Erik Cassano

Saturday, 25 April 2009 20:00

Return to health

When Jesse Thomas first mentioned the T word, he knew it would raise some eyebrows.

That’s T as in “turnaround.”

Like a lot of companies in Michigan, Molina Healthcare of Michigan has recently felt the effects of a sagging economy, which had led to concerns among the health insurance company’s leaders over revenue and membership growth.

But when Thomas became president and CEO of the subsidiary of California-based Molina Healthcare Inc. early last year, he wanted to take things a step further.

“Every market has some of its own challenges that are unique,” says Thomas, who arrived in Michigan after a stint with Molina’s Ohio subsidiary. “In this market, I felt we had opportunities for improvement in profitability, membership and revenue growth. To address that, I repositioned the company as a turnaround. Sometimes that is difficult on the psyche of the individuals involved, but nobody disagreed with me that we had missed some of our targets and had the opportunity for improvement.”

Molina’s situation wasn’t as desperate as some turnaround stories. The existence of the company wasn’t at stake. But the long-term financial health of the company was potentially poised for a steady decline without Thomas’ intervention.

As with many turnarounds, Thomas had to identify the problem areas and ways the problems could be addressed, organize a go-forward plan with his leadership team, and then achieve buy-in from as many people in the organization as possible.

It’s a multistep process that took vision and big-picture thinking from many people. But it also took a great deal of persistent communication from Thomas as he rallied 250 associates around the common cause of improving Molina’s outlook in Michigan.

Build the bandwagon

Thomas saw three areas of concern on which Molina needed to focus its resources: improving profitability, improving membership numbers and improving the overall quality of the services Molina offered to its Michigan plan members.

But in order to move forward, he needed to make sure his leadership team was on the same page with him.

“I needed to see if our associates and leadership team were drawing the same conclusions that I was,” Thomas says. “So, at the outset, it required me spending a significant amount of time with the team, getting the team in agreement that these are the priorities.”

Thomas does meet periodically with all of Molina’s associates in Michigan, but on a more frequent basis, he and his management team rely on cascading communication. During the early stages of the turnaround plan, it was cascading communication that helped get everyone focused on the tasks at hand. Thomas’ communication strategy started with high accountability at the top levels of the company.

From the outset, Thomas wanted to ensure that his leadership team was meeting and reviewing the strategy and that the strategy was communicated throughout the company at frequent intervals.

“As the president and CEO of the Michigan plan, I have leadership that includes a C-level chief medical officer, my chief operating officer and chief financial officer, and other directors and officers who report to me,” Thomas says. “We can’t just get together willy-nilly. We needed to have a standing agreement to return and report to each other regularly, to get together, measure and gauge the progress we’re making on the important priorities of the company.

“Each of my direct reports, in turn, meets with and counsels with their direct reports. So it starts with the leadership team, cascades down to the next level and down through the levels of the company so that every associate in the company is aware of our priorities. We also post them in the building and put them on our computer desktops so that everyone can see the progress we’re making with regard to those priorities.”

Thomas says good communication starts at the top. If you want to focus your employees on a set of goals, you must communicate actively, not passively. Just because the message is out there doesn’t mean people are absorbing it.

“The effectiveness of communication is in the outcome you get,” he says. “Simply put, the burden for effective communication is on the communicator, rather than the person hearing the message. If you can’t tell it, you can’t sell it.

“I follow a principle I call GABE, which is an acronym. G is ‘Get in front of the issue.’ A is ‘It’s always about the money.’ B is ‘Be proactive.’ E is ‘Early and often.’ I believe that I have to keep in mind that the greater burden is on me to communicate and that I need to make sure I’ve communicated effectively to get the outcome I want. I can’t assume someone is going to hear what I want them to hear. So I have to test and retest what I said, asking people what they heard me say, what is the outcome, what are they taking away from my communication.”

In refocusing Molina, Thomas found that what employees take away from your messages can have a lot to do with the words and descriptions you use. Thomas divides people into three general categories: those who learn by sight, those who learn by hearing and those who learn by feel. The stage you set in your communication plays a large role in how you reach each of those groups.

“You develop, over time, techniques for identifying in your associates what their primary system is for absorbing information,” Thomas says. “I use the predicates and metaphors appropriate for that learning style. For someone who is a visual learner, concepts need to be graphically illustrated more often. I’ll ask them if they can imagine or picture an idea or concept. Someone who is an auditory learner, I’ll ask them to drive a point home or nail it down. If someone learns by feel, I want to make sure I’m using predicates and metaphors related to feeling. ‘How do you feel about this; do you get a sense that it would be better if we approached it this way?’

“You have to learn the primary system for how each of your associates processes information.”

When you are in a large group setting, cover all your communication bases.

“You can’t just assume that you have one-third, one-third and one-third of each type of learner within that group,” Thomas says. “You have to mix up the predicates and metaphors in a way that you are making sure that there is a greater chance of hitting all three types of learners within the audience. I’m approaching things in two or three different ways in every forum, meeting or conference in which I am communicating.”

Measure the progress

Molina of Michigan has what Thomas terms a “scorecard culture.” In order to measure the progress of improvement in the areas of profitability, membership and quality, Thomas and his leadership team keep track of the metrics linked to those areas, graphing them and looking for trends.

“It’s very much like football, basketball or baseball,” Thomas says. “You know the progress you’re making because you’re keeping track of the score. You’re keeping track of the boundaries and all the things you need to be doing to advance the ball. We make sure that we scorecard not only all of the activities we perform but also the results, the things we want to get accomplished.

“We put together graphs that regularly show the improvement that we have in one metric over another. We are constantly proving to ourselves that we are making the progress we need to make, that we are watching a trend ... moving in the direction we want it to move. You’re looking for trend lines moving in the right direction, and you are regularly communicating and giving feedback to all who touch that priority to make sure you are accomplishing what you want to accomplish.”

Measuring metrics is one of the ways in which Thomas has gained input on the progress of Molina. The statistics and analysis reported by his management team have helped him refine the direction of the company.

It plays into Thomas’ overall philosophy that good leaders are good followers who take as many viewpoints as possible into consideration before making a decision — as long as a decision is ultimately made.

“As a leader, you have to be very respectful of the guidance you receive,” he says. “You have to be collaborative to a certain extent, without being democratic. Democratic is where you wait until you have total consensus or majority rule. But sometimes you won’t get that majority rule, and you have insights as the president of the company that others don’t have.

“I try to take into consideration the views and perspectives of others, but the buck ultimately stops with the person in charge, the person who has accountability. I know where my go and no-go decision points are. I know what my deadlines are for achieving consensus and whether I have it or not [and I know when] I need to move on.

“If you’re staying relevant to policy, the budget and the guidance of the company charter, having a majority consensus is less relevant than staying true to those things. That’s why a good leader has to be a good follower.”

