Since Sushil Jain, founder, president and CEO of Empyrean Services LLC, started his engineering management and technical consulting business in 2000, he has had a very collaborative and consultative leadership style. Using that style to build trust and respect with his employees and clients, Jain has developed a culture that puts people first.
“The more participative culture with focus on teamwork makes people feel more involved, more empowered and they feel more a part of the company versus just being an employee,” Jain says. “That quality is very important particularly in a small business.”
That culture has helped Jain grow Empyrean Services LLC to annual revenue of $20 million in 2010.
Smart Business spoke with Jain about how he focuses on people to grow his business.
What have been key factors behind your company’s growth?
Fifty to 60 percent of growth in the business over the last several years is attributed to the people that have worked for me. We go out of our way to treat them with respect. Whatever their needs are, we fulfill them. You have to work with people and work for people. Be firm and fair. Lay out the cards the way they are and people will understand that you are treating them with respect.
How can someone make their culture people-oriented?
If people are working together, it makes for a very cost-effective and efficient organization. You should have an open-door policy and make sure people feel comfortable that they can come and talk to you about anything. You have to build the level of respect and trust in the organization so that people trust not only you as a leader but also trust each other. You have to really take the time to listen to the employees. Everybody talks about having an open-door policy, but people have to really see that in action. You have to take the time to walk the floors and sit down at people’s cubicles and start to talk to them. Talk to them about what’s going well and what’s not going well.
How do you get employees to come to you?
When people come and talk to you and they have an issue, you listen and you do something about it. In a majority of cases, you’re able to do something about it, but in some cases, you’re not. You have to go back to them and say, “I know you had told me this or you had talked about this or you requested this, but this is the reason I cannot do it or this is where I am with this and it may or may not happen because of this or that.” People really appreciate that. You have to explain the reason for your decision.
As you grow up in management as you become a CEO, you are faced with making a lot of decisions on a daily basis. Some of those decisions are going to be unpopular. You have to communicate to the affected department or individuals why you are deciding it that way. Some folks may not fully agree or endorse that decision, but they respect the fact that you took the time to explain why you came to that decision. You have to take full ownership and accountability in your decision. That goes a long way toward building trust and respect in the organization.
How do you align culture with who you look to hire?
I think chemistry is very important. You don’t want to bring in a person who has a very different management style than what the organizational culture is because that can be very disruptive. The person may have the best work ethics, the person may have the best intelligence and knowledge, but they do not fit with the team and it could be like a bull in a china shop. That can create a lot of disruption with the team and their contributions could actually be negative rather than positive. The fit with the organizational culture is very important.
How to reach: Empyrean Services LLC, (412) 528-1573 or www.empyreanonline.com
Sometimes, in the pursuit of success, you begin to fail your company.
That’s the position that Mike Gauthier found himself in at his $24 million company, Save on Everything, the brand name of Mike’s Market Share Coupons Inc.
Gauthier, the company’s founder and president, answered a period of rapid growth by altering the structure of his company and constructing a leadership team of outside hires. But in the process, he allowed his company to get away from the culture that had made it a success in the first place.
So Gauthier had to bring his company full circle, bringing it back to a culture that valued internal growth and promoting the ideas of its people.
Smart Business spoke with Gauthier about how to bring your company back to what it does best.
What is the biggest challenge you’ve recently faced in your role?
One of our biggest challenges was a culture change we went through a few years back. We grew substantially, and that brought in a bunch of smart people with their own policies and procedural habits. Although those things are a necessity, one of the things we lost was the essence of who we are as a company, what I like to term our ‘saga’ — what are we about, why are we here. We forgot about that and started making policies and procedures more important than who we are.
So I’ve had to do a huge shift back to what our company was about. We had lost really good people during that time, and I had to end up replacing the management to have more my style and my feel of how a company should run. So we really had to reinvent ourselves, change our products, add new products, and we’ve done that pretty successfully.
What does a business need to have in order to not be bogged down in procedures?
Culture has to be a shared environment. People have to know what is going on within the company. If you’re keeping them in the dark, you’re not going to build a very good culture. I try to bring in more of a family-type culture here, even though it’s tougher to do that as you get into being a larger company. Right now, we’re at about 120 employees, so it’s manageable. But it’s having that daily involvement of your people. We have daily updates so that people know what is going on in the company, what is going on in sales, how we’re doing against our measurements and so forth.
Cultures also tend to flourish when people have a reason more than a job. They have to know that their ideas are valued and viewed as critical to success. They have to see changes will be made if they come up with good ideas. And you have to not punish them for making mistakes. You have to let them try things.
How do you allow your people to try new things, but still stay on goal?
It takes good ideas. You have to ask for them. With our sales staff, we’ll come up with new products from one of the sales members. They’ll see something, and they’ll tell us whether they think it can work in our organization. Instead of blowing it off, we’ll take the idea and see if it actually could work for us. We try to take ideas and work with them. We allow people on the production side to come up with new looks, new covers for the magazines we do. We tell them ‘Here is what we’re looking for; you come up with the product. You design it and come up with the idea.’ That gives them ownership. They take ownership and pride in what the product is going to look like. Then it starts to become more than a job.
How do you find people who are a good cultural match?
