While executives generally recognize the need for a good accountant or lawyer, they often overlook the importance of a strong banking relationship. A bank not only provides the banking services and funds needed to grow, experienced bankers can provide expertise and the financial solutions you need to stay ahead of the competition.
“Your banker can provide a competitive advantage for your company by being a valuable resource for financial expertise,” says Pamela Campbell, senior vice president and San Diego regional manager for California Bank & Trust. “An annual checkup is a great way to see what you could be missing.”
Smart Business spoke with Campbell about the benefits of periodically evaluating your banking relationship.
Why is it important to evaluate your banking relationship on a periodic basis?
Professional bankers can identify potential barriers to success and proactively recommend a customized range of solutions before the need arises. They anticipate your needs as a result of taking time upfront and on a regular basis to meet with you to understand the specifics of your business. They tap into and share industry knowledge and ideally are given the opportunity to analyze your financial position through receipt and review of financial statements. For instance, if your goal is to market products overseas, your banker should, first, understand your goals and, second, suggest appropriate international banking services that will help make your strategic transition into new markets more effective. The relationship you build with your banker today can eliminate uncertainty and assist in achieving your immediate and long-term goals. This forward planning eliminates unnecessary stress and will yield dividends down the road.
What should executives consider when evaluating their banking relationship?
It’s critical to consider not only your business’s current needs, but also its future aspirations by asking these questions:
• Is your banker responsive and knowledgeable? Do you have someone at your bank you can rely on when your banker is not available? Your banker, along with the support of his or her team, should return your calls, texts and emails, and take responsibility to answer any questions or solve problems that may arise. He or she should not only understand your industry but also be able to identify appropriate solutions and take a hands-on role in helping you solve your business problems through referral to professionals within your community.
• Is the senior management team local and accessible? The fate of your loan may reside with a group of distant strangers. Having the ability to meet the local management team and share your business plan is an important part of building a solid banking relationship.
• Is your banker willing to invest time in building a relationship? Does your banker engage in an ongoing dialogue with you? Is he or she willing to meet on a regular basis or whenever the need arises? It takes two willing parties to have a productive relationship.
• Can your banker explain the bank’s lending philosophy? If your banker cannot do this, he or she won’t be as effective in serving as your advocate during the loan approval process. A seasoned banker, within a reasonably short period of time, should be able to determine whether the bank will be able to support your company’s lending needs. Their ability to review a transaction upfront and identify the strengths, and mitigate any potential weaknesses, will save your company time and provide the clarity to plan for the future.
• Is your banker invested in the local community? They will then not only understand the market and economy but also be committed to the success of their clients.
What would executives hope to uncover or discover during this evaluation process?
The evaluation should reveal whether your bank’s vision, policies, philosophy and staff align with the strategic direction of your company. Determine whether your bank possesses the credit appetite, expertise and services to grow with your company. For example, some banks may not be a good fit because they cater to a specific industry niche or maybe don’t offer the services you need to sell your products online or overseas. Your evaluation should reinforce your decision to stay or highlight the need for change.
What shows that changing banks is warranted?
First, do you have a banker assigned to your relationship? Your banker should be someone you can count on to solve problems, respond to requests in a timely manner, offer guidance, and even refer you to additional resources like attorneys, accountants and/or consultants who can help you develop and/or execute on a financial forecast or a business plan. Your banker should be part of a team of professionals you can rely on for support. You should consider a change if your current banker is unwilling to spend time with you, is nonresponsive when you have a request, or can’t explain the pros and cons of various loan or deposit products or what you need to do to qualify for them. If your bank can’t deliver when opportunities arise, you may need a different bank.
What should executives consider when selecting a new bank?
Certainly services and fees are important, but also consider the bank’s niche, its structure, and chemistry with the management team and staff. A community-oriented bank familiar with your industry may be the best bet for small to mid-sized companies because it is committed to helping the region thrive. This understanding of the local community combined with access to banking professionals who support your company with personalized service and proactive solutions will help you achieve your goals. A solid banking relationship reduces stress and helps you focus on the execution of daily activities. There’s no need to settle for a transaction-oriented bank when it’s possible to gain a competitive advantage through relationship banking.