Keep the momentum going

More than a year into his tenure, Thomas’ plan to refocus Molina Healthcare of Michigan has had positive effects. Though the plan’s final 2008 membership was down slightly to 206,000 from 207,000 in 2007, revenue has inched upward, with a final 2008 total of $509 million, up from $487 million in 2007.

The company remains focused on improving the three key areas that Thomas outlined during his first weeks and months as president and CEO, and the company’s leaders remain focused on maintaining a culture of communication that starts at the top.

“When you sit down to review the strategy and where you want to go the following year, you don’t do that in a vacuum,” Thomas says. “The leaders of our company don’t sit in a suite or in an ivory tower and issue declarations. We have a chance to invite the input from most of the leadership team and management team very early in the process.

“We have standing meetings where we bring together our management team, our key leadership team and even all 250 associates within the company. We spend time together, reporting the progress month by month and quarter by quarter. We do that because people need to see the progress being made against the priorities, that we are a company with a purpose.

“It’s about building and maintaining a culture of mentoring, coaching and constant feedback, and my door is always open to the extent that I am able to leave it open.”

How to reach: Molina Healthcare of Michigan, (248) 925-1700 or www.molinahealthcare.com

Saturday, 25 April 2009 20:00

Taking the reins

With every word he speaks and every move he makes, Lynn Gravley is aware that he’s setting an example for his employees.

Gravley, who founded NT Logistics Inc. in 1999, says that self-aware leaders recognize the qualities they want their employees to exhibit and then try to create followers throughout the company by exhibiting those qualities themselves.

“You just try to be straight up and communicate with everybody, exhibit excellence and demand it,” says Gravley, who serves as president and CEO at the $90 million company. “I sometimes lack in exhibiting that, because we all have our flaws. But you just try to be straight up, communicate and hope everybody else is, too.”

Smart Business spoke to Gravley about how to prove yourself to be a leader worth following.

Get everyone focused. You try to constantly communicate these visions and values. Not that we’re saints, we have our failures, but you just treat people how you want to be treated. That is hard to beat, just setting the example.

One of my favorite sayings is ‘clearly define the written fill-in-the-blank’ — goals and objectives or whatever. So many times I can sit in here and ramble on about something, but we fail to see that we’re trying to get to a certain mark. E-mail is tremendously important, but you have to stay after the relationships, because they’re huge.

A lot of my people will e-mail more than they’ll even call. It seems to be more convenient today. But I’m all the time telling my people to make time to call. Make time to talk. Business today is so much more than just our daily tasks. Take time to talk to our customers, our carriers, ask them about their families, because those things do matter.

You don’t have in-depth conversations with e-mail. You do it to your people, and tell them that you want them to do that with your customers. Show the value of it and tell them that you want them to have that same relationship with your customers.

I make rounds. I try to do it at least three times a week, go out and spend time with my operations people, ask them how they’re doing and how their families are. I ask them what their issues are, what hills they’re trying to climb today. In addition, every time we get a new employee, I always tell them that we’re going to play straight up, because that’s the way we built this business.

Steady the ship. A lot of times you have to stand at the very bow of the ship and tell your people that the waves aren’t all that big — even if you know they’re big.

Communication takes on an added layer of importance in this economy. It wasn’t too long ago, maybe three months ago that unemployment was kicking up, people were scared, but we came right out and told our people that because of the conservative nature in which we’ve run his company, we think we’re in a good position to weather this storm.

We’re all going to continue to chip away, but we want you all to know that things are good and we’re going make it. We also tried to spur some aggressiveness by telling our people that this was an opportunity to take some market share away from our weaker competitors.

When there are wins, you certainly celebrate them, and you celebrate them in different ways. When certain groups have wins, we’re very quick to talk about it louder than usual. You want people to overhear successes. But by the same token, if we stub our toe as a company, you want people to hear about that, so you can take the opportunity to pick them up and tell them that we’ll get it next time. It all comes back to communication. You have to communicate the good, the bad and the ugly.

Encourage and reward. I’ve never been successful at creating something where people give me ideas, but I’ve been successful at making them feel a part of something in which they wanted to share those ideas.

That’s the goal. Recognition is huge. There is an old saying that people will die for a trophy. People will also stay at work late for a bonus. Attaboys are huge, and I probably don’t do them as often as I should.

But you also have to draw the line on incentives at some point. It has to remain special. If it ever becomes routine, you’re blowing it. You can’t clearly pinpoint a place where it becomes routine, but you have to be constantly aware of it.

Your direct reports need to help you set that culture. To do that, you have to demand that what you are giving them, they are giving to their people. You see that in the relationships they have with their people. You can tell if what you are saying and demonstrating is working by the relationships they have.

When you get things on a personal level and your employees know that you care and that your managers care, that’s what employees want. People want to know that the company cares about them.

How to reach: NT Logistics Inc., (469) 362-5000 or www.ntlogistics.com

Monday, 06 April 2009 20:00

Engaged and active

Gary Base learned what it means to lead people while he was in the military.

The president and CEO of 630-employee ViewPoint Bank says that his military career taught him that a leader can’t lead without the confidence and trust of those beneath him.

And you build that confidence and trust by engaging the people in your command, communicating with them and putting them in the best possible position to succeed at their jobs.

“The first person who needed to be engaged would be the first lieutenant, or else no one would follow you,” Base says. “So, throughout my 40-year career in banking, I’ve always been very engaged with everyone, where I’m active in participating and I just don’t sit back. But at the same time, you have to be supportive and a mentor.”

Smart Business spoke with Base about how you can better lead by developing stronger relationships with your employees.

Show employees your process. The very first thing you have to do is clarify your expectations. They have to understand what the target is.

You also have to make sure that they’ve been completely trained to accomplish their goals. If they don’t have the skill sets that are necessary, you have to make sure they gain those through training.

You have to support them in going ahead and helping them be successful. Even though you give someone else responsibility, you can’t really abdicate that responsibility. You need to support and mentor your employees throughout the process. Then you need to do some measurements to measure the progress and success. Then, after it’s all done, you need to sit down and evaluate the results with them. It’s really a multistep process.

A good example of clarifying your expectations would be if you had a brand-new type of product you were going to offer. You would go ahead and talk about the product and the vision for that product, what you hope to accomplish with that product, why the institution is doing this. Then [you talk about] what the expectations would be in terms of measurements, rolling out the product, what date, what level of success and sales you expect to have.

If there are any losses as you start out, you need to be clear on what kind of income you are expecting and when you are expecting it, when you expect to be turning a profit and what kind of budget would be associated with it.

Show employees that they’re valued. You need to recognize employees in front of other people. You need to tell them that you appreciate them.

You also need to talk to them personally if there are some shortcomings. Obviously, you don’t do it in front of everyone, but you do need to give them negative feedback if it’s necessary.

The other thing that you shouldn’t do as a CEO is claim all the credit yourself or hold them responsible for all the negative outcomes. That really takes the air out of somebody, when they don’t get the credit for something they’ve done. You see that every day, where people take credit for things they never really did.

