In October 2010, Vince Donnelly was in the position of being acquired. PMA Cos. Inc., which he leads as president and CEO, was acquired by Old Republic International Corp.
The acquisition came with a number of positives for PMA. It provided an infusion of capital and additional resources, allowing the company to increase its operational flexibility. Old Republic also allowed PMA to retain a high degree of autonomy in terms of its day-to-day operations and culture.
But change is still change, and Donnelly needed to pilot an organization of more than 1,000 people through a foundational transition. He needed to quiet concerns and define what PMA would look like moving forward.
“Never having led an organization that became part of another company, it was certainly a challenge from a leadership perspective, both in terms of the internal and external processes involved, talking to our existing shareholders at the time, in terms of what was going on and why we were doing it,” Donnelly says. “Then, it was talking to our customer base and to our employee base.”
In short, the acquisition tested Donnelly’s ability as a communicator. He was quickly reminded that communication isn’t about talking or making speeches. It’s about connecting with people.
“I talked with different people about what the future was going to be like as we made this transition,” Donnelly says. “I found that it is always most effective to physically meet with people and look them in the eye. So I started out by visiting every single one of our locations, talking to our employees and explaining the rationale for this, and most importantly talking about what the future was going to be for us as an organization.”
Start a dialogue
The acquisition became official on Oct. 1, 2010, but the process of informing employees began four months earlier. In June, Donnelly and the leadership team at PMA began travelling to the company’s 20 offices, answering questions and disseminating the information they had available.
Donnelly says one of his most critical tasks was to outline the specific ways in which PMA would change. On the whole, the effect on the employees’ day-to-day tasks was minimal, but that’s not the default mindset of most employees when they hear a big change is in the works.
“There were some transitions in terms of our back room financial area, since we were no longer going to be a stand-alone public company,” Donnelly says. “There were some other functions that became integrated, but mostly everything was going to stay as it was before. However, when you announce some kind of change, whether small or large, people always personalize it. The biggest question they have is ‘What does it mean for me?’ So first, I tried to address what this was all going to mean on a day-to-day basis for our operation. I explained that to them, I gave them some information about our new parent company, about their operating style, their people and so forth, and what it meant for us going forward.
“Second, I talked about how I perceived this as an employee and as the leader of the company. I talked about why I viewed this as a positive for the companies, knowing that the fundamental question in their minds was ‘What is going to happen to my job?’”
The jobs question was one that Donnelly had to meet head-on, in an attempt to combat any speculation originating from outside the company.
“As we announced the acquisition, some of the local press automatically made the assumption that an acquisition was being made, so tons of jobs could be lost,” Donnelly says. “That is why I had to quickly emphasize that most everything was going to stay as it had been. The changes were going to be more like, instead of preparing documents as a public company would and reporting to the SEC, we were now going to share that information with the holding company, and they would take care of that kind of reporting.”
The need for repetition in communication during the first months after the acquisition announcement reinforced a valuable lesson to Donnelly: leaders need to open a dialogue with employees in a time of change and transition, because you can’t simply lecture to your team. You need to give your team a voice to raise questions and concerns to you and the leaders of the company.
“I would tell other leaders going through a transition a few things,” Donnelly says. “First, there is no such thing as communicating too much. Second, you can’t just send out memos or anything like that. You have to talk to people directly. They need to hear from you. Opening that back-and-forth communication creates an environment where people feel free and open to ask the questions on their minds. Because, as a CEO, you can get caught up in the fact that these are corporate decisions, but from an employee perspective it is a very personal thing. You need to be sensitive to that and make sure that the communication strategy, while you need to deliver a big-picture perspective, you need to make sure that you are focused on the impact it will have on each individual employee. While you are not going to talk to each individual employee, you are going to create an environment where hopefully people can ask questions and address their concerns.”
And if you’ve done it once, or even a few times, you need to repeat the cycle of talking and listening.
“It’s not just one and done,” Donnelly says. “Communication needs to be continual. You need to continue to reinforce the messages that you want people to internalize. So you need to understand that communication is a continuous process and not something that you do just once.”
Work as a team
You need to have an excellent grasp of your role in leading your company through a time of transition. But part of that role is knowing how your leadership team should support your initiatives. That includes not only your direct reports, but anyone in your organization with a supervisory role.
“It is on me to make sure that I sensitize our management people as to how important it is to communicate,” Donnelly says. “Like communicating directly with all of our employees, communicating with management is a continual thing. The leaders of the company have had to enable the other management people to answer questions throughout this process, and if questions need to be fed upward to the senior management level, or my level, we coached them to be responsive to that.”
Donnelly created multiple avenues for people to interface with one another, even when they couldn’t be in the same room — or even the same city — together, including videoconferences to update employees on the status of the acquisition. Even with the acquisition itself in the rearview mirror, Donnelly has continued the quarterly videoconferences.
The point, he says, is to continually engage not only the lower-level employees who have the most organizational separation from management, but also to keep management on their toes. If employees are willing and able to fire off questions, managers at every level should be poised like an infielder ready to pounce on a ground ball — on their toes and paying attention.
“The way we handled it, our communication during this time wasn’t supposed to be solely a cascading thing,” Donnelly says. “It always has to be a two-way street. You speak to your people, and they respond by bubbling messages upward. I try hard to think about what might be on people’s minds in a given situation, but you’re never going to be 100 percent right. You want an environment where people will raise the questions they have. And that doesn’t just go for the primary situation you want to address. It should be a day-to-day thing, where people are stepping up to interact not just with the CEO, but with all management-level people. You facilitate that dialogue and open up those avenues because you have to create an environment where it is as effective talking upward through the organization as it is talking downward.”
If you want to foster a team mindset throughout your company, you have to set the example by showing your staff that you view yourself as part of the team. Donnelly accomplishes that by, as he puts it, “humanizing” himself. It’s more than just making yourself visible and accessible. You have to be willing to relate to your people and, at times, appear vulnerable.
In the months leading up to the formal acquisition announcement, Donnelly didn’t have all the answers that every person at PMA wanted to hear. So he had to tell them exactly that. It doesn’t mean you shrug your shoulders and walk away. It means you are frank and honest, and make the promise to your people to share as much as you know, and build a sense of trust that will allow them to believe that when you know more, you’ll tell them.
“Throughout the process, I told people that there would be consolidation of some functions, but I also came right out and told them that I didn’t know the specifics yet,” Donnelly says. “I told them that when I knew, I would communicate that. You can’t be afraid to tell people that you don’t know something at that moment, or that you aren’t free to talk about something at that moment due to regulations. What you are asking people to do is trust you, [trust] that you have the best interest of everybody in mind, and [trust that] when there is news to tell, you’re going to hear it directly from the CEO — good, bad or indifferent. It goes back to interacting with people and remaining consistent in how you communicate so that people build a sense of trust. I still tell all the people there that they will never hear any significant news about the company from anybody but me. You will never hear it from the outside world first.”
If you aren’t forthcoming with information, not only will you lose that sense of trust, you will allow the rumor mill to power up. If you remain silent, your employees — and even your lower- and middle-level managers, will fill in the blanks on their own, with whatever bits of pieces of information they can find.
“If real information doesn’t exist, people will fill in the blanks,” Donnelly says. “They’ll stand by the water cooler or the coffee machine, and they’ll say ‘You know, I think this is going to happen because I saw that Vince didn’t have a smile on his face today, and there was this closed-door meeting.’ People will make assumptions, and when they make assumptions, they often don’t get things right. That’s why it is important to share information, and while you can’t always tell everybody everything that is going on, in general you need to be out in front with communication so that people don’t start filling in the blanks themselves.”
