Jerry Kelsheimer knows that he shouldn’t be talking on his cell phone and driving at the same time, but he can’t help it. Kelsheimer,president of The Huntington National Bank’s Cleveland region, an arm of Huntington Bancshares Inc., is interested in getting feedback inany way he can. So even as he drives through downtown Cleveland, he keeps his Rolodex on the passenger seat and keeps his fingersbusy by dialing up customers to ask them how Huntington is doing. It might not be the safest driving strategy, but using every free momentto learn more is part of Kelsheimer’s leadership style. And that desire doesn’t just extend to Huntington’s customers; Kelsheimer appliesthe same philosophy with his 1,000 employees, using every avenue he can think of to hear what’s happening on the front lines. SmartBusiness spoke with Kelsheimer about why you should hire people who can take your job and why you have to celebrate good times.
Use celebration to drive energy. You can’treplace positive energy, and the celebrationis the energy that drives an enterprise. Youmake sure associates hear, ‘Good job,’ as away to direct positive influence as opposedto a corrective influence all the time.
You see a lot of e-mail, voice mail and personal notes flying around our company. Wemeasure that, and it is an expectation of ourleaders that they are watching and makingsure to say things like ‘thanks,’ ‘good job’and ‘congratulations’ in a personal and sincere way where it’s appropriate.
You can’t quantify how much that helps,but I’ll tell you this, we’d certainly notice ifwe didn’t do it. Capable, committed peoplewant to work for capable, committed people. Winners want to be around winners;they thrive on the interaction. We want tobe committed here to an environmentthat’s positive, that’s high energy. We operate in a very competitive landscape, and wewant to have everyone in it together in away that’s fun. Winning and having fun gohand in hand, and taking the time to stop,recognize, affirm and celebrate all works inconjunction with that.
Hire with higher hopes. My view is, be secureas a leader when you hire. You have to hirepeople that can take your job. My world isa lot easier if I’ve got superstars workingaround me doing their job.
To do that, I look at someone who we’retalking with to see if they will fit with ourteam and culture. We have a very well-defined set of values, and in our process ofconsideration, we’ll talk about values, whatthey mean to us, what they would mean toa fellow associate and see if that matchesup with the person we’re interviewing.
Secondly, I look at somebody’s life balanceand their life skills. Does an individual seemto have the right perspective in general ontheir outside-of-work stuff? You rarely meetsomeone who is overwhelmingly successfulprofessionally that doesn’t have their life incheck and the ability to articulate it in a waythat shows it’s under control.
Ask for feedback. The basic way to get feedback is to continually ask. Each week, Ispend time at our banking offices, and I’malways asking. You never get it if you don’task for it.
Beyond that, we’ve set up e-mail boxesfor associates for feedback, where they cansend me e-mails with suggestions, feedback and input. I’ve got a confidential voicemail box so an associate can contact me,and I don’t know where the message camefrom in case anybody has some constructive criticism or ideas on how we can bebetter in the marketplace.
I meet regularly with a randomly selectedgroup of associates for breakfast, and wehave no formal agenda. I just take a piece ofpaper and a pencil and talk to the group andlet them know that I’m there to listen. Weare at our best when we listen to the folkson our front line day to day, so I’m able totake sincere feedback out of those sessions.
Help your employees help the community. Wehave associates and leaders engaged incommunity leadership here in Cleveland.In an industry where our focus has to beon the customer, that only happens if we have associates that share that commitment, that feel good about our goals, theirrole and their sense of purpose within ourorganization.
People don’t care what you know untilthey know you care. They aren’t interested in your direction and influence untilthey know that you are interested in them,so I think it is important for associates tofeel like they’re at a place that cares aboutwhat they are doing.
If involvement in the community isimportant to the organization — which isshowed by allowing associates the opportunity to invest their time and energy andfinances in things that are truly an area ofinterest or that touch the heart and passionof that associate — then associates will seethat. And if they are part of the team andthere are opportunities for them to getinvolved, then that is something they mustbe allowed to participate in because weowe that to the associate.
Push integrity from the top. In today’s world,you want to trust people; that’s a core element of human nature.
Associates want to be in an environmentwhere folks are going to do what they saythey’re going to do, and you have to showthat from the top. It’s important for theassociate to be able to trust that everyoneis doing it the right way, and that is something that management has to be showing.
We tell our people daily, ‘It’s OK to wantto win and compete against the marketplace, but you don’t compete against eachother internally, and we don’t competewith other areas of Huntington.’ At theend of the day, we need to be able to lookin the mirror and say, ‘We worked realhard to do that,’ but it’s more important tolook our family members in the eye andknow we did it the right way. Winningisn’t winning if you don’t take the highroad and do it the right way.
HOW TO REACH: The Huntington National Bank, (800) 480-BANK or www.huntington.com
Daniel Hamburger has a PowerPoint secret he wants to share
“There’s a wonderful feature of PowerPoint, you hit the B key
and it blacks the screen in show mode, most people don’t know
that,” says Hamburger, the president and CEO of DeVry Inc.
When DeVry, the higher education holding company for DeVry
University, Ross University, Chamberlain College of Nursing and
Becker Professional Review, hit a rough patch, Hamburger got to
know that B button pretty well.
Because DeVry, which had once
posted 10 straight years of 20 percent or higher revenue growth,
had never really hit a bump in the road, Hamburger was presented
with a unique challenge. After revenue of $784 million in fiscal
2004, DeVry stubbed its toe and slipped to $781 million in 2005,
with net income dropping from $52 million to $18 million during
that same time frame. Student enrollments were slumping, even in
the company’s core categories like information technology and
computer sciences. The sudden jolt caused a stir with stockholders and employees.
Seeing that things had gone stagnant, Hamburger, then president and chief operating officer, decided to attack the problem
with a few priorities. First, his leadership team decided to candidly call the challenge a turnaround and address the fact that
changes needed to be made.
That’s when the B key came into play.
“We would go every couple of weeks to another location, and we
would always take the time to have a council meeting and one of
the things that made a difference was to just turn off the
PowerPoint,” Hamburger says. “So the PowerPoint is up, someone
introduces me, and I would just hit the B key. Usually it’s, ‘Here’s
the presentation, now who has a question.’ We turned that around
and said, ‘What do you want to talk about?’
“Often, there would be an awkward silence for a second, but
then they brought out really serious stuff and challenging questions. I didn’t always have the answers, but one of the things I
would always say was, ‘I will tell you if I know, I will tell if I don’t
know, and I will tell you if I can’t tell you.’ That builds credibility.”
Address your shortcomings
Maybe it’s a tired axiom, but Hamburger sees truth to the idea
that the first step in fixing a problem is admitting that it exists. At
DeVry, that subtle distinction made a world of difference on the
“The first thing that we did was candidly call it a turnaround,”
Hamburger said. “That doesn’t sound like a lot, but it was a big deal.
