Along with observation, PEDCO did — and continues to do annually — an anonymous employee survey that asked questions on multiple topics, including what is important to them.

It became evident that employees had different needs and wants based on their age. The baby boomers liked the rigid work style of coming in at 8 a.m. and leaving at 5 p.m. Reward to them isn’t a pay check but opportunities for advancement. Younger employees wanted flexibility. Their families and community played a significant role in their life.

“The most important thing that companies have to realize is what works for one generation and what motivates one generation doesn’t necessarily work for another generation,” Doerger says.

Understanding the differences, PEDCO put in place initiatives that would help the generations work together and understand each other.

First, PEDCO stresses flexible management. In order to engage employees, PEDCO managers try to manage individuals differently. To understand your employees, you must have conversations with them about their professional and personal goals.

“Really just communicate with them and get to know them as individuals,” Doerger says. “As you get to understand and know the younger generation and find out what is important in their life, where they feel their value is, then you can start to address how can I engage this person more successfully and make them feel like he’s a much more active part of the business.”

Other bridging-the-gap initiatives that PEDCO uses are mentoring programs and discipline groups. When you’re making a constructive effort for employees of different generations to work together, ensuring everyone is heard and respected is essential.

On a new employee’s first day at PEDCO, he or she is provided a mentor. The idea of a mentoring program allows two individuals, usually from different generations, an opportunity to learn from each other.

The discipline teams, such as the mechanical group at PEDCO, meet on a regular basis to discuss ways to better their particular discipline. The process helps ensure each employee has the opportunity to bring up specific ideas. It also provides employees with different levels of experience and views on the profession to brainstorm together and develop ideas.

Allowing all employees to contribute ideas or recognizing an individual for their contribution helps the other generation respect that individual.

PEDCO’s conscious effort to bridge the generation gap has meant little turnover from its 75 employees in recent years, along with more engagement between employees and employees and clients.

How to reach: PEDCO E&A Services Inc., (513) 782-4920 or

Preparing for the future

As PEDCO E&A Services Inc. was preparing to celebrate its 30th anniversary this year, management considered how the company’s organizational structure would play into its success in the coming decades.

When planning for your company’s future, you can’t forget about leadership turnover.

Vice President Jerry Doerger led the initiative at PEDCO as the management team members analyzed each aspect of the business — leadership, administration, technical teams, project managers and design teams — to identify future gaps and develop a transition plan. They determined top executives and managers could retire in five to 10 years.

Early analysis allows time to plan and implement training, coaching and mentoring to ensure a smooth transition.

“The biggest thing that a company can do is to, No. 1, recognize that there is a generational gap,” Doerger says. “Put a plan in place to start to bridge the gap — and it’s not going to happen overnight. The other piece is as the different generations begin to exit the workplace, put a plan in place to transfer that knowledge, that understanding and that technical expertise that those folks that are exiting the workplace have to the next generation. What you get at the end of the day is a more engaged work force by doing it.”

Michael Robb was prepared to be disliked on his first day.

Tough decisions would need to be made to keep the jobs of his 52 new employees and keep the organization, Center for Community Resources Inc., out of bankruptcy.

“You have to have courage that you’re not going to be liked,” Robb says about stepping into a leadership role in a turnaround situation. “You have to understand who you can trust, and put your faith and trust in those individuals. You have to know who the players are in the organization and assess that very quickly, because you can’t do it alone.”

Robb’s first days were spent talking to employees on all levels to determine the human services organization’s finances and problem areas. Connecting with employees early allowed Robb easier buy-in during the turnaround implementation.

That was 2005. Since then, CCR has grown its staff to 89 and has an annual budget of $4.5 million. Seeing the need to help nonprofit organizations, Robb and his team started Alliance for Nonprofit Resources Inc. and Nonprofit Development Corp. As executive director of the organizations, Robb oversees 130 employees and budgets of nearly $8.5 million.

Smart Business spoke with Robb about how to turn around a company.