More than a year after the acquisition, Donnelly has kept the same communication strategy in place. He doesn’t want the trust factor to erode, because the next challenging time could be right around the corner, and it will once again be critical to have everyone in the information loop throughout the company.
“It’s like any relationship,” Donnelly says. “If all you do is talk when there is a problem, you have no goodwill to fall back on, and you’re generally not going to be successful. It’s always a continual thing. You can’t just walk in one day and say ‘OK, I’m going to tell you what is going on, and ask me any questions,’ and then walk away. If you go away or don’t address the situation again for a while, you can’t expect people to respond to that. You lose the human element that is so important to good communication, and good leadership.”
How to reach: PMA Cos. Inc., (610) 397-5298 or www.pmacompanies.com
In January 2009, Smart Business Philadelphia previously featured president and CEO Vince Donnelly and PMA Companies (then PMA Capital Corp.) on its cover. Great advice doesn’t have an expiration date, so here is a look back at some of the leadership insights Donnelly shared with us three years ago:
Donnelly on having passion for what you do: Passion comes down to the fact that you have to want to be a leader. Part of that, admittedly, is something to do with ego. But not in terms of titles and positions. It’s that you want that responsibility. I used to be a schoolteacher, and in addition to that, I coached basketball. Being a leader means you want to be the one to take the last shot in the game.
Donnelly on honesty: As far as honesty, people see through whether you are BS-ing or not. It’s a lesson I learned from my mom. She told me that there are some people in life who are two-faced. When things are going well, they act one way, but when things aren’t going well, they’re going to act a different way. People are looking for that honesty and consistency from you as a person. An effective leader is someone who is respected not just for their title but is respected as a person.
Donnelly on expansion: Successful companies are constantly challenging themselves. We charted a course to expand into the fee-based business. But I think that whether you make a new hire, open a new facility or enter a new territory, you have to ask how this fits in to what you do. Does it make you better or is it just something to do? Some companies change for change’s sake. We don’t do that.
If you frequently watch the Home Shopping Network, then you probably recognize Tony Little. He’s that energetic fitness guy with a ponytail and baseball cap, standing next to some healthy product, talking to you about changing your life and saying, “You can do it!”
Maybe you were convinced, and maybe not. But for Little, “you can do it” is much more than another sales tagline used to sell exercise equipment. It’s a personal philosophy for success.
“I’ve just always felt that whenever you hit that roadblock, there are a zillion other ways around it,” says Little, founder, president and CEO of St. Petersburg, Fla.-based Health International Corp., which sells Tony Little-branded consumer lifestyle and fitness products. “I think that too many people quit too soon.”
Little’s own roadblocks have included everything from a handful of near fatal car accidents, to going completely broke, to last year, having an employee steal more than $600,000 from his company.
“That was probably one of the toughest areas for me, because I still had to carry on business,” he says. “I still had to make up the money that was gone.”
At the time, Little’s newborn twins, born prematurely, had also been hospitalized for medical reasons. With his children in a life-or-death situation and the business he’d built facing catastrophe, Little says he only got through it by believing in himself.
“You’ve got to come out fighting,” he says.
Today, Little’s twins are doing fine with occupational and physical therapy, and he has already made up much of the lost business. In fact, his company generated $100 million in revenue last year.
By overcoming personal and professional challenges time and again, Tony Little has become one of the most successful television sales people of all time, selling more than $3 billion worth of products to date. Here’s how he builds, grows and preserves his successful brand.
Pick the right opportunities
Little’s incredible sales track record stems first from his ability to identify profitable market and product opportunities that grow his brand.
“I have well over 45 million people that have brought Tony Little products, which I never really thought that would happen in my life,” he says. “I’ve been successful in the fact that the percentage of projects that I do have been winners.”
He says the first step in building a brand is clearly articulating your niche and purpose.
“You identify that there’s problem out there,” Little says. “You identify the fact that you know the solution.”
Growing your brand is then a matter of finding ways for that solution to extend to other products under your brand name. By focusing on the lifestyle market, for example, he has been able to expand his company to sell everything from shoes to food to pillows and even a personal care line.
“My brother calls me a living oxymoron,” Little says. “He says, ‘You started in fitness. You exercise people. You get them all jazzed up about fitness. Now you’re feeding them, putting them to sleep and they’re wearing your shoes the next day.’
“If you’ve been successful with the direction you’re going, then you just need to keep complementing that direction with other extensions.”
When you see an opportunity that fits within your brand’s niche, you want to make sure it’s something that you and your company can grasp and understand before you pursue it.
“The most important thing about selling a brand is not being overly technical with something and bringing it home so that everybody understands it,” Little says.
You have to be able to put yourself in the customer’s shoes. So do your research and make sure that the opportunity is within your knowledge comfort zone. If it is too complex, you may have trouble communicating it to customers or getting enthusiastic about it yourself. Little finds that the best sales results come from choosing opportunities that you can connect to and inspire your passion.
“Everything in your life is selling,” Little says. “It just comes back to the belief factor that you have in what you’re selling.
“I think I motivate a lot of people to feel better, look better, take charge of their lives and do things because I’m such a strong believer in what I do.”
While having enthusiasm alone doesn’t guarantee that every customer will jump on board, when you are selling something that you truly believe is positive versus negative or middle of the road, it’s infinitely easier to transfer that enthusiasm to customers.
“The more ammunition you go into war with, the better off you are,” Little says.
“I still believe that people love to get excited about something. So I have a large excitability about something if I truly believe in it. And it just translates. And that’s why I always say passion sells. Enthusiasm sells.”
Have a winning mindset
From the time he started in the sales world selling his own vitamin regimen, and later, helping grow a chain of pet food stores, Little has seen the power positivity and perseverance has in selling anything.
“No matter how much money you make, no matter what kind of education you have, no matter who you are in this world, you are always excited about someone who shows up in your office who has enthusiasm, passion and confidence,” Little says. “And so many people lack it.
“I’d never done television. I’d never sold pet supplies. I’d never sold vitamins. I never did infomercials. I just had the attitude.”
Little says that he’s no different than any other CEO when it comes to stressing about bills or an order not coming in on time. Yet he’s found that turning around any tough business situation often just starts with having a winning mindset.
“If you look at our economy now and how tough it is and how people get so beaten up and depressed so quickly, I think that it has to do with your mindset,” Little says.
He says that today’s business environment favors those who are prepared to think proactively and take the initiative to find something, figure out something or do something another way.
“If you’re sitting there waiting for people to bring you something, that’s a mistake,” Little says. “If you have an idea, follow it.
“You hear it every day with different people you work with. You ask them to do something, and they ask, ‘How do you do that?’ You just want them to go, ‘I’ll figure it out. Go ahead, Tony. Go away.’”
A winning mindset starts with eliminating attitudes such as fear and negativity that can inhibit your ability to make decisions and chase opportunities.
“The key to a successful company really is the person who is a decision-maker above anything else, because even if they are wrong with their decisions, their opportunities are at bat that much more,” Little says. “They are bound to get a home run.”
But understanding what good ideas and opportunities are out there isn’t enough if you don’t have the attitude to run with them.
“There are so many people that are going to say no, and it becomes a bit of a numbers game,” Little says. “If you take 99 no’s and you get one yes, the yes could make you a fortune or make your whole life.”
