George Adams Jr. admits that he is an introvert, and he worries that his employees may sometimes view him as standoffish.
So he makes every effort to smile a lot, talk to employees, congratulate them on their successes and ask them open-ended questions about the challenges they face at Electric Supply Inc., an electrical construction, utility and voice data company that posted 2007 revenue of about $130 million. He says that even for an introvert, conversations get easier once you get the other person talking.
Adams, president and CEO of the 130-employee company, also connects with employees by writing a monthly article in the company newsletter about what is going on in the business and the opportunities and challenges it faces, and he thanks people for a job well done.
Smart Business spoke with Adams about how to show employees they are appreciated and how to empower your staff.
Give credit to your employees. When things are going really well, it’s a lot more fun. I guess it would be easy to try and claim too much responsibility.
I heard one of our managers talking to someone the other day, and it was a great quote. We’re tied in a lot of ways to construction, so we’ve seen a significant slowdown. Our vice president of sales was laughing and saying, ‘Well, a year ago, I sure felt a lot smarter than I do today.’ It’s like, ‘Yeah, we all did.’
So this slowdown has been fairly humbling. The thing that probably rubs me the wrong way would be someone not giving proper credit to their team, to just showing token appreciation when, a lot of times, it’s all about the team.
We try to acknowledge (employees) publicly. Sometimes, it’s privately, maybe with a check or gift certificate. This is something that I struggle with that I am wondering, ‘Am I getting the words right? Does the sincerity show through?’
But, I remember reading years ago that an effective manager can get more out of a pat on the back than an ineffective manager can with a $100 bill. Of course, when I read that 25 years ago, $100 was worth more than it is now. But I think you have to be sincere with whatever you do, and it needs to be clear that you are.
I’m looking at continuity and succession. I want our organization to be strong long after I’ve stepped aside. So we want to groom people to be our future leaders or to even lead right now. Even if they may not have a title, they may not be in a management position, they can still lead by example, and they can have a very positive impact on their peers. A lot of them have a positive impact on me.
Empower employees. My dad founded our business, and he was the type that pretty much handled everything. When I was on board full time and we were talking about me making a career, as I watched him, I realized I wasn’t going to be able to do what he did.
It was pretty intimidating for me. He could go from being extremely detailed to the big picture. He handled so many different tasks here. Then, one day, I read about empowerment, and that was the light turning on for me, reading about empowering the work force.
All of a sudden, I started thinking, ‘This might be a lot of fun.’
It’s important not to be too hands-off people have to be held accountable. But, I think it’s a way to make an organization so much more effective, whether you have two people or however many thousand. Granted, not everyone is going to become energized, but most people will appreciate the additional responsibility, and really, the best decisions in most instances come from the front line or closer to whatever challenge it is that you face.
There are a lot of days I feel like we slip up and don’t do it, but certainly, trying to establish boundaries to work within just reminding them to use their best judgment; if they make a decision that perhaps you wish they hadn’t made, coaching them. Simple things.
When there’s an expensive mistake, I think you need to bite your tongue a bit and coach people. No one wants to make mistakes, and we all feel bad when we do. But when someone has made a mistake, the leader, the manager, needs to help them rebound. Their ego is pretty low at that point.
You want to remind them of all the great things they’ve done and to get back on their feet and get back on their game.
Lead with integrity. It’s important if you miscommunicate something, you apologize. You bring it up and say, ‘Look, this is what I thought was going to happen, and I said what I said, and I was incorrect. I apologize for this,’ be it something you said or something you forgot to do. I think it’s important to try to be aware of those instances where you let people down and then apologize. Talk to them about it.
Sometimes people take things differently. My wife is always pointing out, ‘George, this is what you meant, but this is what you said,’ and she’s generally right. I have to kind of work at it to be aware because I can be thinking I said what I intended to say, and I didn’t.
HOW TO REACH: Electric Supply Inc., (813) 872-1894 or www.electricsupplyinc.com
Terrie Gilligan manages what she calls “the Ritz-Carlton of paving companies.”
While her $20 million asphalt paving and maintenance business seems worlds away from the luxury hotel chain, Gilligan says her focus on customer service is just as big of a priority as it is to Ritz-Carlton.
The owner, president and CEO of Parking Area Maintenance Inc. instills that philosophy in her 100 employees, touting the idea that a good reputation can help a company sustain sales, even in a down economy.
“It’s so important that your employees realize they’re representing you,” Gilligan says. “When our customers contract with us, they know our employees will be professional.”
Smart Business spoke with Gilligan about how to instill a sense of “ownership thinking” in your employees.
Q. What does it take to grow a successful company?
The employees of the company are so important. You can go out and buy all the metal you want, but if you don’t have the key people in place to operate the company, it doesn’t matter.
Another key thing is our core values. We live by our core values every day. If you were out on a job site, and you were to ask one of our employees, they should know what they are.
Q. How did you communicate that to your employees?
We have quarterly meetings where we get together with all the employees, and last fall, we implemented ownership thinking.
Ownership thinking means it’s not just me having to worry about everything. It’s letting everybody in the company worry about everything. I used to take everything on myself, and now, we share all the information and all of the responsibilities.