You need to develop a lot of star performers in a large organization, and then you have to retain those people. You do that by giving them incentive to stay, but just giving your people a (cash) incentive is a lot different than giving them personal recognition. Recognition by others is the most important thing you can possibly do. When you do a lot of things and it’s never recognized, you don’t feel like everyone appreciated you quite as much.

Recognize what it means to lead. To be a true leader, your people will decide that. You are a leader if you show initiative, if you are well-informed and if you have a good track record of your leadership working out.

It’s kind of like your starting quarterback. He could be the leader of the team, but he needs to win, as well. Leadership is something others give you and allow you to have. It’s not something that you just deserve because of your position.

The way other people give you leadership is that even when they’re away from you, they’re still moving forward with the same targets you set. They have confidence in your position; they’re not questioning that.

You can try to overlead, which could be viewed as meddling. But if the direction that one of your departments is going is not the proper focus, then you need to get that back on direction. You learn those boundaries over time.

At the end of the day, in order to lead, you have to set a positive example. I’ve worked for some people who were very negative examples over the years. You can be an example, but you can be a bad example and a bad leader or you can be a good example and a good leader.

But the first thing is, you can’t show up at 10 a.m. and expect everyone else to be here at 7 a.m. That is an example of totally negative feedback.

You can evaluate yourself as an example-setter by doing 360-degree evaluations of your performance and by having peer evaluations. We do that with our top executives. There is nothing like an evaluation where someone you work with gets to fill something out.

How to reach: ViewPoint Bank, (972) 578-5000 or www.viewpointbank.com

Thursday, 26 March 2009 20:00

Fighting the current

Walt Fegley fights the current economic downturn by ringing a bell.

No, it’s not a metaphor. He and his staff at Reno Contracting Inc. literally ring a ship’s bell, located in the company’s estimating department.

The bell doesn’t have the cure for lost revenue or work force downsizing, but it does help boost morale.

“For every job we get, we ring the bell,” says Fegley, Reno’s president. “We also put a big announcement out. The message is [that] we celebrate everything that is worthy of celebration. Everybody is proud to be working here, and I want them to know that they should be proud of all the things we are doing.”

As with many companies affected by the current economy, maintaining a positive outlook has been difficult for Reno’s employees. The construction firm, founded in 1993, had grown to a $213 million revenue company by last year. This year, due to a number of planned projects that dried up, company revenue projections have fallen to around $130 million. Reno had to lay off eight people in the past year, and a number of other employees left the company, moving out of Southern California due to the high cost of living.

“Nobody is looking to build right this second,” Fegley says “Everyone is waiting to see what is going to happen with President Obama and his new cabinet. It’s very difficult to see anything out there that you can count on. It’s going to be a very challenging year.”

But challenging or not, Fegley is among those who are charged with paving the way for future success at Reno Contracting. To do it, he’s had to focus on staying nimble, constantly communicating with his people to keep morale up and keeping as much of the company’s best talent as possible.

Stay nimble

To react to a changing economy, you need to keep your business nimble and adaptable. Fegley’s key to that is to make sure you know what is happening with the markets you serve.

“Being nimble is paying close attention, staying networked with the good people in your industry and making your moves quickly,” he says. “I don’t think it’s the company that behaves like a big giant that is going to be able to stay busy and profitable. It is the company that is going to be able to change. You have to change if you want to stay competitive.”

The seeds for a maneuverable company are planted in good economic times. By the time the economy has shown signs of slowing, it might already be too late to make adjustments that are going to cushion your company’s fall.

Fegley says diversification is one of the most effective ways to survive a down economy — as long as you are keeping your company focused on what it does best. You need to figure out new ways to employ your core competencies, but you can’t simply pull growth ideas out of left field.

It’s a lesson Fegley learned on the job.

“Five years ago, we started focusing on medical (construction) and we’ve continued to do more and more medical work,” he says. “We diversified well, but the problem was we stayed in the private market. So we have projects in biotech, office construction, general engineering and health care. But what we didn’t foresee was that the private banking industry was going to collapse the way it did and really drive the money.

“Typically today, if you were going to get involved in investigating a new market, it would be for the next downturn.”

It’s nearly impossible to accurately gauge how the next economic crunch will affect your business. But you can prepare for what might happen, which means bringing as many perspectives to the conference table as possible.

Fegley has done that by helping to foster a culture of continuous improvement at Reno.

“I drive them crazy with new ideas,” Fegley says. “I’m imaginative, and I’m always trying to figure out how we can do things better. In addition, I stay very involved with management groups and network with other CEOs, presidents and business owners.”

In order to get input from your employees, you need to develop a culture of communication that moves in two directions. You need to reach your employees, and as important, your employees need to be able to reach you.

“There has to be a lot of meetings with direct reports that enable information from the top to go down, then go all the way back up,” Fegley says. “And you have you make sure you allow open access to management. We have a company of 65 to 70 people today, and sometimes they need to talk and don’t want to necessarily talk to the person that they report to.

“I think it’s really important to take the time to sit down and listen, then ask your people how you can do something better. It requires you to make yourself a little vulnerable, but if you don’t, it’s difficult to get people to come in and tell you their problems or to get some fundamental feedback on what is happening at the grassroots level. I’m the last person employees typically want to tell, just because of my position. So you have to make it really easy for people to approach you. You do that by being relentless in your communication, both in person and in writing.”

Communicate frequently

Fegley says good communication starts before any speech is given or any memo is sent. It begins with a definition of what you want to communicate and how you want to communicate it.

“There needs to be clarity of thought to start with,” he says. “You need to spend some time to put it in bullet points. Make it clear and have a good understanding of what you want to communicate. You have to have a solid core message that is threaded through the whole communication.”

When facing an uncertain economy, you should reach out to your employees on a regular basis. Even if there is no major news to report, your communication keeps them in the loop and affirms where the company stands.

“They need to see that you’re living through this economy, too,” Fegley says. “You have to start at the top. Keep morale up by setting an example and back it with good communication.

“Our employees are out there wondering what is going on, and sometimes we don’t know for sure if a job is going to come in. But every couple of months at least, I’m sending them all a letter from the president, telling them, ‘We’re all concerned; we’re doing our best. Here are the opportunities ahead of us, and we want to keep you current on them.’ Our director of operations goes around to each job site on a monthly basis and spends a little time there talking to our people.

“You have to realize that at the end of the day, people just don’t want to be left in the dark. These are scary times for everybody, and if people are left in the dark, they’ll fill in the blanks with their worst nightmares.”

You also communicate with the attitude you display each day. When you’re surrounded by negative financial news, it can be difficult to project a positive demeanor. But if you can exude confidence and an upbeat attitude even in the face of negativity, your employees will pick up on that.