Pamela Campbell is senior vice president and regional manager for California Bank & Trust. Reach her at (858) 623-1930 or email@example.com.
Empathy is the ability to experience and relate to the thoughts, emotions or experience of others. Empathy is more than simple sympathy, which is being able to understand and support others with compassion or sensitivity.
Simply put, empathy is the ability to step into someone else's shoes, be aware of their feelings and understand their needs.
In the workplace, empathy can show a deep respect for co-workers and show that you care, as opposed to just going by rules and regulations. An empathic leadership style can make everyone feel like a team and increase productivity, morale and loyalty. Empathy is a powerful tool in the leadership belt of a well-liked and respected executive.
We could all take a lesson from nurses about being empathetic. Time and again, nurses rate as the most trusted profession. Why? Because they use proper empathy to make patients feel cared for and safe.
Over the years I have discovered that most people who score high on assessments for empathy have no idea why. They do not completely understand what it is they actually do that makes others see them as empathetic. They can only express that they:
- Like people.
- Enjoy working with and helping others.
- Value people as individuals.
In order to facilitate a deeper understanding of the importance of empathy in the workplace, I will pose four questions regarding the nature, role and benefits of empathy.
1. Why does it matter for us to understand the needs of others?
By understanding others we develop closer relationships.
The radar of every good executive just went off when they read the word “relationships.” This is not a bad thing since most people understand the problems that happen when improper relationships are developed in the workplace.
This being said, the baby cannot be thrown out with the bath water. In order for a team of workers and their leaders to work powerfully together, proper relationships must be built and deepened.
When this happens through empathy, trust is built in the team. When trust is built, good things begin to happen.
2. What traits/behaviors distinguish someone as empathetic?
Empathy requires three things: listening, openness and understanding.
Empathetic people listen attentively to what you’re telling them, putting their complete focus on the person in front of them and not getting easily distracted. They spend more time listening than talking because they want to understand the difficulties others face, all of which helps to give those around them the feeling of being heard and recognized.
Empathetic executives and managers realize that the bottom line of any business is only reached through and with people. Therefore, they have an attitude of openness towards and understanding of the feelings and emotions of their team members.
3. What role does empathy play in the workplace? Why does it matter?
When we understand our team, we have a better idea of the challenges ahead of us.
To drive home the above point, further consider these:
- Empathy allows us to feel safe with our failures because we won’t simply be blamed for them.
- It encourages leaders to understand the root cause behind poor performance.
- Being empathetic allows leaders to help struggling employees improve and excel.
Empathy plays a major role in the workplace for every organization that will deal with failures, poor performance and employees who truly want to succeed. As leaders, our role is simple—deal empathetically with our team and watch them build a strong and prosperous organization.
4. So why aren’t we being more empathetic at work?
Empathy takes work.
- Demonstrating empathy takes time and effort to show awareness and understanding.
- It’s not always easy to understand why an employee thinks or feels the way they do about a situation.
- It means putting others ahead of yourself, which can be a challenge in today’s competitive workplace.
- Many organizations are focused on achieving goals no matter what the cost to employees.
Each of these reasons can be seen as true.
Let me ask a question though: What distinguishes average to mediocre leaders from those who excel?
In my opinion, the distinction comes through the ability of the leader who actively works against all the so-called “reasons” and incorporates an attitude of empathy throughout his or her organization. That type of leader will excel.
By spending more time learning about the needs of their employees, leaders can set the tone and approach taken by their employees to achieve their organization’s goals.
When writing about empathy I am reminded of the famous quote from Theodore Roosevelt:
“Nobody cares how much you know until they know how much you care.”
This is a truth that has long stood the test of time. It is true for our relationships in and out of the workplace.