We actually opened up our books to all the employees, and they were put on a bonus plan as to how we do in 2008. It’s a flat incentive across the board, down to the field laborers. We’re projecting it to be about $3,500 per employee.
Q. How did you implement this ownership thinking?
We’ve always shared information with everybody. One of our core values is teamwork, and another is continuous improvement, so it was a no-brainer for us to go ahead and implement this.
We sat down with our employees, explained it to everybody and compared it to their mortgages and their checkbooks. We said, ‘This is the way a profit-and-loss statement works, and this is the way a balance sheet works.’ Everybody really embraced it.
We explained the company’s financials for the last five years and where we wanted to go with the company. I had another meeting where we touched on the economy and said, ‘We all have to look at these things because we have to be competitive.’ The response was great.
Q. How did you get employee buy-in?
I felt if my employees were out in the field or if they were on the executive team, they deserved the same amount because everybody’s contributing to this.
About 50 percent of our field employees are Hispanic, and they said, ‘We’ve always thought we were owners.’ We brought in an interpreter to help us implement this, and those employees were so excited about it and still are.
If you share the information with your employees, they take it upon themselves to look out for the company as a whole.
Q. How has that benefited your company?
Everybody’s looking out for everything. For example, I have lunch with our employees of the month. Through those lunches, they’ve told me about waste within the company. One of them went to pick up a bolt for a piece of equipment and never realized it cost that much.
We also have a suggestion box in our break room. Our HR director checks it once a week, and we get eight to 10 suggestions a month. We respond to them on whether we implemented it or why we couldn’t implement it. They need to know that you saw the suggestion, and that you’ve given it consideration. If you don’t do that, they will think it has gone upon deaf ears.
As long as you give employees the kind of environment where they feel their suggestions are welcome, you will get ideas from them that you didn’t even think about even down to the toilet paper we buy for our office or equipment we really don’t need. For the last six months, it’s saved us from laying off individuals because we’ve been able to cut costs in other areas.
Q. How can other companies grow through ownership thinking?
Case studies say it’s not about compensation; the two top things employees look for are being included in things and being recognized. ... It’s got to be in your culture and in your core values.
If you don’t take care of your clients, by giving them not just value-added services but extraordinary service, I don’t think that you can grow a company. And, if you don’t treat your employees well, they’re not going to treat your clients well.
HOW TO REACH: Parking Area Maintenance Inc., (813) 880-9400 or www.easphalt.com
David E. Sessions encourages his approximately 50 employees to be involved in the community, so he often has trouble turning down requests when organizations approach the company for help.
That’s why Willis A. Smith Construction Inc. sticks predominately to helping not-for-profit organizations associated with public education and arts and culture. The president and CEO says it’s important to stick to your plan, not only in what charities you help but also in business.
And yet, he maintains some flexibility and will make an exception if an employee is passionate about a certain cause because doing so, he says, creates loyalty and helps with retention at the company, which posted 2006 revenue of more than $50 million.
While community involvement is rewarding for the employee, the company also sees a tangible benefit by helping the community.
It becomes a winning formula for everyone, Sessions says.
Smart Business spoke with Sessions about how to stick to a plan and how to empower employees.
Don’t get greedy. One of the hardest things to do is potentially say no to an opportunity when it might not be, in the long term, in the best interest of your company.
Many years ago, I put together a strategic plan, which really defines all different aspects of how we do business, and one of those components is a marketing plan.
With any prospect, you need to have as part of that strategic plan you need to step back for a minute and not just look at the excitement of a single opportunity, but you’ve got to ask yourself, ‘Does this opportunity fit within the parameters of that strategic plan?’ Is it in your best interests as a component of that plan when you look at where you potentially want to be one year, two years or five years down the road?
That makes you look at that opportunity maybe a little different. You’re looking at it from a much longer-term perspective.
What we have learned is that sometimes it’s best to say no to those opportunities that don’t fit within that plan, especially if those opportunities fall outside of your comfort zone or what you are good at.
Learn from your failures. I’ve always been of the belief that the only time you truly fail is when you quit or just give up. Maybe just perseverance is the key factor.
We’re human, and we’re all going to make mistakes, or we’re all going to have failure, some larger, some smaller, from time to time. The trick is really not to become discouraged but rather you made an investment in a decision that perhaps led to something not going perfectly.
You’ve got to learn exactly why it happened, what contributed to it, and ultimately, every failure is an opportunity. If you can take that and convert that into an opportunity by learning all the parameters that led to that decision that maybe you didn’t like then, ultimately, you are turning that failure or that error into a strength going forward; learning from your mistakes.
We, with our managers, with our people, one of the things we always say in here is that, ‘If you make a bad decision or if you make a mistake, you are never going to put your job at risk.’ The bottom line is, if there is a decision to be made, make the decision in your best judgment that you think is the right decision. Right or wrong, making that decision is better than not making one at all.
Empower your employees. You get the best effort from others, perhaps not by lighting a fire under them but by building a fire within them. That goes to empowering them and encouraging them to excel, to be creative, to make their own mistakes and to make their own decisions.
