Dave Suder knew what the keys to his culture would be before he even co-founded his company. In fact, if you ask him how he sets a vision for the West Coast limb of KHS&S Contractors, his answer has been nearly a whole career in the making.
“It’s like you work your career and different positions and different organizations and you see what works and what doesn’t work,” says Suder, the co-founder, president and CEO of KHS&S West Coast. “In your mind, you start saying things like, ‘If I had my own business, I would certainly do this, but I wouldn’t do that.’”
The one fundamental from his early career that shapes his leadership today is the importance of people.
“The biggest thing, without a doubt, is treating people right,” says Suder, who worked at other companies where corporate politics drove out employees and he vowed not to let bureaucracy take a toll on KHS&S. “If you look at your balance sheet, your equipment and your plant and your offices probably are the largest line item. But your personnel costs are more [important] than anything we spend money on.”
A couple of years ago, Suder made his company nearly 40 percent employee-owned, giving everyone a stake in its success. But the culture seeps much deeper than an ownership plan, thanks to his constant communication efforts that keep everyone aligned.
Suder builds an environment of teamwork by involving employees in the goal-setting process and empowering and entrusting them to achieve. That team effort boosted the West Coast company’s 2008 revenue to $326 million, up from $255 million in 2007.
As the company continues to grow, Suder keeps employees informed of where the company’s headed, uniting them under the same vision.
Here’s how he does it.
Communicate as a team
Every month for the past seven years, Suder has sent a monthly message out to all his employees.
He instigated it as a way to keep a conversation going as his work force continued to expand — which it did by 500 employees in 2008 alone. Some months, he’ll provide progress updates. But if the company failed to meet plan during another month, he doesn’t shy away from the bad news.
“A lot of it is letting people know what’s going on — the good, the bad, the ugly,” Suder says. “Communication of bad news should be direct, honest and brief. Don’t dwell on the negative, but make sure they know the truth. If not, a lot of time is wasted by employees communicating their respective theories about the situation.”
Regardless of the content, the communication brings everyone onto the same page — which is the first step of creating teamwork. Suder lists the other forums available at KHS&S beyond his monthly correspondence, such as round tables, team meetings and regional meetings. What’s important is not how your communication is set up, just that it is.
“I think the greatest strength of an organization is its ability for people to communicate with one another and walk in lockstep,” he says. “It can also be an Achilles’ heel if you don’t do it.”
Suder’s constant communication isn’t just a way to give employees a warm, fuzzy feeling of inclusion. It also acts as a rudder to point them in the right direction.
“In sports, if the team doesn’t know what play is called, how can they run it?” he asks. “It’s the same in business.”
Let employees decide details
Some corporate decisions will allow more room for employee input than others. Even when the end goal is decided in the boardroom, you can give the rest of the company ownership by leaving the details up to them.
At KHS&S, the planning process starts at the beginning of the year when managers present their annual plans to the senior management team. Suder and the other executives do a broad check to make sure the plans are built on the right foundation of the company’s vision, philosophy and personality.
Then the managers take those outlines back to their departments, where the details are hammered out. Suder refers to this as a drill-down process as the plan moves from the philosophy stage to a certain office’s involvement to who must do what within that office to make the plan work.
“If you make people part of a process — as opposed to sending them out a memo saying, ‘We’re doing this,’ — if you allow people to participate in it, they’re bought in,” Suder says.
So if the executive team decides to open a new office, Suder doesn’t just announce the news, which might send employees running to the watercooler with rumors and speculation. He also explains why the company has decided on the change. And, most importantly, he requests a company meeting to discuss the details.
In that meeting, for example, employees will hash out how to set up the systems for the new office or who should go to the union.
“Take the speculation out of it,” Suder says. “Set the direction and let people participate in creating the result.”
Managers should constantly check progress against the goals throughout the year. KHS&S uses weekly project cost reports, monthly financial statements and feedback from clients on every job. But those aren’t just methods of measurement; they’re also opportunities to remind employees of the destination.
“Let them know what the direction is,” Suder says. “Let them know where you’re headed. Communicate to them often and then, through your management teams, continue that throughout the year.”
Train people to grow
Before employees come into KHS&S, they are evaluated on everything from technical skills to attitude and confidence. Beyond the initial qualifiers, Suder relies heavily on training to get employees where they need to be.
