Joyce Anderson follows the numbers religiously to gauge employee productivity levels. And no, she doesn’t just check the financials.
As CEO of Florida Orthopaedic Institute, Anderson uses management by statistics to measure employee and company performance. Combined with effective and open employee communication, her style is a recipe for honesty, productivity, growth and empowerment, she says.
“People are a lot more productive if you put them on a statistical system because they know what’s expected of them, and you know what should be able to be done by that position,” Anderson says.
In an industry that involves never-ending training of staff and updating materials based on new procedures and laws, Anderson must continue to be flexible and keep the lines of communication open when it comes to managing her 500 employees at the $62 million company.
Smart Business spoke with Anderson about how to identify concrete goals and how to communicate in a way that motivates and empowers employees.
Follow the numbers. I do management by statistics, which means we staticize the different areas of the organization from each individual staff member to each department to each of the executives. Each of them has quality and quantity types of statistics. Then we monitor those on a regular basis weekly.
When a statistic goes down, we go in and find out why it goes down to try to correct any issues. Then if it goes up, we find out why it goes up. Then we bolster those things that cause the statistics to improve.
It works. It takes out the opinion, it takes out the politics. It removes those types of things that make it unfair, and you judge a person by their performance. You can hear all sorts of rumors, you can hear people say things, but the statistics can actually have a quantitative item of, ‘Is that person doing their job; how do they compare to their peers?’
The statistics allow you to empower people. I let my managers and directors run with their stuff because I can monitor it through statistics. If the statistics dropped a little bit, they can say, ‘Hey, this dropped. This is how I’m going to fix it.’
It’s a continuous process. Any time we see a problem, we can then take a look at the statistics and see if we need to refine it.
You have to define your statistic correctly, or you get something inadvertently you might not want. You have to be able to specifically identify the statistic very well and manage those.
Start with the product. What product do we want for this department? How can we measure this? Where are we going to get the information? You don’t want the gathering of statistics to be a painful process.
Set concrete goals to see real growth and progress. Underlying these statistics themselves is the product. The statistic is just a measure of are you producing the products you want to produce.
Set your goal and then look at where you are right now, what the existing scene is. Then, step by step, work out how to realize what we would call your ideal scene, what is your ultimate goal. You have to be realistic in what the existing scene is, and it has to be something that is measured in a concrete manner. So you can see at the end of the process whether you actually achieved it or not.
If you say, ‘Work on training materials,’ you can’t judge that at the end of the quarter. You worked on training materials, but what did you actually do? Did you complete anything?
We like to do it in a concrete format, so that at the end of the time, you can say, ‘This is clearly done.’ You have to really make those things identifiable as things that can be completed.
Communicate in a way that will boost morale. To me, there are three basic ways to deal with a person. One is enhancement, taking what they are saying and saying, ‘OK, let’s work out how we can improve this or go from here.’
Then there’s domination, do this or else. And then there’s nullification, which is saying, ‘You’re basically nothing; my dog could have done a better job than you.’
My viewpoint is enhancement is the only appropriate way to communicate, and that’s in life just as well as it is in business.
We all know that there’s room for improvement in anything. The second you go into invalidating something they’ve done or being very negative, the person is on the defensive and spends all their time justifying instead of producing.
I try to point out how they could do something better or how I might have done it to get a better result. Using enhancement motivates better because they know you’re working with them. You’re saying, ‘How can we do this better? How can we not have this outcome next time?’
The ability to communicate means not just talking but the interchange of ideas. It’s not talking at a person. Part of the time you’re listening and actually figuring out what they’re saying.
You have to identify from their questions and their responses whether they can actually understand what you’re saying. You have to get it into a situation where, given the situation, you ask them, ‘How would you use that?’ So then you can think through how they would actually go about doing it.
HOW TO REACH: Florida Orthopaedic Institute, (813) 978-9700 or www.floridaortho.com
Paul Hering works daily to balance his work life and his personal life, and maintaining that balance is one of the core values on which he’s building Barney & Barney LLC.
As managing principal and CEO of the insurance company, Hering believes that balancing the two leads to happy, productive employees. So he focuses people on getting the job done, while emphasizing the importance of life outside of work, and he creates a positive work atmosphere with incentives such as a wellness program.
As Barney & Barney continues to grow its annual revenue, which hit $53 million in 2007, and add to its roster of 293 associates and 32 owners, the biggest challenge has been maintaining and communicating the company’s founding principles.
“Any time a company compromises on its ethics and core values, that certainly can be a problem,” Hering says. “That can be a downfall.”
Smart Business spoke with Hering about how to grow your company without sacrificing the organization’s culture and values.
Establish values you believe in. From a leadership perspective, I think it starts with being the real person, being authentic, knowing who you are as a leader and not trying to be something that you’re not.
You can seek feedback from your peers to make sure you’re being that way, but I think you know it or you don’t.
When you can establish that authenticity with people, I think they can relate to you much better. And the other things that you’re trying to accomplish organizationally, I think it’s easier for them to get behind.
If somebody really doesn’t believe in what they’re trying to hold out to everybody else in their company as a core value or a strategy, then it’s going to be very hard to get there.
Be a big-time advocate for it and a cheerleader to some extent, and make sure everybody in the organization understands where they’re coming from and why they feel that way.
Communicate and demonstrate your company’s values. We make a real effort to make sure that we’re constantly communicating who we are and what we’re about as a company.
We have our core values etched on the glass of our boardroom that are there for everybody in the company to see.
In some organizations, people probably create a mission statement and put their core values on a piece of paper and then that piece of paper gets shoved in a desk drawer somewhere and nobody could come close to reciting what it is. You really do have to make an effort to keep it out there and in front of people.
I literally meet with every new associate one on one that joins our company. It’s a chance to establish a connection with them and convey what we’re about as a company. I tell them all that I don’t want to see them working late on weekdays, I don’t want to see them working on the weekends.
While they need to get the job done, we want them to have a great life outside of Barney & Barney. That new associate meeting, that’s a chance for me to face-to-face convey that to them in total sincerity and have them look at me and say, ‘Wow, he really believes that.’