Looking back, I’ve been asked what the biggest factor in our turnaround was, and I really think the biggest single factor was the psychological shift to turnaround mode.”
In just telling the 5,000 full-time employees spread around DeVry
that the company had to focus on righting the ship, the feel of the
stagnant company began to change. Hamburger’s team plugged
that message into every meeting, e-mail and memo that went out,
realizing that the best way to get things turned around was to push
the urgency of the situation.
“In a turnaround, the sense of urgency goes up; you make
changes a little faster than you might be able to at other times,”
Hamburger says. “When things are going really well, there’s that
tendency to say, ‘If it ain’t broke, don’t fix it,’ whereas in turnaround time, it’s very clear that you need to take action and you
need to take action now — not tomorrow, today.”
Even though telling people that things need to change is an
admission that the current path isn’t the right one, Hamburger
found that people were excited to be part of the team that was trying to help right the ship. Along with that, both employees and
stockholders appreciated the candor and consistency from leadership, as that honesty kept them from fearing the worst while
addressing the situation clearly.
“I had a boss once who said, ‘I have one set of books,’”
Hamburger says. “There’s not two sets of books where there’s one
message for internal and one message for external. We had the
same message we were providing publicly to our shareholders and
the same message for our employees, and that was consistent.
“Communicate with candor, so call it like it is, embrace reality
rather than sugarcoat it. We were an organization that was sort of
used to always doing well; we really had never gone through such a
severe downturn. It was very important for the team, for any team,
to see that leadership is telling it like it is. If you go around saying,
‘Hey, it’s not so bad, just wait and marketing will turn it around,’ people are smart, they know that’s not the reality. It’s energizing and
motivating for all of us when our leaders communicate with candor,
and that’s the case with politicians or businesspeople, or whatever
you’re leading, that you call it like it is.”
Though a turnaround is usually centered on stopping a company’s slump, DeVry looked at it as an opportunity to grow. Because
a turnaround involves a company that once grew to success,
Hamburger found that studying up on a little organizational history was very helpful to the education company.
“The underlying emphasis was that it was a revenue-led turnaround,” he says. “We had to do a little bit on the cost side, but it
was mainly recapturing the growth that really powers our success.
So it was motivating to the team to say, ‘We’re not trying to do a
moon shot and do something that’s never been done before, we’re
just trying to get back to where we were. We’ve proven we can do
it; we just need to do it again.’”
That meant reanalyzing the data. With so much success, a basic
look at the metrics showed that there was no longer a growth mentality. Just because you’re big doesn’t give you an excuse to be
bloated, so Hamburger and his team studied the basics of where
the growth comes from.
“It was not an extensive paralysis by analysis,” he says. “By just
looking at good old metrics of direct marketing effectiveness and
productivity, you could see our cost per inquiry per student and
our cost per new student start was too high and was higher than it
had been in the past.”
In looking at the numbers, Hamburger realized there was enough
support to get growth back, but many things were broken or slowed.
He had DeVry attack avenues as if they were new, looking for revenue opportunities that had gone unnoticed while growth was
booming. What Hamburger found was DeVry focused on many
things that had been working for several years, even though they
began to get stagnant. In turn, marketing had underestimated the
power of the Internet and many of the degree programs were no
longer competitive in the market.
“First, we had to fix marketing because it was broken,”
Hamburger says. “Second, we had to regain productivity in our
recruiting organization — which would be the sales force of an
industrial company — and the word here was not fix, it was
regain because we’d been very successful; we just needed to get
back to where we were. The third thing was to re-engineer and
restructure our programs to make sure they were competitive.
Some of them were too long, too many credit hours and were
longer than was at market. Those first three points had to do
entirely with reigniting revenue growth; they were really top-line focused, instead of just staying with what had been working. That’s where you have to have a mental shift.”
Build your team
In order to keep a growth mentality, you have to continue to
grow your staff’s roles. Instead of downsizing, DeVry continued to
move people up in the organization and bring in new talent that
could grow certain areas during a turnaround.
Like any growth period, that meant that DeVry was no longer the
right spot for some people and Hamburger had some tough personnel decisions to make.
“That’s one of the key roles of a leader of an organization is
making those calls,” Hamburger says. “What I’ve found is you
need to assess the person’s performance relative to the objective
that you’ve set out. Assess their capabilities and competencies
relative to the challenges at hand. The first one is somewhat
backward-looking — how did you do relative to what the goals
were for last year? The second one is more forward-looking —
what are your competencies and how do those line up to the competencies that are needed for the task at hand going forward?”
That meant re-evaluating people’s roles and judging if the job of
growing a large company had simply been too big for them.
“There are situations where somebody did a pretty good job, but
they are really not the right person for the challenges going forward, so maybe there’s a better role for them,” Hamburger says.
“Those can be a little bit challenging for all of us as leaders because
it’s easier when the person is a poor performer or if they are pretty good but in some way they didn’t live the values of the organization or just did something wrong. But the tough one is you know
they are doing some things really well, but, hand on your heart,
they’re really not the fit. If that job was open, and they were one of
the candidates, you wouldn’t hire them even though they’ve been
around for a long time.”
Hamburger doesn’t profess that his heart-check method is
unique to him, but it was adapted by his team at DeVry to make
sure the staff was ready for growth.
“I’ve used that many times to challenge people where they’ve
been struggling,” he says. “And you just kind of see their body language and they just go, ‘You’re right, you nailed it, I wouldn’t hire
this person if it were open. So you say, ‘OK, now we know where
we need to go to help that person make a transition.’”
While adjusting the staff is never an easy thing for leaders to accept,
Hamburger assesses the situation by showing the double-edged
sword of promoting the wrong person.
“By the way, it’s a false kindness to keep them in that role.” he
says. “What happens in many organizations is they stick around for
10, 20 years and then, because you’ve allowed that to happen, you
are actually not serving your customers and you have a downturn.
Then guess who gets let go anyway, good ol’ Joe who you carried
for all those years without giving him the candid, honest feedback.
Now Joe is not really very well equipped for that next career move.
That was the cruel thing to do. That was the false kindness — not
the person who 10 years earlier leveled with good ol’ Joe and said,
‘You need to make a move to another organization.’”
Putting people in the right place is the continuing step of keeping
DeVry’s growth consistent moving forward. Focusing on items like
online classes, Hamburger insists the growth strategy continues to
be the same as the turnaround strategy: an emphasis on reigniting
quality revenue growth and getting the right team together. After
addressing those troubles candidly and getting that growth mentality back, Hamburger’s adjusted team has the turnaround in full
swing, as DeVry had a record-setting year for fiscal 2007, reaching
$934 million in revenue, and net income climbed to $76 million.
“You cannot grow in the long run without quality,” he says. “You
can grow in the short run, but that will end in tears. We wanted to
ensure, and we did ensure, that the quality of what we were doing
with things like online growth was the equivalent to our history.