“If you walk in each morning and you are positive, you can take another 80 percent of your people and make them positive,” Fegley says. “I like to walk the halls and set that tone. Whether you feel good or bad, when you walk out the door of your office, you lift up your chest, step into that leadership role and show everyone the confidence that it will be OK. People want to see that, hear it and feel it. That’s why not a day goes by where I don’t say hi to everyone in my office.”

Maintain your team

Even in the face of downsizing and attrition, Fegley sees to it that retaining his employees — particularly the managers that form Reno’s backbone — remains a top priority.

The economy might force you to make some difficult personnel decisions, but through all of it, you still need talent to run your business and make sure that talent is properly leveraged to keep your business able to grow and adapt when the right opportunities come along.

At Reno, Fegley does all the hiring so that he gets a firsthand look at new potential teammates.

“I want to develop a relationship with them, and that starts with one or two interviews that they have just with me, just so I can get to know who they are, how they think and how they handle adversity,” he says. “I want to know what is important in their lives. That is the beginning of developing a good relationship.

“Then, you have to give them what they want. I try to make deals with salaries and benefits. I want to make sure the people that come here are excited, interested and know that we demand excellence. We check in with new hires 90 days after they start to see if we’re living up to their expectations and we’re living up to ours. I do that myself — it’s not just my direct reports. If they are having a problem with their job, they can come tell me about it.”

The keys to retaining employees in bad times are really not much different than the keys to retaining employees when times are good. Employees always want fair compensation, recognition for their achievements and want to know that they are working for a company that values their ideas and opinions.

If you develop those principles as part of your company culture, you will stand a better chance of keeping your employees, no matter the economic forecast.

“Losing good people is always difficult,” Fegley says. “In a good economy or bad, there is never a good time to lose someone. Once you start losing people, it can be very difficult to get that loyalty and retain your employees. So it goes back to the relationships you develop. You start to recognize the people that want to be a part of your company and want to stay there long term.”

When you do have to make cuts, go a little deeper than you think you need to. Forcing your employees to endure multiple rounds of cutbacks is one of the quickest ways to ruining morale.

“You have to take action quickly,” Fegley says. “That comes down to evaluating your expenses for payroll and personnel. You generally need to freeze bonuses, freeze raises, and when you cut, cut a bit deeper than you think you have to.

“On top of that, always keep your core employees busy. Morale is always difficult to keep up when the economy falters like this, but here at Reno, we’re in pretty good shape because we’ve managed to keep our core people employed and busy. We’ve even gone so far as to have one of our superintendents drive two or three hours away to work for another contractor, just to keep them busy. Keeping our good people working and busy is one of my top priorities.”

Thursday, 26 March 2009 20:00

Engaged and active

Gary Base learned what it means to lead people while he was in the military.

The president and CEO of 630-employee ViewPoint Bank says that his military career taught him that a leader can’t lead without the confidence and trust of those beneath him.

And you build that confidence and trust by engaging the people in your command, communicating with them and putting them in the best possible position to succeed at their jobs.

“The first person who needed to be engaged would be the first lieutenant, or else no one would follow you,” Base says. “So, throughout my 40-year career in banking, I’ve always been very engaged with everyone, where I’m active in participating and I just don’t sit back. But at the same time, you have to be supportive and a mentor.”

Smart Business spoke with Base about how you can better lead by developing stronger relationships with your employees.

Show employees your process. The very first thing you have to do is clarify your expectations. They have to understand what the target is.

You also have to make sure that they’ve been completely trained to accomplish their goals. If they don’t have the skill sets that are necessary, you have to make sure they gain those through training.

You have to support them in going ahead and helping them be successful. Even though you give someone else responsibility, you can’t really abdicate that responsibility. You need to support and mentor your employees throughout the process. Then you need to do some measurements to measure the progress and success. Then, after it’s all done, you need to sit down and evaluate the results with them. It’s really a multistep process.

A good example of clarifying your expectations would be if you had a brand-new type of product you were going to offer. You would go ahead and talk about the product and the vision for that product, what you hope to accomplish with that product, why the institution is doing this. Then [you talk about] what the expectations would be in terms of measurements, rolling out the product, what date, what level of success and sales you expect to have.

If there are any losses as you start out, you need to be clear on what kind of income you are expecting and when you are expecting it, when you expect to be turning a profit and what kind of budget would be associated with it.

Show employees that they’re valued. You need to recognize employees in front of other people. You need to tell them that you appreciate them.

You also need to talk to them personally if there are some shortcomings. Obviously, you don’t do it in front of everyone, but you do need to give them negative feedback if it’s necessary.

The other thing that you shouldn’t do as a CEO is claim all the credit yourself or hold them responsible for all the negative outcomes. That really takes the air out of somebody, when they don’t get the credit for something they’ve done. You see that every day, where people take credit for things they never really did.

You need to develop a lot of star performers in a large organization, and then you have to retain those people. You do that by giving them incentive to stay, but just giving your people a (cash) incentive is a lot different than giving them personal recognition. Recognition by others is the most important thing you can possibly do. When you do a lot of things and it’s never recognized, you don’t feel like everyone appreciated you quite as much.

Recognize what it means to lead. To be a true leader, your people will decide that. You are a leader if you show initiative, if you are well-informed and if you have a good track record of your leadership working out.

It’s kind of like your starting quarterback. He could be the leader of the team, but he needs to win, as well. Leadership is something others give you and allow you to have. It’s not something that you just deserve because of your position.

The way other people give you leadership is that even when they’re away from you, they’re still moving forward with the same targets you set. They have confidence in your position; they’re not questioning that.

You can try to overlead, which could be viewed as meddling. But if the direction that one of your departments is going is not the proper focus, then you need to get that back on direction. You learn those boundaries over time.

At the end of the day, in order to lead, you have to set a positive example. I’ve worked for some people who were very negative examples over the years. You can be an example, but you can be a bad example and a bad leader or you can be a good example and a good leader.

But the first thing is, you can’t show up at 10 a.m. and expect everyone else to be here at 7 a.m. That is an example of totally negative feedback.

You can evaluate yourself as an example-setter by doing 360-degree evaluations of your performance and by having peer evaluations. We do that with our top executives. There is nothing like an evaluation where someone you work with gets to fill something out.

Sunday, 26 October 2008 20:00

Making your words count

If your idea of a great communicator is a leader who delivers inspiring speeches or writes best-selling books, you’re right — at least partly. Great communicators can do great things with their talents and skills.

However, if you don’t possess superlative oratory skills and don’t have a finished manuscript to show publishers, William F. Provenzano says you shouldn’t take that as a sign that you can’t be a great communicator.

The president of $56 million Ohio Valley General Hospital says that truly great communicators are measured not in the messages they deliver but in how they are received by their audience. If your employees think you are straightforward and genuine and that you value their input, chances are you’ll get high marks from them as a communicator.

But Provenzano says that getting to that point takes consistent reinforcement of your messages.

Smart Business spoke with Provenzano about how to become a better communicator in the eyes of your employees.