Q. Where do you start in a turnaround situation?

What happens is sometimes you go into a situation and people feel like you should have all of the answers because you’re hired. You shouldn’t ask questions to be able to enact policies. People see asking questions as a sign of weakness or that you don’t know what you’re doing.

I always feel like you have to go into some kind of temporary incompetence. When you walk into a scene, you really need to understand what the culture and the structure is that you’re going to be working in. Those are two critical elements that you need to evaluate: How are things getting done? What is the philosophy behind which those things are done?

Q. To whom do you ask questions?

No matter where the company is at when you come in, you have to be open to everybody who might provide feedback to you.

Some do it willingly; they just come to you. They may come to you for a lot of different reasons and a lot of different motives. Others, you have to seek out. That’s where it gets difficult, because who is going to provide you with reliable information and who is going to provide you with information that is not necessarily in the agency’s best interest, but it’s in that person’s best interest, too. You have to evaluate that.

Q. What questions are you asking?

There is a double bottom line with nonprofits. The first bottom line that a lot of people focus on is good service provisions: Are we doing it well? The second bottom line is: Are we doing it at an affordable cost?

When you look at it that way, I carve out my questions really: What’s the finance process? Are we looking at our accounts receivable and our accounts payable? Are we managing our cash flow? Are we looking at a cash basis or an accrual basis? That dictates a lot about how an organization runs and can survive. Who is in charge and who is making the decisions on how money gets released? Who is making the decisions on how money is being sought? Once you find out who is doing those things, then you can start asking the process by how they make their decisions.

Q. How do you get staff buy-in on ideas and strategy moving forward?

On two fronts: Is it going to make their jobs better and how they do their work better? Is it going to make their overall experience of being within an organization better? Sometimes people look at coming into a place on two fronts: I like my job, but I hate my employer.

What are you trying to do to meet those two things? You have to understand what the employees want.

I always found benefit from meeting with staff over those brown-bag-lunch meetings. You sit down at lunchtime. I’d buy pizza. And I’d say, ‘Here are some of the things going on. What are your concerns? What are you worried about?’

I got a great amount of feedback, which I thought was really relevant. In those meetings, I would say, ‘I’m going to take your feedback, and we’re going to communicate back. If we can’t accomplish those things, here’s the consequence.’

If you can use not just words, but bring in some handouts to show the staff, ‘Here’s what it currently is. There’s our bottom line.’

Q. Are there other essential steps that must take place?

You have to be visible when you’re coming in on a turnaround. We had a couple of sites, and I made a point to always be at the other site on a weekly basis. Actually spend time working there. I didn’t have a designated office. I would pick a conference room, and sometimes I would get kicked out because there was a meeting.

People want to see that you’re there rather than behind some closed door. Minds start to race.

If you’re doing those one-on-ones, if you’re meeting with people on a regular basis, it really starts to help ease their concern. They can focus back on what they need to do be doing.

You have to give a time frame: ‘Within 90 days, we will have structural changes done or some process changes done.’ You may not know what those exactly are.

You have to understand where things are and pinpoint. Depending on where the cash is for an organization and where they might be in crisis mode will really delineate how quickly you have to react.

How to reach: Center for Community Resources Inc., (724) 431-0095 or

Thomas M. Nies understands everything has a life cycle. So the longest actively serving CEO in the computer industry built his business on the notion of reinvention.

“Creating a long-term sustainable business is obviously something that is not done just once,” says Nies, founder of Cincom Systems Inc. “But it’s something that must be continuously done over time. The competitive advantage of one’s offerings has a limited time span — three years, five years, seven years — and the more high-technology-related the endeavor, the shorter the typical life span.”

Nies grew Cincom from its Cincinnati roots into an international software player. And he did it by staying in front of and adapting to changing industry and client needs.

“Creating a long-term sustainable business requires some type of entrepreneurial orientation to the business that is constantly reinventing itself,” he says. “New products, new technologies, new services, new offerings that continue to respond forward so as the initial products or services die off, the company doesn’t die off with them.”