You have to lead by an example. Just because I own this company doesn’t mean I can sit back and go play golf and let others do the work. I’m in here working as hard, if not harder, than anybody in this company, and I am establishing what those parameters are. I’m leading by my own example. If they see the boss in there working as hard or harder than everybody, that sets a pretty good example.
When you work directly with people, you get a better response, better loyalty, better companionship. Overall, if you work directly with people one on one, your beliefs, your values tend to rub off on people better than if you are not here.
I’ve developed a certain way that I like to do things, and I want our managers and our people to share. I want them to be creative enough to do things on their own, but also get some fundamental beliefs and values entrenched into the way that they do things. You can’t do that remotely.
We really have a business structure in here that defines what roles are and how we do things. That structure isn’t what I would call a rigid structure that absolutely says, ‘This happens. You do this, you do this, you do this.’
But it provides enough of a blueprint or a guideline for people than to perhaps use their own style. That is very, very important when you can put your own name or your own spin on a task.
HOW TO REACH: Willis A. Smith Construction Inc., (941) 366-3116 or www.willissmith.com
Dan Rodriguez is an enabler.
The founder, managing partner and CEO of Veredus Corp. wants people to succeed at his staffing company, so he invests in their training and development instead of forcing them into a sink-or-swim situation.
“It’s a two-way investment,” he says. “They’ve elected to come work for us. In turn, we’re going to make an investment of time and development to give them an opportunity to succeed.”
Rodriguez’s approach to his employees has improved retention at Veredus, which earned $38 million in revenue in 2006.
Smart Business spoke with Rodriguez about why training your employees is worth the investment and why you should really think twice about adding that new wrinkle to your business.
Q. What major pitfall should business leaders avoid?
You have to focus on what you know how to do. We’re a staffing company. Our core competency is going out and finding qualified individuals.
We have relationships with qualified individuals that can fill jobs. We have relationships with qualified companies and managers at those companies that will give us jobs so we can place those candidates.
Sometimes, I’ve seen folks creep out of what their core competency is. They try to do project work, or they try to do outsourcing, or they try to do software, or they try to do training.
We stick to what we know.
We do what we do, and we feel like we’re really good at it. We don’t really creep too far outside of our box. Because chances are, if you’re looking to go out and do something else, there’s probably somebody else in that space that’s already been doing it for some time and that is probably pretty good at it. So we stay away from that.
Q. How do you avoid straying from your core competency?
We remind folks every day of who our customers are.
Our customers are our candidates who are looking for jobs, our consultants that we have on assignment and our clients. Sometimes things happen, and you take the focus off the customer, and that’s not good.
You’ve got to be focused on all your customers all of the time ... or somebody else is going to come and take your space.
Q. How do you make sure everyone stays focused on the customer?
We talk about it. Our management team just came out of a management meeting here recently, and we talked about making sure all our folks are focused on the customer. You build internal processes where you’re touching all three of your customers on a regular basis.
We do feedback surveys with not only our clients but also our consultants who are on assignment and our candidates. We’re continually looking for feedback on how we can get better, how we can improve.
It’s part of our culture, it’s one of our core values and something that in our everyday discussions about business that we focus on.
Q. How do you decide which feedback to act on?
As a leader, I’m very introspective. I’m always looking at how we can make our business better. How can we differentiate; what can we do? A lot of our management meetings are centered around feedback we’ve gotten from our surveys, feedback we’ve gotten internally on how we can improve our processes and make sure that we’re doing things better.
I don’t know that there’s any formalized process for bringing some sort of feedback in and determining how we’re going to address it. But overall, as a management team, our mantra is focused on how do we differentiate, how do we get better, how do we make our company a better place to work?
That’s one of my standard questions as I’m going through my reviews with my internal people right now. I sit down with everybody in the company, or at least everybody in Tampa, and talk to them about their goals and last year and how they did and what they want to do this year going forward. Two of my standard questions are, ‘What can I do for you?’ and then, ‘What can the company do to make this a better company?’
We are definitely asking that question, and quite frankly, some companies I’ve worked for in the past haven’t even asked that question.
Q. How do you implement that feedback?
It depends on which of our customers the feedback’s coming from. Whenever we get feedback, we as a management team get together and determine how we’re going to address the specific issue that has been brought to our attention.
Many of the changes we’ve made big and small, from process changes to the way we do things on a daily basis have come from employees at various levels that made a suggestion. We looked at it; it made sense from a tactical standpoint, and we went out and implemented it. That occurs on a monthly, if not a weekly basis. It’s a regular occurrence.
HOW TO REACH: Veredus Corp., (813) 936-7004 or www.vereduscorp.com
You may have dipped your toes into the world of Web recruiting by posting jobs online. But to dive into the wired talent pool, your tactic may have to be active participation in social media.
“New media, also known as user-generated media, are fast and reliable and allow a two-way conversation,” says Greg Rollett, marketing and communications director at Rollett Marketing. “One of the oldest and best ways of obtaining employment is through a personal connection. Online networks bring that connection back into the equation.