DeLores Pressley, motivational speaker and personal power expert, is one of the most respected and sought-after experts on success, motivation, confidence and personal power. She is an international keynote speaker, author, life coach and the founder of the Born Successful Institute and DeLores Pressley Worldwide. She helps individuals utilize personal power, increase confidence and live a life of significance. Her story has been touted in The Washington Post, Black Enterprise, First for Women, Essence, New York Daily News, Ebony and Marie Claire. She is a frequent media guest and has been interviewed on every major network – ABC, NBC, CBS and FOX – including America’s top rated shows OPRAH and Entertainment Tonight.
She is the author of “Oh Yes You Can,” “Clean Out the Closet of Your Life” and “Believe in the Power of You.” To book her as a speaker or coach, contact her office at 330.649.9809 or via email firstname.lastname@example.org or visit her website at www.delorespressley.com.
Roadblocks abound in business. Most business owners have been told, “No, we won’t fund your great invention.” Most executives have been told, “We’re not ready yet” to enter that wide-open, new market. But how they respond to those obstacles, the “no”s that are inevitable, is often a good indicator of who will ultimately succeed.
The first step is to step back and assess the causes of the opposition. That likely requires asking probing questions to get insight about the reasons and reasoning behind the rejection. The banker who rejected your idea may have valuable insight into your industry sector, information that could affect how you choose to proceed.
While data gathering, also probe for guidance on how to make your proposal stronger, when to re-pitch your proposal and who else may have decision-making or decision-influencing authority. The goal should be to identify possible avenues for future appeals.
Armed with the new information, it’s useful to then take a look back at where you are in relation to your goals for the project. Review and celebrate your successes. It will give you the energy to continue onward. But measuring your results, as well as who helped you accomplish the past results, also may shed light on who may be able to guide or assist you in your next steps.
Now, modify your strategy. Every rejection should be viewed as an opportunity to improve. Your planned adjustments should be listed and scheduled. Then, as you progress in making changes, you will be able to see your accomplishments and have a record of how you responded to different scenarios for future reference. It also will give you a clear return on investment in time and energy spent and keep you centered on progress.
Patricia Adams is the CEO of Zeitgeist Expressions and the author of “ABCs of Change: Three Building Blocks to Happy Relationships.” In 2011, she was named one of Ernst & Young LLP’s Entrepreneurial Winning Women, one of Enterprising Women Magazine’s Enterprising Women of the Year Award and the SBA’s Small Business Person of the Year for Region VI. Her company, Zeitgeist Wellness Group, offers a full-service Employee Assistance Program to businesses in the San Antonio region. For more information, visit www.zwgroup.net.
There are many pressures on organizations to make the most out of every customer interaction and maximize the return on investment on marketing and sales spend. However, businesses often don’t have the work force necessary to handle these functions as timely and effectively as they would like or the tools and processes in place to measure and track success. Companies that are able to track interaction, engagement, investments and customer patterns and behaviors often enlist the help of a customer relationship management (CRM) tool.
“A CRM tool helps businesses manage sales, marketing and customer service operations without significantly expanding their work force,” says Gina Rosen, a consultant at Columbus. “CRM, in the past, may have been nice to have — a luxury technology, but in today’s marketplace, it’s a must have to stay competitive.”
Smart Business spoke with Rosen about CRM, its applications and how it has helped businesses improve processes to better engage customers, target sales and gauge marketing effectiveness.
What are the typical features offered by a CRM system?
The features offered by CRM are very diverse. It’s primary applications are contact management; marketing automation; sales force automation; sales and lead management; reporting and analytics; call center and case management, particularly with respect to customer inquiries or complaints; workflow automation, or automating manual processes; and social media integrations. Businesses have the option for on-premise solutions where the software is hosted at the business on its servers, or they can utilize a Web-based or cloud option, which involves less initial financial investment. The software can also be customized to meet the particular needs of a business.
Is CRM cost prohibitive for businesses?