When Little first pitched his idea of selling a low-impact exercise video on HSN, the network had never sold an exercise video in its history. But after much persistence, he was able to track down the company’s owner, Bud Paxson, and convince him to try the idea.
“Bud looks at me and says, ‘So you are the guy that calls my company all the time,’” Little says. “I said ‘Yes sir.’ And he said, ‘Well, videos don’t sell.’ I made a bet that my videos would sell if they were presented a certain way.”
In the first airing, Little’s tapes sold out in four minutes. When Paxson called to order 1,000 more of the tapes, those sold out too.
“Certain people will get right up to a goal line and fail, whereas you really need to be the person who is going to bring it over the line,” Little says.
“There are actually a lot more opportunities out there. So many people are not realizing that the person who is going to get the job right now or the person that is going to be able to innovate on a product is someone who has an energy level and enthusiasm and a belief.”
Protect your reputation
Lastly, the strength of your brand is based on more than just your ability to choose the right products or get people to buy them. Because your brand name is synonymous with all aspects of your customer’s experience, everything from manufacturing quality, to shipping time, to how you handle a return affects how your customers feel about you and whether they’ll continue to buy your products.
“You must keep the customer’s experience great and never lose sight that it’s the customer who made you a brand,” Little says.
Once Little did a show to sell a shoe product, but it turned out that some customers who bought the shoes had high insteps so the strap would not fit them. Instead of just accepting that there would be more returns, he called the manufacturer and asked them to create a Velcro extender so that customers could extend the shoes to fit. He shipped the extenders out immediately, and the result was twofold.
“One, it reduces returns and it helps the customer have something that they originally bought,” Little says. “So I was able to make these extenders for the shoes and get them off to the people who had an issue and then they were all happy. Then what was a problem became an asset for my company. I was able figure out that that’s a really good thing to be able to adjust shoes. Now all of my shoes are adjustable.”
Whenever he discovers a customer issue, Little takes swift action to let people know that he cares and is going to make the issue a priority.
“What I do is try to cut the product off immediately, try to revamp everything,” Little says. “Let your consumers know that you understand their concerns and you are working on it. That’s how you preserve your brand.”
If something gets screwed up, he knows that it’s still his name that the customer associates with the problem and subsequently, his brand’s reputation.
“It’s a lot more work for me because people are buying Tony Little in the respect of, ‘I believe that he’s already checked this out,’” Little says.
“If I have a consumer that’s not happy with something, the type of e-mail you’ll get from that consumer is basically, ‘This has to have been somebody else. Tony Little would never let me down like this.’”
That’s why Little uses a range of media channels to connect with customers and talk to them about their feedback.
“The common mistakes are usually in the way people market a product, not understanding their demographics and not understanding the people they are selling to,” Little says.
He still writes in all of his online guest books, answers customer e-mails and always responds to anyone who reaches out to him personally about a product.
Transparency with customers also gives you a more accurate picture of your customer satisfaction, so you can gain insights from the positive feedback as well as the negative.
“The majority of people that send in a review on the Internet on something normally are always going to skew to the negatives,” Little says.
“People we find who love a product or are satisfied with a product aren’t just all of a sudden sending you stuff. They don’t have the same emotion.”
Being responsive, approachable and showing consumers that you’re really thinking about how they use your products builds trust with them as well as with your own business partners. When your brand faces challenges and you need to make up lost ground, having that trust is an invaluable asset.
“Obviously there will be certain times that you just don’t agree…but in the long run no matter how negative a person is or what their experience has been ? as a person who built their business off of their brand – you try to always respect your customer,” Little says. “I don’t think I would be in business if it wasn’t for taking care of my customers.”
How to reach: Health International Corp., (727) 556-2959
1. Build your brand with products you understand and believe in
2. Develop a can-do mindset in decision-making
3. Be accountable for your customer’s experience
The Little File
founder and CEO
Health International Corp.
Born: Fremont, Ohio
What would your friends be surprised to find out about you?
That I’m a very quiet person, and that I love reading books — as many as I can get my hands on.
How do you regroup on a tough day?
I’ll give myself a self-motivational talk and put myself through a challenging workout. It never fails to energize me.
What is your favorite part of your job?
It’s important that I have fun when I work; I don’t like to get too serious. Even when I’m selling or presenting new opportunities, I like to be myself and have a good time. If you don’t enjoy what you’re doing for a living, you should find another line of work.
What is your favorite Tony Little product?
The Gazelle. The Gazelle was an exercise machine that has been used in more motion pictures than any other infomercial. I also used it on the Geico commercial, which was fun. It was over a billion in sales for just that one product. It was just fun and the amount of mail, the amount of letters and before and after pictures and stories — even to this day I probably get two or three a week. People just still love the product.
Whom do you admire in the business world?
I have great respect and admiration for people who are self-made. I’ve always looked up to Donald Trump as someone who is willing to speak his mind and create victories from adversity. I would also include Cornelius Vanderbilt. I just finished reading his biography, ‘The First Tycoon,’ and he really was an amazing man. He wasn’t particularly well-educated, but he wound up being one of the wealthiest people in American history. Then there’s Steve Jobs. So much has been said and written about him since his death, but I admired him most for never giving in to a challenge, no matter how tough it got. He never gave up on himself, and that’s a lesson for all of us.
Michael Benoit took a risk when he launched Total Hockey Inc. in 1998. He had torn up his knee playing basketball and initially chose hockey as a sport, one he could play with less wear and tear on his legs. As he became more intrigued with the game and less excited about his job leading a health benefits consulting business, he decided to take a shot at building a business that sold hockey equipment.
The 210-employee company has grown steadily and earned revenue of $18.6 million in 2010. Benoit, the company’s founder, president and CEO, has high hopes to keep it going in the future.
He discovered one of the keys to successful growth is to not take the entire burden of building the business on your own shoulders. Take the lead in that effort, but don’t be afraid to accept or even seek help.
“I’m just as likely to be putting a fixture together as analyzing financials as negotiating with vendors,” Benoit says. “So I’m involved with a lot of different things. That said, I try to give our staff a lot of rope. The worst thing somebody can do is overmanage people. The best approach is to find good people and let them run. I like mistakes.”
Benoit describes the state of the hockey equipment retail industry as “primitive” when he first started his business.
“You could easily imagine you were back in the ’50s doing retail,” Benoit says. “It was very fragmented with a lot of mom-and-pop, single-store operations. We’re part of this drive bringing a much more modern, much more disciplined approach to the business.”
Benoit relied heavily on his people to help develop a modern identity he hoped would be attractive to both shoppers and investors. He wasn’t afraid that these people might make a few mistakes along the way.
“If you expect people to work hard and innovate and you expect them to make mistakes, you’ll be OK,” Benoit says. “Eventually, there will be a mistake. There will be problems and there will be things that are done that aren’t done the way you would do them. But that’s OK. Most companies suffer from overcontrol on things.”
So if one of your supervisors wants to put a line of equipment in one part of the store and you think it should go somewhere else, you have to ask yourself a question: Is this a battle you need to fight? Or are you better off letting your people do their jobs and trusting that they know what they are doing?
“When you have people out there trying to make things happen, there are a lot of times where I don’t agree,” Benoit says. “Whether it’s before the fact or after the fact, I’ll say, ‘Boy, I wouldn’t do that.’ The thing that is very important to me and what I insist my staff be conscious of is a sense of integrity and a sense of doing the right thing. Beyond that, I’m all in favor of them taking chances and trying to create new things and experimenting.”