Smart Business learned from Rollett about how to effectively use social media to attract and hire employees.
How are online networking sites being used for hiring?
Recruiters can use social networking sites, such as MySpace, LinkedIn and Facebook, in numerous ways. Companies can post classified ads at no cost, view profiles based on a series of keywords or research candidates. By viewing blogs and profiles, you can see people’s expertise and observe their growth and progress over time.
Social networks will continue to be a gold mine for finding new talent that a) isn’t actively looking for a new position but would be interested in a change; b) is currently employed but is better suited to a different niche that plays to their skills and appeals to their interests; c) is part of an entrepreneurial venture but could benefit from a steady paycheck from a solid organization; and d) is a traditional Gen-Y job seeker, whether in high school, college or a recent graduate.
Niche recruitment social networking sites have also emerged. These include HealthCareerWeb.com that focuses on the healthcare industry and allows job seekers and recruiters to build custom pages and interact with each other. I think we will see a great increase in these types of sites in the future.
How can businesses maximize the impact of their social media efforts?
By being themselves. The more you ‘act,’ the less believable you and your company become to a client or a job seeker. The biggest advantage of using social media is to join in on conversations about your brand, your industry and your clients. By opening up communication, you can see problems before they go mainstream, create new ideas, educate yourself on the real needs of your user base and downplay negative stereotypes associated with your company. You can voice what is on your mind in a cost-effective, precise and engaging way.
By building a ‘friendbase’ on social networks and providing accurate information, you can create a community of like-minded individuals who support your business and can spread ideas, products and services virally. This not only promotes the overall health and wellness of your business organization, but also helps attract workers that share your company values and fit your professional culture.
Should companies develop their own content on places like MySpace or Facebook?
Yes. Developing original content should always be considered in the context of online or other branding efforts. For instance, MySpace provides you and your team creative freedom to craft a profile that is searchable by Google and other search engines. Advanced search tools on these sites help you to quickly sort through users’ content at little to no cost. This proactive method can assist you in locating those off the radar quiet lookers who aren’t actively searching for a new position. By using precise search parameters, you can pinpoint the highest quality candidates for an open position.
How can businesses avoid mistakes?
Social networks don’t require a large investment in new tools or programs, but can consume a significant amount of time. As with all marketing efforts, there needs to be a focus and a why. Why would you use MySpace? Why are you going to spend quality office time on Facebook?
Mistakes usually result from jumping into the social media realm too quickly and without enough research or knowledge. This can lead to using the wrong tone in your writing, focusing on the wrong demographic or targeting the right demographic with the wrong message. Online resources, local meet up groups and conferences can help businesses learn about these topics, view success stories and develop an effective strategy.
GREG ROLLETT is the marketing and communications director at Rollett Marketing, a social media marketing firm focused on Gen-Y and new media. Reach him at (321) 438-4442, email@example.com or www.rollettmarketing.com.
Marketing and communications director
Does the current lending climate preclude entrepreneurs from starting a new business or expanding one? Not if CEOs do their homework. Funding vehicles exist that will help CEOs achieve their dreams; it’s just a matter of knowing what’s available and making sure that your company can service the debt.
“Big companies have greater resources because they have large infrastructures. Therefore, they tend to find a greater number of financing solutions in a tight lending market,” says Brian Lamb, CFO of Fifth Third Bank (Tampa Bay). “CEOs of smaller organizations or start-up operations must rely on external resources to source loans and to understand how to make their business attractive to a lender, given the increased credit scrutiny in today’s lending environment.”
Smart Business spoke with Lamb about how CEOs of small companies can finance expansion, given the current lending climate.
What should CEOs know about the current lending climate before seeking funding?
Be sure that your company has adequate cash flow to service the debt and enough cash flow in reserve to continue making payments, in the event the economy slows and your company’s sales decrease. In this particular market, lenders are scrutinizing financial statements and a company’s financial situation more closely, and one of the things they will review is the value of any collateralized assets used to secure the loan. For example, if you’ve collateralized the loan through real estate, the lender will be looking at the property closely to make certain that the value of the real estate and the equity in the property are secure. Lenders want to see a better balance between debt and equity as part of their tighter lending standards.
What are some of the available funding options?
There are products in the market that offer quarterly payments, which helps with debt service through more advantageous cash flow. Some loans will let you make interest-onl payments in the beginning, which will help expanding companies grow into the debt service. When you inquire about these funding options, be sure to ask about the covenants that are part of these loan agreements. Those covenants usually require companies to maintain certain financial ratios as part of the agreement. CEOs should not be afraid of the covenants; just think your decision through and be sure to run projections that will help you understand how your business will perform under a variety of economic scenarios and how those covenants may affect payments. Fully understand what the loan is actually going to cost in terms of interest and repayment under every possible set of circumstances.
Can some of these loans be refinanced down the road?