It has to start at the leadership levels within the company. If the leadership of the company doesn’t buy in to it conceptually, it’s just not going to work. It really starts with everybody agreeing (on) a key core value that we share as a company and modeling that behavior. Demonstrating to our associates that we value that, and that’s how we’re going to behave, and that’s how we want you to be.
We communicate that message and hopefully emulate that.
Resist compromise. The only way you can do it is by never compromising on your core values, having a clear sense of what those are.
There’s probably always a temptation to look for ways to grow your business and think only about the numbers and not necessarily is this the right thing for the company. Is it consistent with our mission and our vision of where we want to be?
I think you always have to step back and look at growth opportunities and say, ‘Are these opportunities consistent with who we are as a company?’
Question everything. Take your time to make a good decision and be thoughtful.
The other thing you have to do is you have to be careful about the people you bring in to your organization and make sure they share your values.
You’ve got to get the right talent in the organization.
We want to see evidence of strong values. We want to see people who are driven to be successful.
(While interviewing) there are questions you can ask people about how they would react in certain situations. You can probe about things that you see in their work or life experience and say, ‘Why did you do that? What motivated you?’
Be a good listener. People need to feel like I’m hearing them. I think for anybody who is working on being a good listener, you have to resist the urge to chime in. You have to really be quiet. You have to be an active listener and ask questions to confirm that you’re hearing and understanding what the person is saying. Give them feedback and say back to them, ‘This is what I’m hearing; am I right?’
For some people, it’s easy; for some, it’s hard. But I think it’s a skill you can develop.
HOW TO REACH: Barney & Barney LLC, (800) 321-4696 or www.barneyandbarney.com
Three years ago, Robert Christie sat down with his top executives to outline a long-term plan for 3E Co.
But since then, a whole new set of environmental laws has been created, and things have changed — and the company needed to change, as well.
The president and CEO of 3E — a provider of environmental health and safety compliance services — says that flexibility is the key to handling the challenges of hypergrowth and of constantly changing compliance issues.
“One of the failure points that I see for companies is they set a goal and they don’t want to change it,” says Christie, whose company posted 2007 revenue of $47.6 million.
Christie sees flexibility as a crucial element for any company to be successful, and it’s a component he makes sure his management team, infrastructure and growth plans all contain.
Smart Business spoke with Christie about how to plan for the future and maintain flexibility to grow your company.
Prepare for something to go wrong. When companies go through growth, the thing that can bring them down is not being prepared for something to go wrong — and they will go wrong.
The best-run companies in America expect things to happen that are going to be mistakes or issues that they have to recover from. If you don’t have a disaster recovery plan, if you don’t know how to deal with a mistake, the best-laid plans are useless.
Most people think of a disaster recovery plan in the case of thinking about their computer facility. Or, ‘Oh my gosh, the telephone lines went down, nobody can call in or call out.’
Those are the easy ones because you can always have backup plans. It’s the things that you don’t think of. Good companies sit down with all their managers and ask, ‘What if?’
In the case of Southern California, how do we as a company recover from a fire that took place last year and devastated San Diego?
We happened to be in a fortunate position to have planned for people to work from home and to be able to dial in to our computers from home. Our employees that talk to our customers still had access to our network to talk to them.
Seize opportunities by knowing your clients. You need to figure out what the markets are that you do business in and how they might be changing.
Find a way that you can make sure you can have a competitive advantage.
It’s a lot of market research, and it’s a lot of spending time with your customers. Your customers every day are struggling with issues. The closer you are with your customers, the better the opportunity is for you to be successful.
Assemble a staff of flexible people. Make sure you have a management team that can be flexible and adapt to changes.
Lots of people can do very well at managing a business of a certain size, but when it doubles or triples, it sometimes requires that they be able to have a different set of skills.
You need to be flexible. You need to be in touch with your clients constantly. You need to be able to adapt to having multiple opinions. You have to have a very open mind and be willing to change your direction.
We look for people that can motivate people, that can manage them, that can inspire them.
If you’re going to go to a specific place with your business, everyone has to agree that they’re going to that place. You have to have a management team that agrees on the vision and the direction that you’ve set forth. Then they have to have the ability to execute on that vision.
Train employees to know the company and its vision inside and out. It’s important you set up a training program within your divisions that makes your employees experts in the area of where they work. But I also think it’s critical that you set up training that allows people to understand everything you do.
It’s training you do in a day, training you do in workshops and in seminars, and it’s training that takes place over a period of a year or two.
As the CEO of this company, coming in here, I didn’t understand everything we did for probably up to two years. Until you see your products in use with your customers, until you talk to your clients and understand where they’re going, it’s impossible to understand everything you do.
It’s important to make sure they get a very broad understanding of your product and how that relates to the vision and direction.
If they understand what you do and they understand where you’re going, then they can buy off and be more motivated and excited, not only about what you do but other opportunities for them to grow and expand within the company.
Stay connected with employees. I think the most successful thing you can do with your employees is speak to them face to face.
Let them have a chance to ask questions. Assume in many cases they’re intimidated to ask questions, so you have to have a pulse from your managers as to what you think they’re worried about. You have to literally answer those questions before they raise them.
You need to stay informed. Companies that are doing well in tough environments have executive teams that are involved in their businesses.
HOW TO REACH: 3E Co., (760) 602-8700 or www.3ecompany.com
Margaret K. Nabors got her start with $60 and a cooking pot.
But that was 20 years ago, when she co-founded Mustard Seed Market & Café with her husband, Phillip, yet today, the company boasts 300 employees at two locations.
Nabors, co-founder and CEO of Mustard Seed Market & Café, says that when it comes to growing a business, keeping track of the numbers is imperative, taking risks is a must and a good business plan is essential.
“It’s a road map,” Nabors says of creating a growth plan. “It makes the journey a little bit easier.”
Smart Business spoke with Nabors about how to create a plan for growing your business.
Q. How do you create a plan for growth?
It happens sometimes spontaneously, and other times in a planned, well-thought-out manner. There are pluses to both of them.
When you’re sitting down and going through a formal meeting, that’s very helpful, because at that point in time, you really get things down on paper. You can measure: Have we met our goals? How close are we to getting our goals?