That is a tough part of the job. We went through all the scientific methodology and all of the other aptitude programs that are out there. They give you some idea, but in reality it’s all about who wants to step up to the plate. The trouble is, I’ve found that when you bring someone in from the outside, a lot of them are anesthetized from the neck up. They haven’t been cultured to think for themselves. So if you’re running a culture like ours, it takes a while to change that. Ultimately, it’s up to them. If they feel like it’s important, that they want to change and work hard, they’ll do it.
HOW TO REACH: Save on Everything, (248) 362-9119 or www.saveoneverything.com
Richard Howe wouldn’t call himself a “turnaround guy,” but based on his track record of turning around struggling companies, some of his peers might.
“I’m not a ‘turnaround guy’ just because I’ve done three turnarounds,” Howe says. “You get kind of branded that way, but I’m not really the turnaround guy. Really, I’m a business grower.”
As president and CEO of Inuvo Inc., Howe has already helped reposition the $50 million company to generate fourth quarter revenues 46 percent higher than the same quarter of 2009, which was also the year he joined Inuvo. Part of his strategy to accomplish this was improving Inuvo’s organizational structure to eliminate inefficiency and better carry out the company’s vision.
“I’ve run about a dozen businesses and three of them were turnarounds, and they all have similar characteristic traits to them,” Howe says. “One specifically, is the company has been excessive in its spending of money, so that needs to be curtailed. The costs need to get under control. Two, the team, the people around you often need to be changed, retooled and improved.”
One of the biggest expenses most companies have is in employee head count.
“I believe in team, so I spend a lot of time making sure we have the right people in the right roles in the company,” Howe says.
“You go through an exercise of evaluating staff. We created a system and the system had variables in it, different characteristic traits for what constitutes a great employee and what constitutes a not-so-great employee, and we rank ordered them. We took a look and said, ‘Going forward, what are the parts of the company that we’re going to focus on? From the collection of resources that we have and scores that we’ve gotten from everybody, who’s best to help us achieve the vision of the company?’”
Rather than set a specific head count number of employees to keep or cut, you should simply look at ways to structure the leadership more effectively. Sometimes that can involve small changes in personnel, but in other cases — at Inuvo it was also a matter of consolidating subsidiary businesses — it can mean creating an entirely new organizational structure and changing out entire management teams and boards.
While making personnel decisions is always difficult, reassessing your leadership team is a key part of getting your company back to operating efficiently and profitably on a cash-flow basis. It also demonstrates to existing employees that you’re giving them the leadership they need to achieve growth.
“The whole company was re-energized and re-motivated when they finally realized that we actually did have a senior leadership team at the company that was committed to the success of the company, one,” Howe says. “Two, they felt like they were a part of something that was going to be very successful and grow.”
Howe saw that personnel headcount was the biggest expense base for Inuvo and a key area to improve cost efficiency; yet, before making these decisions it’s important to look at all your areas of business to examine cost saving opportunities.
“Every single expense line in the company we just systematically went down through them and said ‘Why are we spending this money? Why are we spending this money?’ And, is it giving us a return or not?’” Howe says.
Most important, once you have a plan to reduce expenses, you need to enact it quickly.
“When you first do a turnaround, you’ve never done one and you get in there and you tend to over analyze the problems,” Howe says. “It causes you to take too much time to make the kinds of expense cuts you need to make to get the operation under control.”
How to reach: Inuvo Inc., (727) 324-0211 or www.inuvo.com
There will always be unforeseeable challenges and problems that arise to threaten a company’s growth, but according to Rich Howe, the most successful business people are those who undertake such challenges with strong intent and determination.
“It’s one of the single, greatest characteristic traits that I’ve found in successful business people; it’s the sense of urgency,” says Howe, the president and CEO of Inuvo. “It’s waking up and realizing that today is the best day to call someone or do something or get something done. … I’ve just found that those people tend to be able to get the impossible accomplished.”
Even when things aren’t going their way, these people won’t let themselves be steered off course.
“In business, you are going to encounter rough periods,” Howe says. “It’s just going to happen. It seems like some individuals have the ability to get punched in the face and get back up and keep going, and others seem to not be able to deal with those challenges, and they end up failing as a result. The most important characteristic trait of any leader: Can you take a punch and get back up and keep fighting? And if you can, then there’s a good chance that you are going to be successful, because it’s the getting back up part that’s the key.”
Sarah Sinclair says she could run a Toyota plant or a chicken farm. After all, it’s all about people and processes.
As the executive chief nursing officer for the Cleveland Clinic Health System and chair of the Stanley Shalom Zielony Institute for Nursing Excellence, Sinclair is charged with overseeing 11,000 nurses. When she started, her role was a new one, so she had to focus on the people and create processes in order to make changes to improve the organization.
“It’s not that hard, but it’s hard work because it’s about building relationships,” she says. “People will go with you in the change process if they believe you’re sincere and have good integrity and you’re not in it for something for you, but you’re in it for the right thing in the organization.”
It’s key to make sure you paint a picture of where you want the organization to go.
“It goes very much to being able to create a future state in the form of a vision, which allows people to get engaged in that process,” she says. “That’s the most important thing because if people can see where it is they’re going, why it’s important and be a part of creating that, then they have a vested interest in wanting to go there.”
To start, Sinclair asked whom the changes would impact the most in the organization, and she gathered groups of those constituents together to talk to them. This included patients, physicians, leadership, professionals with whom nurses worked and the nursing leadership and staff nurses. She talked to them about what was important and what needed to be prioritized to make the organization better.