Yes, some loans offer CEOs the opportunity to refinance the terms, or the product may offer tiered pricing based upon certain criteria, so be sure to inquire about that before securing the funding because it’s not an automatic feature. The refinancing or tiered pricing feature is usually tied to hitting certain thresholds or debt service coverage ratios and, while not every company can qualify for this option, it’s definitely worth pursuing. Also, in 36 months the market could be completely different, so it may be advantageous to leave options open to refinance to more favorable terms.
How can I improve my company’s ability to service debt?
Look at some of the treasury management services your bank provides as a way to gain efficiencies and lower operating costs. For example, there are ways to reduce manual accounting processes by taking advantage of online wire transfers and a reduction in the need to cut manual checks. Now can actually be an opportune time for CEOs to explore all options that will reduce overhead and increase their company’s ability to service debt.
What external resources are available to help CEOs?
There are resources available for CEOs of entrepreneurial firms, so no one should have to go it alone. Ask your banker what type of training he or she can provide around lending products and cash flow management techniques. Given the current climate, CEOs will need a more proactive approach to securing financing because it may take some time to prepare the company’s financial statements and align your business model to meet the debt service. Knowing your options well in advance of the need is one of the best techniques to keep your business growing in today’s lending climate.
BRIAN LAMB is the CFO for Fifth Third Bank (Tampa Bay). Reach him at (813) 306-2491 or Brian.Lamb@53.com.
When Robert B. Conroy Jr. attends new employee orientations at St. Petersburg General Hospital, he makes it a point to know beforehand something about each employee. Whether it is where he or she previously worked or where he or she went to school, the president and CEO of the 219-bed hospital, which employs about 550 people, sets aside time before each orientation to memorize the facts and bring them up in conversations. Conroy does this as a way to connect with new employees and open the lines of communication with them. And, he says, the feedback he receives tells him that his effort shows employees he has a genuine interest in them. Smart Business spoke with Conroy about how to show people you are listening and how to communicate change.
Be visible. In our case, since we’re a hospital, the customers are obviously the employees but equally so are the physicians and the patients. So we sort of have multiple customers. My visibility to the organization with all the customers, I think, is critical.
To the extent that the patients are not cared for in my office, I prefer to visit with the staff and the physicians out in the hospital. My main objective is to do as little business in my office and as much out in the hospital, and that subsequently creates the visibility.
By being accessible, typically the customers the patients, physicians or employees will engage me when I’m out there and give me their ideas.
Stay in touch with your work force, and your work force probably is in touch with the customers. Then, obviously, don’t be 100 percent dependent on your work force to keep you in touch with the customers. You have to have some direct communication with your customer in order to really understand what they are thinking about your organization and how it’s performing.
If I was in window manufacturing, if I had a plant, I’d be visible in the plant. If I had customers, I would have to go to the customers to be more visible where my windows are being sold.
Listen. We are in a service industry, and I think when you are in service industries, you need to have good listening skills, whether it’s the employees talking about the organization and the culture or the physicians talking about the services that we’re assisting them with as they treat their patients or the reason we’re here, which is taking care of patients.
There is a lot to be learned, and, as a leader, we need to harness that information in order to use it to make our strategic plans.
Show people you are listening to them. First and foremost, it’s the one-to-one contact. As they engage you, you have to make some time to have the personal one-to-one contact with your customer. On a group basis, obviously, I think you have to have your normal meetings, either with your employees, we call them town-hall meetings, or with your management team.
Have an exchange of information and leave time so that it becomes a two-way dialogue and not just a monologue or delivery of information on my part. Always allow enough time for them to express their opinions, either about what I am talking about or what may be on their minds at the time.
You have your presentation, and then you open up the floor, so to speak, about the presentation, and then you leave time about any other issue that may be out there that may not be on that particular agenda.
Clearly communicate and monitor change. When we are communicating change, you have to make sure that everyone knows the direction you are headed. That’s the senior management team, the middle management team, and since you have them on board with the strategic plan and the vision for the organization, then they can assist me in imparting that to the employees.
Since we are a 24-7-365 organization, it’s almost impossible for me to individually communicate to everyone.
I’ll have group meetings ... but I’ll also delegate that responsibility once I’m sure they understand it, and I’ll hold the middle management and the other senior managers accountable for sharing and communicating that message. Just like advertising, I think it has to be repeated a lot.
In that context, if it is coming from more than one person, it shows a team effort, it shows a team commitment. It also allows us to get the message out several times, so as no one misses it. And, if we are making changes, that they are aware of those changes and they hear about them before they experience them.
In our situation, we have multiple customers; we have changes we have to communicate to the patients, changes we have to communicate to the employees and to the physicians.
When I’m out and about, I’ll ask people if they’ve heard about the changes and validate that on a personal level.
Don’t give the impression that you always have the right answer. As leaders, I think we may think we have the right answers. Leaders often get the right answers, but typically, they don’t do that alone. They do that by surrounding themselves with other good leaders or future leaders.
The pitfall would be not listening to the people you have surrounded yourself with. If you’ve done good, targeted selection and selected the right people, then I think listening to those people and engaging them and using their ideas would be the best advice I would have for avoiding pitfalls.