Once we had that, we have really turned the jets on and, in fact, are
consistently growing faster than the market for online education.”
HOW TO REACH: DeVry Inc., (800) 73-DEVRY or www.devryinc.com
Ronald Hill fights every day. As executive director of the Western Reserve Area Agency on Aging, Hill is in a constant battle to get advocacy for his organization, find help with his mission and topple lobbyists toting around bigger budgets than his. To go round after round at the agency responsible for planning, coordinating and administering federally funded programs and services for older adults in Cuyahoga, Geauga, Lake, Lorain and Medina counties, Hill has to help his 210 employees find the passion and resolve to stick with him in a never-ending effort. Along the way, he’s learned that the best way to maximize his $92 million budget at WRAAA is to give those employees a say in how the agency tackles its challenges and motivate them by letting them take the lead on projects. Smart Business spoke with Hill about how he creates a democratic work environment and why communication is key to improving morale.
Build a management democracy. I believe in a democratic work environment. You give individuals the freedom, latitude and resources they need to manage their units or to accomplish their goals.
It’s important to foster the development of leadership in the organization because we need as many advocates as possible. Part of that leadership style focuses on trying to develop leadership democracy among my managers.
I have a lot of management meetings and maximize input from managers and, where possible, my supervisors and staff. Try to create as many opportunities for staff to have input and kind of keep them informed on what’s going on in the organization.
Wherever possible, give them the opportunity to have input on the decision or to include them in problem-solving, so they feel that they take ownership of the organization.
From personal experience, when you are kept in the dark, you just don’t even care, you don’t even buy in to those decisions since you don’t know what’s going on.
Hire by committee. In hiring, I don’t interview folks alone, I take a team approach. I’ll go with maybe four or five people who are part of the team and include individuals who the person we are hiring would be accountable to. That’s part of that whole culture of maximizing opportunity for input in every possible level.
That’s important so those individuals know that anybody we hire, they shared in the decision-making. Then, they also have a stake in supporting that person to make sure they succeed in the position.
Hire for a cultural fit. It starts in terms of looking for people who fit your prototype. You have to understand the environment that your organization operates in.
We have a social mission, so I’m looking for people who have a strong commitment, a strong social consciousness and who have a lot of competency skills in the area. It’s important to hire people who share my philosophy or at least embrace the philosophy in the industry of aging.
You look for people who can mirror your values. You look at their career path in terms of what organizations they have worked in — that’s a major part of it. Then, in the interview, ask questions to elicit responses that you would hope would be indicative of a consciousness that meets your mission. Try to understand somebody’s core values to make sure they are congruent with your values as an organization.
In doing that, I find that the better candidates do a lot of research early on, and we don’t have to ask as many questions; they try to present a posture that they feel we would find desirable.
That’s part of my job as a leader; find the people who have those values and commitment, then you don’t have to do as much as you would in other arenas because those people are self-motivated, and they understand the environment as well as I do. They understand the challenges, barriers and opportunities, so you help yourself in that regard by selecting good people.
Motivate employees with new challenges. We deal with needs of an aging population, so the environment is challenging and stimulating. So even those support staff members who get heavily involved across the board, I involve them in taking on a lot of projects and let them take the lead on some projects where they can step outside of their traditional duties and apply their expertise to some other areas where they might historically not have had an opportunity to do that.
That helps to motivate them, keep them engaged.
I think all my managers take advantage of any time they can engage in something outside of their comfort zone and apply the competencies that they have. Again, I try to provide opportunities for my managers to participate in those whenever possible, and also to participate in the brainstorming that goes on, and that helps in trying new, innovative approaches to projects and problems.
Be flexible when it comes to improving morale.
Communication is the key as far as I’m concerned, and it’s two-way communication. You try to really understand their needs, their perceptions and understanding.
Morale goes up and down, there’s no question about it, so you work on understanding what has impact on morale. We went through a situation where something was really affecting morale, it was a personnel policy change, and we underestimated the impact. After we realized the impact, we took a step backward, reconsidered it and reversed our decision based on the negative feedback we got. A lot of leaders, once that decision is made, they’d just stick by that decision.
In reversing it, I got a thank-you card expressing their appreciation for listening to them and not going forward with that policy change. ... Sometimes you don’t have that flexibility. Sometimes to comply with the law or some other mandate, you don’t have any choice, but this was clearly one of those situations where we had a choice.
It’s important to be flexible in your decision-making and be willing to admit your mistakes. I have no hesitation in admitting that I’m wrong or that I don’t have all the answers. Sometimes things require a compromise.
HOW TO REACH: Western Reserve Area Agency on Aging, (800) 626-7277 or www.psa10a.org
Along his path to a more sustainable life, C. Douglas McMillon got some basic insight about how important it was to change his ways. McMillon, president and CEO for Sam’s Club and executive vice president for its parent company, Wal-Mart Stores Inc., got the wisdom from his teenage son during a conversation about environmental changes that the retail juggernaut was considering.
“He said, ‘We’re going to need this planet, Dad, duh. You should be working on this,’” McMillon says.
Duh, indeed, he thought as he began helping Sam’s and Wal-Mart’s push to start Sustainability 360, a companywide initiative promoting sustainability. The company started off small but used each change as a steppingstone to get others involved. Famed green activist Adam Werbach was brought in to help navigate companywide changes, while leadership made an effort to celebrate those already making a difference, giving Wal-Mart’s and Sam’s 2 million employees opportunity to see how easy it can be.
“You start by telling stories,” McMillon says. “When someone steps up, you bring them up on stage and say, ‘Look at what this person has done.’ Then people start asking, ‘What can I do differently?’ And we make it as easy as possible.”
Beyond company goals for buying more sustainable products, reducing packaging and changing the energy output of stores, senior leaders asked those interested in making a change to join in at an individual level with a personal sustainability project. The PSP can be small, but with more than 520,000 employees on board since its July 2006 inception, it’s making a difference. With a company magazine that promotes daily changes employees can make, like switching to compact fluorescent light bulbs, and buttons employees get for making the effort, momentum is pushing the platform along.
“I had a person tell me, ‘I’m turning off the water when I brush my teeth,’ and I said, ‘Great, way to go,’” McMillon says. “When you can change the course of a lot of people, you can make a difference.”
The thing that he hammers home is the changes are both voluntary and realistic.
“I don’t know that we’re going to get everybody,” he says. “But, over time, I’d like to think that you’ll influence a majority to do things differently.
“It’s got to be something you personally can do. If we ask you to create a situation where Wal-Mart is powered by 100 percent renewable energy, and you’re the club manager, there is only so much you can do. But you can say, ‘We used to put shrink-wrap around the palates, and we were paying someone to come and get that. Today, we sell it, we recognize the value, and we’re keeping it out of the landfill.’”
McMillon says that difference-making ability is helping build a more involved employee base.