Know what to communicate. First, you need to know what you have to communicate. You really need to be able to step back and see what you need to communicate, what is it about the organization that is important and what is it that you need to talk about.

When you do that, you focus on the A priority, so to speak, and you’re not just chit-chatting. You focus on those, and then you communicate and discuss those issues.

So for us, it’s basically talking about where we’re going with the hospital, what is our strategic plan. You talk about that, and then you tie the other pieces together.

Say we need to build a medical office building, which we are actually just doing now. We need to get a contractor to build it, we need to go out and get the leases and meet with the physicians. We need to get them into the building and make sure they use the hospital services.

Remain accessible. Employees need to see the leader. They need to see who is running the organization and know them. But probably the most important part of that is people really want to feel part of the organization.

They don’t want to just be a worker. They want to be part of its mission and its future. They really want to contribute to the success of the organization. If you don’t involve them, you don’t talk to them and you don’t see them, they don’t feel like that. That’s the biggest key.

Employees will bring issues up to you. If they see something, they might e-mail you. But if I’m just walking around, they’ll say, ‘Hey, Mr. Provenzano, were you aware of this?’ Then you go back to the office and figure out how to address it.

So they’ll frequently talk to you, even if they don’t end up e-mailing you. And if they see you around frequently, they’ll feel more comfortable stopping you and talking to you.

Teach others to lead. You need leaders throughout the organization. You need people who take a leadership role in the lobby, meeting and greeting people, helping them with their problems and issues if they’re not sure where to go or what to do. You need someone to guide and direct them.

Everybody in the organization needs to be a leader. Everybody in the organization is responsible for the future success of the organization. That’s why we involve them. If an organization does well, it’s going to be because of people, not because of bricks and mortar.

I go over that with the new employees. I let them know that when a patient comes in here, when a doctor or visitor comes in here, act like you are the only person they’re going to come in contact with, that they’re going to judge the whole organization based on how you treat them.

No one goes and interviews 500 people to decide if this is a good organization. They don’t come to see me. It’s that person that sees them and handles them.

If they’re nice and take care of them, they’ll like the organization, and it will do well. The people on the front end make all the difference in the world.

Instilling that sense of ownership starts with the orientation, where we tell them that we’re going to listen to them and that we’re concerned about them and want them to have a future here, and that they’re crucial to the quality of care we can provide. People’s lives are in their hands, even though they are just one individual.

Then we try to keep them involved in the decision-making, in the philosophies, so they feel part of the organization.

Stay tuned to the future. I think the major role of a CEO today is to keep in mind that the world is changing rapidly, and you have to change with it. The success and future of your organization determines whether or not you put them on a strategic plan or initiative that is going to survive in that environment as it changes, and the way it’s going to change.

So you sit back and ask yourself what is going to happen ... within the next five years, what it is going to do. Your ability to predict that will likely determine how well you’re going to do.

No one has a crystal ball, but you try to predict what is going to happen, what is liable to happen and what is your role going to be in it, how are you going to position yourself. If you are able to do that, you’ll be in business.

HOW TO REACH: Ohio Valley General Hospital, (412) 777-6161 or www.ohiovalleyhospital.org

Sunday, 26 October 2008 20:00

Stepping up to the plate

Ron Whitley is fully aware that theworld’s appetite for steel is insatiable. Steelis built into cars, buildings, bridges and ahost of other things that make modern lifepossible.

Armed with that knowledge, a companythat makes and distributes steel could follow any number of paths to profit. AsWhitley charted a course for Ranger SteelServices LP in the early ’80s, the optionswere almost too numerous. Ranger hadbecome involved in a variety of steel markets since Whitley’s father, Roy, foundedthe company in 1958, but as Whitleyworked his way up through the ranks, hebecame concerned that Ranger wouldspread itself too thin.

“In the earlier years, Ranger was involvedin other product lines, which at the timedid work for Ranger,” says Whitley, thecompany’s president. “But since then, asthe world has changed and become morecomplex, so have the items and the sourcing of these items. So, in 1982, I made thedecision that we were going to focus onplate products.”

Ranger pulled out of other markets, someof which were putting them into directcompetition with their customers, andbegan focusing on delivering differentsizes, grades, thicknesses and widths ofsteel plate.

The new approach allowed Whitley tofocus Ranger — which earned $328 millionin 2007 revenue — on delivering two thingsto customers: steel plate and service. Withjust two overarching goals placed in front ofthe entire company, Whitley has been ableto focus everyone at Ranger on becominggreat at both of them, loading the company’sfinancial and manpower resources into oneniche instead of attempting to cast a widenet. But keeping it simple doesn’t meaneverything stays the same at Ranger, year inand year out. Focusing on a niche marketmeans having the ability to adapt to continue serving that market.

Not every company can home in on a narrowly defined niche and cast everythingelse aside, but Whitley says keeping yourcompany’s approach to business as simpleas possible is a goal for which you andevery business leader should strive.Simplicity helps your people stay focusedon building within your niche. It also helpsthe transition process in a time of change.

Whitley has had to help his company doboth at various times.

“We keep the model simplistic so we can behands-on,” he says. “A lot of companies mightoperate in a more complex fashion, and thatmight be right for their business model. But,for us, it would be totally disruptive.”

Stay ahead of the curve

Change is a fact of life in business, andthe only way you’re going to be able to stayon the basics of drilling down on your company’s core competencies is to make sureyou’re going to understand what in themarket is going to affect your company inthe coming months and years.

Whitley received some firsthand experience with that in the late ’90s when customer demand was shifting from importsteel to domestic.

“At that point, the majority of Ranger’sinventory was made up of mostly an importorigin, and there had been a continual trendby customers to demand more steel manufactured in the United States,” Whitley says.“We charted this, plotted this and realized thetrend was becoming more cumbersome tobuy large quantities of imported steel, so weshifted our focus to buying a majority ofdomestic steel. Today, 95 percent of ourinventory is made in America.

“If we had just continued to stock 100percent import, we would have lost a significant portion of our customer base.”

The key to reacting to market changes isto not waste time. If your research says themarket is shifting, prepare to shift alongwith it — or even beforehand, if possible.

“If you meet and react to these changesearly on, you’re more able to maintain control of your business,” he says. “New eventsare going to happen constantly. That’s justthe nature of business. In Ranger’s business, that’s been our blueprint. When theseevents do happen, we look to see howthese events might interact with or compromise our blueprint. Then we relate tohow we’re going to change to that. We’revery careful.”

Keeping ahead of market trends requireskeeping up on the latest industry news viathe media outlets that serve your industry,but your knowledge base shouldn’t beginand end with trade journals, newspapers orwhat you see on television. You need eyesand ears on the ground.

Representatives of Ranger Steel cultivateand maintain relationships with customersand vendors both in the U.S. and abroad.The representatives in the field stay in frequent contact with their superiors, whichallows information to well up within theorganization, giving Whitley and his management team a view of where the marketsthey serve might head in the near future.