HOW TO REACH: St. Petersburg General Hospital, (727) 384-1414 or www.stpetegeneralhospital.com
Cedar Hames sometimes knows more about his clients’ business than they do. The president of Paradise Advertising & Marketing Inc. says that because his company is pushing messages and brands into the marketplace, his employees need to be aware of how the marketplace is changing.
It’s all part of the constant quest for knowledge at his $20 million firm. Hames tells his employees that it’s not enough just to keep up they have to stay ahead of the curve to succeed. For instance, Paradise used to create just print advertising for its clients.
Now, the marketing communications company has switched its advertising presence over to the online component of newspapers.
Smart Business spoke with Hames about the science of planning for growth.
Q: How involved in the day-to-day operations should a leader be?
I’m more of a big-picture person. If you have a motivated team, you shouldn’t have to be that involved in the day to day. If you hire bright, talented people and provide the tools for them, just step back and let them do the work they do best.
The biggest pitfall is for a CEO to micromanage. If you’re micro-managing, you’re not only not letting them do the work that they should be doing, but you’re not doing the work that you should be doing.
Each CEO should have a different approach to that, but in our case, one of my particular rules is to do strategic thinking and planning for our clients. We have a team that does that, but that’s a lot more important than me trying to edit a radio commercial.
Q: How do you develop and communicate a vision to your employees?
As far as the vision, it’s more a way of doing business than anything else. We’re in the communication business, and too often, businesses do not communicate to each other, much less outside the business. We try to open up that communication.
Of course, now with e-mail and such, you get more communications than you want sometimes. But we do try to have weekly or monthly meetings where we try to share knowledge with each other and get together.
They’re not gripe sessions. Sometimes we exchange necessary information; other times we exchange ideas. Communication is a key factor, along with the knowledge that if you’ve hired talented, motivated people, you don’t have to motivate them, you just have to provide them with the opportunities to do the work.
Q: How do you find those qualified employees?
In our business, we’re so specialized, it makes for a small universe of talent that is available to us. So, the best way to attract exceptional talent is to do exceptional work. If you’re doing that, talented people will seek you out.
Regardless of the area we’re working, we try to be very strategically based and very creative. That is the type of thing that attracts good people and keeps them motivated: the ability to be creative.
Q: How do you manage business growth?
We try to be proactive in the sense that over the past five years, we’ve had such substantial growth that we anticipate that each year we’ll continue to have that growth. In our staffing and in our office space and other areas, we try to allow for at least a percentage of growth and build it into our budget plans.
There might be a lot of CEOs out there cringing at that thought, but it’s worked for us. I’m sure a lot of them say, ‘When you get the business, then you staff up, and you make those arrangements.’ When we anticipate (the growth) and so far that has certainly been the case then we are already prepared.
Remember, with us, it’s not like we can run an ad in the paper and have a number of people lined up who would be qualified. It’s a specialized area, so we try to be proactive, especially in the staffing arena.
Q: How do you anticipate the amount of business growth?
We have different departments and a formula as to the number of hours for each person in a 40-hour week; we allocate what we call billable hours. That may not be actual, but it will reflect the cost of that person that we’re putting toward the client. We know from experience that a certain type of work for a client will take X number of hours per month times these 12 individuals.
We know that we anticipate growth at a certain percentage, and we can just do the math and make sure that we’ve got the people on board that can accept that business.
The reality is that we would love to have more business come in than we anticipated and rush out and try to attract some talented people. But it’s certainly smart to anticipate that growth. Since we’ve had such an ongoing record of bringing in business, it’s worked for us.
HOW TO REACH: Paradise Advertising & Marketing Inc., (727) 821-5155 or www.paradiseadv.com
For the past several months, the slowdown of residential sales has dominated headlines of newspapers, nightly news reports and political debates. The effect of this slowdown on the economy ranges from moderate to severe depending on whom and where you ask. Experts’ answers and explanations are varied as they try to predict the impact on the economy from both a macro perspective and its effect on the average family.
“One sector that is impacted by residential activity is the retail market globally, since goods are primarily imported from China and other countries, down to the locallevel where spending habits change,” says David Conn, a retail specialist with CB Richard Ellis in Tampa.
Smart Business talked with Conn for his insight about the retail sector, its response to current market conditions and how the industry plans to serve changing consumer demographics.
What is the current effect of the slowdown in the housing market on retail?
After a period of significant growth, the downturn in housing came very quickly, so we are just starting to see the effects as third quarter results are reported. It appears that most retailers are experiencing or expect a decline in recent same store sales. A major portion can be attributed to the drop in housing activity. Purchases normally associated with setting up a new residence have obviously been the most affected.
However, there are a number of other factors contributing to declining sales at other retailers. These include high real estate taxes, rising insurance premiums and rising fuel prices. These all put pressure on disposable income. A drop in consumer confidence is also often cited by experts. Despite the negative news and disappointing third quarter sales, many retailers are still predicting anywhere from moderate drops in sales to moderate gains in same store sales for the holiday season.
How does the retail sector address such forces in play?