“Surprisingly enough, there will start to emerge common themes of all the various stakeholders of things that are important and things that they see have an opportunity to be better in a future state,” she says.
As these themes emerged, she captured those in the work they did and went through a process called multivoting with each of those stakeholders to prioritize the objectives based on what they thought was needed most immediately. Each person was able to select his or her top three choices.
“It’s really looking at what gets the most votes,” she says. “It’s not a democracy, necessarily, but it is, in a way. If 40 percent believe this is No. 1, and the next closest is 20 percent, then probably that is the priority to the bulk of the stakeholders. There’s usually good thought put into it.”
She says to pick the top two to three items to focus on moving forward. It’s also important to remember that going through a process like this takes time, and you can’t rush it.
“Take the time to do it strategically, methodically, and cross all the T’s and dot all the I’s,” Sinclair says. “Don’t try to race through it to some end that you’ve determined — take the time to build the relationship and get your stakeholder input.”
It took Sinclair about three months to go through this process when she started, but that’s because the Cleveland Clinic is a large organization. If you have a smaller organization, you may be able to do this more quickly.
Once you determine your top objectives, then the real work starts. Make sure your structure reflects the objectives you’re working on and put people in key leadership positions who can effectively move you forward. You also need to create project management around your objectives.
“If you had three different themes, it would look like three different projects with timelines, objectives, how often are people going to meet, what are the outcomes, how are you going to measure their success,” she says. “It’s putting the structure around the process to make sure you hold people accountable to getting the work done.”
As you move along, it’s also important to make sure you’re prepared to make a change if need be.
“It’s pretty clear,” Sinclair says. “Usually, it’s when your stakeholders are telling you something’s not quite right. It goes back to listening and intuitively watching the signs of your organization — when it’s going through fatigue, when it’s not moving at a pace you’d like to move at — sometimes you have to energize it. …You’ll know when your team is beginning to tell you things aren’t working or the team suggests something new.”
How to reach: The Cleveland Clinic Health System, (800) 223-2273 or www.clevelandclinic.org
When Elizabeth Barry came into Delta Systems Inc. as president and CEO, the company was in good shape. The business, which designs and manufactures switches, electronics and wireless control systems and provides turnkey contract manufacturing/EMS solutions, was doing well and had no reason to change. But Barry saw so much more in the company than what it was doing and knew that if it could change, it could grow and become better.
Barry started the process with changing some of the senior staff members in the organization.
“That kind of change kind of brought more change, because once they came into their own departments, then they started making changes,” she says.
But when you’re bringing in new senior team members, what should you be looking for? In Barry’s case, because she wanted to grow, she needed people who also wanted to grow.
“Companies grow and get bigger, and management styles change,” she says. “Some people are better in smaller companies, and others are better in bigger companies. I was looking for those who were ready to work and help us grow to the next level.”
She looked for people who had skill sets that would enable change — both in terms of revenue and culture. That meant looking for people who had worked at a larger company and understood the barriers and the gates and would work to break down the silos. Additionally, if someone had led an organization through a complicated or discouraging change, such as a bankruptcy, and moved it forward and made it better, that was encouraging, as well.
Whatever it is, she says you have to look at your senior team and determine if they’re the right person to move your company to the next level.
“You have to get to the point where you feel a department might be better served with a change with a new person in there,” Barry says. “The days of someone staying at a company for 20-plus years are kind of over. They need to have different experiences and different situations, and staying with the same company might not afford you to see what’s out there — state-of-the-art approaches or different approaches — that someone who’s stayed at a company too long may not be able to see and adjust to. They might not have had the growth that is needed to move the company to the next level.”
One of the other keys to leading change at Delta was for Barry to get buy-in.
“You just have to get it started and show them that it’s going to work and everything is going to be fine,” she says. “Then once the change starts happening and it isn’t too disruptive or they get used to the disruption, then it feeds upon itself.”
She says it’s also important to listen to the naysayers.
“You’ve got to hear both sides of the argument,” she says. “As much as you want everyone to follow you and do everything that you feel is right, you need the voices of reason to say, ‘But have you considered?’”
She says she wouldn’t be properly doing her job if she didn’t at least hear the opponents out in the process.
“As much as you don’t want to listen to it and you don’t want to hear it and you don’t have time for it, you’ve got to do it because you’re probably being negligent if you don’t listen to the other side,” Barry says. “Putting the blinders on never served anyone too well. You can be lucky and make it through a few situations, but there are those situations where if you didn’t listen to them, you might be blindly going into something and regret not paying attention to the voices that you’re hearing — the naysayers that are out there.”
Most of the time, people will come around, and if they don’t, then that’s OK too. Barry recognizes that some people will choose to leave because they don’t like the new company, and that’s OK too, because she knows that where the company is going is the best place to be.
She says, “If you truly believe that these are changes that are needed, then you just have to stick with it.”
How to reach: Delta Systems Inc., (330) 626-2811 or www.deltasystemsinc.com
Stodgy and old were not the words Jodi Berg would use to describe Vitamix Corp., but those were the ones that Forbes used to describe the high-performance blender company, and seeing that in print shocked her.