The impromptu meetings, those are enormously constructive, as well, because something has come up that has inspired you to talk about it. It really gets the juices flowing.
You need to have an executive team that you can share ideas and formulate direction. You need to be cognizant of the economy, labor market. This can have a huge impact on the direction you may want to pursue.
You need to know the growth pattern of your business. You need to be realistic about the strengths and weaknesses of your business.
You must be willing to listen. Be willing to listen to the people on the ground the people who are in the trenches down there what they have to say about their department, what their needs are, what they think are the long-term goals that can be fulfilled. That’s important.
Listen to your managers because they’re the ones that are interacting with the staff. Our senior vice president meets with each department head at least twice a year to map out the direction of their specific department, discussing with them their team’s strengths and areas to be improved.
Q. How do you prioritize growth goals?
You have to have short-term goals. But then there’s the long-term planning of how are we going to get the departments honed in for the long haul.
We’ve been on a three-year plan for our new location. What we’re doing is going department by department, analyzing it, tearing apart the numbers, tearing apart the work force. Really what we call tweaking it, so then at that point all you have to do is maintenance.
Q. How do you recommend monitoring and updating your growth plan?
Work with the numbers. It’s through the numbers that really helps you sit down and hone in on a department or an area that needs attention.
Acknowledge the company’s strengths and see if there is more room to expand on them. Then, recognize areas of weakness and set up a methodical plan to address those weaknesses.
Get buy-in from your core team and then, in turn, ultimately the entire staff we tend to go department by department, utilizing the numbers created by our accounting department: gross profit, inventory control, labor percentages.
Q. How do you encourage taking risks?
I wouldn’t be in business if I didn’t take risks. You have to have a little bit of faith in yourself. You have to have instincts in some regards. Once you get past that, you have to go in and, then again, look at the numbers.
You have to do a plan to see if it’s going to work out in your favor or not.
In this day and age, you must be very aware of the economy. Are your ideas going to be well received by your target customers?
Yet at the same time, you cannot let fear stop you from moving the business forward. If you have confidence, undoubtedly, everyone will be stepping in line with the updated direction.
Always remember you are responsible for the well-being of a lot of families, and the decisions you make affect lots of folks.
Q. What one thing can bring a company down or prevent growth?
Improper staff, if you have a staff that alienates the customers or doesn’t know the product or doesn’t understand.
We have what we call Mustard Seed Market 101. It’s an introductory to the business so that they get the basics of how we were founded, what are our ideals, what are our food standards, how do we expect them to treat the customers and each other?
There’s all kinds of ways to measure your staff. Put yourself in the position of the customer. Is this person fulfilling their role as your liaison?
You have to look at, are they meeting your numbers? Are they able to control their labor? And, are they happy?
HOW TO REACH: Mustard Seed Market & Café, (330) 666-7333 or www.mustardseedmarket.com
Liberty Tire Recycling was rolling when it came to growth. More than 100 acquisitions took place in the last 15 years, and as the tire recycling company grew, CEO Jeffrey Kendall wanted to make sure it also became a great company.
“We decided to draw a picture of what a great company would look like,” Kendall says. “Then we said, ‘All right, how do we get from here to there? How do we get from being an OK company that is a consolidation of a lot of mom-and-pops to a great company, where we’re proud of every single thing we do?’”
By identifying and implementing your company’s best practices, you position your employees, your operations and your company for future success.
“The process is one of always improving, always getting better, always looking at each step in your process and wondering how you can do it better,” Kendall says.
To make the process effective, you have to involve your employees.
Kendall made it clear when they started the process last year that listening to the company’s 1,400 employees at Liberty Tire Recycling’s 28 plants was essential.
“Instead of just us sending a team around, having them figure out the best way to do X, and then telling everybody to do it that way, we’re involving everybody in the process in determining which are the best ways,” Kendall says.Rally management
Kendall knew the process wouldn’t get off the ground unless the general managers of the plants thought it was a good idea.
Undertaking a project as large as defining best practices starts with getting management’s buy-in. When speaking to managers, try to link your idea to the possible benefits of the program.
For example, Kendall’s general managers are compensated based on the performance of their plant, so they’re interested in finding ways to make their plants run better.
“You have to be upfront with them,” Kendall says. “You have to tell them it’s important, why it’s important and how we’re going to do it. Get some input from them. They may want to do it a different way, but you still achieve the same end result. Lay out where you’re heading and why you want to go there. As long as it’s a good idea, they’re usually on board.”
Before starting the process, Kendall put his vice president of operations, Peter Ellis, in charge of the initiative.
Large projects need a leader. You need someone who can focus on the process and is familiar with the day-to-day work you’re examining, someone who can track the project’s many details and someone who can clearly communicate with you.
If lean manufacturing or defining best practices is new to you, you might consider bringing in a consultant. The team of about a half-dozen people who traveled from plant to plant partaking in the exercises was made up of Liberty Tire Recycling staff and members of an outside consulting firm with expertise in the topic.Involve employees
The crucial element that must be part of lean manufacturing and best practice exercises is the employees. Rather than dictate changes you would like to see made, you need to approach the process by asking those who do the job day in and day out for their ideas.
“Folks who participate in it and see how the operations run better, they’re coming up with the ideas,” Kendall says. “We’re not handing them a list and telling them to go do it this way. People want to improve. People want to do better. When they haven’t been called upon in the past, they really enjoy participating. We’re getting tremendous excitement and participation from everyone involved in the organization. Just that alone is almost a good reason to do it.”
The company has taken on projects from how to better operate machinery to the process of how to grade tires not ready to be thrown away. Once a project is identified by looking through the plant’s data, everything is connected to cost, time and effort to produce a product, and employees involved in that line of work are called in to brainstorm ways to find efficiency.
“Typically, you’re trying to understand why it’s done a certain way. What’s the reason?” Kendall says.
But Liberty Tire Recycling took the discussion one step further when it came to involving employees.
“When we conduct these exercises, we’re bringing in a lot of folks from different plants, so that they participate in providing ideas for the plant in which the event is occurring, as well as taking ideas back to their own plants,” Kendall says. “We expect at the end of the year a lot of the best ideas will be absorbed by osmosis, to a certain extent, based on people’s real-life experience at these different facilities.”