In those markets where residential activity has slowed dramatically, retail developments may get delayed, scaled back or even cancelled if retailers can’t get comfortable with sales projections. Fortunately for those of us living in Florida, most retailers continue to believe in Florida as a growth market and see the housing slowdown as a temporary event. However, there are other influences that affect retail sales. Two such influences include an increasingly diverse consumer market and opening new stores. Products and fashions have relatively short life cycles, so buying decisions, product placement and competitive pricing are critical in the face of increasingly compressed life cycles.
At the same time, retail developers face increasingly longer time-lines when developing new centers due to a variety of factors. These challenges include finding affordable land, increasing construction costs, impact fees and increasing opposition from homeowners, and lengthy and expensive entitlement processes. These challenges make it harder for retailers to quantify their expansion plans and deliver new stores as promised to Wall Street.
What are some of the major changes you have seen from the shopping center environment itself?
Probably the most evident is the physical changes in shopping centers themselves. The total redevelopment of Clearwater Mall five years ago transformed a nonperforming, older enclosed mall into a vibrant new outdoor center and is an example of the new generation of shopping centers. These centers are anchored by discount department stores, such as Target, as well as specialty anchors, like Bed Bath & Beyond, The Sports Authority and Staples, each with a unique offering to customers in a setting that allows for convenient parking. In some cases, these centers combine lifestyle retailers, such as Chico’s, Coldwater Creek and Talbot’s that were once found inside regional malls, but now prefer the convenience and lower occupancy costs of outdoor centers. Even successful regional malls are adding outdoor expansion areas that typically include restaurants and non-typical mall anchors to draw shoppers that might otherwise bypass the mall.
What is the impact of online shopping?
Without question, online shopping continues to grow as consumers seek convenience and ways to save time. In addition, the young people of today are very computer-savvy and use the Internet in almost every facet of their daily lives. That said, there are some limitations, since you cannot touch or feel items. A picture and text of an item is not always adequate. Now retailers are complementing their physical stores with an online store, so they can reach customers 24 hours a day. It really is the best of both worlds.
DAVID CONN is a retail specialist and executive vice president with CB Richard Ellis in Tampa. Reach him at (813) 273-8440 or firstname.lastname@example.org.
Growth has been a constant companion in the 10 years MikeFencel has led Brandon Regional Hospital.
And that’s just fine with him.
He realizes that in order to succeed, you have to constantly stayahead of the competition.
When Fencel became CEO of the hospital in late 1997, it had 255beds. Now it has 367, and there are plans to add 40 more by thefourth quarter of 2008.
The growth has been a steady but crucial necessity at the hospital, which posted about $300 million in revenue last year.
“If we didn’t grow, that could encourage other competitors towant to seek a location somewhere in my primary service area,” hesays. “I think the fact that we have been able to expand so muchand commit so much in resources over those 10 years makes it aharder argument for others to say we aren’t meeting communityneeds. It would have opened the door for others to come in. That,we feel, is not necessary because we are doing a fine job ofaddressing those needs.”
In order to lead the hospital through growth, Fencel needed todeal with the challenges that came along with it. He had to formthe right management team, delegate authority and get buy-in fromhis more than 1,600 employees.
Form a strong team
When Fencel became CEO, there was already a senior management team in place, but within several years, many of them wouldbe retiring. That meant he would have to make sure the transitionwas smooth while finding members who would fit in to the culture.
Fencel also noticed there was beginning to be some resistanceto change from the employees. Having been in existence since1977, the hospital grew to a point where not all the employeesknew each other, and some were uncomfortable with the growth.Because of that, Fencel needed a management team that couldgenerate excitement about growth and help everyone understandthat it was for the best.
“You lost that sense of family that once existed, but that isjust the nature of the organization as it’s grown,” he says. “I hadto have people who could help me articulate and carry out reasons why continued change needed to take place. As we haveevolved and grown, the dynamics and the need to have a really well-organized, well-structured senior team have come tothe forefront to me.”
When first sitting down with a candidate for his team, Fencellooked at the interviewee’s past work history. More importantly, he looked for concrete examples of change-related situations, why there was need for change, what they did about itand how he or she succeeded in executing it.
He also wanted someone who did his or her homeworkbefore the interview, and wasn’t going to sit there and let himdo all the talking.
“I like to see people who have gone to the Web site, have donetheir part to try to evaluate and understand the organization thebest they can, and they are prepared to ask me as many questionsas I ask them, so they are fully aware of what those opportunitiesand challenges for that position will be,” he says. “If you come in,look great and have a nice resume but don’t know anything aboutour organization, that doesn’t show me a whole lot.”
After other members of the management team also interviewedthe candidate, the group got together, discussed all the informationand made a decision.
None of the senior management team, which is composed of sixmembers including Fencel, was promoted from within the hospital, but each member came from HCA Inc., the parent organizationof Brandon Regional Hospital.
“One other thing that is critical is having the right fit,” Fencelsays. “Someone may be extremely successful in a certain role inanother organization within HCA or outside, but their culture isdifferent from mine. That was another lesson learned. We’ve hadto make some changes because it wasn’t the right fit for the individual, the team or the organization. It actually turned out thatsome of the people on their own recognized that and sought otheropportunities, and got those in HCA, where it was a better fit forthem.