“My first reaction was how could someone think we’re old and stodgy because I knew our goal wasn’t to be,” says Berg, who is now president. “I had to make sure I wasn’t just having an internal perspective but having an external perspective of how our company could be perceived. It was one of those wakeup calls that everyone should have.”
Berg had an approach to business that would help her transform the company and make it more appealing to the outside judges. Throughout her career, she had used an acronym called DANCE to help her as she moved into new positions, and that same acronym was critical to move Vitamix into a new position, as well.
The D stands for determining what your destiny or goal is. She says to ask yourself, “What is it exactly that you want to achieve or you want to be?”
“Be very specific about that,” she says. “That’s the only way you’ll know if you get there if you’re specific about where you want to go.”
She likens it to when people plan vacations and says that often people plan their vacations more than they plan their daily lives.
“When you plan a vacation, you pick a destination, you know who’s going to go, you know how you’re going to get there, you know what you’re going to do when you get there, you have an agenda, you have a plan,” she says. “Oftentimes, when people go through life, they just wing it. Why would we put more planning into our vacation than our own life? I think it’s because they just don’t think about it. If you can think of your life as destinations or a project you’re working on as a goal you want to achieve, take the time upfront to define what that is.”
Then the next part of DANCE is the A, which stands for alignment. She says you have to make sure you’re aligned around that goal and uses the vacation example again.
“If we want to go on a trip to California, whether we walk or drive or fly, we’re going to head west, but if we don’t align our compass to make sure we’re going west, we may never make it to California,” Berg says. “If we head out and we start heading north, we may feel very busy and feel like we’re accomplishing something, but we’re not getting anywhere close to our goal, so align your decisions around where your destination is.”
The N stands for network — don’t assume you have to do it all on your own.
“If you look at other people, a lot of what you’re managing to do has probably already been done by several other people — good, bad or indifferent — and you can learn from all three versions,” she says. “Look around and find people who have done it before and don’t be shy about saying, ‘This is what I’m thinking of doing; this is where I’m going.’ Bounce your ideas off of other people. The more input you have from other people, the better your decisions are going to be, and the faster you’ll be able to achieve the goal you want to achieve.”
The C — care — is the easiest one to understand but often is the most difficult to execute.
“Make sure you care for yourself in the process, and make sure you care for the people around you,” Berg says. “In an airplane, they say put your oxygen mask on first for a reason because you can’t help other people if you’ve passed out. You have to be functioning, and you have to be in good condition in able to lead.”
Then lastly, the E stands for embrace success — in any large or small form it may come.
“Oftentimes, we set a goal, and we think that we’re not successful until we achieve that goal,” she says. “In reality, every baby step that we take along the way, if that step gets us a little bit closer to that goal, then that is a success, and we’re moving in the right direction.”
By following the DANCE approach, Berg transformed Vitamix so the outside critics could see the exciting business she had seen all along.
How to reach: Vitamix Corp., (800) 848-2649 or www.vitamix.com
When Stephen Mansfield was hired on as president and CEO of Methodist Health System in the fall of 2006, there wasn’t any drama around it.
The former CEO was simply retiring and things were running like clockwork. But with that retirement, the board saw an opportunity. The hospital’s financial performance was starting to deteriorate, primarily because of the amount of charity care and uncompensated care it had to provide — a common problem for hospitals as an increasing number of people lack health insurance.
“My feeling was, and the message was, that we need to grow,” Mansfield says. “If we’re going to be able to sustain the mission of this company and provide care to the poor who are unable to pay for their care, we’ve got grow in some new areas that can generate income to offset that.”
His first 90 days on the job were spent in conjunction with the outgoing CEO, so he did one-on-one interviews with the board, senior leadership, community leaders and about 80 medical staff members, all in an effort to understand the organization well.
By January, Mansfield was in a position to stand before the board and the entire medical staff and provide his assessment and early thoughts as to how and why the company should grow from where it was — about $460 million in net patient revenue — to $1 billion in net patient revenue by fiscal 2011.
The results in his first four years are impressive: $890 million last fiscal year and nearly doubling the net patient revenues. Additionally, the system has grown from two hospitals in 2006 to seven today.
“It’s been a pretty aggressive growth trajectory,” he says. “I don’t know many other health systems that have doubled in size over the last four years. We’re very fortunate.”
Here’s how Mansfield used two key strategies — planning and careful hiring — to hit his growth goals.
Create a plan
Mansfield simply loves strategic planning, and it’s the first thing he went into following his address to the company in January 2007. He knew that if Methodist was going to grow, it couldn’t just meander its way through it.
“Next to the right people, strategic planning is one of the most important functions you can do,” he says.
Mansfield essentially creates a four-year plan every three years, which allows for a year overlap on each plan. For example, he began creating Methodist’s 2012-2014 plan in February 2010, while still in the middle of the 2009-2011 plan.
He starts with an off-site, one and a half day conference with the board, leadership team and medical staff leadership. One of the keys to strategic planning is getting an outside perspective, so he brought in well-known, industry experts to speak about where they saw health care going.
“Have thought leaders from your industry come and talk to your leadership,” he says. “We tend to get myopic in our focus on our own organization and our own market, and we think that’s the way the world’s running, but, in fact, there may be trends occurring outside of your market that you need to take into account for your market. …
“You may not agree with all of them, and some may not work for your market or your company, but it’s helpful to expand our horizon of thinking at the beginning of a strategic planning process. Then you take it from broad to narrow and make it work for your organization and your service area or market.”