Benoit believes that many entrepreneurs lose that willingness to trust as the years go by. They start out as very bold and open to taking a few chances to achieve their dreams. But somewhere along the road to growth, they lose that edge and become more conservative.
“If you’re not moving and innovating and encouraging people to fail, your days are numbered,” Benoit says. “They might be numbered in years, but they are numbered. We’re kind of always living on that line. That’s the target. We want to be just safe enough.”
As you ponder the growth of your business and the wisdom of a particular risk, ask yourself a question.
“What happens if you don’t do this?” Benoit says. “If the answer is, ‘Everything is OK,’ then it probably doesn’t make sense to do it. But if we will lose ground to someone who is willing to take that risk, that raises the importance of it and maybe you need to give it some more thought.”
How to reach: Total Hockey Inc., (866) 929-6699 or www.totalhockey.com
Stay true to you
When you’re trying to sell people on your business, you can’t put on a show that isn’t true to what you’re all about. You may win them over that day, but it won’t work for very long.
“The biggest mistake I’ve seen is trying to act like what you’re not,” says Michael Benoit, founder, president and CEO at Total Hockey Inc., a 210-employee hockey equipment retailer. “Trying to mirror the listener or prospect too much. Trying to tell them what they want to hear as opposed to what you’re all about. If you’re true to yourself and true to your market, you should be OK. It’s not always an easy environment, especially in the last few years with respect to financing.
“The banks aren’t terribly imaginative these days. But that still doesn’t mean you can afford to try to be what you’re not.”
When you’re trying to expand your business, don’t be the only one talking to potential investors or customers you want to engage. Let other people in your organization represent you, even if they aren’t managers. And don’t give them a script.
“I would rather trust,” Benoit says. “It’s better that way and much more natural. People can read preparation. That’s hard to disguise that somebody has been prepared.”
Caroline Nahas doesn’t try to be intimidating. But it would be naïve to deny that her position has that effect on people. So when she speaks to employees at Korn/Ferry International, she works hard to be very approachable.
“People can be intimidated through absolutely nothing that you did other than you have the title,” says Nahas, office managing director of Southern California for the executive search firm. “I always think one of the greatest approaches is to sit down and say, ‘Hi, I’m interested to hear what you think.’”
Nahas leads about 150 employees that work in offices in Irvine and Los Angeles.
“Show them the respect and show them that you think their views and what they have to say is of value,” Nahas says. “There is bound to be someone, whether they come up with a right or wrong statement, someone is going to open up. And suddenly, you are getting into this dialogue and then you can ask some of the questions that you’re curious about.”
Korn/Ferry is going through a transition where clients expect the firm to have more intimate knowledge of what recruits can do and how they can address specific concerns in their business.
When your business is going through a major transformation, you need to get your employees at all levels of your organization involved in the discussion about how to address the changes.
“I might say, ‘We are going through this strategic change, and the people on the executive team are extremely excited about it for these reasons,” Nahas says. “I’m curious, what would you do if you were us to get this out to the population of the firm?’ What you have just done is show them a great deal of value. You’ve said, ‘I value your opinion.’ When you do that, you break down the barriers, but you also engage them and win them over and make them part of something rather than making them feel part of something that is being imposed on them.”
Keep in mind that just because you’ve been thinking about this change for a long time and have talked about it with your peers, others in your company may not be as familiar.
“If you’re a CEO and living this day to day and it’s sort of your overall vision, you’re very deeply steeped in the subject,” Nahas says. “Sometimes people can forget because they are so engaged in it and so enthusiastic and passionate about it, they forget that the people they are communicating to haven’t had the benefit of all that vetting, of the debating, the learning and the creating. So you just have to be more repetitive and consistent in terms of delivering that message and trying to put yourself in their shoes, three or four levels down. Make it real for them.”
Reality is another obvious but often overlooked component in communication. Just as you look for concrete evidence to see that your business is growing, your employees appreciate tangible examples to help bolster the case for whatever it is you’re telling them.
“If you tell people stories about why something has been successful, giving them real-life examples of clients who have integrated and used some of those services and how they have benefitted and how the partners or the people at Korn Ferry identified those needs within the clients is extremely impactful for helping people understand how something works,” Nahas says. “Telling them on paper or giving them theoretical ideas is not as effective as practical application and real-life examples.”
After you’ve had a good discussion with someone who you don’t normally talk to, follow up with a note to express your thanks for their time.
“Write back and say, ‘I truly appreciated the open, candid session we had,’” Nahas says. “’Your input was valuable and your active participation made a huge difference, not only in the meetings but obviously also in our company.”
How to reach: Korn/Ferry International, (310) 552-1834 or www.kornferry.com
Don’t act too soon
Caroline Nahas doesn’t face a lot of conflict in her role as office managing director of Southern California for Korn/Ferry International, where she leads about 150 employees. But when she does, she works hard to maintain a sense of impartiality.
“When you’re going to be involved in resolving conflicts with individuals, it’s very easy when the first person comes in and gives you the story; generally, that person is obviously editorializing,” Nahas says.
“It’s not that they are trying to do that. It’s just natural. They have their own view and they are very passionate about what they are raising objectives about. It’s very easy, as you’re listening to that, to get drawn into the story and to potentially show a reaction or to even prematurely make a judgment.”
If you want to maintain peace in your company, you’ll resist the urge to make that judgment before you’ve heard the other side.
“Listen, don’t render any kind of a judgment, don’t show any kind of expression that you agree or disagree,” Nahas says. “You’re just listening. This is such a great adage. There’s always two sides to the story. Often times neither one is right or wrong or they are both right and they are both wrong. But it’s absolutely critical you get all the information before you react.”
It wasn’t arrogance that left Delta Dental of Missouri so unprepared for the sudden influx of competition it was facing. It was the fact that up to the beginning of 2010, there really had not been anyone to challenge the company’s status as the leader in providing dental benefits.
“For a number of years, there were limited choices in terms of dental benefit plans,” says David Haynes, the 113-employee company’s president and CEO. “Delta was the premier choice. As the economy worsened, large health payers have started seeing dwindling bottom lines because of increasing medical claims costs. They started looking for other revenue streams, and as they looked, a natural one to look at was dental. So we started seeing a lot of increased competition.”
Haynes was brought in to lead the business in January 2010. He was given the challenge of preparing this untested company, which had generated $437.4 million in 2009 consolidated revenue, and getting it ready to face this new threat.
“Because of the lack of change that had occurred for a number of years, as a business, we weren’t organized strategically as a team and we didn’t operate as a team because it wasn’t necessary,” Haynes says. “We operated more in silos. Each discipline represented things they needed to take care of and business was good. As you’re starting to move into a rockier climate and you know your business model needs to change, one of the first things I said we needed to address was how we structured the organization and how we operate and how we make decisions. We had to start making decisions much more quickly.”
This would be easier said than done as everyone had grown pretty comfortable with the way things worked at the company.
“My challenge is really getting my team and the employees rallied around some common efforts and common goals in terms of the changes that we need to make as the marketplace is changing around us,” Haynes says.
He didn’t have a lot of time as the competition was going to get more intense. But he had faced tough challenges before. This was a guy who as a high school student singlehandedly managed a lunchroom of 600 factory workers one summer and left an indelible mark in doing so.
“My supervisor at that time, he said, ‘You know, you’re one of the greatest guys I ever had working for me,’” Haynes says. “’But I’m going to be glad when you leave. You got all my people to quit smoking and they are going back to school and they think they can change the world.’ And I said, ‘You know what, Danny? They can.’”
Haynes faced a daunting task. But confidence would not be an issue in his effort to overcome it.
