Part of the plan Featured

8:00pm EDT May 26, 2008

You may not always agree with him, but Darryl Low is going to make sure you at least understand what he’s saying.

“Even if they disagree, they understand,” he says of his 50 employees at MZI HealthCare LLC. “As long as they understand, they’re willing to get on board.”

When he became president of the health care software provider in 2005, Low spent hours explaining the rationale behind every decision he made. That process helped him focus his management team on common goals, and the company has since doubled its revenue to more than $5 million in 2007.

Smart Business spoke with Low about how to get buy-in from your employees during strategic planning.

Q. How do you begin forming a strategic plan?

The key element is understanding the whole picture before you go into your strategic planning: understanding the market, understanding your product, its strengths and weaknesses, and then identifying which strengths you can leverage the most to either turnaround the company or to grow the company.

Q. How do you come to that understanding?

I have always taken time right out of the chute to spend with clients. Go and find out what the real world perceives the (product) to do, what they believe it does well and what they believe it doesn’t do well.

Go out and do face-to-face meetings. I actually scheduled to meet with clients of all different sizes around the country, and we probably spent the first year in pretty (regular) meetings face-to-face with the clients.

We have about 120 customers, so it’s a little easier for us to do than if you had thousands. [Even then], it’s still worth targeting some of your key accounts and then throwing in a good sprinkling of smaller clients to get a really good picture of the perception.

We all know perception is reality, and so it’s very important to find out what the reality of your customer base is.

Q. What’s the benefit of meeting with clients face to face?

It does a couple of things. In turnaround situations, it gives them a face to put the hope to. It really allows you to quickly form a bond that you’re just not going to get over the phone.

There were a couple of clients when we acquired (the company) that were in the process of replacing the software. By being able to go and meet with them to admit that there were issues, to give them an overview of how we were staging to resolve the issues and just having lunch with them, they left with a very high level of comfort that we would resolve their issues, and it postponed their decision to leave.

I haven’t personally touched all the clients, but I’ve also sent out my vice president and sales force to deliver the message after they’ve spent time with me to understand what the message was. Every position, it has been worth the time to do that.

Q. What are the pitfalls to avoid during the planning phase?

Taking too much input internally can be a pitfall, especially in the case where you’re going through an acquisition. You may have a good team, but a lot of their thought processes are based on their experience with prior ownership, and it’s that same leadership that obviously put the company in a difficult situation. They have good ideas, but you have to take it with a grain of salt.

There have been a couple of situations where I have conceded planning issues to staff in an effort to win some ownership and buy-in from them knowing that it was the wrong decision, allowing it to go through, and ultimately, it did prove to be a wrong decision. You’ve got to be careful with trading off good decisions with the empowerment side of it.

Q. How do you deal with resistance in a turnaround?

It has taken a lot of time around the table almost debating, really going over and over what the problem is, how we can get from here to there, understanding that we all have different directions to get to the same place.

Ultimately, what it comes down to is saying, ‘I’m going to take your feedback.’ I’m still going to make the ultimate decision, but I take a lot of time explaining my rationale and logic. Even though they don’t necessarily agree with the path, they understand the rationale and the logic behind it.

You need to be confident in your ability to make good decisions — not cocky about it but confident. If you’re not confident in your ability to make decisions, then you are going to run into the situation where everybody else is making decisions around you, and it leads to chaos.

You’re more likely to keep a good team of people that are supporting the end goals of the company in the same direction. But the flip side of that is you’re also not leading the company into chaos by letting all of those people direct the company in different directions.

HOW TO REACH: MZI HealthCare LLC, (661) 310-9333 or www.mzihc.com