After that, he says to come back with your senior team and synthesize the thought from that session at a high level and put it into a document.
“Whoever’s going to be tasked with the primary responsibility for delivering on your plan needs to be involved in your planning process so they feel ownership in that plan,” he says.
Over the months that followed, the senior team members discussed and refined it, and in September, they presented it to the planning committee.
“We had a lot of people involved in it, because we wanted to have buy-in from the medical staff,” he says. “I didn’t want it to be Steve Mansfield’s strategic plan — I wanted it to be our medical staff’s plan, our board’s plan, our community’s plan, our employees’ plan, our management structure’s plan.”
A year after the initial conference — and still a year before the plan starts — is when he starts the budgeting process for that three-year plan. They create a planning calendar, which he calls a racetrack, that has the key things that have to happen during that time period for the plan to be successful.
“As much value as I place on planning, I don’t think it’s the final plan that’s so important as it is the process of creating the plan,” Mansfield says. “Then the real differentiator is not necessarily the plan but how well you execute on it.”
He says companies get caught up in creating a plan but they don’t involve key stakeholders and then they don’t track their progress or see how they’re doing against the plan.
“Those things are so important to making sure the plan has the impact on the organization that you want it to,” he says. “I tell people all the time, as proud as we are of our strategic plan, reality is, if you compared our strategic plan to our two top competitors’ strategic plan, there’s probably about an 80 percent overlap. So what’s the differentiator? The differentiator is who can execute the plan better.”
Once the plan actually begins, he meets every other week with his senior executive group to review key data. In one meeting a month, the key metrics of the plan are reviewed by the planning department, and the team receives feedback on how they’re doing on accomplishing and delivering on the plan. The hospitals are given updates on the things they’re measured on once a month. If anything is off, he and his team try to find out why.
“Missing a goal is not the cardinal sin,” he says. “Missing the goal and not having discussed it and asked for help along the way is.”
Lastly, to make sure people are staying on track, he also stops by people’s offices — not call them to his — to casually talk with them about how things are going.
“There’s no substitute for periodically sitting down with the key members of your team and saying, ‘How’s it going? How are things working? Do you feel like you’re getting things done that you need done? Is there anything I can do to help you? Oh, by the way, I saw that you did such and such, and that’s awesome,’” he says. “We get, as CEOs, so busy sometimes that we don’t just take the time to sit down with the key members of our team and just spend a little bit of time refreshing on the priorities and making sure that we’re acknowledging the successes. We have a propensity to assume success and sometimes to withhold encouragement, and that’s not good.”
Hire the right people
When Mansfield came into his position, he was new to the area, having just moved from Arkansas, so he recognized his weakness — not knowing the market. He needed to hire a development officer who knew people, knew the area well, could look for growth opportunities and had the relational acumen to facilitate complex transactions. He hired someone in, and that person made a lot of connections for Mansfield very early in his tenure.
“You plant a lot of seeds and not a lot of them grow, but we planted a lot of seeds in those early weeks and months and a lot of them did grow,” he says.
That person got a group of physicians in McKinney, Texas, to agree to do a joint-venture hospital there. Shortly after that, he brought another group of physicians in the community on board that was already assembled and looking for a partner to do a joint-venture hospital. The city of Richardson also approached Methodist about merging its hospital into their system. On top of all those efforts, they also opened two other hospitals.
The system was also facing a physician shortage, so Mansfield got the board to agree to an aggressive employment recruitment strategy, so hiring was a major part of his position when he started.
But hiring can be tricky, so Mansfield was very particular in his process and says that’s the way you have to do it if you want to be successful. To start, he first looks at if there’s anyone he knows that could do the job well.
“The best way to make sure you make a good hire is when you hire someone you already know will fit in that job if you can just convince them to take it,” he says.
That was the case with the development officer, as well as with the CEO for one of the hospitals, the new system COO and the human resources executive. Despite knowing these people, though, he knew it couldn’t be all up to him.
“Even if it’s someone I think will work, they’re not going to be effective if they can’t work with the rest of our team,” he says.
So despite having a front runner for a position, he still did searches and put each candidate through a hiring process that makes them interview with teams of board members, medical staff, employees, senior executives and middle management.
“It helps to do a team interview,” Mansfield says. “I’m not sure if it helps you so much with your selection process as it helps you with that person’s assimilation … to have key people who would have to help that person be successful involved in the selection process.”
He says to ask behavioral-based questions, such as what have they done, what’s the worst decision they’ve made and what they did about it, instead of what’s their management philosophy.
“Those kinds of questions you can get a little bit deeper than ‘What’s your management philosophy.’” he says. “Don’t ever ask that question.”
All together, a candidate can meet with about 120 to 150 people in his or her interview process.
“It’s a scheduling nightmare trying to get that many people together, and it exhausts our candidate,” he says. “If that candidate is still perky at the end of a day and a half of being asked the same question that many times, they can probably handle a typical day at Methodist.”
With that many different people scoring a candidate, it’s easier to get buy-in for whomever you ultimately hire.
“Through that process, we select a person — it’s not just Steve Mansfield’s person, it’s all 150’s person,” he says. “We’ve all got a vested interest in that individual being successful and quickly assimilating to our team.”
