Cleaning up Featured

8:00pm EDT April 25, 2009

Adam E. Coffey never thought he’d be the president and CEO leading the turnaround of a company that makes its money collecting quarters from washing machines.

“I wanted to be a goalie for the Detroit Red Wings or a pitcher for the Detroit Tigers,” Coffey says. “That was my childhood dream, but somehow I wound up in laundry.”

A Jack Welch disciple since his days at General Electric’s John F. Welch Leadership Center at Crotonville, Coffey has become a turnaround specialist. He has run several business units for Fortune 500 companies and worked as president and CEO of numerous organizations before joining Web Service Co. LLC, which posted 2008 revenue of $220 million.

“I’ve taken turning a company around and turned it into a tight, precise formula that I’ve practiced at multiple companies and have had great success with every time,” he says.

Smart Business spoke with Coffey about how his formula works and how following his plan can help improve your company’s efficiency.

Figure out what you want. Typically, the biggest issue that someone faces when they come into a company is you hear things like, ‘We need to cut expenses; we need to take cost out of the business.’ Too often, people indiscriminately make cuts without putting any great thought into what they’re trying to accomplish.

I put it into a five-step approach: Establish the ground rules, analyze the existing processes, ask ourselves why we’re doing it, reinvent processes that are irrelevant, then you implement, implement, implement.

The first step is to establish the ground rules. Who am I? What am I trying to accomplish in the marketplace? In this particular company, I am the premium product supplier. I’m the Neiman Marcus; I’m the Mercedes-Benz. So when I look at my ground rules for success, anything I do can’t hurt the customer satisfaction or my position in the marketplace.

Simplify everything. The next thing I do is analyze the existing processes. Every company has to pay employees. Every company delivers some kind of product or service. The third step in my five-step approach is I ask why we do the things we do.

When I walked into this company, I process-mapped out the 55 things we do. One of those processes dealt with security — how we had these very complex and cumbersome rules that were all built around security. You can’t use the same lock within a square mile; you can’t have more than 10 machines on the same lock, etc.

I asked myself, ‘Why? Why do we do this? Is it still relevant today?’

In the 1960s, we had a problem with professional thieves who prided themselves on picking locks. The thief would go into your laundry room and take all the money out of your machines and leave the machines undamaged. You didn’t even know they were there. You just were left wondering, ‘Why didn’t anyone do laundry?’

So we developed a very complex sequencing of locks so that our collectors literally had keystrings with hundreds and hundreds of keys. They would spend 10 minutes in every laundry room just trying to find the right key. In the 1960s, that process made a lot of sense for our business.

But this is the year 2009. I don’t face professional thieves with lock-picks anymore. I face crackheads with sledgehammers. They’re not walking into my laundry room and leaving any doubt they’ve been here.

Often, what you’ll find in companies is that we do things today because we’ve always done things this way. We’ve stopped wondering, ‘Is there a better way? Is there a more efficient way to do something?’ That’s why the next step is to reinvent processes that are irrelevant.

In this case, we redesigned the process using the catchphrase, ‘One room, one key, one lock.’ Why? Different world, different reality, therefore, different process. All I’ve done is make it artificially difficult for me to sequence locks, keep keys in inventory, get my collectors out there and have them find the right keys for the laundry rooms. So I threw out everything with that old process and started over.

Do your homework. In my first 90 days with this company, I talked to 100 percent of the employees. Every company has job classifications — we have installers, service technicians, sales, service managers. I spent a day in the life of each of those job classifications so when I later sat down to analyze how our company worked and to look at the processes, I knew what these people did for a living.

My best ideas came from the line employees. It didn’t take long for me to ride with a collector and have him tell me what was screwed up about his job: ‘Here are the things I do that are stupid.’

Don’t forget that your people, the line employees doing those jobs every day, know a hell of a lot more than you do about what goes on in that job in the real world — especially when you’re a guy like me who is new. I was new to the industry; I didn’t know laundry other than I knew how to do my own.

I asked a lot of questions: What’s wrong with your job? What could be done better, simpler? Everybody in the different job classes was quickly able to articulate to me the major problems.

You always get fluff, too. Sure, a collector would rather drive a Lamborghini than a Chevy Astro van, but I’d filter that out from the complaint of, ‘I carry too many keys. It takes me too long to find the right key.’

How to reach: Web Service Co. LLC, (800) 421-6897 or www.weblaundry.com