To gauge the life span of your products or services or perhaps the need for new offerings, you must understand the marketplace and, as a result, your clients.

“One has to be constantly in touch with the marketplace to understand, ‘What is the opening we’re trying to take advantage of? What product or service are we trying to provide that customers really want? What unique value propositions can we offer them?’” Nies says. “If we don’t have unique value propositions that are pretty certain to gain some preference, the effort is probably going to fail.”

To understand those questions, Nies created a company culture and a method of inquiry that gives his 800 employees a role in understanding what the customer wants.

Involve everyone

At Cincom, understanding the client isn’t just left to the sales team. Nies says it’s important that every layer of the organization, from him to the front desk, is involved in inquiring how the company can better serve the customer.

“We try to involve everyone in the company, in every way possible with inquiring of the marketplace every day and every interaction,” Nies says.

The importance of involving multiple levels of employees is the ability to then go back, discuss the feedback and piece together the larger picture of what the customers’ needs are and what their business will look like in the future.

“I would most certainly recommend that all companies do it no matter what you’re selling or providing,” Nies says. “Typically, senior executives don’t want to talk to lower levels of the provider’s organization, they typically want to interact with their peers. You’re not going to get good insight from senior-level people unless your own senior-level people are willing to do the work necessary to interact with them.

“Similarly, the technicians don’t want to talk to the senior-level executives of a provider, because their interest is in the technical aspect of the product: How does it function? What does it do? What are its features and capabilities? You have to match people on both sides of the organization, the provider and the consumer. Then they have to constantly review and digest that within their own company to make sure that insight is being gained and all aspects of those insights are considered.”

If you want employees at multiple levels within your organization to participate in the customer discussion, you need to explain to them what their role is and teach them how to interact with the customer.

Understand the customer

Nies firmly believes that successful selling is not about promoting and telling customers what they need. Value-based selling or value-based providing, as he calls it, is about understanding the clients’ wants and how you can best serve those. Nies created an internal university called Understanding U to get that message across to his employees.

“That training or learning environment focuses totally on the need to understand what we’re trying to do and what customers want,” he says. “How do you help them buy what they want rather than try to sell them what we have? We try to stretch this understanding and inquiry mode of operation as broadly throughout the company as we can at every level. Because I believe we need a collective leadership at our business rather than leadership from the top or any particular group or person.”

There are two overriding requirements to successfully practice value-based providing in complex environments. You need to gain credibility with the client and understand their needs.

“One of these is the need to gain the credibility and the trust of the other, which builds their confidence that the values that are suggested or offered will be successfully gained without inordinate risk or cost and that they can be quickly gained,” Nies says. “The second theme is that understanding the other person’s wants and needs is essential. The explicit values they desire can be identified and established.

“An effective selling strategy is not about grand design or clever tricks or flashy presentations or good closing tactics. Rather, it’s about thoroughly understanding the customers’ perspective, their motives, their fears, their uncertainties, their wants, their needs and dissatisfactions, and how they may differently react at various stages of their choosing cycle. Then [you have] to understand how best to respond to each concern and to understand how to help resolve every issue and worry in ways (that) consistently build an increased trust in confidence.”

To ensure employees understand the complexity of reading customers, Nies developed a training program that includes reading materials, role playing and team collaboration. For example, after a topic is discussed, each team presents its idea of what that topic meant, how it should be applied and ways to better handle the situation.

Nies started with his direct reports and then oversaw the process as they facilitated the course for the next level of employees. Courses not only focus on sales but also on management, technical support and engineering. The hope is for between 30 and 40 percent of employees to partake in Understanding U by the end of this year and for participation to be continuous.

“We say that we learn forward, but we only understand backward,” Nies says. “We have to have certain knowledge before we can begin to understand. Understanding U is a means to connect the learning, connect the knowledge that we have and show how everything fits together and to do that on the basis of discovery rather than lectures.”

Ask the right questions

So you’ve made it a priority for your employees to interact with customers and understand their needs. Now you have to actually execute.