No it is not, however, had this question been asked six or seven years ago the answer would have been yes. Previously, enterprise-ready CRM software required significant funds to get the software and hardware in place. But with the advent of cloud-based solutions, even businesses run by a sole proprietor can afford CRM and leverage its applications to optimize processes. The cloud-based model allows business owners to pay through subscriptions that charge per user. The pay per user cloud-based model offers a low-cost opportunity to implement CRM, experience the value and see the return on investment (ROI).
What are the most compelling reasons an organization would implement CRM technology?
A recent survey of 200 top-performing small and medium-sized businesses showed that the number one reason businesses implement CRM software is to establish data-based metrics for sales and marketing. It also provides the ability to show ROI and quantitative key marketing metrics that mean a lot to businesses.
The second reason CRM is implemented is to proactively communicate with customers. Customers expect a lot these days, and one of those expectations is that businesses, whether small or large, interact with them. To stay in front of your customers and offer personal interaction is critical.
Within that same vein, the third reason companies take advantage of this software is for custom-targeted sales and marketing. With CRM you can customize that end user experience, which makes your sales force more effective. Customers can interact directly with your CRM custom solution through your existing website and experience a tailored visit based on previous interactions, or your sales force can utilize the standard feature when interacting with customers and have all of a customer’s history available in one spot.
What are the most important value drivers for CRM?
The top value for a business is the software’s ability to help manage marketing and sales campaigns. CRM can help businesses test marketing and distribution strategies and gauge customer reactions. This information can be applied to future marketing efforts.
Another important value driver is that the software serves as a customer data repository, allowing you to consolidate customer knowledge within the organization in CRM. This includes far more than just contact details, but also customer behaviors and attitudes and price sensitivity. This, combined with personal data, can allow businesses to build more effective and predictive sales models and marketing campaigns that result in higher sales.
Further, CRM systems can help demonstrate ROI. With CRM you can quantitatively show increases in sales, customer referrals and participation in promotions.
What is the most common challenge a business faces when implementing CRM?
Typically the challenge is user adoption — getting your sales force and front line users to embrace CRM. They often see populating the fields as double entry, an extra step, or another way for management to check in on them. But once the sales force sees that using the software results in more sales, they can easily overcome that hurdle.
What are the most common performance metrics?
The top one, hands down, is revenue growth. The faster you can show ROI the better.
Second is growth in a business’s customer base, which means adding new customers or converting leads into paying customers.
The third most common performance metric is aggregating customer data. Many companies have customer data spread out over disparate systems. CRM gives businesses a one-stop shop for their records.
Can you give us some examples of companies that have benefited from implementing CRM?
The Toledo Mud Hens baseball team, which works within the media and entertainment industry, had ticket sales go up 88 percent in one year and their internal operations couldn’t keep up with demand. Adopting CRM allowed them to automate and streamline inefficient processes, which translated into more ticket sales. A customer testimonial is available with more information.
Another example is the human resources consulting firm Findley Davies. Implementing CRM in their call center has given them the ability to manage daily responsibilities and track productivity. It has dramatically changed and improved day-to-day operations within their Benefits Administration department.
Gina Rosen is a consultant at Columbus. Contact her at (248) 850-2195 or email@example.com.
With more than 20 years in the market and 6,000 successful business implementations, Columbus is a preferred Microsoft Dynamics business partner for ambitious companies. Columbus’ key deliverables include flexible and future-safe ERP, CRM, BI and related business applications that deliver competitive advantage and immediate impact.
Polly LaBarre is the co-author (with Bill Taylor) of “Mavericks at Work: Why the Most Original Minds in Business Win.” The strategies, tactics and advice in “Mavericks at Work” grew out of in-depth access to a collection of forward-looking companies. These maverick companies are attracting millions of customers, creating thousands of jobs and generating billions of dollars of wealth.
Here is a portion of my interview with LaBarre about the book, which covers forming strategies, unleashing ideas, connecting with customers and enabling employees to achieve great results.
Q: Describe what you mean by “maverick.”