To get the best participation, you need to set the tone from the top as to why it’s important that the organization engages in these activities and that it will only be successful with the employee’s participation and offering of ideas. Also, employees need to know they won’t be criticized for speaking up.
“We wanted their ideas, and they weren’t going to be criticized for coming forward with ideas,” he says. “You have to stick by that though. It doesn’t mean you’re going to take all of the ideas. But you want to hear them. It’s like a typical brainstorming session where you’re going to reject certain things.”Install accountability
As you’re looking for ways to find efficiencies, you need detailed projections as to how much improvement you anticipate.
At each plant, the team would list about 40 to 50 assignments of what should be done. That list was then communicated to headquarters, which sent somebody back to the location once a month to compare financials and see if they met the projected numbers.
“It’s critical to have good data and also figure out if the changes you made have had an impact,” Kendall says.
You want to look at whether the new practice reflects what came out of the meeting and whether you can measure the change in productivity.
Only a few months after committing to lean manufacturing, Liberty Tire Recycling, which has revenue of more than $200 million, began to see financial results as well as a boost in employee morale.
“As the CEO, you need to know, one, that people are engaged and, two, that they have specific plans that are measurable and quantifiable,” Kendall says. “You need to know what the results are and that somebody has gone back and looked and is seeing whether it worked, because obviously at some point, if it’s not working there’s no reason to put everybody through the drill.”
How to reach: Liberty Tire Recycling, (412) 562-1700 or www.libertytire.com
Jerry Doerger wasn’t surprised when young employees began working on projects while listening to iPods and texting on cell phones. After all, he has four millennial children, and he sees the multitasking and embracement of technology every day.
“What I have been able to recognize and to accept is the different working philosophies and the different working patterns between the baby boomers and the millennials,” says Doerger, vice president of the engineering and architecture firm PEDCO E&A Services Inc. “I’m living with it at home, so I understand it a little bit better. I’ve started to work with some of the senior-level managers who have grown up with [the idea that] you go to your quiet room and you study or you go to your cubicle and you get your work done. That’s not how things are happening with the millennial generation.”
There is a good chance your employees span multiple generations. Baby boomers and the younger millennial employees see work and life in different lights, yet, many times, they must work together to accomplish one task. The question becomes how do you bridge the gap to ensure a successful employee base and a successful company?
Along with observation, PEDCO did and continues to do annually an anonymous employee survey that asked questions on multiple topics, including what is important to them.
It became evident that employees had different needs and wants based on their age. The baby boomers liked the rigid work style of coming in at 8 a.m. and leaving at 5 p.m. Reward to them isn’t a pay check but opportunities for advancement. Younger employees wanted flexibility. Their families and community played a significant role in their life.
“The most important thing that companies have to realize is what works for one generation and what motivates one generation doesn’t necessarily work for another generation,” Doerger says.
Understanding the differences, PEDCO put in place initiatives that would help the generations work together and understand each other.
First, PEDCO stresses flexible management. In order to engage employees, PEDCO managers try to manage individuals differently. To understand your employees, you must have conversations with them about their professional and personal goals.
“Really just communicate with them and get to know them as individuals,” Doerger says. “As you get to understand and know the younger generation and find out what is important in their life, where they feel their value is, then you can start to address how can I engage this person more successfully and make them feel like he’s a much more active part of the business.”
Other bridging-the-gap initiatives that PEDCO uses are mentoring programs and discipline groups. When you’re making a constructive effort for employees of different generations to work together, ensuring everyone is heard and respected is essential.
On a new employee’s first day at PEDCO, he or she is provided a mentor. The idea of a mentoring program allows two individuals, usually from different generations, an opportunity to learn from each other.
The discipline teams, such as the mechanical group at PEDCO, meet on a regular basis to discuss ways to better their particular discipline. The process helps ensure each employee has the opportunity to bring up specific ideas. It also provides employees with different levels of experience and views on the profession to brainstorm together and develop ideas.
Allowing all employees to contribute ideas or recognizing an individual for their contribution helps the other generation respect that individual.
PEDCO’s conscious effort to bridge the generation gap has meant little turnover from its 75 employees in recent years, along with more engagement between employees and employees and clients.
How to reach: PEDCO E&A Services Inc., (513) 782-4920 or www.pedcoea.com
Preparing for the future
As PEDCO E&A Services Inc. was preparing to celebrate its 30th anniversary this year, management considered how the company’s organizational structure would play into its success in the coming decades.
When planning for your company’s future, you can’t forget about leadership turnover.
Vice President Jerry Doerger led the initiative at PEDCO as the management team members analyzed each aspect of the business leadership, administration, technical teams, project managers and design teams to identify future gaps and develop a transition plan. They determined top executives and managers could retire in five to 10 years.
Early analysis allows time to plan and implement training, coaching and mentoring to ensure a smooth transition.“The biggest thing that a company can do is to, No. 1, recognize that there is a generational gap,” Doerger says. “Put a plan in place to start to bridge the gap and it’s not going to happen overnight. The other piece is as the different generations begin to exit the workplace, put a plan in place to transfer that knowledge, that understanding and that technical expertise that those folks that are exiting the workplace have to the next generation. What you get at the end of the day is a more engaged work force by doing it.” <<Preparing for the future
As PEDCO E&A Services Inc. was preparing to celebrate its 30th anniversary this year, management considered how the company’s organizational structure would play into its success in the coming decades.
When planning for your company’s future, you can’t forget about leadership turnover.
Vice President Jerry Doerger led the initiative at PEDCO as the management team members analyzed each aspect of the business leadership, administration, technical teams, project managers and design teams to identify future gaps and develop a transition plan. They determined top executives and managers could retire in five to 10 years.
Early analysis allows time to plan and implement training, coaching and mentoring to ensure a smooth transition.
“The biggest thing that a company can do is to, No. 1, recognize that there is a generational gap,” Doerger says. “Put a plan in place to start to bridge the gap and it’s not going to happen overnight. The other piece is as the different generations begin to exit the workplace, put a plan in place to transfer that knowledge, that understanding and that technical expertise that those folks that are exiting the workplace have to the next generation. What you get at the end of the day is a more engaged work force by doing it.” <<
He spoke through Chinese translators who had some knowledge of the English language. And he learned the meaning and methods of good communication.