“It’s helping attract and retain people, especially younger people,” he says. “They want to make a difference. You might be in college today, and in less than a year, you could be a buyer, and you get to implement what I just asked you without a manual. You can say, ‘I’m not going to buy any more of this item until we talk about the recycling issue.’”
McMillon also sees the company’s efforts producing positive effects with consumers. During a recent tour of several Sam’s locations, he pulled up a chair in one club’s café and watched people notice signs about the company’s projects.
“They were grabbing family members and saying, ‘Look at that, they did this, they did that,’” he says. “We are going to see sales growth because as customers become more aware of this issue, our packaging will be more relevant to them.”
It hasn’t been long since H. Lee Scott Jr., Wal-Mart’s president and CEO, asked a small group of executives to start thinking about sustainability. Thinking back to that meeting and the talking-to from his son, McMillon says you have to start these conversations at the top and realize people are interested in making these changes, but they just aren’t sure how to begin.
“I’m an example of somebody who was not thinking about this, but when asked to think about it, you change,” he says. “Executives are people, too, and they have families. It’s not that you have to win an intellectual debate. You fuel that with financial numbers, like the income from recycling, and now your interests are aligned.”
HOW TO REACH: Sam’s Club, www.samsclub.com or (888) 746-7726
If Tony Panzica gives you a job, he trusts you to do it, so he won’t be coming around to check up on you every few minutes. Instead of worrying about checking on every detail of what his employees are doing, the president and CEO of Panzica Construction Co. trusts that the systems built into the construction management and general contracting company will tell him when people aren’t performing. Instead, he spends his time finding new ways to push the $135 million company forward. By freeing up his schedule to allot more time to visit job sites and talk with employees and clients, he’s learned how to keep growth consistent while also keeping his 150 employees happy. Smart Business spoke with Panzica about why it’s important to put people first and how a few hors d’oeuvres can get employees to open up.
Make employees priority No. 1. We are very concerned about people and what makes them happy and what makes their families happy. If you don’t have happy employees, they can’t produce, so I’m very concerned about their allocation of time. I try to force them to go home at a reasonable time to spend time with their children, so that the next day they can come back fresh, and they’re ready to go again.
Every leader ought to have the ability to empathize with people and see things through others’ eyes. If you are not able to empathize with them, you can’t understand what their problems are, and you can’t work with them to grow.
I try to be very flexible with employees; if they find they have to be with their families or take care of a personal issue, I let them take the time. Employees are your most important resource, so you motivate them by trying to make them understand that you understand their needs and are sensitive to their needs.
From when they first begin, I usually step in their office or ask them to come to lunch, so that I get a chance to get to know them a little better. I reinforce the concept that I’m here to talk about any issue that they have, and I’d rather know about it before than after. If you reinforce that kind of message enough, they usually accept it pretty well.
Trust your staff members enough not to baby-sit them. Once someone is hired, I trust them to do what they do. They say, ‘Well, how will you know if I’m doing my job?’
It doesn’t take long for a client or another leader to tell me that something has gone wrong. I don’t have to sit there and baby-sit you, and, if I do, I shouldn’t have hired you in the first place.
What’s very important is that most employees will say, ‘A job is a job, and it’s not what I’d choose to do all the time, but since I have to do it, I want something that makes me feel fulfilled as a person.’ You can fulfill people’s needs by empowering them and letting them take charge of their own destiny, rather than interfering with their day-to-day operations.
There are many companies that get overinvolved in the day-to-day operations, and they interfere too much. I don’t need to interfere with you because you’re here to do a job, and if you’re not able to do it, it will show.
Get more information during interviews with job candidates. I ask open-ended questions that lead them to tell me a little bit more about themselves without me probing. I’ll ask them questions about what their interests are, and people usually open up.
They don’t usually just say golf, they’ll say, ‘My son plays baseball, and we like to do this or that,’ and then you can usually find out a little bit more about them.
Take staff meetings off-site for better feedback.
We go to a local restaurant and just sit down and order hors d’oeuvres and maybe a beer or something at the end of the day. We just open up and allow them to tell me what issues are bothering them about projects, and what I’ve found is, getting them away from the office atmosphere, when the projects are completed and they don’t have to run someplace, they’re usually pretty open, and they tell me things.
And many times, after that meeting is over, I will find that one or two of them will want to stay on a little bit longer and say, ‘You know, I’m really having a problem with this superintendent,’ or, ‘These resources weren’t available.’ That’s how I find out things; if I can get them out of the atmosphere that they work in day to day, they’re usually a little bit more open.
Be where clients can see you. The biggest challenge in the major growth side is trying to get people to accept your capabilities. As you grow, it’s hard to get (clients) to trust you to move on to more difficult and more involved projects because many people say, ‘You haven’t done this before, so I don’t want to give you the chance to do it here and learn.’
The only way you are going to be able to do that is persistence. As a leader, you have to show clients quality and that your performance is of the utmost capability.
I’m on every job we have at least once a week. That’s helpful because the field employees don’t really get a chance to see management very much at most places, so when they see somebody that actually cares enough to be there once a week, and when clients see that, they say, ‘This is a pretty interested leader; he’s actually here checking things out himself.’
That’s where the personal touch with every client is very important. They know that if they see me on the job every week, there’s a relationship, and they can pick up the phone and call me to resolve a problem.
HOW TO REACH: Panzica Construction Co., (440) 442-4300 or www.panzica.com
It’s good to be king, but sometimes it pays to know what it’s like
behind a retail counter, too.
Just ask Chuck Fallon. Long before
he took on his current role as president, North America, for Burger
King Holdings Inc., he worked at his father’s auto parts retail store.
Working after school and weekends, the hours weren’t all that
great but the lessons were.
Watching his father, he learned about passion and determination.
Working behind the counter, he learned exactly how much a field
employee knows about what’s going on.
Fallon brought those principles to his business career, and it was
only fitting that when the fast-food enterprise famous for its hamburgers started to come out of a slump and needed a new leader
for its 23,000 full- and part-time North American employees, it
turned to Fallon.
Pushing those same principles that he learned long ago, Fallon
turned his focus on the company culture. By turning to employees
to help shape his own education about what was going on in the
field, he has created a culture that brings in passionate employees
and puts the onus on them to help the leadership team come up
with new directions.
“If you are truly inquisitive and passionate enough about the
business, you can cobble together or aggregate those great ideas
and say, ‘Those are the kind of things we should be doing’ and
then put the resources behind those,” Fallon says. “That is an
iterative process, and it’s a very collaborative process. This is not
a business that I knew walking in here, and I respect that there
are a lot of people who do, and the more you genuinely engage
with them on what works and what doesn’t work and what
they’ve seen in the past, the more effective you are.”
By hiring passionate, driven employees, traveling the North
American circuit to put a human context to his leadership and
taking the time to ask the questions that every leader should
know the answer to, Fallon has helped the North American market cook up some nice results: Revenue has grown to $1.45 billion in 2007, up from $1 billion in 2006.