“I think one of the greatest ways to motivate an employee is to actually train them well,” he says. “Give them the tools to do their job and then let them go do it. The satisfaction that comes from that is more than any attaboy you can give somebody.”
To start, Suder gives assignments commensurate with each employee’s experience and skill set. If employees succeed, he gives them more responsibilities and more challenging opportunities. But all the while, he looks for areas that can be improved, and he attacks those with additional training.
Training — much like empowerment — is a process. Along the way, it’s crucial to acknowledge an employee’s improvements as he or she gains your trust.
“It’s important that they know you believe in them,” Suder says. “If somebody knows that I trust them and I believe that they can do something, there’s a chance that they’ll even rise above where they think they can be.”
The most meaningful way to express your trust is by assigning increasingly difficult tasks. But don’t assume your pride swells in proportion with their tasks. Explain the magnitude of responsibility you’re placing on the employee and why you think they can do it.
“People need to know they have been entrusted with responsibilities that affect the bottom line and everyone’s livelihood,” he says. “Leaders that communicate trust by virtue of what they empower their people to do are far more successful than leaders who don’t.”
Another way to display your trust is to back off and let employe
es do their jobs.
“Don’t micromanage, as this conveys a subconscious lack of trust in your people.”
Suder says he has to bite his tongue when he’s tempted to micromanage, but he has taught himself that a leader doesn’t always have to be leading to be in charge.
“Sometimes leading is following,” he says, who displays a sign on his desk that reads, ‘Lead, follow or get out of the way.’ “Sometimes when you are participating in one of your groups, you let them lead and you follow. You try to coach and support so they can get to where they need to be.”
That was the case during Suder’s recent travels to Singapore, where KHS&S is setting up an office. The meetings there were clear-cut examples that Suder was not on his home turf, and he had to turn leadership over to the regional directors there.
“I’m there to show that I care by being present,” he says. “And afterward, I might give the individual a little bit of observation or suggestion. But in that particular case, I’m following. I’m not there to run his business; I’m not there to do his job. I’m there to support him in being successful at his.”
When you step out of that leader role, which is necessary when empowering employees, you adopt the traits of a coach instead. Instead of calling all the shots, you’re simply making minor adjustments to keep the company on track.
“I think it starts with trusting your systems and people, and then helping guide the outcome so that it is consistent with the vision and character of the company,” Suder says. “Coaching requires … asking pointed questions that would require your people to make sure they too are seeing the bigger picture the way I do.”
Suder draws the illustration of employees wearing bigger glasses as they move up through the organization. It’s his job to make sure their new lenses are in focus when they make decisions.
Make the most of mistakes
KHS&S employees know when Suder isn’t satisfied.
He gets sarcastic.
He’ll have a snarky comment for a mistake that costs the company, such as, “Well, we could have sent two kids to Harvard for that one.”
Although he gets frustrated, Suder expects mistakes to happen. So he has set safety nets in place that prevent mistakes from killing the company. For example, his estimating group operates on a system of checks and balances, requiring several different perspectives to go into each project. That way, if one person misses something, there will be opportunities for his colleagues to counteract it.
Still, those safeties don’t prevent mistakes from happening.
“You wish they wouldn’t happen and you bite your tongue,” Suder says. “And sometimes, if it’s a big mistake, you beat yourself up a little bit — quietly, privately — but outwardly, you continue to support your team, knowing that there is a larger goal that we’re trying to accomplish.”
That’s where the coaching approach comes back into play. Suder will sit with an employee to analyze his or her mistake, asking questions to determine if they both share the same big-picture view.
“You talk about it,” he says. “You talk about what happened, why it happened, clearly what they would have done differently. And you let them come to the conclusion. It’s very difficult to force anything into anybody’s head, so you really don’t try to do that.”
Instead, he says, you stay patient. And if an employee fails to align his view with the company’s because of your efforts, you set up other forums where employees can help each other.
For example, Suder organizes round-table discussions without any executives present so employees can freely share both their successes and mistakes, hopefully helping each other prevent the latter.
So while he may get frustrated — and, as a result, sarcastic — Suder says the culture’s success lies in the way mistakes are handled. Instead of screaming, he and his employees work together to keep the compass pointed in the right direction.
“We’ve always said people are going to make mistakes,” he says. “So let’s encourage learning from those situations.”
How to reach: KHS&S Contractors, (813) 628-9330 or www.khss.com