“I learned techniques of communication should probably be scaled down rather than scaled up,” says Killion, now president and chief operating officer of the Barberton-based Babcock & Wilcox Power Generation Group Inc. “You look at some executives who are on their career path and they think that the way to impress people around them is to use longer words.
“You’ll find from most employees that’s not something that’s effective.”
Communication is the lifeblood of your organization. You can’t afford to use 10-letter words or buzzwords that make employees think you’re speaking a different language. Not only will you lose employee’s attention, but the message you’re trying to convey will get lost.
Since taking over at B&W PGG in late 2008, Killion, once again, has been methodical in his communication with employees as he works to instill a growth culture after years of conservative business practices.
Essentially, what it comes down to is planning what you’re going to say and how you’re going to say it, and then communicating your message in an engaging and concise way.
Here is how Killion gets his message across to 7,000 employees.
Put in effort upfront
You need to start out right when it comes to communication. The best way to do that is by conveying to employees your style of communication. It’s one of Killion’s priorities when taking over in a new location.
“I’ve always found it’s important to find a way to communicate what your style is — without acting arrogant, without acting like you’re very self-centered — just be able to tell people how you work, how you think, what you expect out of them,” Killion says. “When a new executive moves into an organization, there’s some sense of urgency. Either it’s a turnaround, takeover or the last (CEO) wasn’t doing a good job. Even if it’s a smooth transition, there are still some differences.
“You want people to have the advantage of you telling them early on what you expect, what your style is in communicating. Do it at a high level, then, ultimately, so that other people can follow along. People will accelerate on the learning curve and understand what the new leader’s hot buttons are.”
Communicating across the board to employees can be a time-consuming process, especially when so many decisions are fighting for your attention. But if you haven’t articulated what your communication style is to at least the highest levels within the organization, you’ve missed a primary step in engaging employees. See it as a time to immerse yourself in the organization and get employees comfortable talking with you.
Reach out to employees by communicating in a manner that speaks to your style. You may also find scheduling staff communication on a regular basis helpful.
“What we said last year — and what I think I would have done even if I was new to the organization — was there was going to be a year of change because the recession was so strong and we need to do (all-hands meetings) every quarter, along with that we could then talk about financial results,” Killion says. “Some predictability like that is good to a newcomer.”
That same effort that goes into explaining your communication style to employees should go into crafting your message. Killion puts preparation into all of his internal and external communications, whether it’s an all-employee meeting or customer presentation.
“I don’t just write some slides and say, ‘Here, go do it; put it on the projector,’ and it’s ready,” he says.
You need to take time to prepare a message that is not only clear but the right kind of message. For example, as B&W PGG moves into growth mode, segments of its operations are contracting and changes are occurring. The last thing Killion wants his employees to think is the company is trying different flavors of the month as it works toward its goals.
“We’ve communicated that there’s one sustainable growth plan here and a strategic plan that has variations, and we adapt as we go along,” Killion says. “But it’s not tearing up our basic strategy and starting all over again. We avoid anything in communication that suggests we have a complete failure and we’re going back and starting all over again.”
To ensure you’re conveying the right message and doing it clearly, you should consult with others within your organization. Think about what people or departments might be able to add insight to the topic of your message and who is well connected with employees throughout the organization.
For any internal communication, Killion brings in his internal communications manager, the financial controller, human resources, the people who will prepare the message and whoever else might have an important background based on the topic. One of the most important pieces to the conversation is that B&W PGG has trained communication experts on hand to help develop the message. Whether or not you have that expertise on staff, you can’t undermine the benefit of collaborating with colleagues.
“It’s a group that will come together and openly talk about what are the topics of interest, what should we be putting (in front of employees),” Killion says. “There’s some give and take, and some discussion on that and a little bit of debate. Then, we put the message together and we review it significantly from different viewpoints to make sure that it’s clear and the right message is coming across. As you know very well, there are different ways to say something to get the right results.”
The process is an effort to really narrow down the core talking points. At the same time, Killion and his group discuss what they’ve heard going around the rumor mill and whether or not the issues need to be addressed during all-employee communication. If it’s a rumor about job security or benefits, chances are a fact-or-fiction slide could make its way into a presentation. They also spend the time discussing stories or analogies that will allow employees to better relate to the topic.
The same steps take place with basically the same group when it comes to external communications at B&W PGG.
“So what goes out is consistent with internal communications,” Killion says.
Communicate the message
No matter what format you choose to use when communicating with employees, you have to keep in mind two things: Is the style engaging? And is the message easy to understand? If you fail at either one of those, your message probably won’t stick with employees.
With about 7,000 employees scattered throughout North America, Killion’s preferred method to reach his staff is through quarterly all-hands meetings that allow for updates on key initiatives, financial results and how those two tie together.
B&W PGG gathers the local employees in the cafeteria and connects employees located in remote sites in the U.S. and Canada through a webcast. The hour-and-a-half-long meeting is recorded and then transcribed into written form so employees can access the information at a later date.
In order to make sure he’s not just cramming information down employees’ throats, Killion thinks of the process as having a beginning, middle and an end.
“I stand up and before I get into any details say, ‘Here’s what this is all going to be about today and here are probably the key topics,’” Killion says. “Then we have some repetition as we go through on what some of the keywords are. Then we have takeaways at the end.”
You need to be clear from the beginning about the purpose of the meeting or the conversation. Killion says employees generally want to do a good job, and along with that, they want to know what it is you’re asking of them or trying to convey to them so they can continue to do good work. By stating the point of the meeting immediately, your employees quickly understand their reason for being there and are engaged.
Throughout the conversation or presentation, you need to repeat the key phrases or information that you want employees to absorb.
“It’s the old slogan, ‘I’m going to tell you what I’m going to tell you, and then I’m going to tell you what I told you,’” Killion says.