Build a team
The silo problem was first up for Haynes as he sought to put Delta Dental in a better position to respond to its new competition. It was a problem Haynes knew quite well having served as chief financial officer at the company for eight years prior to becoming CEO.
“As CFO, I dealt only with financial issues,” Haynes says. “As a chief operating officer, you dealt only with the day-to-day operating issues. Human resources and marketing, you dealt with your respective disciplines, as well.”
Haynes needed to demonstrate that these departments would benefit from knowing what the other was doing. Operations needed to know what IT was doing and IT needed to be familiar with what sales and marketing was doing and sales and marketing needed to be aligned with finance and so on and so on.
In order to accomplish that, Haynes had to get them to work together. He had to create a safe environment where they could get through their unfamiliarity and uncertainty about working more closely together.
“They have to feel comfortable to ask questions,” Haynes says of his leaders. “When you’re coming from a siloed environment to a multidisciplined approach to management, you have to make sure people don’t feel compromised at the table. Finance may not be their expertise, so all questions are fair questions.”
When you’re trying to bring leaders together who haven’t had a lot of interaction, the sharing of departmental knowledge is only part of the puzzle. You’re trying to build a team.
“It’s really important as a team to establish and clarify what is your mission and vision for the company,” Haynes says. “I find even with our team at times, all of the disciplines have a different take on the marketplace and what we should be doing. If your team isn’t on the same page in terms of vision, where you’re going, and mission, why you do what you do, it’s counterproductive. It’s wasted energy.
“At a senior team level, if you have that kind of wasted energy, it’s going to multiply out to all of your staff, as well. They are getting a mixed message. What is our vision? My boss said it was this, but I’m hearing this from somewhere else. That really is very difficult for an organization. Make sure you clarify your mission and your vision.”
If you find that people don’t understand your mission and vision and aren’t clear about where you’re trying to take the business, don’t automatically blame your people for failing to grasp your explanation. Take the initiative to solve the uncertainty before it spreads to the rest of your staff and creates even more confusion.
“That is something leaders struggle with because you really like it when people love your ideas, but you have to understand that any time you make a decision, there’s probably folks who don’t understand the decision or aren’t in favor of the decision,” Haynes says. It’s one thing to tell people, ‘Hey, we’re seeing more competition. We have to work more closely together.’ You’ve got to explain what that means and how your plan will solve the problem you’re facing.
“I’ve always looked at those opportunities and said, ‘Well, that means we didn’t communicate it well. We didn’t think through the objectives well enough. We didn’t communicate the objectives well enough. We need to do a better job.’ That’s why I welcome the discussion.”
Deal with resistance
There are times, of course, when it’s not a lack of understanding that makes it hard for people to buy in to your plan. Sometimes, they just don’t like what you’re proposing.
“We had an employee that when I sent this out, I got a bunch of e-mails back on it, and I got one that was a little disgruntled by it,” Haynes says. “He said, ‘I’m really disappointed by this, and I feel really kind of bad that we made this decision.’ I know this employee very well. We corresponded and chatted about it. I said, ‘Here’s the reasons behind why we did this.’ I think it’s important to take that time and effort to deal with employees and deal with them one on one, if at all possible.”
When you’re not able to do it one on one, do it in a broader forum. Try to understand what their concerns are so you can address them. It’s all part of making sure your employees feel respected and feel like they have a voice in what your company is doing. “One of the worst things for an organization at any level is fear,” Haynes says. “You have to get the fear out of an organization. If you can get fear out of an organization, you can move forward at warp speed.”
Few things cause more fear than the unknown. But Haynes need only look at his past experience in the business world to find leaders who were less than truthful with their employees.
“I always had a problem with that because employees are very smart,” Haynes says. “I said, ‘If you have trouble being truthful with an employee, then you’ve made the wrong decision.’ Once you’re comfortable with a decision, regardless of how hard or difficult that decision might be, you should be able to communicate that. You should be able to debate that issue and have people understand why you did that and why it was in the best interest of your organization. If a decision is in the best interest of your organization, regardless of how tough it is, I don’t mind presenting that to anybody. In fact, I welcome that challenge.”
Fortunately for Haynes, his efforts to be transparent about the moves to be made at Delta Dental paid off with at least one member of his team, who has seen the benefit of interaction and the way it can contribute to making faster and more informed decisions.
“I was talking to one of my officers and she made a comment to me,” Haynes says. “She said, ‘You know, when you said you wanted to start bringing senior staff together in that fashion, I wasn’t really sure. I thought, what’s the senior staff going to do? But after I’ve seen these meetings and I’ve participated in them, I’m getting it.’ She’s really excited. She does such a tremendous job of coming to the table and contributing to all the disciplines. The team now is seeing so much benefit in terms of the multidisciplinary approach. They are realizing that we mitigate a lot of business risk by involving experts in very different fields coming together to reach a good conclusion.”
Look at the big picture
Perhaps the most important piece of what Haynes wanted to accomplish was the instilling of core values that would be part of every decision made in the business. These values would be the glue that would guide the company in its new direction.
“Great companies are born out of values,” Haynes says. “If you’re living those values and they permeate your decision making, you can’t help but become a great company. It’s important in terms of how you enforce those values. It’s a daily issue. It’s a moment-to-moment issue. It’s done in the smallest encounters when you’re walking down the hallway to make a copy and a staff person stops and asks you a question about the latest policy change or what’s going on in the board room or whatever that question might be.”
Values often become a punch line at companies that do nothing more than posting a plaque on the wall. It takes years of parenting to instill proper values in your children and it takes an extended effort to convey proper values in the workplace, too.
“A lot of your line managers that are dealing with fires on a daily basis, they aren’t really thinking about, ‘Wow, how does this fit into our values?’” Haynes says. “‘How does this shape our organization?’ You’re trying to connect those dots and you’re trying to lead by example most of the time.”
So values aren’t really something that you specifically talk about. They are guiding principles that you use when making decisions about your business. And as Delta Dental altered its operations to respond to more competition, Haynes wanted to make sure everyone was on the same page with how to act.
“Employees are incredibly smart,” Haynes says. “I don’t care what level they are in the organization. Employees really understand management a lot better than people ever give them credit for. If you’re insincere about values or you’re inconsistent about them, they know it. And they absolutely are going to nail you on it.
“As a leader of the service industry, the one thing that I find is just critical for us is that our employees believe in the leadership of the organization and that they believe in the direction we are taking the organization. I find that loyalty level you’re looking for in a service industry really comes whenever you start walking the walk and talking the talk of values. People can gravitate toward them.”
By bringing people together and showing a deeper reason for it than just sharing department reports, Haynes helped Delta Dental to increase 2010 consolidated revenue to $489.9 million.
“I need to make sure we’re in sync so as I’m carrying that message to my senior leadership team and to our management team and our staff, they see crystal-clear alignment in terms of what we’re doing,” Haynes says. “Are we great at it? We’re not there yet. I’m not telling you we’re the example. But in five years, I hope to be the poster child for it.”
How to reach: Delta Dental of Missouri, (800) 392-1167 or www.deltadentalmo.com
The Haynes File
Born: Versailles, Mo.
Education: Bachelor’s degree in accounting, University of Missouri; MBA, William Woods University, Fulton, Mo.
Who has been the most influential person in your life?