Hire for passion
When he was interviewing for one of his first jobs, Fallon was
asked a tricky question.
“The interviewer asked me, ‘What do you think is more important, intelligence or drive and determination?’” he says.
From what Fallon saw, he was in a no-win situation. If he said
intelligence, that meant he didn’t value drive and determination. If he said drive and determination, did it concede that he didn’t think he was smart? He decided that he’d rather ride out his luck
on his moxy than his brains.
“I didn’t think I was the smartest guy around,” Fallon says. “So I
said drive and determination, and he smiled and said, ‘Ah, you
should have said intelligence.’”
It took him a minute, but he got the joke: The interviewer, looking over Fallon’s impressive resume, knew that the young man was
smart. What he didn’t know was how hard he was willing to work.
Today, Fallon still thinks about that question when he interviews
“Let’s face it, the ante into the game is being intelligent,” he says.
“I’m going to make an assumption, though somewhat tested, that
you are smart enough to be where you are if you’re sitting across the table from me. For me, it is about passion, it’s about desire —
hunger, if you will. If you bring to the table the kind of drive and
determination that I can see, boy, that’s somebody that I can really feel comfortable putting my trust behind to get the job done.”
Fallon uses a basic interviewing technique to find out if employees have the grit to make it: He asks them to spell out how they’ve
“It’s about achievement, if someone can walk in and articulate
those examples,” he says. “Those folks that have that false positive, they couldn’t tell you two instances where they’ve taken a situation and turned it around or been the catalyst for making an initiative. It’s those folks who have actually done it that can articulate
it, that’s the litmus test.
“I’ve had people in front of me with great eye contact, great body
language and great personal experiences, but when you really pin
them down and say, ‘Give me an example of where you’ve applied
yourself,’ they can’t. A truly passionate, energized person, you’ll
have to turn them off. Impassioned individuals you generally
have to rein in a little bit because they’ve lived it and breathed it.”
Put a face on leadership
There’s a new hit at Burger King, and it’s not anything on the
menu: It’s The King. The forever-smiling, bling-covered mascot is
becoming as popular for the restaurant as the famed flame-broiled
And while Fallon doesn’t don the big mask or wear quite as much
jewelry, there is one culture-building lesson he and the other leaders
at Burger King have learned from the mascot: Sometimes you have
to give the company a face. That’s why all 11 members of Burger
King’s global leadership team make it a priority to schedule trips
spanning their respective areas.
“We’d be foolish if we didn’t ensure that we were out there in the
field seeing how it works,” he says. “So we ride markets, and we
engage employees all the way down to the restaurant level.”
When you’re trying to build a company culture for 23,000
employees, putting that face to the message is key. Fallon knows
that it’s easy for a corporate vision to get lost if it isn’t given the
proper context and human touch, so he tries to make the personal connection, even if he can’t sit down with every employee.
“The advantages to traveling are that you are a real person, you’re
not somebody from headquarters who thinks up crazy things in an
ivory tower to burden people in the field,” he says. “The other thing
is, we all have a very healthy respect for where the tip of the spear
is, and the tip of the spear is right there in the field, and those folks
have to filter through all the messages that are coming to them, and
they have to influence the business. Respecting that from their perspective and being truly inquisitive about how things are going, asking them, ‘If you were king for a day, what would you change?’ And
consistently being there furthers that cultural message and gets
them to open up and give honest feedback. People will tell you what
they think you want to hear but not always. They’ll tell you what’s
really on their mind if you’re out there enough to build up a relationship.”
Similarly, Fallon keeps lines of communication open much further down the chain than his direct reports. While he respects the
hierarchical system at Burger King, he’s not afraid to go directly to
the source for an answer.
“I don’t hesitate to pick up the phone and call a field leader at the
local level in New Orleans or Denver,” he says. “I always circle
back with their boss and their boss’s boss, but I think that’s part of
being close to the action and making sure that you’re getting a
good feel for what’s going on.”
Listen for the answers
In his career before Burger King, Fallon took enough Myers-Briggs tests to know that it’s not his natural tendency to bring people in when he makes a decision. To keep his team involved, he’s
learned one trick that he’s pushing to the core of Burger King’s culture: Ask questions — and then listen to the answer.
When he’s out traveling his area, Fallon encourages feedback
because it helps build relationships with the field employees, but it
also helps him understand what’s going on in the company.
“One of the first orders of business is to understand the business,”
he says. “If you don’t have the right kind of understanding of their
hot buttons around being successful, then there’s no way you’re
going to direct change or help create a vision.
“If we would just listen to what our people were saying, then the
minute that you hear something that you don’t understand, what
does it cause you to do? You ask a question, so it causes you to listen more. If a leader is doing all of the talking, they’re not gaining
any credibility or insight and they’re not gaining any ability to collaborate. If you’re doing the talking, you’re not getting the facts. If
you’re doing the talking, you’re already making judgments based
on what may be a subset of the facts.”
Asking a lot of questions also helps Fallon know that messages
from the top are being successfully pushed down. It’s easy for people to just nod their head at corporate initiatives, but he wants to be
sure they really understand what’s going on. By inquiring about the
way they understand their jobs, he does an evaluation of how well
the communication is coming through.
“There are so many people that nod their heads, and say, ‘Yeah, I
get it,’ but they don’t really, or they have questions and they don’t
raise them,” he says. “Part of being a good leader is not letting people off the hook and ensuring that you are really putting yourself
in their shoes and analyzing how you’re communicating to the
organization. We have a very dispersed field team, and the minute
you start communicating a point, by the time it filters to the West
Coast, it could be interpreted very, very differently. It’s important
for us to have that self-evaluation and really assess how our message is getting interpreted.”
To Fallon, the most important thing is to hold his emotions in
check while he continually gives others a chance to speak. It takes
practice, but he has learned to let people finish what they’re saying
and hold his judgments until he has all the facts. In turn, he’s built
a culture where people are willing to explain what’s going on.
“Don’t be less than curious when you are in a situation or presented with a problem,” he says. “If I’m below curious, that means
I’m already being judgmental. I walked into this company with a
desperate desire to listen and to learn, and I bite my tongue a lot
by listening and asking probing questions. When you do that, emotions can’t creep in because you’re driving and probing to the facts.
I need to know enough of the details to help us as a team come up
with the right decision. You can’t be successful in any organization
trying to come in and think you know it all. You have to realize that
vision and change don’t happen by one person. By being inquisitive
and really gaining that credibility, you’re able to help direct people
and aggregate ideas.”
HOW TO REACH: Burger King Holdings Inc., (305) 378-3000 or www.bk.com
Stephanie DiMarco doesn’t want to hear how great Advent Software Inc. is doing. Sure, as founder and CEO, she likes to know about the wins at the investment management solutions organization, but she doesn’t want to celebrate the good stuff at the cost of omitting the bad. That’s why, when she travels, she keeps a list of customers with her, so if she gets extra time, she can squeeze in a meeting to get feedback on how the company is doing. That desire to get to the heart of anything that isn’t working at Advent is the driving force behind the company’s boom to a record $184 million in revenue in 2006 and is the philosophy that DiMarco constantly drives home to her 850 employees. Smart Business spoke with DiMarco about why you should put problems under the spotlight and how important it is to challenge your employees.