In his all-hands meetings, Killion doesn’t only repeat information, but he uses visuals to demonstrate what he’s saying and to stress certain points. For example, a PowerPoint slide might have a handshake when Killion is talking about teamwork, a dollar sign when he’s talking about financials, an upward slope to depict an uptick in business or a world map to signal global views.
“It’s all to make it more interesting but also to make a visual, something that people can retain rather than just boring word charts,” Killion says. “And it absolutely helps different kinds of learning styles in the audience.”
Again, you can’t chance employees slipping into a daze. Just as important as the visuals is your word choice.
“We make sure what we’re communicating is understandable to all the participants,” Killion says. “Don’t talk too high level; don’t use some of the buzzwords or phrases that are limited to engagement of the people who are there.”
As you’re wrapping up the conversation, you need to narrow down and repeat the key points you want on employees’ minds as they leave. Killion usually stresses four takeaways and displays them with visuals and bullet points. As he reiterates the message, he says, “Here’s what I want you to take away.”
“Drill it down and say, ‘Here’s what we really meant for you to get out of this session,’” he says. “People who might still have eyes glazed over from some of the material can still get the takeaway points.”
After you’ve emphasized what employees should have learned from the meeting, it’s an opportune time to move into staff response or feedback. The key points to the conversation are fresh on employees’ minds and it allows them to ask questions for any clarification. By closely listening to the questions they’re asking, you can also gauge how well you delivered the message.
After giving his presentation, Killion simply opens the floor to questions. Employees located off-site have the ability to e-mail a question that then gets read aloud.
You need to make sure your format allows for every employee to be involved in the conversation. And you need to make sure employees understand you’re expecting a two-way conversation.
“First of all, make them feel comfortable,” says Killion, who tends to use light jokes during the Q-and-A session. “Even though it’s a very, very large audience, it’s making sure they’re asking me a question rather than speaking in front of several hundred people.”
Chances are it might take a few sessions to really get employees to open up and be at ease with asking questions. But this is where your candidness with employees about your communication style comes full circle. By setting expectations and engaging employees in conversation from the beginning, a comfort level for interaction and communication is set.
After four decades with The Babcock & Wilcox Co., Killion has a distinct advantage. About three-fourths of his employees who stand and ask questions he’s known for years.
“That’s a comfort level,” he says.
“We stress through the presentation that our main objective is to communicate with them. It’s not just to get down there and do something that we think is an obligation but really to communicate. I think it’s the tone of the material that we present. What we try to do is bring it across in a style that is easy to understand and, then, when we get to the Q-and-A make them feel comfortable to ask questions. We don’t have a long pause before the first question is asked.”
How to reach: Babcock & Wilcox Power Generation Group Inc., (330) 753-4511 or www.babcock.com
Ruth Skocic had seen enough.
As a social services director, she witnessed needless tragedies due to lack of medical information in emergencies. Her frustration turned into My LifePlan Inc., a medical information technology company giving first responders and health care providers vital information.
In growing My LifePlan, Skocic realized entrepreneurs can’t build a company alone. She collaborates and bounces ideas off her seven employees, a number she expects to grow to 40 by early 2011.
“You have to respect them for all of what they bring,” says the founder, chairman and CEO.
Smart Business spoke with Skocic about employee relationships.
What are the keys to being a good leader?
One of the things I had to learn to be a good leader myself was patience. Nobody likes to have that.
Another part about being a good leader is learning to accept the people who work with you and the people around you for who they are and what they bring to the table. Don’t put expectations on employees that you know don’t fit their role.
If I see potential and expectations for others who work for me, I will push that on them. I will push them to the point where they’ll say, ‘What is this lady doing?’ And the next thing you know, they realize they just created this incredible task and got it accomplished. They’re like, ‘Wow, I can’t believe I just did that that was amazing.’
It’s really to know the people who are working for you, because I have to work for them, too. They have to trust in me and count on me, day in and day out, to help them become a better person at their job, too.
How do you communicate to employees that you recognize potential and are increasing expectations?
I sit down with them and tell them I believe they have the capability to do a certain project and the rest of the team is here to help guide them and encourage them to take the challenge.
How do you make sure you don’t put unfair expectations on employees?
Again, watching, observing, taking chances on someone to excel in a challenge. If this person doesn’t meet the particular challenge, change what challenges you give them until they reach a potential you both can work with.
How do you understand employee’s strengths and weaknesses?
Take time to engage and understand the employee and be patient over time, because time shows you what someone can and cannot do. Be patient. Be Understanding.
What do you do to really understand?
People would tell me, ‘Oh my gosh; this is horrible advice,’ but let me tell you it’s not horrible advice. I wear my life on my sleeve, and I share with my employees and my staff and my contractors that is who I am. I open myself up to be criticized or judged by them if they so choose. My life is, for the most part, an open book to them.
So if I share with them, they share with me. You build a friendship with them at work to let them know that you actually care.
And there is a fine line. One day they may not be doing something quite right at their job, they’re making mistakes. And you care about them as a person. Yet they’re late every single day, they’re upsetting everybody else, or they have a negative mindset and they’re coming in and basically poisoning the group. So you have to let them go. That’s painful. That’s why people say maybe you shouldn’t know personal things.
I look at it as it’s OK to care about the people who work for you and it’s OK to let them know that you’ll help them along the way help them make a better place in their own life. Then they end up sharing.
At the same time, there’s a balance. As much as I care about them and I genuinely feel that we have friendships here within our organization there comes a time when I feel like I have to crack the whip. I come down on them and say, ‘What happened? Why didn’t this go well?’ It’s a respect factor, too, because they actually know I’m also the other person where I care and I’m passionate but this is about business.
The employee has to have the understanding that there is business to be done, and yet you can build a friendship through that business. But when push comes to shove, we have to separate that. We can and will, and we always have to respect each other for it.
How do you communicate the need to, at times, separate friendship and business?
I absolutely make employees do that during the interview process. Interviews go both ways. The interviewee should be interviewing my staff as well as my staff interviewing them. They need to know if we’re a good fit for them.
So what I have them say is, ‘We work really hard. At times it’s hectic and you have to drop everything you’re doing and fly right. In the mix of that, there can be a lot of tension. Just know at the end of the day, we all genuinely really care about each other and we’re here to encourage.’