Beyond sheer numbers in interviewers, there are other keys to hiring. He also suggests, especially for senior executives, for you and your spouse to spend time with them and their spouse in a dinner setting to see how they interact together, what kind of support they have in their life and how they are in social settings.
He also makes it a point to look for diversity and likes to have at least one of the final four candidates come from a racial or gender minority.
“That doesn’t mean we select the diverse candidate,” he says, “But if you’re not seeing them, you certainly can’t select them.”
After that, Mansfield likes to get an off-the-record perspective on that person by speaking to someone he may know that might have worked with that person. And then the final step is to use an outside company to complete a psychological profile of that person, which is what he calls Myers-Briggs on steroids.
It’s a long process, but he’s successfully recruited more than 100 physicians that have helped Methodist grow.
“Despite all of that, I think the interview process is still just a little better than a coin toss,” he says. “It’s like getting married. No matter how long you date, when you get married, you find out some things you just didn’t know. Usually those are mostly pleasant things, but that’s just the nature of it.”
How to reach: Methodist Health System, (877) 637-4297 or www.methodisthealthsystem.org
The Mansfield file
Mansfield on leading change: To change anything — to change a habit or change culture or change anything that’s indelibly embedded as culture — you have to start with making the compelling case for why. Why change? If we’re successful, if we’re delivering on our mission, if we’re happy, then why change?
Changing a culture is like breaking a horse — you’re going to get bumped off, but you have to be willing to get back on and keep getting back on until you get the change from the culture that you need to be successful.
Mansfield on your career choices: Work for an organization whose espoused and practice mission matches well to your own value system and life priorities. I feel very fortunate to have had almost a four-decade career, and I have never been in an organization where I felt like I had to compromise my value system in order to be effective in the role that I had. I think that’s very important as you’re contemplating where you’re going to spend your career, to make sure you’re working with a company whose goals and value systems and mission and vision statements you can embrace and support from a personal standpoint.
Mansfield on setting personal goals: I’m still amazed by the number of people who don’t do it, but it’s so important for human beings to have the discipline to periodically create and update your own personal goals. Not just your goals related to work, but your goals related to community and faith and health and all of those variables that make us multidimensional creations. Human beings have the capacity to accomplish so much more than we do.
One of the delimiting factors is we don’t create a road map that’s trying to take us to a better place as individuals. If you don’t really care where you’re going — it doesn’t matter — one road’s just as good as the other, but if you’re intentional about what you want to accomplish with your life across its many dimensions, I think that there’s strength and power in that acknowledgment. The Bible says that as a man thinketh in his heart, so is he. What does that mean? I think that means we can accomplish a whole lot if we establish an expectation of ourselves to do so.
For sustainability to have a significant impact on your business, it has to live throughout your organization. You’ll see meaningful change when both the leadership and the culture of your company are engaged, not just when you apply sustainability to your products or processes. But you have to start somewhere, right?
Greening your business is not just about making a statement on Earth Day or on your website, it’s about looking at your core business from a new perspective. Rather than be overwhelmed by a wholesale sustainability program that may or may not resonate with your organization or your marketplace, start by doing just one thing.
That’s what textiles designer David Oakey of Pond Studios in LaGrange, Ga., decided to do when Interface Inc., the commercial carpet company (of which I am a part), first headed down the path to zero environmental footprint. Oakey found himself frustrated by the new vision for his client — all that he could see when he thought about “greener” carpet was hemp and wool, and he knew that wasn’t going to cut it with the company’s commercial customers. Almost in desperation, he said, “Let’s just try one thing — in the spirit of ‘reduce, reuse, recycle,’ we’ll try using less of the petroleum-derived nylon in the tufted face of the carpet.”
It was a small thing in some respects — if it didn’t look good or perform well, it could be checked off as a failed experiment. But at the same time, it was a bit radical; nylon makes a significant contribution to the environmental footprint of carpet. Carpet face weights, or the amount of “fuzzy” stuff on the face of a carpet tile, were long believed to indicate quality. Chintz on the nylon and your product screams “cheap,” or so it was believed.
Flash-forward several months and several rounds of tinkering with new ways of tufting the yarn tighter and the one-ounce-lower face weight was an enormous win for Interface — more intelligence, less stuff. Not only was the difference negligible in terms of appearance, the lower face weight actually performed better in appearance and retention tests. Today, the average InterfaceFLOR carpet tile is more than 4 ounces lighter than it was in 1994.
Importantly, the experiment turned into a huge win in terms of innovation and inspiration. “What can we do next?” his design team asked, eager to get further outside the box and explore the possibilities.
It was the same for The Coca-Cola Co. when they started down the road to sustainability, but for them it wasn’t dematerialization; it was water footprinting that made the most sense. Integral to the beverage business and at the top of the world’s list of scarce resources, water — and understanding the impacts on the company’s core business — was a logical place to start, and a place from which a great deal of innovation and inspiration has sprung.
You could argue that Nike, on the other hand, is in the business of innovation — strong, lighter, faster, better, to quote their House of Innovation site. Green Xchange is not a program for recycling your old running shoes — though they do that, too — it’s a collaboration between Nike and Creative Commons to create a digital repository where intellectual property related to sustainability can be shared. Again, looking at the core business leads to innovation and inspiration, this time on a potentially world-changing level. And again, these are initiatives that strike at the core of a company, not on the fringe.