Don’t hide the bad news. There’s nothing like adversity to get you motivated. We had some problems to fix in 2003, but it was a very energizing time because I think that people felt for a couple of years we ignored our problems, and there was enough good news that you could hide behind.
So there was a sense of relief that we were going to be very bold about the issues that we had and correcting them. It was extremely energizing for people, and we also learned from that experience that it’s OK to put the problems under the spotlight because they only fester if you try to ignore them.
Keep your employees challenged; keep your employees. If great people are challenged and excited about what they are doing, they’ll stick around. Financial compensation is one component of why people stay at a job, but in lots of cases, it’s the smallest component as long as you’re competitive and fair and people feel well compensated.
Being excited about what you do is more important to most people, and having that shared vision of where the company is going is really critical to keeping people for the long term.
Clear up the fog for your staff. We try to be very clear about what our objectives are on a quarterly basis, an annual basis and on a three-year plan. We communicate the vision for the year, and then on a quarterly basis, we update those.
I just sent out a mid-year update to the whole company describing where we are, and the opportunity and the challenges for the year, so there is no mystery about what our goals are and how we are tracking toward those goals.
Clarity is a lot better than fog, and most people are a lot more successful when they understand the objective, so they’re not just taking an order, they have a holistic picture of what we’re tying to accomplish. They’re much more motivated when they see the bigger goal we’re working toward instead of just seeing it as an individual task.
It’s very important that it’s a shared vision, and I think it’s kind of a myth that leaders create visions and push them downhill. I know that’s certainly not the case in our company; we develop a mission, and if you develop it properly, where you have the buy-in from all your constituents, then it’s really about the clarity of communication so that everyone understands it.
Keep an honest workplace. You really have to have a leadership style that is very open and honest and fair because smart people have other options, and they aren’t going to be interested in working someplace where they don’t feel like it’s an honest place.
People want to feel like they are in control of their destiny. Part of that is having access to the CEO and being able to give the CEO your opinion. And I’ll listen to it, so they feel like they can impact the objectives of the company. I don’t think anybody likes feeling like there is a hidden agenda or they don’t have access to the top, so an open door is a big part of knocking out that mentality.
We typically do a lot of rounds of interviews when we hire people, so they have a lot of access to people around the company, so that gives them the opportunity to get that feedback directly from their managers but also from people who will be their peers. And I think that new recruits really appreciate that because they get a pretty candid view of the company, and the open-door policy is something that people do indicate to new recruits. And it’s much better coming from a peer than my saying, ‘Hey, this is a great place; we’re really open.’ It has a lot more credibility coming from them.
Now, I can’t make them say that, but it’s true of our culture, so it does kind of permeate.
Recruit right and hire right. The most important thing that any manager does is recruiting because the quality of the company is directly related to the quality of the people. So it’s very important that you never compromise, and when you’re operating in a competitive environment, where the best talent is scarce, it’s easy to compromise.
But my mantra is never compromise, even if we have to work twice as hard to get the right candidate, I’d rather wait it out than hire the wrong or lesser person.
Find things that stir up your passion. Being passionate about what you do is the key to success. So certainly for a CEO, who has a big job, that’s really, really important.
It goes back to enjoying what you do, and I find our business really satisfying and rewarding. And when I talk to a customer that is really happy with us, that’s energizing for me.
Or when I talk to a customer who was one of our early customers, and they’ve been with us for a number of years, and they weren’t so happy with our situation, that’s also energizing because I’m very motivated to make sure this long-term customer gets turned around. Knowing that you can turn a situation like that around and make them happy again is really energizing, and you have to find things like that to keep you going.
HOW TO REACH: Advent Software Inc., (800) 685-7688 or www.advent.com
Don’t tell the nice folks over at Penn State, but Tony Buzzelli beat the system.
A young Buzzelli, on his way to an accounting degree, scoured the course curriculum up and down before finding a speech class that didn’t require him to do any public speaking formerly one of his pet peeves.
But when Buzzelli began his career at Deloitte & Touche USA LLP, where he is now the vice chairman and Pacific Southwest regional managing partner, he realized that he’d actually cheated himself. To be a leader, part of his life would always include public speaking so he began speaking in front of smaller groups at charity events, learning how to handle it.
Today, Buzzelli loves public speaking and doesn’t want the 3,000 employees under his charge at the professional services firm getting through Deloitte, the U.S. member firm of Deloitte Touche Tohmatsu, without any personal development. He wants them to have lives, which enhance who they are as a person, as part of a company culture that celebrates employees because, well, happy people make better employees.
“There’s an old dilemma in this business: Do you start with the best clients or the best people?” Buzzelli says. “Well, you have to start with the best people because you can’t have the best clients without the best people or, if you do, you’re going to lose them. I have been focused on people from the earliest days of my career. I’ve been doing this sort of stuff for about forever, and it all has to emanate from the top, and for me, it’s about personal and professional development.”
That focus can’t just be a hope to build a nice company culture, according to Buzzelli. It means taking the time to find out what people want from their employer, appreciating that talent comes from many backgrounds and figuring out how to blend all that together. In the end, the goal is to build a company that employees are proud to work for. In turn, Buzzelli’s been proud of his region’s results.
Figure out what employees want
Buzzelli asks himself the same question over and over as he tries to build the right culture at Deloitte How do you align a company vision and culture to 3,000 people?
He says the first key is creating an environment where people trust the executives and are willing to give feedback.
“The simple statement I’m offering is, ‘We have to create an environment where we can establish trust,’” Buzzelli says. “And the behavior that either enhances trust or destroys it is responsiveness.”
He develops a rapport with his employees through regularly scheduled luncheons with small groups representing large portions of the company. The low-pressure situations leave room for candid conversations.
“People will come and talk to you if you create an environment and listen carefully to what they say,” he says. “I have lunches with people we call ‘boomerangs,’ those people who have left and chose to come back. My question to them is, ‘Why did you come back, how did we stay in touch with you, and, oh, by the way, why did you leave?’ I’m forever trying to understand why people stay and why they leave. I take this very seriously, but I do it in a way where it’s fun for people to get together.”
Not only do the lunches provide insight for Buzzelli, they also help spread the message of his willingness to listen and respond. “Before I get back to my desk after lunch, they are talking to other people about it,” Buzzelli says. “This is a very viral thing, if I’m eating with 25 people, then I’m probably getting hits on anywhere between 100 to 200 people. It creates a buzz when I sit there and listen and act upon what I hear.”