That is something that I have them talk about right out of the gate in the interview, it’s not all peace and love all the time.
How to reach: My LifePlan Inc., (866) 297-0995 or www.mylifeplaninc.com
On the day it was announced that The PNC Financial Services Group Inc. would purchase National City Bank, S. Kay Geiger immediately rallied her employees new and old around the fact that the company would be stronger moving forward. Her message was this: Here were two of the oldest businesses in the Greater Cincinnati and Northern Kentucky region, and combined, they would be a superior entity than they were as independent parts. That same message went out to customers and to the community, and throughout the merger, that message never faltered.
Any acquisition and merger brings questions of uncertainty for employees and customers. But your job as the leader is to provide honest communication and keep them focused on the bigger picture one unified company.
As regional president, Geiger saw success by using continuous communication and a strategy of teamwork.
“It’s collaboration,” she says. “It’s two companies’ minds coming together, two companies’ commitments coming together, two companies’ customers coming together, two companies’ employees coming together. Each one of those individually becomes a very specific way in which you can deliver the message, but in no case were the messages in any of those places different.”
Here is how Geiger integrated two banks and 1,600 employees with a universal message.Create a strong team
To guide your organization through a process as large as merging two companies, you need to lead with your best.
Often in mergers, the acquiring company keeps a stranglehold on the leadership team. But Geiger felt that if she were going to unite the banks, she would need to combine management from PNC and National City.
“It makes a true blended company, as opposed to what sometimes you’ll see in a merger is one organization has a larger number of leaders from their respective company,” she says. “... If we looked at the blending of our attributes, the blending of our successes, then that would allow us to work on preparing relentlessly for our conversion that occurred over the next year.”
On day one of the merger, Geiger started by making it clear to those who ran the 17 different lines of business that forming the leadership, as well as the transition to one company, would be a collaborative process all the way through. Once it was clear that everyone’s assistance was needed, she began evaluating in teams who would best fit each position.
If you’re going to ask for a collaborative effort, you must follow through on that request.
To show that this was not about PNC but about the two banks coming together, Geiger sat down with the leaders of each line of business, such as the heads of corporate banking and wealth management, and together they openly discussed what they thought would be the best going forward for that sector in the market.
When you have multiple effective, qualified leaders, it’s not all based on experience. You need to take into account each person’s background, skill set and personal interest and match those with the parts of the business that need to be led. That’s where true dialogue helps in the process.
In PNC’s case, developing the team through a collaborative, conversational effort allowed for stronger results because people were placed in what Geiger calls their strength zone, not their comfort zone. For example, through discussion, it became clear that one of the senior leaders running the retail bank would be better suited to head the business bank.
“That created a much more powerful and even a much better business going forward because we took the strengths of their past, put them into the new future, and they could capitalize on what they had done before the two came together,” Geiger says.
While developing your leadership team, there are certain characteristics you want members to possess, especially if you’re about to embark on something as detailed as a merger.
“The best people are people that listen, are people that learn, and then they lead,” Geiger says. “Listening and learning is so important, because the toughest part is we’re all accountable and we can’t really ask people to do anything that we’re not willing to do ourselves. You have to have people that are clearly defined as relationship builders. … They have to really be very good communicators, and they have to develop skills to allow people to want to work with them as opposed to for them.”
It worked out that PNC’s new leadership is made up equally from PNC and National City employees. To also ensure collaborative planning and to truly view the big picture, Geiger made sure that her direct team included the leaders of all 17 lines of business. With a large undertaking, such as a merger, you can’t afford to miss any details or leave any segment of your business out of the conversation.
“We specifically put the multiple lines of business together,” Geiger says. “It’s not a function of how big. It’s not a function of how profitable. It’s a function of having a collaborative effort that can look at all aspects of our business.”
Once your team is in place, you need to unite them under a common goal to ensure continual collaboration. The end objective of a merger is generally straightforward. Still, you have role changes, new people working together and some uncertainty about what lies ahead. You won’t be able to successfully lead the rest of your employees through the process unless management is unified. And the only way to ensure unification all the way to the end is through communication.
“You have to be an honest and frequent communicator,” Geiger says. “It takes ultimately very, very open and very regular communication, even if the information is not always positive. Communication is the key whether the information is good or bad. By having that openness, it allows you to manage the situation rather than the situation manage you.”
Really, what it comes down to is making sure everyone is on the same page. Throughout the process, Geiger met with her team weekly to discuss and make decisions about the merger agenda.
“The art of changing a group from what it is into what it ought to be is really about having people understand where they’re at and how to visualize and prepare relentlessly on where they want to be knowing that, that all obviously continues to change,” Geiger says. “The secret is you have to communicate together what the success is going to look like, but then in order to achieve it, you have to have an everyday agenda in working toward that.”Communicate to employees
Hearing the word merger can be terrifying for employees.
Employees from both PNC and National City were nervous about what the future held, so Geiger tried to ease concern by immediately communicating the information she knew and painting the bigger picture for the staff.
“If you’re going to be in the banking business, this is the best place to be,” was the message Geiger tried to convey.
By rallying employees from the start around the goal of building a blended, much stronger company, it generated camaraderie.
It may be obvious, but you have to be as open and honest as possible with your communication. To get her message out, Geiger relied on town-hall meetings, regular e-mai ls and communication with leaders who were then directed to cascade the information through the organization. It was a collaborative effort that presented one message from multiple avenues.
“There is merit in having, from time to time, everybody together, if you can do that,” Geiger says. “We do that through town-hall meetings. We bring people together and express exactly where we are and where we intend to go, so there’s no guessing.”
It’s important that communication doesn’t end after the first announcement. You won’t be able to answer every question immediately, which will cause some uncertainty to linger with your employees.
“There’s a tendency when there’s large mergers that there’s activity early on about the task at hand, and that’s very important,” Geiger says. “But really that’s just a foundation to prepare what the organization has to look toward in continuing to recreate themselves.”
Crucial elements throughout the process are scheduling regular communication and updating employees with information as soon as it is available. Your employees not only need clear direction throughout the process to concentrate on the task at hand but to convey the proper message to your customers.