I was a change-of-life kid. My parents were older when I was born, and my dad died when I was young. So my mother played a very instrumental role in the development of who I am and who I became as an adult. She was very instrumental in it. My maternal grandmother, I absolutely idolized and I hope to live and pattern my life after her. She was a friend to everyone she met and she had a true zest and love for life. She really dedicated her life to service. That’s a lot about who I am. My management style, if you want to put a label on it, and I didn’t know it for years, I’m a servant leader. In the roles I’ve been in, I believe in servant leadership. The person who taught me that naturally is my grandmother.
What is the best advice you ever received?
Be honest. I know that sounds so simple, but in business and as a leader, just be honest. Even difficult decisions are made easier when you’re honest.
Haynes on reinforcing values: As a CEO, you look for every opportunity you can to reinforce the values of the organization. I’m not the best at it. I know I’m not. I have to consciously focus on it every day. I tell my team, ‘Hey, if we miss an opportunity, call me out on it. Make sure we’re doing that everywhere that we can.’
Before you hand out your first business card, before you set up the most bare-bones website, and before you minimally introduce a new venture to the market, you need to have a logo.
A graphic has the power to make a quick and indelible impression, and a good logo can give a start-up an early advantage. Just ask Nike. Just ask Apple. The same is true in reverse. A poorly conceived and poorly executed logo suggests to anyone who sees it that the company just isn’t ready for prime time.
So it was pretty early on when we realized that we needed a logo. As an early-stage start-up, we at Summit Data Communications wanted to look like a professional, confident and dependable company, not a handful of rattled guys taking the biggest risk of their careers. Yet while we knew enough to know that getting our first logo right was a big deal, we still managed to fail at it spectacularly. Here’s how it happened.
We got the first part of the process right: get a good designer. Through one of our partners, we engaged a designer with a good reputation and a portfolio of previous quality work. We then shared with him the collective and unfiltered thoughts of the seven of us, including our favorite colors, shapes and typefaces. Although not one of us had any design experience or training, we provided detailed feedback through multiple iterations. The result was our company’s first logo, which came to be known as “the river of blood,” is reproduced here for the first and last time. In the end, the designer in question refused any compensation for the logo, asking only that we never, ever associate his name and good reputation with it. This was entirely fair because the problem wasn’t him — it was us. We wouldn’t make the same mistake again.
We knew we had a serious problem and we set out to solve it. Conveniently enough, another partner knew another designer, one untainted by a previous relationship with us. He initially agreed to help us out in a few weeks. When he saw the logo, he realized that our young company was a critical case and our image was in imminent danger of irreparable damage. “I’m on it stat!” he said. Just two days later, we had a new logo, pictured here for comparison. This time, only two of the partners knew the project was going on, and the result was delivered not for comment but as a fait accompli.
Our company got far more from this process than just a respectable logo. I also gained a few valuable management lessons:
- It’s not enough to hire the right people. You have to let the right people do their jobs. If you hire a pilot or a brain surgeon, you tend to afford them a fair bit of autonomy. The same should be true for engineers, writers, and yes, designers.
- We all know that too many cooks spoil the broth and that the camel is a horse designed by committee. Still, it’s easy to forget this, particularly when you are on a new team and you are building confidence and relationships. Feedback is great, but acting on every opinion isn’t.
- Lastly, everyone makes mistakes. The difference is what you do in the aftermath. Successful organizations identify errors early, correct them quickly and learn as much as they can from them. You’re going to fail sometimes, so the key is to fail fast.
Ron Seide is the president of Summit Data Communications Inc., a wireless technology company headquartered in downtown Akron. Reach him at firstname.lastname@example.org.
Type “customer loyalty” into Google and you’ll get more than 8 million hits. Search for it on Amazon and you’ll find more than 13,000 titles. Selling the concept of customer loyalty is big business in the business world. Call me disloyal, but I say customer loyalty is a myth.
Loyalty is being unswerving in allegiance, unwavering in devotion. The implication in business is that loyal customers should stick with a vendor, no matter what — even when they’re aware of better options.
Is that reasonable to expect, much less realistic? I don’t think so. Instead, it’s better to keep our eyes on the prize: profitable, reliable, repeat business.
It’s imperative to understand that the cornerstone of any successful repeat strategy is memory itself. It starts with your brand promise. You’ve got to offer something worth remembering — something unique that solves a specific problem or meets a particular need a particular way.
Yet being worth remembering isn’t enough. You also need to find a way to make sure that you’ll be remembered. After all, what’s the difference between you and a competitor who has never served your customer before? If your customer doesn’t remember you: nothing. You have to win the person over, all over again.
But if you do have an account in your customer’s memory bank, then you are with that customer all the time. The next time that person is in need of whatever product or service you offer, he or she already knows where to go. The best brands become synonymous with the service or solution they provide — think Kleenex, Xerox and Google. In a world of overwhelming choice, you can be your customer’s default setting.
And that is why memory belongs at the heart of your repeat business endeavors. If you want repeat business, your goal should not just be to make a sale but to make a memory.
But how? Here are four tools you can use to help ensure your product or service gets remembered. I call them the grand SLAM: story, leadership, alliteration and music.
Story: Our minds are hardwired for narrative. Wrap your offering in a story, and it will be easier for your customers to recall. For example, if I say, “turkey sandwich,” do you know what business I’m thinking of? How about if I say, “Jared”? Stories have lasting appeal.
Leadership: Being the original is an aid to recall. As market strategists Al Ries and Jack Trout once wrote, “It’s best to have the best product in your field. But it’s even better to be first.” If you’re offering something specific and unique in your category, then you can make a leadership claim. Authenticity beats imitation every time.
Alliteration: Repeating the sound of an initial consonant makes simple phrases stick. Think “Dunkin’ Donuts.” “I’m cuckoo for Cocoa Puffs.” “Every kiss begins with Kay.” Ever wonder why the Geico spokes-creature is a gecko, not a chameleon? Alliteration is pleasing to the ear. It rents room in your customer’s brain.
Music: Catchy tunes get replayed in our heads, helping messages take root. I bet most readers born in the 1960s like me can still sing all the words to the jingle, “My Bologna Has a First Name.” That commercial aired in 1973. Remember anything else from 1973? Set the words to music and help make the memory last.
Most importantly, to win repeat business you first need to deserve it. As Walt Disney once said, “Do what you do so well that they will want to see it again and bring their friends.” It’s no accident that Disney and his successors have positioned scores of shutter-snapping photographers around their theme parks. They’re creating enduring, take-home, share-with-friends-and-family souvenirs.
I’ll say it again: if you want repeat business, don’t just make a sale. Make a memory.
Jerry McLaughlin is CEO of Branders.com, the world’s largest and lowest-priced online promotional products company. Reach him at JerryMcLaughlin@branders.com.
For Andreas M. Schulze Ising, running a global company is both his biggest challenge and his biggest advantage. The president and CEO of Advanced Polymer Technology Corp. doesn’t get to work within the confines of one country operating in a certain way with a standard set of rules and regulations. However, he thrives on the ability to draw from different environments and points of view to advance the capabilities of the 200-employee global manufacturer of polyurethane-based materials, synthetic turf products and sports flooring applications.
The company has development teams around the world to aid in its global business, but keeping those teams in contact and working together is a constant, yet well worth it effort.
“When you’re just focused on one country, it’s an easier task because government and guidelines and the mentality of the folks in a certain country that you’ve experienced work in a certain way,” Ising says. “When you mix and match those and you work in the American industry and you have to incorporate the German way of thinking or the way things are handled in Australia or Hong Kong or China, then you really have an interesting task.”
