And the employees knew nothing about it.
“They thought the company had millions of dollars, and if someone flew first class or stayed in a hotel suite, it wasn’t a big deal,” Chaney says. “They had no perception of the reality of the company.”
Chaney, chairman and CEO, focused PreCash’s efforts on a core group of products and instilled in his nearly 200 employees that they should treat every dollar spent as if it were their own. That combination worked, as the company posted $22.5 million in revenue last year and is on track for $35 million this year.
Smart Business spoke with Chaney about how he led the turnaround.
How do you prepare for growth?
Hire the very best team of people that I can surround myself with that is capable of running a much larger organization. Rather than hiring a CFO that has run a $10 million company, I’ll try to get one that has been inside of a half-a-billion-dollar company and share with them the vision of where I’m trying to take the company, pay them the amount of money they need to be paid in many cases a higher compensation than I get to get that talent.
I’d rather hire above the job for the top positions rather than to the job, and that’s more expensive. It might be a factor of two times more expensive, and in small companies, that’s a big number. If I have a strong team around me, they have seen the battles of the past, they know what’s coming next and they’re able to prepare for that and get us through this growth curve.
How do you communicate your vision to employees?
Communication to employees needs to be brutally honest. I’ve seen several CEOs sugarcoat the prospects of the company or the outcome of bad news issues.
What I did was have biweekly meetings with all the employees to tell them the issues that we are facing and how we need to change the direction of the company, sharing financial results, sharing successes and failures of the subsequent two weeks, getting everyone to think and act alike and on the same path. That sets a culture for the organization that has remained in place today.
How do you get employees to buy into it?
It takes time. It takes consistency. It takes honesty. If you say what you’re going to do, and then you do what you said you are going to do, people will start to believe you.
In the first meeting I had with employees, in a room of 100 employees, 10 believed me and 90 didn’t, but after time, that ratio flipped because they saw consistent changes.
They saw they were important to the organization. They saw focusing all their energies and efforts manifested itself in additional revenue and helped the company move to the next stage. It takes consistent messaging to the employees to make that happen.
We would show progress every other week with employees, and it got a sense of reality around the issues and it mended the team together. It made it their own.
How do you motivate employees during growth periods?
Celebrate the successes but also reward the failures: You tried something. It didn’t work. Way to go. We worked hard on it together. There’s nothing wrong with that. Let’s try it again.
You’ve got to communicate the good and the bad and be upbeat and positive the entire time you’re doing that. Nobody should ever feel bad about working hard at the company, regardless of the outcome.
You want them to take risks and chances. You don’t want an employee saying, ‘This is my job. This is the box I work within, and I won’t go outside that box,’ because all of a sudden, you’ve stifled the growth of the company.
They’ve got to feel empowered to reach beyond their boundaries and know that if they do something great, they’ll be rewarded, and if it doesn’t work out, there won’t be a negative consequence.
How do you manage growth?
Five percent growth is very manageable, and big companies do that all the time. Fifty percent growth? One hundred percent growth?
The rules are breaking. What you did yesterday cannot be repeated a year from now because it won’t work because you’re twice as big.
Everybody has to go beyond the normal box that they say, ‘This is the job description I got when I got hired.’ That job description goes out the window at about month three, and you have to be able to constantly adapt to change. And in a growth organization culture, some people are better at that than others.
Some people like to dot the I’s and cross the T’s and know that they have 117 widgets to perform today. That doesn’t work well in a growth culture, and that employee will find it incredibly frustrating to work in a growth culture, and their teammates will find it very frustrating to work with them.
How to reach: PreCash Inc., www.precash.com