When Interface first began our journey, companies like Coke and Nike were just starting out, too, and there wasn’t much of a road map for any of us to follow. Stories like the ones I’ve shared here help you start, but if you want to take a deep dive into how a business can do it, pick up a copy of Interface founder and Chairman Ray Anderson’s book, “Business Lessons from a Radical Industrialist.” It’s not only a how-to, it’s a “why-to.”
In any endeavor, before anything can be successful, the people involved need to know what it is they are trying to achieve and what efforts and resources are directed toward achieving it.
The company vision is the manifestation of its purpose and its values. From it emanates the strategy by which its goals will be attained, the leadership approach of its executives, the motivation for its members and the inspiration for its customers. A clear, well-thought-out, inspirational and easily communicated vision is the wellspring from which everything else flows.
And yet for the vast majority of companies, their vision is created in isolation by the marketing department and relegated to become mere corporate wallpaper in employee manuals and annual reports.
Even when it is well thought out and inspirational and communicated to employees and customers, all too often the direction of the company and the values demonstrated by its leadership are at odds with the company’s vision that it renders the vision meaningless. For the vision to resonate, company leaders must be seen working toward fulfilling it and genuinely conducting themselves in accordance with the stated ethics of the company.
But before the vision can be bought in to, it has to be developed. Ideally, that should be a managed process throughout which the staff is consulted, instilling a sense of ownership — although that is a luxury that many companies, particularly larger companies, do not have. At the very least, the heads of departments and senior management should set aside enough time together to discuss the strategic vision of their company, to create one if they’re running a new company, or in light of changing markets and products, to assess the relevance of the vision they already have.
Inevitably, many will see this as a waste of their time. They’re good at their job, they know what needs to be achieved, and they resent the implication that any touchy-feely, marketing-gobbledygook corporate retreat is going to make them better at it. But it is often the skeptical ones who stand to benefit the most from the exercise.
To make it work, it therefore needs the wholehearted support from the very top of the company. Ideally, it should be conducted by an experienced third party who can bring a dispassionate objectivity to the process. Money is well spent on hiring a training or consultancy firm for this. Putting all the senior executives in the same place — those who by nature of their positions are likely to be strong characters — and giving them free rein to voice and defend their opinions almost guarantees a relevant and important exchange of ideas. Even people who have worked together at the same company for a long time and who might be expected to have a similar vision will discover that they all have differing views of what the company is all about, where it is going, how it should get there and what it will look like when it does.
Julian K. Hutton is president of Merlin Hospitality Management, where he oversees the company’s hotel management and distressed asset management operations, drawing on 20 years experience in the worldwide travel and hospitality industry.
Stephen Polk senses a slow return to normal for the automotive industry as the coming months and years progress.
It’s just that “normal” is going to come with a new definition.
Polk is the chairman, president and CEO of 1,400-employee R.L. Polk and Co., a provider of information and marketing solutions to the automotive industry. He has had a front row seat as General Motors and Chrysler declared bankruptcy and were forced to undergo massive internal restructuring. He’s watched as countless auto suppliers have gone bankrupt or been sold to interests outside Michigan.
But it won’t always be this way. And when things do begin to rebound, businesses all across southeast Michigan will need to function in a new, post-recession environment.
“With the energy we’ve seen so far this year, we’re starting to see a return to normal,” Polk says. “Not to the normal of five years ago but to a new kind of normal. I’m optimistic about the future. Our forecast for 2011 is 12.9 million vehicle sales in the U.S., and I’m confident we can achieve that.”
What will the new normal be? Polk says it will center heavily on every company’s ability to develop and maintain close relationships with customers. Businesses will need to give the employees at the customer interface points the tools and the sense of purpose that will allow them to build those relationships. Corporate leaders will need, more than ever, to stay in touch with customer wants and needs and the ongoing changes in the marketplace.
The coming years won’t be a time to assume. It will be a time to listen and react and to remember that the success of your company’s relationships will determine your long-term success.
“It’s about the success we’ve had in staying close to customers, understanding what their needs are as the world has changed,” Polk says. “While the OEMs, the manufacturers, represent a piece of our business, there are a number of other customer sets we’re dealing with, [such as] the agencies trying to promote products, the dealers trying to sell products. We need to align ourselves with where they are in the world today.”
Commit to your people
In any economy, if your customers are consumers, you have to keep them buying. If your customers are other businesses, you have to keep them selling.
Polk’s company falls into the latter category, so the job that he and his team will have moving forward is to support clients in the auto industry so they can keep producing products that find their way into new car models and, in turn, into consumers’ garages.
Your role as supporter is critical when your customers are going through hard times. It’s something Polk recognized early on, and as the industry emerges from the deepest part of the recession, he anticipates being able to reap the benefits of the support and loyalty his business showed.
“Our commitment was to serve those immediate customers so they could continue to do day-to-day work as they went through the whole bankruptcy phase and came out of it,” Polk says. “Some of it was on our own nickel, as we realized that during the bankruptcy proceedings, we weren’t going to get paid for some things right away. But we were able to maintain a continuity of service, and that helped our customer to continue to sell throughout the recession. There was some recognition that we were there when they needed us.”
In order to commit to your customers to that extent, you need to commit to your employees. Your employees need to be supported by your leadership if they are ever going to be able to support your customers through trying times.