“Superficial attempts to gain information get superficial responses,” Nies says. “Human beings are conservative. By that I mean we want to try to do the least amount necessary to get a result. That’s good if it produces a result, but it seldom works.”

Simply, you can’t skimp on your communication with customers and the amount of feedback you acquire. You need to have direct, frequent and continuous conversations that will allow you to properly identify the customers’ needs and then provide solutions to meet those needs.

“Our emphasis is on inquiry, questioning, listening and curiosity and then trying to come up with innovative and progressive responses to what they want,” Nies says. “Rather than sitting around our own offices trying to dream up better ways to sell them what we’ve got or what we want to build or produce.

“You can’t fall in love with your own opinions. You have to confirm those. You have to interact directly with the customers and prospects and ask them. Listen to what they have to say in a very empathetic way.”

Nies and his employees use three essential questions when it comes to understanding customers and their needs: What do you want? Why do you want it? How can we help you get it? The “you” is stressed in each of those questions.

“The key point here is the emphasis has to move away from the provider and promoting himself (and move) to the customer and what they want, why do they want it and how do they want you to satisfy their needs,” he says. “That is a major quantum shift in the orientation of modern business. Modern business, up until these times, has been able to pretty much sell everything it can produce, because the world economy has been growing over the last 50 years, since the second World War.”

As the CEO, you need to lead by example. Spend time with your customers and ask the important questions. Nies does exactly that, either meeting with the CEO or the highest member in the company to gain a better understanding of the broader goals of the customer’s business.

“If I were meeting with a senior executive, I would personally not meet with him and tell him what he should be doing,” Nies says. “Sit down with him and say, ‘What are your plans to improve the competitive position of your business? Are you satisfied with your current rates of revenue growth? Are you satisfied with your current market share and its changes positive or negative? If you’re satisfied and believe this is working, what can we help you do to do more of it? If you’re not satisfied, what would you like someone like us or some other provider to do to help you reverse your situation?’

“My discussions with them would be almost totally inquiry-oriented. They know their business very, very well. They’re experts; they’re sophisticated thinkers. For me to be a provider to them or a helper, I need to know what they want and how do they want me to help them.”

Asking the right questions is an essential first step in being able to serve a customer. Without a total grasp on where his or her company is headed and what he or she is looking for in a product or service, you won’t be able to properly analyze how your company can meet that customer’s needs.

Nies’ method of understanding the customer is partially proven in the results the company sees on quarterly customer service surveys. Routinely, between 97 and 98 percent of those who have used Cincom’s customer service report they would recommend others to buy the company’s products.

“The key idea here is that one cannot serve customers that one cannot create,” he says. “The entrepreneur has to understand what those customers want and why they want it so they can satisfy them and provide answers for their wants and needs. If they can’t do that, then they have no reason for being in business.”

How to reach: Cincom Systems Inc., (800) 224-6266 or

You won’t find Steve Christian hiding in his office avoiding a problem that needs to be rectified. That philosophy wouldn’t be good for anybody and certainly not the organization.

“Don’t avoid confrontation,” says Christian, managing director of accounting and consulting firm Kreischer Miller. “A lot of people don’t like confrontation, but it’s really an opportunity to make an organization better.”

It’s similar to being handed lemons and making lemonade. You take a problem or a mistake, and you find opportunity by breaking it down until you understand what went wrong. You determine how you can fix the problem and how you can avoid it in the future.

Christian says two characteristics of being a good leader are confronting issues and maintaining a constant focus on the good of the organization. Well, those go hand in hand, and that’s how Christian chooses to lead the firm and his 200 employees.

Smart Business spoke to Christian about how to effectively deal with company problems.

Don’t avoid confrontation. Not many people, in my opinion, welcome confrontation. I happen to be somebody who doesn’t mind confrontation because I think it’s an opportunity to make things better.

If somebody has let the organization down, has let me down, they’ve done something wrong, they didn’t serve a client right, well, the easiest thing is just to ignore it. But that’s not what you’re supposed to do. You need to look at it as an opportunity to make that person better, make that situation better, make the organization better.