For example, PNC announced that those working in the PNC and National City branches would not find themselves unemployed.
“To have good customers, you have to have great employees,” Geiger says. “And to have great employees, you have to give them confidence.”Connect with customers
Your customers, just like your employees, have questions and concerns. Just as with your employees, you need to assure them that you’re able to serve their needs as the company moves forward. And just as with your employees, that revolves around solid communication.
“You have to feel like your customer is your most important friend, your customer is your most important asset,” Geiger says. “So we believe that regular, often and friendly communication is key.”
Because PNC is in a heavily regulated industry, there were mandatory pieces of information that had to be communicated at certain times. But you don’t want your message to feel forced. You want to deliberately reach your customers through multiple types of communication phone calls, e-mails, visits and each time you want it to feel like you’re talking directly to them.
“We had hundreds of thousands of customers who we touched during this merger, and we tried to make it as personal as possible,” Geiger says. “To make sure that they were informed so that they felt they were in control themselves, as customers, of any changes that would occur.”
Making that personal connection and sharing up-to-date information is directly linked to your staff conveying a united message and true concern for the customers’ well-being.
“Any organization collectively and wherever you are in the organization, whether you’re the president or a business banker or you’re the first person you see when you walk into a branch they need to see that you care,” Geiger says. “They need to know that you’re listening and that you care about what they have to say about their experience. They have expectations that they’re going to be serviced well. They have expectations that you’re going to be there for them. (It’s) the ability to give them the confidence that that is what you stand for.”
While the message is being communicated throughout the organization, you need to make sure that the customer is actually hearing the right message.
“Just like the avenues of communication are diverse, the avenues to know if we’re making the mark, those are diverse,” Geiger says.
PNC looks at multiple sources of data, including third-party customer surveys, monthly Gallup polls and information provided by leaders of each line of business on where their division stands.
By reviewing feedback on whether your communication has effectively cascaded through the organization, you get a better grasp on whether your message needs to be modified and what questions you need to better answer as you continue to move forward.
“That’s usually the biggest challenge of organizations coming together of whatever context they came together,” Geiger says. “Is it going to be the same going forward for me as a customer, me as an employee, that it was in the past? And the fact of the matter is that it never is. But you hope that you take what it was and give yourself an opportunity, when you have such dramatic change at your doorstep, that you look out far enough and you prepare to make yourself better.”
How to reach: The PNC Financial Services Group Inc., (888) 762- 2265 or http://www.pnc.com/
Let’s start where one expert stopped.
“We don’t know how a lot of this is going to work,” says Randy Kammer, vice president of regulatory affairs and public policy, Blue Cross Blue Shield of Florida.
Like with any new law, it’s going to take time to understand the exact mandates and lasting effects of Congress passing the $940 billion health care reform.
The good news is most of the changes that will affect you won’t take place until 2014. The bad news, maybe, is that you have to start planning now. Once you understand some of the specific regulations, you’ll realize this is bigger than just buying health insurance. It could affect your finances, the number of employees you choose to employee and, ultimately, your strategy for growth.
“The thing that I would tell small business owners is they need to not run away from this, especially when there are things that are very confusing, very complex,” says Eileen Rodriguez, regional director, Small Business Development Center at the University of South Florida. “You want to be able to plan ahead and see whatever is coming at you, whether it’s good or bad, so you have time to plan and adapt properly.”
What you need to know
First off, if you have fewer than 50 employees, you’re exempt from the mandate that requires companies to provide insurance to employees by 2014 or be faced with a fine.
If you have fewer than 25 employees and average annual wages of less than $50,000, you’ll be able to see savings this year. A small business tax credit worth 35 percent of your contribution toward your employee’s insurance premium is expected to be given for 2010. The second phase of the tax credit begins in 2014. Those who purchase their employee health insurance through a state exchange will receive a tax credit of up to 50 percent.
“(Businesses) really need to focus on how do they get this temporary tax credit,” Kammer says. “How is it going to be issued? When can they take advantage of it? Because it’s my understanding that they can take advantage of it this year.”
Companies with fewer than 100 employees will be able to take advantage of state-based Small Business Health Options Program (SHOP) Exchanges in order to purchase coverage. The SHOP Exchanges will allow companies to enter into a pool to buy insurance.
“Small businesses are going to be able to pull together to purchase coverage under an umbrella,” Rodriguez says. “This should potentially allow these small firms to improve their purchasing power.”
The exchanges will be grouped by geographic region and are expected to be organized by 2014.
Companies with more than 200 employees are required to automatically enroll employees in their health insurance plans, but employees can opt out of the coverage.
[Page 2: What you need to prepare for]
What you need to prepare for
No matter your company size, no matter your internal resources, this is not something you should attempt to understand on your own. Turn to your trade associations, your broker, a business development group, someone you trust who will be knowledgeable about the topic.
One reason is the health insurance industry expects premiums to increase in the coming years as cost shifting occurs prior to taxes really setting in.
“I started to look at the taxes that are going to come into place in 2013, and most of that is on the business owners themselves,” says Thomas Mangan, CEO of the Philadelphia brokerage and consulting firm Corporate Synergies Group Inc. “Heading into that, you’re going to have these high increases that, most likely, most small and medium businesses will (see) in the 12 to 14 percent range.”
For most companies, as you know, health insurance is one of the largest line items in the budget. Mangan suggests sitting down with your broker to discuss whether or not you can expect a significant increase in your premiums and what that ultimately means for your company. Premiums should go down once most of the law’s mandates are in place.
Health plans also will change because of certain regulations insurance companies face, such as eliminating discrimination against pre-existing conditions and no cost sharing for preventative services.
Much larger than your plan, this law could decide how many people businesses choose to employ.
“They’re going to keep a much closer eye on what their limits are once all of this falls out as far as what advantages might be out there for small businesses that have X amount of employees,” Rodriguez says.
Because there is so much uncertainty, because there are so many changes expected to take place that can affect your business, this is not something you can sit around and wait, watch how it plays out and then react.
“This is an opportunity for a smart business to become very proactive and have an advantage over those companies that do nothing,” Mangan says. “Those who don’t take action are going to end up getting hit much worse and it will reflect it in their price.”