“Staying ahead of the curve on purchasing requires our purchasing department to,at times, look nine to 12 months in advanceon buying commitments,” Whitley says.“You have to have a lot of exposure whenyou’re looking that far down the roadbecause the market can make changes upor down in a certain time period.

“We spend a lot of time nurturing partners,the people who make steel, and we try towork with them and communicate withthem very closely through face-to-facemeetings where we exchange frank andhonest market information about what isgoing on in the steel industry. We have beenable to nurture a reliable group of vendors,both domestic and foreign, that we continueto depend on for our product line.”

Keep people informed

At first glance, it might seem like something of a contradiction: Build a work forcethat stays focused on what it is you do well,yet is open to change.

In order to continue to stay focused onyour markets, you need adaptability within your company’s ranks, people who are willing to change theirapproach to meet the needs of the people you serve.

Whitley has a basic rule pertaining to thinking ahead: Informedpeople are motivated people, and motivated people are muchmore likely to be willing to do what is asked of them.

“It requires a balancing act to stay on what it is you do well whilestill accepting changes,” Whitley says. “Because we eat and sleepplate steel 24-7, we feel like we’re going to know the changesbefore anybody else does.”

But it still takes communication and education to achieve buy-inwith an employee base that wants to know where the company isheaded and why.

“Changes are about how they are presented to employees,” hesays. “It’s a matter of education, to explain what I call result outcomes, to explain to people that this is why we’re going to changeand this is what we see as the result of that change.

“If people know where you’re going with it, it’s a lot easier forpeople to accept changes. Changes are uncomfortable for everyone, myself included, but if you aren’t changing, you are growingstagnant and going nowhere.”

Keeping your company both focused and nimble starts with youand the communication you deliver. If you don’t keep your employees informed about the direction of the company and the industry,you can’t expect to easily justify your future plans to them.

Whitley says communication is the first and most importantingredient in paving your company’s future path. Without it, no onegets on board with you.

“You can’t force change if someone doesn’t know why you’remaking the change,” he says. “The result of that is negative.Communication is No. 1, and showing them the outcome is No. 2.Show them why you’re going to make the changes and ask for suggestions. People might come up with different things to add thatwill make the whole situation better.”

Developing a culture of communication can become a lengthyprocess. It’s something that can only be accomplished over time asyou continually take steps to keep your employees in the information loop.

“It’s kind of like being married — that level of trust doesn’t comeovernight,” Whitley says. “It takes a lot of years of work. If you aretelling someone to trust you, you have to demonstrate it. If management says something to employees, they’d better back it up anddo it.

“It’s something that grows over time. It’s not something that youcan come in and write down on a piece of paper.”

Let others help you lead

As the person who leads change in your company, you have tosee to it that your vision and mission isn’t lost as the companyevolves.

But just because you have to keep the overarching goals of thecompany in mind doesn’t necessarily mean that you need to control every aspect of the process.

At Ranger Steel, which is projected to earn $500 million in revenue this year, Whitley lets others in the organization step up andassume leadership roles, helping to cut the paths that will serve asthe means to the end goals. Every employee at Ranger knows thatthe goal is to stay adaptable and profitable — which the companyhas for each of its 50 years — and the foundation is built on theproduction of plate steel. Those facts serve as the boundary linesfor Ranger’s future. Beyond that, Whitley wants others to deliverinput as to how Ranger will meet their customers’ plate steel needsin the future.

It’s part of having a culture of communication. After you havecommunicated from the top, you need to be willing to listen towhat everyone else wants to say.

“People come in here looking for answers,” he says. “Sometimes,I don’t have all the answers. I don’t pretend to be the brightestleader here, but I think I do quite a respectable job of it. If I don’tknow about something, I ask people what they think we should doand listen to what they have to say. Listening is a very importantpart of being a leader. You have to lead by example, and if you sayyou’re going to do something, again, you’d better follow throughand do it.”

If you want employees to take a genuine interest in where thecompany is headed, and take a genuine interest in helping youlead, you need to take a genuine interest in informing and teachingthem, then take a genuine interest in their input.

It’s a lesson Whitley learned long ago, and something he continually reinforces to his managers.

“Any information that needs to go lower down than management,such as market information, customer information or anything thatwould affect sales, is immediately passed down through the company, whether it be in formal meetings or e-mails,” he says. “Everybodyhere is well informed, because the days of telling people things on aneed-to-know basis are long gone.

“A company team is like a football team. They have to work together and jell together. They might not all go out to dinner or lunch witheach other, but at work, they need to develop into a true team.”

HOW TO REACH: Ranger Steel Services LP, (800) 231-5014 or www.rangersteel.com

Sunday, 26 October 2008 20:00

Attack of the clones

If someone says “diversity,” what is your initial reaction?

Carl Camden thinks he has a pretty good idea.

“If you did a poll, I’m certain it would be racial background, ethnicity, gender, maybe lifestyles if you’re more enlightened,” he says. “When you talk about diversity, people tend to go into a little bit of a dazed-eye look. They’ve been there, they’ve heard many presentations on diversity and all the things you’re supposed to do.”

Camden, the president and CEO of $5.7-billion staffing and recruiting giant Kelly Services Inc., has seen firsthand through decades in business how companies can cross over from diversity awareness to diversity overkill. And he wants to change it by changing the way people in business think about diversity.

More specifically, he wants to write a new definition for diversity as it pertains to business. In a company, diversity shouldn’t simply pertain to employing people of varying skin colors or ethnic backgrounds. He says that the true meaning of diversity is employing people with diverse backgrounds and experiences.

In a society where people from various ethnic backgrounds now frequently share the same experiences during their formative years, it’s no longer enough to assume that people from different races, ethnicities or genders will bring different perspectives to the table.

“Just because we don’t look alike doesn’t mean we don’t think alike,” Camden says. “It used to be easy to assume that you were guaranteeing the company diversity of thinking or background if you achieve apparent diversity in age, ethnic origin and gender makeup of the staff. Now, we’re arguing that just because you achieve that doesn’t mean that you have the wide range of background and thought that you’re looking for.”

Camden says diversity shouldn’t be viewed as a buzzword or a goal you set simply to make your company look socially progressive. It’s a real issue with real consequences for your balance sheet, and it takes serious thought and planning to address.

Recognize the benefits

Diversity helps your business in a very tangible way if you approach it correctly. A diverse work force will help you sell your products and services to a diverse customer base.

“The understanding of the markets you are targeting is always better if you have people from a similar background as your customers,” Camden says. “My son and daughter, who are teenagers, the marketing to them is infinitely more effective if it’s being guided by people of the same generation, as opposed to people who only know that generation through market research. Nothing replaces having people who understand those who you are serving: the customers and the markets.”

Kelly Services’ leaders have had to learn how to use diversity to serve new markets over the years. Many people who grew up in decades past probably remember the “Kelly girl” moniker, an informal term for a clerical staffer hired and placed by the company. For years, Kelly Services was synonymous with secretaries and office workers. But as the staffing needs of businesses evolved, Kelly Services had to evolve, too. Overtime, the company began supplying engineering and technology firms with staffing help. But there was a problem, and diversity was at the root.