And the key element of that support system is a soapbox — many of them, actually. You need to give your employees a means of being heard by you and your leadership team. If your employees on the front lines feel empowered to relay what they’re hearing from customers, if they feel like management is actually going to listen to them and use their information to make decisions, you’re going to have a staff on the front lines that will engage customers, ask questions and remain aware of their changing needs.
“A lot of it is just listening and training your staff to make sure they’re listening to what the customers’ needs are,” Polk says. “You communicate what you want, really try to build it into your meetings and various avenues of communication. Then you listen back, make sure everyone knows what is important, everything from performance evaluations to planning for the year, it all has to revolve around some kind of customer metrics.”
Use what you hear
If you’ve put your front-line people in a position where they can reach upward in the organization with ideas and information, you need to be able to take what they’re telling you and use it to better the company. Otherwise, you’re sending a negative message to your employees about the effect their work is having on the company’s overall mission.
Polk uses the engagement of his customer-level employees as an opportunity to gain a realistic picture of where his company’s customers are headed and what their needs will be in the foreseeable future, which allows he and his leadership team to begin sketching a strategic plan for the coming years.
“The first part is starting with that very open and realistic assessment of what the current reality is,” Polk says. “What your strengths, weaknesses, opportunities and threats are. You take an environmental scan of where your customers are growing and where they see the most value in the products that you deliver.
“We want to know where we can create efficiencies to help our customers and ourselves, then try to project that into the future. The real challenge is creating a living plan out of it, something that isn’t going to sit on the shelf.”
A living plan has to have some degree of flexibility. If you are going to place an emphasis on listening to customers and reacting to their needs, you can’t formulate a market strategy that is so cumbersome or rigid, you can’t react to an unexpected change.
It’s a delicate balance to stay on your core competencies but remain willing and able to pounce on an opportunity that allows you to employ those competencies in a new way. Polk says you can’t deviate from your mission as a company, but your products, services and areas of focus have to exist in a fluid environment.
“You have to start with a recognition that what you are putting out there in the market is really about how you want to conduct the business,” he says. “There are focus areas that are going to have to change, but it’s understanding the types of services you want to be at, the types of products you want to be building around in each environment. You have to communicate the fact that those areas are flexible, create an understanding with everybody in the company. That is probably the most important thing.”
To understand when you need to take advantage of an opportunity or forge a new direction, you need to be able to measure your progress against your goals. That means you need process checkpoints and a willingness to allow your team to assess where you are in relation to your goals.
“You really need to be able to understand what your checkpoints are along the way in any process or product or in any initiative that you are outlining,” Polk says. “It really needs to be a candid self-assessment of what is the reality that your customers are dealing with, the reality of how you’re delivering on expectations, then making adjustments to it.
“Sometimes you need more effort, and sometimes conditions dictate that you stop doing what you’re doing — even if it’s something that you had been committed to. The right answer is ultimately to be open and honest about the reality you’re facing.”
Make it cultural
You can engage your employees by builing avenues through which they can communicate and make sure that their input and ideas have a bearing on the decisions that will affect the future of the company. It’s all great in theory and better in practice. But over time, as the economy improves and the business environment becomes more stable, it will become easier to let some slack into the organization philosophy to which you once rigidly adhered.
The only cure for that is to make customer focus and employee empowerment a part of your company’s culture. You make that happen, in large part, by rewarding the behavior you want to see and promoting your best and most experienced employees to more influential positions.
“It all starts with building a culture that employees can appreciate and thrive in,” Polk says. “A big part of that is the importance of having a great leadership team in place. Our senior leadership team includes a variety of experience in all aspects of the automotive business. You have to fit the culture to you business, to where you want to take the business in the future. For that, you need to instill a common values system that is shared by all employees and reinforce those values by ensuring that your people are well compensated and are going to have avenues for career growth within your company.”
Ultimately, employees want a fair salary, but more than that, they want to feel like they’re working with upper management, not working for upper management.
If you build strong relationships within your organization, your team will be better able to build strong relationships with the people you serve. The often-referenced cliché about happy employees leading to happy customers — it’s a cliché for a reason. Because it’s tried-and-true.
“If employees understand your business goals and objectives and what their role is within the organization, they can effectively contribute and provide valuable insights in their areas of expertise,” Polk says. “That is why we host regular communication meetings with our staff and also communicate important business announcements in a timely manner. It helps continually engage our employees in an open, honest dialogue with management, which helps solidify our overall communication structure within the team.”
How to reach: R.L. Polk & Co., www.polk.com or (800) 464-7655
The Polk file
Education: Bachelor of science degree, Denison University, Granville, Ohio
History: Great-grandson of R.L. Polk & Co. founder Ralph Lane Polk; employed by company since 1981; president since 1990; chairman and CEO since 1994
Polk on the CEO’s role in setting the stage for the future: My role is to lead the organization and prove a foundational direction for the business. The senior leadership team we have in place at Polk is effective and dynamic, and all of them are accomplished leaders. I work very closely with them, both individually and as a team, to help further develop our business goals and objectives, develop strategic ways we can be supporting customers and representing Polk in the marketplace.
Polk on achieving success in the current business climate: It may sound cliché, but it’s the reality of things — if our customers succeed, we succeed. In our business, it truly is about the relationships and strategic partnerships we have with our customers, to help them achieve their business goals and to help them succeed in the marketplace.