A: Mavericks are different, edgy and independent of spirit. Their personal style or message may not appeal to everyone. But that’s precisely the point. Mavericks are defined by the power and originality of their ideas. They stand out from the crowd because they stand for something truly unique. What’s more, they take stands against the status quo, in defiance of the industry elite and offer compelling alternatives to business as usual. Mavericks may be fighters, but they’re not rebels without a cause. Their sense of purpose is not only powerfully distinct (Think: Southwest Airline’s quest to democratize the skies); it’s provocative and disruptive (Think: HBO’s declaration of originality, “It’s not TV. It’s HBO”).
Don’t confuse mavericks’ unswerving commitment to a cause and their lack of patience for the status quo with the egotism, monomania and power mongering modeled by too many celebrity CEOs and moguls. Mavericks, in fact, have a sense of humility.
Q: Are mavericks born or made?
A: It’s probably a little bit nature, a little bit nurture. We wrote this book to nurture the maverick in all businesspeople. What red-blooded working person wakes up in the morning, looks in the mirror and says, ‘I think I’ll stand for business as usual today’? We all want to make a mark, forge our own path and express ourselves in the world. It’s just that some of us need more of a nudge down that path than others.
Hopefully, the maverick individuals and ideas we present are inspiring and instructive enough to move people. The 32 companies we feature have vastly different histories, cultures and business models. We examined glamorous fields like fashion, advertising and Hollywood, as well as old-line industries like construction, mining and household products. The maverick leaders of these organizations are young, old, women, men, Americans, Europeans, charismatic and preacher-like, retiring and almost reticent. They just don’t fit any one mold.
Q: How does a maverick survive within a traditional company?
A: We encountered a bunch of mavericks inside big traditional companies. They all seemed to have a couple of survival strategies in common: They unleashed tough questions and critiques of their organization without losing their sense of loyalty to it. They’re the kind of questions every CEO should be asking. For example, Jane Harper asked of IBM, ‘Why would great people want to work here?’ And Larry Huston, now vice president of innovation at Procter & Gamble, argued, ‘The current business model for R&D is broken. How can P&G possibly build all of the scientific capabilities we need by ourselves?’
Mavericks don’t just ask questions, they act. We saw this again and again: They just got started, usually without a budget or formal permission, by designing an experiment around their question. Jane Harper launched an experimental Extreme Blue lab in Cambridge and spent a couple of years begging and borrowing resources until the program’s impact became clear.
Mavericks look for peers and fellow travelers outside the boundaries of their company. Not surprisingly, mavericks tend to click when they meet other mavericks. They’re great networkers and learners and are always looking for kindred spirits for support and ideas.
Q: Who is the quintessential maverick in American business?
A: Herb Kelleher and the team at Southwest Airlines. In the midst of the financial carnage and heartaches of the airline business, there’s one company that keeps growing, keeps creating jobs and keeps generating wealth. And that, of course, is Southwest. Southwest didn’t achieve these results because its fares were a little lower than Delta’s or its service was a little friendlier than United’s. It achieved those results because it reimagined what it meant to be an airline. If you ask Herb Kelleher what business he’s in, he won’t say the airline business or the transportation business. He’ll say that Southwest is in the freedom business. The purpose of Southwest is to democratize the skies, to make it as easy and affordable for rank-and-file Americans to travel as it is for the well-to-do. That’s a pretty commonplace idea today but largely because Southwest fought the entrenched conventions of the industry so doggedly in pursuit of that purpose. Its unrivaled success is based on its unique sense of mission rather than any breakthrough technology or unprecedented business insight.
Guy Kawasaki is the co-founder of Alltop.com, an “online magazine rack” of popular topics on the web, and a founding partner at Garage Technology Ventures. Previously, he was the chief evangelist of Apple. Kawasaki is the author of ten books including Enchantment, Reality Check, and The Art of the Start. He appears courtesy of a partnership with HVACR Business, where this column was originally published. Reach Kawasaki through www.guykawasaki.com or at firstname.lastname@example.org.
It seems that every other week there’s a major story in the media about a company claiming that one of its competitors has purloined a cherished secret that provided an unfair competitive advantage. This is all part of running a business in today’s fishbowl environment, where sensitive information is too abundant and can be obtained by almost anyone and everyone who is so inclined.