“We at Kelly and throughout the industry believed that anybody who was good at recruiting for our established core areas could do an equally fine job recruiting individuals who were from all of these specialty areas,” Camden says. “It turned out that we and others were wildly ineffective at recruiting inside some of these specialty areas until we got to the point of realizing something that now seems simple. We thought, ‘Gee, maybe the people who run the engineering branch and do recruiting should be engineers. Maybe the people who do the recruiting for accountants should be accountants.’”

When Kelly Services started hiring engineers to recruit engineers and accountants to recruit accountants, the company’s growth in those areas gained momentum and the company’s leaders gained a new perspective on how a workforce with diverse backgrounds could help the company conduct business.

“If you go back to pre-Internet days, if someone was looking for an office clerical job, they would pick up the paper and look at the want ads,” Camden says. “But engineers don’t do that. That’s not how you find them. You had to understand what professional associations they belong to, what are their interests and hobbies. It changed where you placed your ads; it changed where you put your recruiting efforts.”

Start with the interview

To find people with diverse backgrounds and experiences, you need to get to know job candidates beyond surface-level information. Unfortunately, the interview process for many companies doesn’t go beyond the surface when it comes to a candidate’s personal background.

“You need to spend as much time talking about their life experiences as their academic experiences,” Camden says. “What were their biggest challenges, how did they find their way into college, what were their difficulties in getting to college and being successful. You have to work with your HR department to find out what questions you can and can’t ask, but I think that we tend to gloss over background questions very quickly in the interview process.”

Camden allocates a larger portion of interviews for getting to know job candidates on a more personal level.

“I’m setting myself up so that a third of the interview is about their background and life experiences,” he says. “I do that because in my experiences when I’ve been sought after for a job, it’s basically,

‘Tell me something about yourself,’ and you typically answer, ‘I was born here, I went to this college, I studied this and my job is X and Y.’ All we really do when someone asks us to tell us something about ourselves is give a short summary of what is already on the resume. Then, the interviewer checks off the box and moves on to, ‘Tell me about your first job.’

“We don’t ask questions like, ‘How did you decide what college you were going to go to, how many majors did you have along the way before you settled down to become a journalism major, a biology major, and what made you change from one to the next?’”

Camden says human resources departments are coached to stay away from drilling down on personal information because it ventures too close to subjects like race, ethnicity and other areas that might open to door to questions that could be viewed as probing or even discriminatory.

It’s no secret that race and ethnicity are potentially touchy subjects around which you and your HR team should tread carefully during the interview process, but you shouldn’t go180 degrees in the other direction. Camden says that if you remain too distant from getting to know a candidate on a personal level, you’re staying in a comfort zone. That can lead your company to hire people based on familiarity and comfort level, which can be bad news if you’re trying to build a diverse work force.

“Your ears should perk up anytime someone in the company says, ‘Isn’t it amazing that we all ...,’ whatever that ‘all’ is,” he says. “‘Isn’t it amazing that we all went to the same school, all play golf, all belong to the same club,’ whatever it is. That’s a sign that the backgrounds of your people might be too homogenized.

“I was fortunate to have a boss very early on who, at a time when everyone at the top ranks of business played golf, asked me if I played golf. I said no, figuring that was going to be a negative response to him, and he said ‘Great. We need a nongolfer around here. That’s all they talk about around here is golf, so you make certain you talk about something else and bring in another perspective.’”

Camden says that when recruiting for a position, finding different backgrounds and perspectives should be more important than finding a comfortable fit.

“We, as leaders, have just got to stop telling our recruiters that a comfortable fit is the No. 1 criteria,” he says. “I can’t tell you the number of times I’ve been called when someone is recruiting folks or pitching to folks and it all comes back to that comfortable fit.

“Tell me they believe the same core values we believe, that they possess a high sense of integrity, that’s fine. But when the pitch is all about the comfortable fit, it really has to be setting off some alarm bells. That can’t be first or second on the list we’re feeding our recruiters. It’s not rocket science; it’s a matter of raising the idea of diversity further up in the priority set.”

Communicate the concept

The comfort zone is an easy trap to fall into simply because people tend to gravitate toward what is familiar. If an employee at Kelly Services finds Camden falling into his comfort zone, he requests something of them: “Watch me, and yell at me if I’m doing it, because it’s probably not going to be apparent to me that I’m doing it.”

Raising consciousness about diversity of thought, and maintaining that consciousness, is a matter of constant communication and dialogue from all levels of the organization. Along with diversity of backgrounds and experiences comes a need for diversity in communication methods.

“The keyword is ‘tailoring,’” Camden says. “What I need in diversity can be different as you roll down the organization. Our managers have their own management meetings, their own group meetings, their own internal blogs and their own speaking opportunities.”

To keep the message front and center, Camden says employees need to hear it from their direct supervisor. A wide-ranging message from the CEO can help start the message cascading, but in order for it to take root, the managers who interact with your employees each day have to take an active role.

“It’s always constant communication, and a message from your own direct boss is often more powerful than a message from the distant CEO. That way, it keeps rolling down the organization.”

When you lay out your reasons for placing an emphasis on diversity, do so as simply and as clearly as possible. If you can relate the reasons in a convincing fashion, you stand a greater chance of getting everyone to not just buy in to the concept but also emphasize it when it comes time to hire or build a project team.

“It’s almost like ‘Field of Dreams.’ If you build it, they’ll come,” Camden says. “If you look for it, if you make it a priority, you’re going to get it. But you have to make it a priority, and you have to communicate it frequently. You have to demonstrate that it’s a priority by the people you are directly hiring around you.

“If you are thinking about the challenges you are facing and how differences in backgrounds would help you meet those challenges and form your responses to those challenges, I think that, over time, what you are looking for in people would change. You need to take that time to step back and ask what set of experiences and backgrounds would be useful to where you are and where you are going.”

HOW TO REACH: Kelly Services Inc., www.kellyservices.com

Thursday, 25 September 2008 20:00

Process of inclusion

Technology is a wonderful thing, says Greg Dell’Omo.

Technology has made communication more efficient and able to reach an extremely wide audience in seconds. And electronic communication mediums, such as e-mail, would seem to be the perfect invention for time-challenged business leaders.

But it comes with a catch, says the president of Robert Morris University: Technology can make communication a little too easy.

When you start using your computer as an easy way out, as a substitute for getting out among your employees and the people you serve, technology starts getting in the way of your leadership.

Dell’Omo says you can’t neglect the personal interaction that makes your employees feel valued. Any time you can spend walking the halls of your building, talking to employees about everything from the future direction of the company to the brand of coffee in the break room, is time well spent.

Smart Business spoke with Dell’Omo about how he involves his employees at Robert Morris University — which posted 2007 revenue of $89 million — through active engagement.