When you sit down to have these discussions or confrontations, which is sort of a harsh word, it’s really how do you handle it. Do you handle it constructively? Or do you handle it destructively?

If somebody performed less than stellar client service in our business — since we’re a consulting firm, an accounting firm — does it do a lot of good for me to sit there and scream at them, ‘Don’t ever do it again. What were you thinking?’ I’d much rather say, ‘John Doe, what happened here? This is their perspective. Why is it happening? What do you think? What are we going to do differently? We’ve all done that before. Just try to help the situation not recur. We can’t have it back.’

The easy thing for anybody in life is to just ignore it.

Prepare before the conversation. First of all, you have to tell yourself no matter how much I don’t want to have this conversation I have to have it for the good of the organization.

Then you just have to find the best way to communicate. What are you trying to communicate? What do you want to accomplish in this meeting with this person? You have to ask yourself that and then come up with a game plan or an action plan to communicate that.

Take the emotion out of the meeting. Perhaps it’s something that has very much upset me. I may not meet with that person right then. There’s maybe a cooling off period of some sort ... so there’s not a lot of emotion at the end of the day.

But you have to remind people what they need to be doing differently.

Communicate the need to improve. One sign of a good leader is ... you don’t throw people under the bus. When things happen, it’s all about, ‘How are we going to improve our organization?’

The fact that it was John Doe that did it really isn’t relevant to anything. In fact, it’s sort of good that John Doe did this because we’re going to be a better firm for it at the end of the day.

If I see something happening with an individual or individuals and I think it’s something that I worry could be pervasive or I can give people a heads up, be careful of that, I will then communicate, ‘Hey team, we’ve had a couple situations where this has happened. Obviously it doesn’t put us in the best light with people or clients. Just be sensitive to this issue.’

Offer openness in bringing up problems. They have to trust you. I encourage everybody here whenever they have issues or problems, they don’t have to come talk to me, they don’t have to go to HR. But they have to find somebody they’re comfortable talking to because often they have to be part of the solution to whatever the issue is.

If you treat people fairly and they know you have their best interest at heart, and you don’t harm them in any way, make fun of them or criticize them, they’re going to feel comfortable because they trust you. It’s all about trust at the end of the day. You have to be consistent. You have to treat them with respect. You can’t be up and down — up one day, down another.

Admit your own mistakes. We acknowledge that we’re wrong or I acknowledge that I’m wrong. We do two things: We try to right this ship and go another direction whatever that means. What I always do personally is I very rarely dwell on something that already happened. What I want to do is take away from it what can I learn and how could I (make) the process better or my decision-making better the first time around.

I acknowledge it in a meeting, I acknowledge it in writing, if I think we should have done something. I don’t try to justify it. I don’t try to rationalize it in any way. I am comfortable that people make wrong decisions.

You may have evaluated it properly but it turned out to be wrong. If you only look at it, as I said, for what’s the good of the organization — forget me politically in the organization, forget somebody else — but if you only care about the organization and its best interest, it’s easy to admit mistakes.

How to reach: Kreischer Miller, (215) 441-4600 or

Toni Pergolin had heard her organization’s name was confusing. As she thought about that, she realized she never heard people use the tagline. She never used it. And the logo — the logo was a decade old.

Pergolin, president and CEO of then Bancroft NeuroHealth, realized all signs pointed to rebranding.

The nonprofit came out of the process with the simplified name of Bancroft and a tagline of “One World. For Everyone.” Part of the success, Pergolin says, is due to the involvement of employees in the rebranding effort. From start to finish, they were asked their opinions.

“We had an open-door policy, and we encouraged people to speak up about it. Ask questions: Did it resonate with them? Is it powerful? Is it meaningful to them?” Pergolin says of the follow-up after the unveiling. “It was really educating, having them be a part of the process and then allowing them to give feedback.”

In 2009, Bancroft had a $95 million budget and 1,950 employees.

Smart Business spoke with Pergolin about how to involve employees in rebranding.

