John Magee walked away from a multibillion-dollar company to start over.
Before helping found Crane Worldwide Logistics in 2008, he worked for Eagle Global Logistics, a global supply chain company that had grown from $80 million to more than $3 billion in the time that Magee was there.
Unhappy with how big the company was getting and the loss of personal touch to its clients, Magee and eight others from Eagle left to start their own supply chain business, but they had to wait out a noncompete agreement for a year.
They took the time to scout how and who they wanted to hire and the clients they wanted to chase. One thing was certain: They didn’t want Crane Worldwide Logistics, a full-service customs brokerage and logistics company, to turn into the same thing they had just left.
“That sitting out actually gave us a chance to reflect on the industry,” says Magee, president of Crane Worldwide. “What did we see taking place in our industry? How did we want to launch a new organization in there? It was truly the best thing we could have done, because it allowed us to get so much set up the way we wanted to do it so that when we launched the organization 12 months later, we could do it, in many cases, very different than the way a lot of our competitors and the industry has morphed into.”
Not wanting to become another huge global company that lost touch with clients and not wanting to be too small and stuck in a niche, Magee and his other team members combined their expertise to develop their plans for growing and staffing their new company exactly how they wanted to.
Here’s how Magee grew Crane Worldwide to $252 million in revenue and 700 employees in 2010 by carefully planning for controlled growth.
Know your destination
Growing a company is ultimately not the biggest challenge, but being able to control it is.
You must clearly identify how you want to position your company and then stick to that plan.
“Since the late ’90s and into the turn of the century, our industry has seen a tremendous amount of consolidation,” Magee says. “All that industry consolidation created a few dozen big players that are $3 billion in annual sales and larger. They basically try to be everything to everybody everywhere. No matter what industry it is, what geography or what type of service somebody is looking for, they try to say yes and they try to do it. I don’t subscribe to bigger is better; I think better is better.”
Being better means staying true to how you want to position your company. You have to be diligent about not faltering from how you want the company to appear to employees and clients.
“You have to know what you’re good at and stick with it,” Magee says. “Don’t take on business for the sake of growing. Don’t sacrifice the company’s results because you’ve taken on something that doesn’t make good sense for your company. Don’t try to grow for the sake of growing, because you’ll spend time and effort and resources on nonvalue-added work. Everybody feels it. The company feels it, the people feel it, and it takes away from that feeling of being in high performance when everything is working right.”
Having started with a company when it was relatively small and watched it turn into a multibillion-dollar company, Magee knew that becoming a huge company wasn’t the right path to go down a second time.
“I can tell you the bigger we got, the harder it was to be great at what you do,” he says. “We want to be this global midsized player,” Magee says. “We want to have high touch, high service and really get back to the core brokering of supply chain solutions. I want to bring this high focus on it that I think a lot of the big guys lost, but be large enough so that people with global supply chains are willing to trust us with it. That was our vision. We want to be a $1 billion company. It’s not because that’s some magical number, it’s really to let the market and, more importantly, our clientele know where we are positioning ourselves.”
Hire for growth
When you have a clear path that you want your company to go down, you need employees who will be capable of continuing that growth. If employees are unable to handle the growth your company sees, you will end up having to let go of them and start the process all over. You have to hire for the future.
“What I saw [at my old company] was us outgrow our management team easily four times, arguably six times during my 13 years there,” Magee says. “When you start making management changes, you run the risk of getting this momentum built up and then, all of a sudden, you have to bring in a new leader who can take us from here to the next level, and by doing that, you run a risk of seeing that momentum come to a stop.”
Because of the experience of the founders of Crane, they knew that they would be able to get their company off the ground and grow. However, they still needed to be smart about who they looked to hire.
“Part of our plan for the future is let’s go hire these key positions above and beyond where we are today, where we’re going to be in two years, but let’s really think about where we’re going to be in five to seven years and let’s hire for that,” Magee says. “That has allowed us to attract the talent that we needed and ultimately that has led to what we’ve been able to accomplish in the first two years.”