Let them see your face. We all like personal contact. Technology is a wonderful thing, it has allowed us to communicate very effectively to a wider audience, but people still like to have that oneon-one connection.

They like to know they are an individual, not just another person on the other end of a computer screen. In addition, you can’t beat face-to-face communication in terms of its personal aspects, the ability to read body language, the ability to understand, ask questions, deal with it right away.

We all know e-mail communications can be very misleading at times and can even create misunderstandings. E-mail is easy and omnipresent — [it is] there all the time. People can rely too much on it.

The way people communicate on e-mail is not always what they intend. The way they write a sentence or structure a response, they might send a very different meaning than what they intended. It might sound more harsh or flippant than it was meant to be, it might appear overly defensive.

A lot of times, the communicator never intended that, but that’s the way it is coming across in written form. So you have to be very careful about that. We talk a lot about that with my senior management team, balancing e-mail communication with as much face-to-face communication as possible.

Put your feet on the ground and walk. Communication gets a lot more challenging when you starting talking about communicating below the senior management level. We’re a midsized university, we have about 5,000 students and about 600 employees, so it’s a struggle to communicate with all different levels.

That’s where technology comes into play with e-mails, but you don’t want to rely solely on that because, again, it can kind of become sort of de-personalized. You really want to balance it, be efficient, get the word out, but making sure that your communication is fairly personal and one on one.

I just try to walk around the university whenever possible. It’s important to try and be as visible as possible.

Making the time for that is the challenge. You have to build it into your schedule if you want to take an hour or two, hit a certain part of the campus, making sure you run into a certain number of people, that you attend a number of functions on campus, just touching base with a lot of people on a one-on-one basis.

Develop an inclusive, collaborative strategy. My leadership style is an inclusive style that relies quite a bit on gathering information from a number of sources and getting the whole team involved in moving the organization forward.

One of the first things is to make sure you hire good people, having talented people around you and then giving them the responsibility, authority and the tools, and then hold them accountable. It’s a real team effort with a lot of decisions being made but moving in the right direction.

In many respects, it’s easy to set an inclusive strategy, but it’s difficult to implement it. If you have people involved in setting the strategy, then they’re much more willing and able to become implementers of the strategy.

That goes to the whole heart of the idea that you need inclusive leadership and an inclusive management style. People should have a clear understanding of what they’re required to do, and then you hold them accountable.

If you have a strategy laid out and everyone knows what direction we’re going in and how the pieces fit together and align, we spell out a lot of measurable goals, and people know what they’re held responsible for.

We also review on a regular basis the progress in all areas of the university. I have my senior-level management team, which I call my cabinet, including the vice president and some of the key directors, and we meet and review the different aspects of the strategic plan.

It’s making sure you don’t lose sight of things, that you’re always staying on top of things. It’s not a matter of micromanaging; it’s a matter of how do people talk about where we are, where it’s coming together and where it’s not coming together and what corrective action might need to be taken.

HOW TO REACH: Robert Morris University, (800) 762-0097 or www.rmu.edu

Thursday, 25 September 2008 20:00

Get out of the office

If you’re a manager at Village Ford Inc., Jim Seavitt wants >your cell phone number.

The president and owner of Village Ford Inc., an auto dealership that earned $95 million in 2007 revenue, says the cell phone should be his primary way of contacting his managers. And if you are a manager and he rings your desk, you had better not be there to answer.

“If I call your office and you’re in it all the time, that means you’re not walking around,” Seavitt says. “So give me your cell number so I can call your cell while you’re walking around and you can get out of that office.”

Seavitt says an effective leader is a visible leader who keeps employees in the information loop and values their opinions.

Smart Business spoke with Seavitt about how he builds bridges between management and employees and why doing so is critical to the success of any business.

Stand up and get out. You want to be out there; you want to be sure that you’re visible to your employees. It’s so easy to get into that comfort zone, to get on that damn Internet and just be content with phone and e-mail.

Sometimes, it’s a struggle to keep yourself visible. We’re spread out here in three different buildings, and sometimes getting across the street can be like trying to get to a whole other state. You really have to force yourself to get up and get around.

People need to know you’re there, that you’re just not up in your office or playing golf, that you are actively involved. Every day, I make it a point to walk through the entire dealership and stop and talk to people. It’s the touch point.

If you were to walk in and take a tour of my dealership with me, I’d venture to say that 80 percent of the people would ask me, ‘Jim, how’s it going?’ and know that I’d know them and they’d know me pretty well. That leads to my whole philosophy, that if your employees like what they do, if they like where they are, like the people they work for, more than likely, you’re going to have great employee morale, which will translate into customer satisfaction.

There have been a number of surveys I’ve seen where people always think pay is at the top of the employee satisfaction list, but it’s not. At the top of the list is being in on things. How do you let employees be in on things? I have a lunch once a month with 15 to 18 employees, so that by the end of the year, I’ve had lunch with every employee.

I call it ‘Lunch with Jim.’ They all come upstairs, go to a meeting room, we buy them lunch, they ask questions, and I give them a state of the nation where I give them an update on the economy of the nation, because a lot of them don’t keep up with that.

I tell them what is going on with Ford Motor Co. and what is going on with Village Ford. That way, they feel like they’re in on things.

Understand why you’re communicating. Employees need to have the feeling that they’re helping, that their opinions count, that they know what is happening at their company. As I said, pay is important, but more important is the fact that they know what is going on, that they feel they have control over their destiny.

Even now, with Ford Motor Co. laying off people by the scores, by the thousands, my people have a very good feeling of where they stand. They know the way that we are going to scale our business down, and we’ve done it mostly through attrition.

They know what we’re doing about health care, how we’ve had to change the plan three times here. You can imagine how that touches people and what would happen if you didn’t give them a heads up on why things are changing and what is in it for them.

When I’m communicating, I’ll tell my employees 90 to 95 percent of what I know. There is a point that has to do with the financial part of the dealership that I can’t tell them, but it’s pretty doggone open. If we didn’t turn a profit for the month, I’ll tell them.

To give a related example, we’re redoing our showroom in a couple of areas. Our waiting area needed to be done. I knew what was going to happen. People tell me, ‘I’m not going to get a raise, but Jim is putting new stuff in the showroom.’

So I had to let them know why I was doing that, where that money came from, that it was money I put into the dealership that goes toward capital repairs and improvements, and that it’s different from operating profit. I explain that to them in detail so they understand it, so they get a better feel, and it improves their comfort level.

Hire managers to help you communicate. Select good department managers, give them good direction and encouragement, and get out of their way; let them take responsibility and lead. That’s my leadership style with my management team.

With my employees, I believe in management by walking around. I have 187 employees, so it’s all about getting out there, walking around every day. You need to be walking through the shop and walking through the office, walking on the showroom floor, getting to know your people.

HOW TO REACH: Village Ford Inc., (800) 331-4909 or www.villageford.com