Educate your employees. We went out with the thought in mind that we have to educate them to make sure that they understand the vision of the organization and why it’s so important to them, why our mission is important to them. And what they do every day relates — how that links back — to everything that we do here. So the first thing we did was really educate them.

I think it’s important [that] it’s face to face. What we tried to do was link what they do every day, how they make a difference, to the end result. It’s different for every position and every program, so I think it was important that we could talk to the AP clerks and say, ‘Here’s what you do, and that’s why you make our organization better.’ We could talk to teachers and say, ‘Here’s what you do, and that’s what your link to the organization is.’

I continue to do that. Every time I speak within the organization, I always try to give an example of something that just happened last week or somebody needs this ‘One world. For everyone’ just to keep them very involved.

Be the one to educate. We went through a lot of discussion about it, and we did think it was important that the CEO went out because then you knew it was important to me.

It shows if it’s something that I would put time and energy into, that I think it’s important enough to spend my time on, then it certainly should be something that they should think is important enough for them to spend their time on.

I think that’s a key point. If they hear about it (from somewhere else), I think it’s an easy thing for rumors to start around, ‘Why are they doing this; why are they doing (that)?’

We didn’t really allow for any of that. We were very clear. We were excited about it. It wasn’t because we were trying to hide anything. It was very clear from the beginning what our focus was and why we were doing it.

Involve employees. We actually had (employees) be a part of the process, and I think that’s extremely important. When we rolled it out to them, (we could say), ‘This came from you guys. This is what we heard from you. You are the ones that decided what the brand was.’

They were part of the focus groups and the discussion; they were a part of the rollout.

That, I think, is extremely important, to get buy-in and their commitment toward it.

We would specifically ask questions like: Did you think the brand was powerful? What did it make you think of? How do you live the brand? How do you make this ‘One world. For everyone’? We would ask them pretty specific questions.

Reach out to everyone. We really take the initiative to invite anybody who wants to be a part of it. We do that in a couple of different ways, and we do this throughout the organization on anything we’re going to communicate.

Sometimes I’ll send an e-mail out saying, ‘I want your ideas,’ so I can touch a lot of people that way. I have regular lunches with the CEO for people who want to come and talk about their specific issues or their concerns or their ideas, so they can come through that way.

At the end of the day, as long as you give everybody the opportunity, people feel they’re a part of the process. Even if they don’t want to be, they don’t want (to share) an idea, at least they felt like if they wanted to, they could. That’s important. I would think it’s hard to say, ‘We’re only going to ask the managers, and we don’t care about the opinions of the other people.’

It’s good just to have them feel a part of the process. If they don’t connect to it, I think they’ll just not even care about it. If they see what they do, like, ‘Wow, I actually made a difference today. I made the brand; I made it one world,’ I think they’ll really connect with it and really talk it up.

Provide follow up. I talk about the brand everywhere I go to employees and outside stakeholders. I’m always making sure I say the words, and I’m giving examples about how we really live it.

We got just a ton of feedback unsolicited from those families, employees and donors. Anytime everybody would say something about it, I would immediately call back and talk to them about it. It was almost engaging them in it, as well.

I think that it is the CEO’s role to keep it going. If I never said the words, it would go away. It’s really part of my job to keep the excitement going. Everywhere I go, I talk about it.

Really engage them like, ‘Oh, what did you think about it? Did you think it captured it? Why did it hit you? What was so exciting to you about it?’

How to reach: Bancroft, (856) 429-0010 or

Year after year, Todd S. Nelson watches as Education Management Corp. adds to its list of locations. As the company expands into new cities and new states, like its recent venture into New Mexico, the more Nelson and his top team are removed from direct contact with their students.

However, that doesn’t mean they don’t have a pulse on the students’ needs.

“If you’re planning ahead and you understand your growth, make sure that you are providing the resources to be able to maintain that healthy level of contact with your customers,” says Nelson, CEO of EDMC. “Really the key is making sure that you’re planning ahead ... regardless of how fast you’re growing or how big you become; (maintaining customer contact) is a very core guiding principle that will help you and your company to stay successful.”