In this era of heightened visibility, some of the best companies, especially high-tech firms, play everything incredibly close to the vest, particularly when it comes to providing information about current sales trends, new products and projects that they are exploring or developing. This is because such information is a coveted company asset. In today’s “victory at almost any cost” world, too many are looking for that edge to leverage whatever they can to stack the odds in their favor.
We also read too frequently about how easily these secrets have somehow wound up in the wrong hands. Sometimes a loose-lipped employee simply talks too much to too many people in the wrong places. Occasionally, someone simply leaves a briefcase or smartphone, jam-packed with confidential information, in a bar, at a restaurant or on a plane.
What’s not talked about much is the frequent practice of competitors simply asking what appear to be innocuous questions of lower-level personnel in a company in order to garner nuggets of “inside information” usually without risking the perils of violating any legal statutes. It’s also common practice for Wall Street security analysts to simply walk into a retail store, as an example, and begin asking questions about trends, what products are selling and which aren’t. It all gets down to the reality that it never hurts to ask a question because one never knows when a valuable tidbit will be revealed.
Like it or not, this is just the way it is, and there will always be people who ask and others who tell. What can you do to protect your coveted information? The answer is basic: mandate that providing revealing responses to specific questions is a violation of company policy and could result in draconian consequences for anyone who spills the beans, no matter if well-intended. Once your employees and suppliers know the ground rules and the consequences, you’re one step closer to closing the possibility of vital information inadvertently slipping through the sieve.
The best way to accomplish this is to establish, enforce and continually reiterate a “one voice, one company” policy. This translates into all hands within your organization knowing what can be told to outsiders and, more importantly, what can’t. This policy must be in writing and must state what types of questions are off limits. It must also explain how the questioner is to be handled when the interrogatory is posed. In my retail chain experience, we often had competitors, vendors and industry analysts visit stores and ask all types of questions. Candidly, I don’t blame them, but with a clearly understood policy, employees know how to respond by referring the questions to headquarters and a specific department or individual. Ninety-nine percent of the time the person asking the question never follows up with the corporate office because he or she knows the desired answers will not be forthcoming.
Most employees want to please their employer and most want others to think they are in the know. When you create an ironclad policy, it takes the pressure off of your people and adds another layer of security about things no outsider needs to know. For your suppliers, require that each sign a confidentiality agreement and specify that you have a simple “one strike and you’re out” policy. Also use your own secret shoppers to test your vulnerability by having them ask the forbidden, just to verify that the company veil is not being lifted by the unauthorized.
This protocol is certainly not foolproof, and periodically, there will be lapses — the most frightening of which are the ones you’ll never learn about. It all gets down to a numbers game. Confidential information, just like the cash, equipment and other assets on your balance sheet, can never be taken for granted and must be protected. Anyone can look in your fishbowl in this day and age, but it is your job to make sure that what they think they might find is not what they get.
Michael Feuer co-founded OfficeMax in 1988, starting with one store and $20,000 of his own money. During a 16-year span, Feuer, as CEO, grew the company to almost 1,000 stores worldwide with annual sales of approximately $5 billion before selling this retail giant for almost $1.5 billion in December 2003. In 2010, Feuer launched another retail concept, Max-Wellness, a first of its kind chain featuring more than 7,000 products for head-to-toe care. Feuer serves on a number of corporate and philanthropic boards and is a frequent speaker on business, marketing and building entrepreneurial enterprises. Reach him with comments at email@example.com.
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Are we grateful for the things we have? Are we grateful that we live in a country where the government can’t seize our businesses, where there’s no threat of rebellion and where we can go home to the comforts of our modern homes?
Many people in the world don’t have any of those luxuries. Some can’t even look forward to a good meal or clean drinking water. Most of us here in the United States don’t have to worry about such problems because the people that came before us worked hard to create a nation that has an amazing standard of living. The generation before us rose from the troubles of the Great Depression, led the fight against Nazi aggression that killed millions and returned home to finish making America into a superpower, but do we ever pause to think about the contributions our mothers and fathers made to make things easier for us today? They lived in small houses, often sheltering multiple generations, and worked long hours to make a better life for their children and grandchildren and selflessly went off to war to protect our freedom.