By giving them these outlets, he allows employees to create a work atmosphere that empowers their life ambitions as part of the job. To show that he’s committed, he stays responsive to that ideal. When he found out that volunteering was important to his people, Buzzelli didn’t just pick a program and tell his people to give it their time. Instead, he formed a volunteer committee that represents every different level of the organization.
“You can’t make people volunteer that’s kind of an oxymoron, right?” Buzzelli says. “Whenever anybody asks me to dedicate our people to volunteering, I tell them I don’t have the authority to do that, I give that to our volunteer council. It’s very empowering to our people, and they tell each other. I don’t override their decisions and I don’t impose my will it belongs to them.”
The candid conversations that Buzzelli gets into with his people also help him push the vision of the company.
“I endlessly repeat what we’re trying to accomplish and make sure it’s obvious,” he says. “A lot of people have this vision thing about what they want, but they try to communicate it indirectly. I try to be very clear and unambiguous about what I’m trying to articulate. I remind people that our vision is to be the standard of excellence, and I’ll ask what actions are we taking to make sure that whatever that activity is that we’re dealing with fits into that model.”
And by building up trust with his people through his responsiveness, Buzzelli can get them to speak up about the problems in their own way.
“A leader needs to listen aggressively,” he says. “You usually hear the trite call to listen to your people, but you have to listen and communicate, without ambiguity, what you’re trying to accomplish, including eliminating barriers.
“If you force them to say what’s going to get in their way, you essentially get some answers that are often excuses on why they don’t want to get it done. So when you take that away and take care of those barriers, say, ‘I’ll take care of that,’ then they are accountable, and then there is a much greater chance of succeeding.”
Buzzelli says another part of building up a people-first culture is allowing employees to fit their personality and lifestyle into the company model.
He champions the company’s diversity efforts and meets regularly with a diversity council. The main idea is to appreciate everyone’s lifestyle to fill the company with different mindsets.
“Critical talent management is finding the people who have the competencies but also fit our organization,” he says. “The diversity we’re talking about is the diversity of thinking. Most people think of diversity as color, but we’re really focusing on the values we’re bringing to our clients by having all of those competencies from diverse perspectives focusing on internal or external issues. It’s very enriching because people bring their different perspectives. When I talk to my partners about diversity, I’m trying to push them to think about diverse thinking and helping them realize the benefit of having diverse points of view in the room.”
Buzzelli says diversity makes for a better company culture, but it also makes for a better company.
“We’ve had great success against our competitors because we bring in people with a different perspective,” says Buzzelli.
As an example, he points to a recent audit opportunity for his company. Sitting through the meeting with a potential client, Buzzelli was surrounded by the team he thought was best suited to win the job. Ironically, that team had almost the exact same diversity makeup as the client including a large percentage of women. After Deloitte won the job, the client mentioned how important that diversity was in getting the deal done.
“I didn’t notice at the time; that’s just the way we operate,” he says of his diverse team. “But they commented to us, ‘We’re really happy to see that you have so many women on the team because the last competitor had all men.’ So they all looked alike, but we had talent that not only was diverse from a sex perspective but also from an ethnic and age perspective, and that’s just because we had the right people.”
Build a company people admire
Building a company culture that values employees and encourages community service doesn’tjust make for a friendly feel around the water cooler, it also becomes a retaining point for good employees and a marketing tool for potential clients and employees.
“The important thing for a leader is to understand your organization and what the shared beliefs are to make sure you’re attracting the people and lining them with the vision and objective you have,” says Buzzelli. “There’s a subtlety that people don’t see there. People really want to work for a company that they admire. You strive for that because people are now beginning to see that there is a talent shortage, so what’s going to create a difference to an individual is being an organization that they admire. If their personal values align, and they enjoy giving back to the community, then they’re going to enjoy an organization that does the same.”
Deloitte did a study of Generation Y talent this year and found that 62 percent of those surveyed, aged 18 to 26, said they would prefer to work for a company that gave them the opportunity to contribute their talents to nonprofit organizations.
Buzzelli says today’s talent wants to know what a company is about meaning they won’t sign up for a company with mixed messages.
“If I ever was in a place where I wanted to move to another organization, I’d need to understand what their shared values are,” Buzzelli says. “To be honest, I wouldn’t even join an organization that said, ‘Well, gee, we haven’t figured that out yet,’ because that’s hard to do. If you don’t know who you are as an organization, then you have a problem.”
Not only do things like community service align with the principles of incoming talent, they also act as a brand builder but you have to understand that it needs to be done in the right spirit, with community focus first and the windfall for the company coming as part of that.
“We have a responsibility to give back,” Buzzelli says. “But by giving back and meeting people and getting them to trust you and being responsive to the needs of the community, you build a reputation. It’s about our people first but the collateral benefit is the organization.”
Deloitte’s culture has had a direct effect on turnover and diversity. A decade ago, turnover percentage was in the mid-20s, but today, it is around 15 percent annually. Its voluntary turnover of women during the last three years has decreased from 17.9 percent to 14 percent, and in the last year, minority representation has increased 1 percent.
Besides the hard numbers, events like Deloitte’s Impact Day show the tangential benefit of the culture. The volunteer day gives employees the opportunity to work in the office or donate time. At the most recent Impact Day, more than 1,100 Deloitte employees packed the streets of Los Angeles in blue T-shirts with the company name. It created a great feeling for employees, but the reputation boost was also palpable.
“Leaders in the community recognize it, and when I go around here in L.A., I get positive feedback from people who noticed that,” Buzzelli says. “Now, L.A. is a pretty big place, so the point is, it’s very clear that people want to be aligned with an organization that they’re proud of. And most people are proud of an organization that gives back to the community.”
HOW TO REACH: Deloitte & Touche USA LLP, (213) 688-0800 or www.deloitte.com
spoke with Handy about how to build up the community you work in and how to set the tone for your company culture.
Build up the community you live in. I believe that the strength of our company is directly tied to the strength of our communities, and if we’re not giving back and doing everything that we possibly can to help out, then we’re missing the mark, and I think that ultimately, we have a huge instance of volunteerism in the company. It’s promoted, it’s constantly discussed, and we make sure that our colleagues know that it’s not just something that will be appreciated in the community; it will also be appreciated internally.
It’s critical for everyone to spend some time recognizing that there are those that are less fortunate and they can help. In our case, it gives us a chance to work together outside the company, but it’s also a good thing for an employee to do the work outside of the bank and come back and be able to share those things and be celebrated at the bank. And it’s a good chance for not just them, but also for the colleagues to see the passion of the company and what we can do.
We have a [Sabbatical] program where we dedicate a colleague for three months for a not-for-profit company and then come back to the company and tell people about the experience and how meaningful it was. A big part of [our Champion for Action program] is we give money, but it’s recognition that we do with a media partner, it’s a big part of volunteerism, and we get to know that agency that we work with. And I can’t think of a better way to build the moral fabric and a positive feeling throughout the company.
Help employees by making them accountable.