In order to maintain that healthy level of contact, you must stay in touch with your customers, monitor and measure customer satisfaction and hold employees accountable to providing great service.

Nelson has done just that to better understand those who EDMC serves, its students, and to better determine how to make the $2 billion company (NASDAQ: EDMC) stronger.

As one of the largest providers of private post-secondary education, EDMC has four primary education institutions — Argosy University, The Art Institutes, Brown Mackie College and South University — as well as Western State University College of Law. With 20,212 employees and 136,000 students, as of October 2009, providing quality education and service is a constant priority.

“As an organization becomes larger, it’s easy, at times, to get caught up in the organizational issues,” Nelson says. “As it gets bigger, it’s easier to get more removed from the customer, and that is a huge mistake. If you’re not communicating with them, you don’t know their perception of whether you’re doing a good job or not.”

Stay connected

You need to be in touch with your customers so you understand what they think of your company and the service you’re providing. Without that connection, you won’t have a strong hold on your strengths and weaknesses.

Nelson says making that connection can be broken into two simple, but necessary, steps. Step one is provide the customer with an avenue to communicate with you. Step two is being proactive in personally connecting with the customer.

Nelson oversees institutions with 136,000 students. They’re in 98 locations in 30 U.S. states and Canada, so reaching out to each one of them is nearly impossible. Even if you can’t directly talk to all of your customers about their questions, concerns and general feedback, you have to give them the ability to reach you.

“By providing them an avenue to have access to you, that allows them, those who may have low-end type of feedback, an opportunity to communicate with you,” Nelson says. “Then, you can make sure that you’re addressing their issues.”

There are fairly simple ways to give customers constant access to the company or divisions within the company. You can set up hot lines or e-mail addresses that cater to specific segments of your organization. Perhaps you send out a survey that is readily available to them when they use your product or service.

“The most important thing is to make sure that you have and you’re providing them a tool at their fingertips that they, at any given time, can communicate back with you,” Nelson says. “There are a lot of different things that you can do. Just make sure that it’s accessible and visible for the customer so they know they can get in touch with you.”

Communication is at its best when the tools to converse are simple and allow for timely and ample reply. While you have to use a communication structure that works best for your company, it’s always a good idea to ask those whom you’re serving their preferred method of communication.

“By talking with them or communicating with them and asking them that question, they’ll let you know,” Nelson says.

That ties into the second step: being proactive in maintaining that line of communication. You don’t only need to understand how your customers want to be communicated with but, also, how often. Those are two questions that can differ drastically based on your company, industry and service offering. The easiest way to find out that information is simply ask the customer.

Nelson says a direct conversation, whether in person or by phone, tends to be the most efficient means for communicating.

“Your ability to communicate effectively is enhanced because you’re not only able to hear what they’re saying, but you can put it in the context of whether there’s body language,” he says. “Also, I believe it shows your commitment to your product and the customer. For example, in my past, when I’ve had someone who has physically taken the time to talk to me about something, I know it’s a priority.”

Depending on your number of customers, you’re going to have time and, possibly, geographic limitations trying to touch base with all of them. Those restrictions mean you need to work even harder at determining who to engage in conversation to understand the views of your organization.

The best thing to do is reach out to a methodical sample of your customers.

In EDMC’s case, the company picks a communication vehicle and then pulls from a cross-section of students based on geographic locations, degree programs, online students and on-ground students.

“Where there’s any differentiation in a particular class of your customers or group of your customers, you would want a reasonable sample,” Nelson says. “Again, it’s us proactively going out and communicating with them and not waiting for them to have to come back and communicate with us.

“It’s a way to build a better, more responsive, healthy organization because, at the end of the day, the most important people are your customers and your employees. It’s just incredibly important that you know what they’re thinking. Otherwise you could lose touch with whether you’re really doing a good job providing that service or product to your customer.”

Measure satisfaction

As your organization grows, you have to put techniques and processes in place that allow you to monitor how well you’re meeting customers’ needs and expectations.