In order to hire in front of your growth, you must constantly be on the lookout for potential employees. You want people who you can see working in a higher-level position than what you’re hiring them for.
“If you can envision that you can see this person being developed into two levels above what you are hiring them for, then you probably have a good candidate for the job,” Magee says. “It’s vitally important that your human capital pipeline can keep up with your sales pipeline. If you can’t bring on the right talent, you’re going to ultimately hit a ceiling even though you can continue to bring on revenue. It’s going to hit a ceiling and your customers are going to feel it. As we know with inertia, what’s in motion stays in motion, but what’s at rest stays at rest and you don’t want that momentum to stop.
“You have to prioritize recruiting. You don’t recruit when you have a need. You recruit every opportunity you can. I’m always asking, whether its colleagues, whether it's customers, or whether it's suppliers, ‘Hey who’s out there that I should know?’ Because when the time comes to pull the trigger if you’re starting your recruiting then, you’re falling behind. When the time comes to pull the trigger, if you already have multiple candidates that you’ve been getting to know and been recruiting over time, even though you didn’t have a role for them, it’s a lot easier to finish the process and bring them on board.”
Create the right culture
Controlling growth means setting up the right culture for your company. With the right culture, people will instinctively do things the way you want them done. This requires finding the right people to help you reach your goals.
“Having lived and worked all over the world, whether I worked with some great people or I competed against them, I was fortunate that I knew a lot of folks and a lot of my colleagues knew a lot of folks,” Magee says. “We spent the year that we were off creating a recruiting database. We couldn’t talk to anybody from our former company for 12 months from a solicitation perspective, so we went out and built a recruiting database everywhere else.
“We also defined what kind of culture that we wanted and we called it our Crane Character. I basically took the letters from Crane and I created our character statement. The C stands for customer-centric, the R for responsible, the A for attentive, the N for integrity, and the E stands for execution.”
It is crucial that all employees agree with and abide by the company culture that has been established. If employees don’t mesh with the culture then the odds of it working in the employee’s or company’s favor are slim.
“When we are hiring, can we see the individual that we are bringing on board … developing into two levels above what we are hiring them for,” Magee says. “Do they have the first four values within our character statement? Are they customer-centric, are they responsible, are they attentive, and do they have integrity? If they pass that test, then we bring them in the door. At the end of the day, if they don’t execute … they are probably not staying if they can’t actually do the job that we are hiring them for. But if we’ve done a good enough job betting it, then your success rate on bringing in the right person is pretty high.”
That upfront attitude has been a big reason for Magee’s success hiring people who can continue to drive the growth of the business. You have to be able to tell employees exactly what the company’s plans are and why.
“You have to lead by example,” Magee says. “Have integrity. A lot of leaders tell people what they think they want to hear versus just being completely open and honest with them. I know that’s the only way I want to be treated is if somebody just shoots me straight and is very open and honest. I think if you lead by example, have integrity and be open and honest with everybody and communicate, people will follow that. They want that from their leader and when they feel like they are getting partial truths, that’s not as good.”
HOW TO REACH: Crane Worldwide Logistics, (888) 870-2726 or www.craneww.com
The Magee File
Crane Worldwide Logistics
Education: Received a marketing degree from the University of North Texas
What was your first job and what did you learn from that experience?
When I was in middle school, I went and printed up business cards and started mowing lawns in the neighborhood for $6 a lawn. Mowing lawns was a commitment. If you make a commitment, you’ve got to stick with it. My friends would invite me to the pool or to the amusement park and although I would have loved to go, I said no I couldn’t I have to mow yards that day. That taught me the value of money.
What is the best piece of business advice that you have received?
Don’t set your goals too low and write your goals down. If you look, I think statistics say that only 3 percent of the world writes its goals down, but that 3 percent makes more money than the other 97 percent put together.
If you could have a conversation with any one person, who would it be and why?
Jack Welch. I have a tremendous amount of respect for what he did during his leadership at GE. I’ve read lots of books on GE, and Jack and I definitely don’t subscribe to everything that Jack does, but in my mind, he goes down as the best executive that’s ever run an organization.