“If I feel the leadership team understands my approach and philosophy and will support me and are committed to do the things Ineed done, then I want to keep them here.”
Though he wants people who will follow his lead, Fencel alsorealizes it’s important to have diversity on a team.
“I’ve got a wide variety of years of experience from differentmembers, attitudes, enthusiasm, personalities, and you blendthem all together,” he says.
After Fencel’s team was in place, he knew he needed to delegateauthority because the growth of the hospital meant he could notoperate it by himself.
Fencel says his primary role is to develop, maintain and modifythe strategic plan and growth initiative and to be a liaison with theparties that will help move the organization forward.
He and his team developed their delegation process by readingbooks and looking at the ways different organizations handle delegation. They identified areas or activities that certain team members were more comfortable at doing than others were and cameup with certain types of philosophies they were comfortable withand could lead by.
When the senior team began to take more responsibility, Fencelintentionally stayed out of the spotlight, which led some to believehe no longer cared about the organization. If he could do it all overagain, he wishes he would have communicated the change betterto employees and let them know he would still be in contact withhis management team and be kept in the loop.
“The way we’ve grown no longer allows me to have as much timeas I’d like to be available and in contact with all the employees, butI am still going to be in touch,” he says. “I know what is going to goon, and I am counting on these individuals to be my point peopleon a day-in, day-out basis. If and when the time requires me to beback out there, then I will. But, to try to continue and meet theemployees’ expectations and visibility is hard.”
By the time Fencel realized the impact the change had, it was toolate to try to go back and communicate it.
“But that’s one of those lessons learned,” he says. “If someonehas been in their role for a long time in a high-growth organizationand decided to make some fairly significant changes in their structure of management style, then I would certainly encourage themto try to communicate those things so people know that upfront.
“If someone has been in their leadership role for a long time andtries to change approaches, you really have to make sure youunderstand the impact that change will have on the organizationand be able to communicate if those changes are taking place andwhy they are taking place. In retrospect, I could have done a better job in that regard with the employees as a whole.”
While he could have communicated the change better, Fencelsays delegation is necessary to keep yourself fresh and on top ofyour game.
“It’s improved my quality of life,” he says. “If you have a better,happy, well-rounded, quality of life, professionally and personally,that just makes you more effective in your role as a leader. Overtime, (work) just absorbs you. It’s all-consuming. You’re not able toseparate and think strategically like you need to do.
“If you don’t have a way to break away from that, I don’t see howyou can possibly continue to be fresh with your ideas, objective inyour viewpoint and energized to help drive the organization forward.”
While building the right management team and delegating authority to them was important, he also needed to get buy-in from theemployees on the many growth-related changes the hospital wasgoing through.
One example was the move to create a cardiac surgery program.Before getting started on the project, Fencel needed to make sureeveryone understood why the hospital needed the service and whygoing through the process was worth it. Even if it was communicating the message through something as simple as e-mail or in meetings, the results would outweigh the simplicity of the method.
In addition, because previous attempts to start the program failedprior to Fencel’s tenure, it was important from the start he showedconviction in making the program become a reality, no matter whathurdles got in his way.
“Some of the people who had been here at the time those firstefforts were made probably had some doubts it could be done,” hesays. “It took us three attempts. I think if I had given up after thatfirst effort or second effort, I would have validated for some that itwasn’t beneficial for our hospital to go through all that. But, I wasn’tgoing to give up and a lot of other people weren’t either. Those people that doubted, we proved them wrong. That wasn’t our intent, butit helped validate that if you put your mind to it, work hard and worktogether, there is a lot that can be accomplished. Here is an examplewhere we went to a great degree to bring a much-needed serviceinto this community for the benefit of everyone.”
Fencel says leaders need to get buy-in to make a change happenbecause everyone in the organization will eventually have a part init.
“What I have to do in my role is to provide a vision and communicate the vision and what our strategic initiatives are and why,” hesays. “At the end of the day, I’m not the one making that happen. It’smy staff nurse, it’s our environmental service worker, and it’s theplumber or electrician in our plant operations department. All ofthem have a role directly or indirectly in making things occur. If theydon’t buy in and believe it, then we are less likely to be able toachieve the goals and vision that I think are so critical to our success. Communicating the vision, communicating the reason why weare doing it, communicating the challenges, allowing them an opportunity to ask questions in different forms, whether it’s with me orthrough their immediate leadership, we try to do it. Are we completely successful 100 percent of the time? No. That’s a process younever stop working on.”
Keeping employees informed not only creates buy-in, but it alsoserves as a great marketing tool for your company.
“At the end of the day, I have over 1,600 employees, and they can bemy best form of advertising,” he says. “You have newspapers, youhave direct e-mail pieces and TV spots, and you can do all sorts ofthings. But, the amount of people employees come into contact withat the ball field, in their church or a civic organization, and being ableto speak intelligently and with pride in what we are doing, that goesa lot of further than any other type of advertising.”
HOW TO REACH: Brandon Regional Hospital, (813) 681-5551 or www.brandonregionalhospital.com