But measuring customer satisfaction isn’t only about asking the right questions and properly compiling the data. The person or department you put in charge of this segment of your business needs to have a strong understanding of analytics and they have to work with you, the CEO.

“Sometimes they might report directly to the CEO, but if not, they have to have direct access to the CEO,” Nelson says. “That’s the key to keeping clear and timely communication with your customers.”

Also, whomever you give the responsibility must have the technical training to perform the job and a deep understanding of the organization as a whole. At EDMC, the Academic Programs and Student Affairs Department undertakes surveying students.

“I would think that as a person is developing their own management team, that it is very important that they recruit or find within part of their management team someone who has expertise in that area,” Nelson says. “You want to hire the best and brightest in an area like that that is so important to the future success of the company.”

Like Nelson says, measuring customer satisfaction must be seen as a priority, which means how you gather feedback and the topics you’re gathering feedback on are just as important.

One of the easiest and most effective ways to capture the information you’re looking for is by developing a format to survey customers. When creating the survey, think of how your customers prefer to be communicated with because their participation is an essential part of the process.

EDMC performs a variety of informal and formal, electronic and physical surveys. But the company sees the best response is when it keeps the customer in mind and asks: How can I make this convenient, user-friendly and in an appreciative way?

Not only must the survey be easy to access, but the questions must be on target and easy for the customer to understand.

“The types of questions that you would ask would be related specifically to the profile of that particular customer,” Nelson says. “In our case, if someone is one of our doctoral students in our doctoral pharmacy program, you would want to ask them about their faculty member, their classroom facilities, the clinical facilities, the curriculum — those things that are very specific to that particular customer.”

You want to survey customers in every area they might have expectations of your service, as well as the service outcomes. For example, EDMC tracks how students are doing in the program they’re enrolled in, graduation rates, whether they’re finding jobs and the salaries they earn. EDMC also surveys potential and past customers, as well.

“It’s all, in some way, related to the customer,” Nelson says. “Everything that we can, we try to measure and make sure that we’re tracking.”

Obviously, it’s a lot of information to collect. You need a solid team because the process doesn’t stop there.

“It’s very important that that data is then quickly analyzed because, again, there is a shelf life to the data you collect,” he says. “Quickly analyze it and put it in a format that the leadership of the company at all levels has access to for the areas of the company they’re responsible.”

Create accountability

If customer service is one of the core values you list, then everybody from you and your management team down to the newest hire need to treat it as such.

There are several ways to send the message that customer service is a priority and that employees will be held accountable to upholding that value. First and foremost, Nelson says it starts with the CEO’s leadership.

At management meetings, employee meetings and whenever Nelson has the chance, he makes a point to report on where EDMC stands in terms of the level of student interaction and satisfaction.

“If you’re talking about it and you’re reviewing it and you’re sharing it with the people who work directly with you, it becomes very obvious,” he says. “So first is by being an example.”

Part of the communication is making sure you and your management team share with employees what metrics the organization is tracking. EDMC uses the standard methods of communication, such as company Web site, department meetings, companywide voice mails and e-mails to get the message across, but the important point is that employees are hearing it repeatedly.

Using metrics to gauge customers’ thoughts makes holding employees accountable easier, because you always know what grade the organization is making when it comes to service and specific aspects of service. As the leader of the company, you can’t reach out to every employee and every department. But you can get the conversation rolling by following up on the metrics with your direct reports and setting the expectations to follow suit down the line.

“In other words, on a regular basis through the management structure, you follow up to make sure that they’re following up,” Nelson says.

You can maintain customer communication and monitor customer satisfaction, but remember they are directly linked to your employees and their abilities. Nelson says the commitment to EDMC’s students has to be shown during a new hire’s interview process.

“For those who are current employees, you continue to do management development and employee training to make sure that those values that are so important are being reinforced and framed and taught to the people in the organization — all of us,” Nelson says.

HOW TO REACH: Education Management Corp., (412) 562-0900 or

Page 1 of 18