Advanced Polymer Technology’s ability to pull from very different environments and perspectives allows the company to be an industry leader in innovation. It’s that ability that landed it the task of supplying surfaces to the Olympic authorities for the games in 2012.
Here’s how Ising keeps Advanced Polymer globally connected in order to develop innovative quality products.
Develop a global framework
Advanced Polymer manufactures and installs running tracks, tennis courts and artificial turf for rugby, football, soccer and many sports facilities and schools across the globe. The company has to be able to understand how business works in different parts of the world in order to succeed.
“It’s always a little bit of a struggle when you have locations, specifically production environments on a global basis,” Ising says. “You have to provide those folks with the right truths to make them understand how things work on a global basis. When you have brand names that you market globally, you have to make sure that you comply with the rules and regulations in a certain country but use those to excel the company and get everybody on the same boat to make sure things are going in the right direction.”
One of the key things to running a successful global business is to really provide people with a direction.
“You have to be able to see beyond the future and what the market requires,” he says. “How can the folks on hand and how can doing innovation fit into that picture and excel the company forward? Give them a straight line and the proper advice and have a plan for how the company can survive so people have a clear idea of what the next steps are. It’s very important to make sure that on the global level that this mission is clear across boundaries and clear across the country. It has to go beyond the local customs and how people think on a local basis. Because as a global company, it’s very important that the mission statement and the brand strategy is very clearly defined and can be grasped by everybody to make sure that it’s a team environment and teamwork that goes forward and extends in the right direction.”
To help Advanced Polymer keep tabs on how things are going in other countries and where each region can benefit from one another, Ising uses a global development team.
“We have a global development team of Ph.D. candidates … on hand in Europe and the states and Australia, and they create and test products to the market,” he says. “They have such an influence from the local markets and they understand the local requirements, so when you put all that together, you don’t just have the creativity of a specific area or a certain way of thinking whether it be German, Australian or Chinese, you actually cross the boundaries by having these guys talk together. It’s a very simple tool and it gives you a platform where ideas get brought to the table and discussed.”
If you operate on a global scale or even if you just operate in one country, you have to have a way for different regions to communicate and share ideas that can benefit the business.
“We look from three different directions from three different continents on similar products that we can enhance and modify based on local demands or local requirements,” he says. “As you can imagine they have very, very different conditions in Australia versus in Germany. In the United States, you have not just forest areas, you have deserts and extremely cold areas where the requirements for certain flooring products or sports flooring products are very different. There are different performance characteristics that are very dependent on the environment, temperature and light. Having the input from these different continents gives you quite an interesting mix of ideas and points of view and perspectives of what is right. The most important thing is to have an open mind and try to see things in a different global environment from that perspective.”
Innovate on ideas
Different perspectives are what allow you to develop ideas. You have to bring people in who actually look further beyond this perspective to help progress the company forward.
“In the end it’s all about innovating things,” Ising says. “It’s all about coming up with this new product. It’s always being a step beyond the competition. That’s probably one of the key focuses. We have a company that works in many different directions not just the sports flooring industry, but we make polymers for optical materials and you can imagine how extreme the bandwidth is between a simple tennis coating to something that will find it’s way into an optical application.”
While working on products for different industries creates challenges for the company, it also allows it to find innovations it otherwise wouldn’t find.
“For example, a running track that has up to 70 percent renewable resources,” he says. “With all these different technologies we have on hand in all these different areas, we have done a great job overlapping amongst those areas and coming up with a whole range of products.”
Whenever possible you have to allow your employees who operate in different areas of the company to interact so they can offer different perspectives and ideas and be challenged to innovate.
“You have to always be able to challenge somebody to step out of their own bubble and look at it from a customer basis, but also from a very fresh angle,” he says. “I think that’s also a key in our company since we have the global approach you always get all sorts of views out of very different perspectives. You have to make sure that you don’t get stuck with a certain way of looking at things. You always have to be able to challenge what you do and look at it from a different person’s perspective, a different market perspective, or a different requirements perspective because only then will you be able to overcome these problems and get this aha effect.”
You have to understand that when you’re looking at a problem for so long, it becomes the same old thing. Putting a different spin or twist on a situation can get you another step in the right direction.
“When you work within the sports environment you are always challenged,” Ising says. “You’re always challenged by the athletes, by the directors and the guys that actually use the products. There’s always an idea that comes from this market. On the other hand being so versatile and not being just a sports flooring business, but having a lot of high-tech applications like the optical industry, you challenge the standards that are not common in the sports flooring side or the industrial flooring side. You get a complete different set of requirements and you get a complete different set of eyes that look at things and can tell you how that is met. Then you have to have the ability to take those estranged views from a different environment into a more common environment and sometimes it has a very eye-opening effect.”
The biggest key for Ising and Advanced Polymer’s innovation comes from the fact that the global employees communicate in meetings, over the phone, and through e-mail platforms to provide different opinions from different environments that trigger the thought process and make products better.
“The key is you have to really challenge people,” he says. “You have to really everyday make sure that you ask the right questions, that you have people on your team that do the same thing, that really push that question and have good ideas and different perspectives on things so that you have a good discussion that will shed light from different angles on other things to do.”
Maintain a collaborative environment
In order to keep people in your company interacting with one another and sharing ideas, you have to make sure communication between them is easy.
“You have to always be able to communicate,” he says. “I have to communicate from my perspective to the communicators and I try to convey the message to them to do the same things within their teams — have an open mind, have an open ear, listen to people and really try to give good feedback and really try to question things in a positive way, in an upbeat and creative way.”
Advanced Polymer also uses a simple platform to communicate ideas to everybody within the corporation to get instant feedback.
“You come to work in the morning and you open up your e-mail and besides your normal e-mail, you have these little idea snippets, these little comments, these little challenges every day that people can take a look at and think about the day-to-day business, but again be challenged or poked to comment on these questions or ideas,” he says. “Everybody uses it in the company. Any request that goes into a development project is going to be put on that and discussed instantly.”
You don’t have to be on time for conference calls and forced to wait because not everyone is dialed in and you don’t have to fly anywhere to speak to someone.
“You get these things and you can respond very, very fast and it makes things so much easier because you really have an instant feedback and people can attach pictures and excel sheets and it’s out there for everybody,” he says. “To have a quick idea discussed amongst your peers that are involved in this is so much easier. It’s also kind of fun, because you don’t have to elaborate forever, you just put this out there and the idea is taken further by other colleagues in the organization.”
It is very beneficial to have ways for employees to share ideas amongst one another, but you also have to determine which ideas are the best.
“We have certain levels of R&D work that is basically on a more creative level that we discuss once a month in a management meeting where we look at these things and determine what has potential, what fits into our vision of the company, and what we can move forward,” Ising says. “Based on those decisions there is always something in there that we can take and actually incorporate into existing products or we go ahead and work it into new ideas and new products. It’s really a process of listening to the folks in your company. It’s a function of that and it’s a function of your market intelligence. What does the market tell you that you need? What are your potential possibilities within the company? It comes down to understanding what your company is able to do and reflecting that into the market environment.”
At the end of the day you have to have a passion for what you do and a drive to constantly do it better.
“That’s what sports are all about — being competitive and looking beyond your means and trying to exceed the next challenge and that’s what we do at our company very well,” he says. “It’s all about innovation and it’s about the people your company has and bringing that together.”
HOW TO REACH: Advanced Polymer Technology Corp., (724) 452-1330 or www.advpolytech.com
- Develop a global framework and mission that allows you to best utilize your team
- Get different perspectives to unlock hidden innovation
- Implement communication methods to maintain innovation and best practices
The Ising File
Born: Muenster, Germany
Education: Master’s degree in textile polymer chemistry from Bergische Universitat Wuppertal
What was your very first job?