My style is to let them run the business and keep me informed as necessary and make use of me as necessary but to empower them to be leaders themselves.
It’s ownership of budget, it’s ownership of their markets, it’s management of their people, it’s maintaining an open door so that they and their reports can get access to me as they need, but basically, it’s making sure that they take responsibility for both the good parts and bad parts of their operations.
Accountability can take many forms. We have budgets that we adhere to, and we count a lot of things and keep track of how we are doing on a very regular basis. The key is that I listen well to what they are telling me and communicate back to them on a very regular basis, and that gives us very open lines of communication. We don’t manage for the people who report to us, we lead through great communication.
Look deeper during the interview. We want people who get great references from business partners, and we want people who are willing to work hard but who are open-minded and who also listen well.
In an interview process, I ask a lot of questions about specific topics, whether it’s about their community projects or work-related, to make sure that what’s said is real, and I make sure that I can confirm this with the outside references.
We also look for ability to listen, [we] want to make sure that people are not over-selling and are willing to talk honestly about themselves and their own qualities because that shows a willingness to accept the fact that they might learn something new at anytime because they are not the be-all, end-all.
Lead the path to communication. Leadership by example is a huge part of leadership in general. If people see me willing to listen and be patient with what’s being communicated, then they’ll follow suit, and I think it fosters a sense of community, a sense of working together across the whole leadership team.
Set a tone for the company culture. Develop a set of core beliefs that are focused on engaging colleagues and the community in a way that will benefit everyone. We have credo meetings, and I have regular meetings with as many as 100 people to talk about the things we believe in. One of them is being proactive with the community and also with our customer base.
Its continually discussed, made a part of the fabric to a point where we can discuss actions as to whether or not they are credo-like. It even develops in a way that’s sort of a language. It’s treated very much as an empowerment tool where if you feel like you’re doing the right thing, that you see that it’s recognized and it’s more than just a mantra, it’s reinforcing a set of beliefs throughout the company.
Be the public face for your company. I insist on my leadership team being available to our staff and being in the marketplace and watching what’s going on. Whether it’s spending time with the colleagues on a local level or doing something bigger like working on the Harvest for Hunger campaign, I’m involved in those things and take advantage of every opportunity I can to work with those things.
Spending time with colleagues to the extent that I can, and to the extent that my leadership team can, is invaluable. It’s difficult to see everyone as much as we’d like, but it’s so valuable when you can make it happen, so you have to find time to do it.
HOW TO REACH: Charter One Bank, Ohio, (877) Charter or www.charterone.com
It doesn’t matter if you have good news or bad news, just tell Bob MacIntosh what’s going on. MacIntosh, president and CEO ofmarketplace PIER 39, knows that the key to keeping his people heading in the right direction is to avoid surprises. Instead ofplaying off the major brands that most malls in America have, PIER 39 has created a niche market with unique shoppingattractions and a scenic location on the San Francisco Bay, with its own famous sea lions. To keep that niche, MacIntosh has toconstantly keep his finger on the pulse of both the industry and his customer base. Relying on his employees for feedback,MacIntosh has led PIER 39 to more than $189 million in annual revenue.
Smart Business spoke with MacIntosh about theimportance of staying informed and of understanding a market.
Talk to your staff to stay informed. My direct reports know that theonly surprise in this world is a birthday party, so keep meinformed. Whether it’s good or bad, I just want to know what’sgoing on. To make sure that’s happening, I have lunch meetingswith all of my direct reports, and we discuss specifically what’shappening in their world and if things are going well.
What I do on a weekly basis is I have two meetings with people; the first is Monday morning, and we discuss the weekendresults from what we own and operate, and that gives us all asense of what direction we are going. That’s very important.Even if one of those guys is in construction, I think it’s veryimportant that he knows how our sales are going, so it keepsthe building team’s spirits up.
On Wednesday, I have my direct reports and expand it toinclude other key people in our organization, and at that meeting, we discuss the busiest areas of current activity — what’sgoing on in your world, so to speak. By having those kinds ofmeetings — and they don’t have to be super long — it’s just agood way to get things out and keep everybody informedbecause that’s so valuable.
I talk with different people every day — not just my directreports but other people, too. I feel free to talk to anybody. Idon’t necessarily have to go through the leasing person to talkto the people that work in that office.
Again, the thing is communication and to make sure everyone knows what they’re doing and they are staying on target.The worst thing that can happen is people go off in the wrongdirection, and you aren’t aware of it.
Get feedback from the outside. I also am out in the public a lot and justmeeting people, and I hear comments about PIER 39. So I can seeif we are accomplishing what the vision is. I think that’s veryimportant to do. You can think you are doing a great job, but whenyou go out and talk to other people, they’ll say something like, ‘Ilike going to PIER 39 because ... ‘ and you can get a feel for whereyou stand.
Remember that your employees are the experts. I also listen to my people. I know that I don’t have all the answers, and they are specialists in their own area. So I listen to them, and if their strategiessound right to me, then I say, ‘Let’s go.’
I ask questions of my nine direct reports, but they know my styleand that’s to let them do their thing but to keep me informed.
It goes back to letting them do what they do in their specialtyarea. A lot of people try to dot somebody’s I’s and cross their T’s, Idon’t do that. We work together, and it works out. When they seethat I come to them for the answers in their area, that builds upchemistry and allows them to do their job without fear.
Fix the message, not the messenger. I don’t shoot the messenger. Youhave to take any news, good or bad, and listen to it. When I heargood news, I don’t jump up and down and wave the flag — samewith the bad news. If something could go bad, it’s better to hearabout it early and maybe cut it off, and that means you have toknow what’s going on. So if we have potential of stopping it, let’sstop it. Come talk to me, and I’ll listen to the problem, and we’ll gofrom there.
Maintain the company’s chemistry when hiring people. Basically, my philosophy on hiring is to bring in the best people I can while keepingchemistry. I interview them, but I have other people interviewthem as well because chemistry is very, very important.
We’ve had situations in the past where the person did not getalong with the other direct reports that I have, and they have to allget along or it doesn’t work right. It doesn’t matter if you are hiringa leasing person or a construction person, they have to get alongwith other people because they’ll all have to work together.
Understand your niche. First, you have to understand your product.At PIER 39, we’re dealing with the public. If you are in manufacturing, it’s a different audience, but we’re dealing with customers,so we need to know our product. I have to understand my directreports and their responsibility, and I have to understand the customer.
We take surveys twice a year basically asking the same questionsso we can compare ourselves this year to the year before and theyear before that. One of the questions asks if they are satisfied withPIER 39. We can use that to reinforce that what we’re doing for ourcustomers is right. We don’t go out and celebrate that, but it’s aconfirmation of our success. We have to focus on our customer.From marketing to leasing, we want to get tenants in here that ourcustomers really like, and we have to understand them to do that.
HOW TO REACH: PIER 39, (415) 705-5500 or www.pier39.com