I had many jobs during my childhood since my parents emphasized that life is not free. The one that stuck most with me was working as a delivery boy for medications in my mom’s pharmacy. We had to bike for miles to drop off prescriptions come rain or shine from 20 degrees to 110 degrees. Sometimes the work was more than one could endure. But what counts is getting the job done.
Who is someone you admire in business and why?
This would be my first boss. He touched me because of his vision and the ability to turn that into reality. He was probably the best listener and had that amazing ability to bring the right people together to achieve highest results.
What is your favorite country to do business in and why?
It is most certainly America. A country filled with people wanting to live the American Dream creates an environment of fast pace but also the desire to move ahead with business and life to create that amazing environment all Americans live in. Things happen in the U.S.; people try, try to excel in their own life/career and move others with them. The U.S. also provides a very pragmatic business environment that gives everybody the tools to become great entrepreneurs.
Do you have an APT product you are most proud of?
APT has worked for a very long time to be the industry leader in quality. Our product lines prove that. We have lately focused on environmental-friendly products within the polyester and polyurethane-based product families, utilizing many renewable resources in our formulations. Latest developments created a new generation of running track based on the legacy track, Rekortan, used in the 1972 Olympics in Munich, Germany, called Rekortan G13 that is based on up to 70 percent renewable chemistry. It’s not only a track that runners will love for its accommodating features but will also provide a surface that will exceed the current requirements for sustainable and green building and construction codes.
Ever since I began bringing CEOs together in 1996, I’ve been on a quest to learn how CEOs could create more breakthrough ideas more frequently and reliably. I’ve read hundreds of books on strategy, management, leadership, creativity, innovation, group dynamics and even neuroscience to find the best ways to extract the most value from the unbelievably deep pool of wisdom and creativity of our Alliance community.
Recently, I read “Where Good Ideas Come From: The Natural History of Innovation” by Steven Johnson. Johnson does a deep dive into the history of innovation from Darwin to Freud to Google and Apple, identifying seven key patterns that create the most fertile grounds for innovation. The following concepts are consistent with how we design Alliance meeting environments to maximize the creation of great new ideas and further vision to be the most innovative and strategically valuable organization for CEOs on the planet.
- Scientist Stuart Kauffman describes the “adjacent possible” concept, which says although the world is capable of extraordinary change, innovation happens on the edges. The history of life and human culture is a story of gradual but relentless probing of the boundaries, and each new innovation opens up new paths to explore. The best Alliance members push the boundaries to create breakthrough ideas for their fellow members.
- Malcolm Gladwell wrote a great book called “Blink,” which discussed the power of intuition, or the instant hunch. However, Johnson found that world-changing ideas are more often the result of what he calls the “slow hunch.” Slow hunches start with a vague, hard-to-describe sense that an interesting solution to a problem exists. However, these hunches typically linger in the shadows of our minds — sometimes for decades — with additional pieces of information gathering together. Then one day the discovery of a new idea completes the puzzle and blossoms into the aha moment that has incubated for years.
- Serendipity can be described as a happy accident. Serendipitous discoveries typically involve exchanges across different disciplines. One core philosophy of the Alliance has been to fill our private Alliance groups with members who bring diverse experiences from different industries, business models, functional skills and other measures of diversity.
- Berkeley professor Charlan Nemeth investigated the relationship between noise, dissent and creativity in group environments. She found a paradoxical truth about innovation: Good ideas are more likely to emerge in environments that contain noise and error. While we would think that innovation would be more strongly correlated with the values of accuracy, clarity and focus and that good ideas should be correct to have value, noise-free environments are too sterile and predictable to maximize creativity. A few errors in the process of discovery actually helps foster the creation of good ideas.
- Stanford professor Martin Ruef studied the relationship between business innovation and diversity of professions and disciplines. Ruef discovered that the most creative individuals had broad social networks that extended outside of their own organizations and involved people from diverse fields of expertise. Diverse, horizontal social networks were three times more innovative than the standard networks, which include people more similar to ourselves. Long-term familiarity, conformity and convention dampen potential creative sparks, whereas entrepreneurs who build bridges outside their own industries borrow or co-opt new ideas from the outside and put them to use in a new context.
- Psychologist Kevin Dunbar studied research scientists to determine how and when they achieved breakthroughs. What he found is that eureka moments rarely happened when they were thinking on their own but most often during regular meetings with their lab peers. The most productive tool for generating good ideas was a circle of humans at a table. This “liquid network” is not the wisdom of the crowd, but the wisdom of someone in the crowd. It’s not that the network itself is smart. It’s that the individuals get smarter because they’re connected to the network.
Paul Witkay is the founder and CEO of the Alliance of Chief Executives. Based in Northern California, the Alliance of CEOs is the most strategically valuable and innovative organization for CEOs in the world. Paul can be contacted at email@example.com.
Tom Fricke’s resale cartridge business is part of a multibillion-dollar global printing industry.
Fricke, who has been CEO of Cartridge World Inc. since 2008, has helped his company expand as the largest global dedicated retailer of ink and toner cartridges by taking advantage of the industry’s tremendous growth to build out franchises in new and existing global markets. Operating in 65 countries and growing, Cartridge World generated 2010 revenues of more than $160 million under Fricke’s leadership.
Smart Business spoke with Fricke about how to sustain long-term corporate growth by finding the right business partners and having a responsive leadership style.
What is the challenge of finding good partners in a fluctuating industry?
Our business is changing, the challenges we face are changing, and that change is consistent with the vendors, as well. I think that the biggest pitfall is you find vendors that are right today but aren’t going to be right in a year or two years from now as the evolution of the industry continues. So the biggest thing we’ve looked for is finding those kinds of vendors who are going to be able to change with us. There are some vendors who may have been great today but just weren’t going to be right for tomorrow. I think you are constantly trying to look for those who have the same mindset and the same approach to the future as much as today.
How do you decide who will be the best partners for growth?
The best way to do it is to spend a lot of time with them. I like to get out and meet with as many of my partners as I can. I like to be as open and forthright with them of the challenges we face and the challenges that we’re considering as we go forward. I think that kind of dialogue and that kind of personal relationship is critical as you really start working through your suppliers.
We like to be demanding of our vendors. We like to be fair. We want to make sure that they’re the right kind of partner that has similar strategies that we do. We like to them to be technically very capable. We like them to be very responsive, and we want partners who are going to be as supportive and focused on the franchise network as we are. The best way for us to make all those assessments is to be as interactive with them as we can. So if it’s not me, it’s the local, regional teams or management teams. We like to spend as much time with our partners as we can to make sure that we understand them and they understand us.
How can a leader facilitate a culture that is responsive to change?
To me the secret is you always try to find the balance. … You do what you have to do in order to operate in a new environment, but you also have to be patient. You are struggling between being demanding and being patient. You need to be a perfectionist, but you also need to let people know that it’s OK for them to try new things and make mistakes in the process of making it.
The capabilities of a leader really have to be a function of the environment in which they are operating in, the challenges that they have in front of them, the nature of the system they are dealing with and the business that they are in. I think if anything the leader needs to be multifaceted, because you really need to try and get a feel for all of that. Your style needs to flex and change. It’s really that ability to get in and sense what the business needs, what the people need and provide whatever leadership is needed.
How to reach: Cartridge World Inc., (510) 594-9900 or www.cartridgeworld.com