Do we ever think about any of that? The answer for many is no. Gratitude is in danger of becoming a lost art as we focus on accumulating money and possessions, always looking to be better or richer than the next person.
How many times have you read about or talked to someone who had everything you could ever ask for — nice home, nice car and no money problems — lamenting the fact that he or she doesn’t have as much as or more than someone else? We sometimes catch ourselves comparing who has more instead of who has less.
As business leaders, we should have some sense of moral obligation to help those within our sphere of influence, whether it’s our peers, employees or the person who lives down the street. We should be doing our best to look out for those around us, but too often, our days are consumed with the details of business.
Our world may be built on information, but wisdom is lacking. Business has been boiled down to statistical analysis and quarterly earnings reports while people are just another line on the ledger. There is often little room for gratitude in corporate America, and that’s a shame.
When our focus is on accumulating things, we can never enjoy it, because we don’t know how. How can we enjoy something when we’ve already raced off to try to get more? Like a kid tearing through a pile of Christmas presents, we never really take the time to appreciate each gift.
In this season of giving thanks, we should take a moment to think about those who came before us and who helped us get to where we are. Let’s thank those around us for a job well done and consider reaching out to someone who could use a helping hand. But most importantly, let’s consider putting our lives in perspective by thinking about those who are less fortunate.
When we focus more on gratitude, we’ll make a difference that’s far more effective than any business plan. It will allow us to take the time to celebrate success and enjoy the fruits of our labor. Gratitude doesn’t require a giant donation or a huge event; sometimes the little things are more effective.
In the end, we’ll find that the only things truly worth accumulating are good will and happiness. It’s in our control to start helping everyone around us get their fair share, and that’s something all of us can be thankful for.
Fred Koury is president and CEO of Smart Business Network Inc. Reach him with your comments at (800) 988-4726 or firstname.lastname@example.org.
Cabela’s, the world’s largest direct marketer of hunting, fishing and related outdoor merchandise, considers its stores to be destinations that draw customers from a broad geographic area. So it was unusual when the company decided to open a store in Allen, Texas — just 40 miles away from a Fort Worth, Texas, location that boasts a 230,000-square-foot showroom with amenities that include a museum of animal displays, an indoor archery range and two large aquariums.
“It was kind of a tough choice to make. There are no other stores that close to each other in the company,” says Steve Andognini, general manager of Cabela’s Allen. “This store is considerably smaller than the Fort Worth store. It was a concept store for Cabela’s, less than half the size of the Fort Worth store, but with the same amount of product and the same assortment, just in a smaller design.”
Smart Business spoke with Andognini about the store and the Allen community’s response since it opened on April 14, 2011.
Why did Cabela’s decide to open a store in Allen?
We do a lot of research before going into a market. Allen had a great combination of good demographics and users of our products and our brand. We do a lot of zip code surveys and we know where customers are who are already purchasing from other stores and from our catalog, and we knew that this area would be extremely popular for our business.
What we found was that instead of the Fort Worth and Allen stores pulling business from each other, both have actually grown their business in the past year.
To what do you attribute that success?
One of the great things is that the area around Allen is thriving. We’ve been very fortunate to have some great, very loyal customers and also a great talent pool for our employees. There’s so much local pride, almost a small-town pride that’s here, and that benefits the store greatly. The local economy’s strong; the housing market hasn’t been as affected as it has been in other markets in the U.S. where there are Cabela’s stores.
How does Cabela’s differ from other outdoor equipment retailers?
Cabela’s sells fun. But the company has also stuck to the same values that Jim and Dick Cabela started it with 51 years ago. We know our customers and understand them better than any other outdoor retailer. We say it’s in our nature. From all levels of the company, from outfitters in the store to the CEO, everyone is passionate about living the outdoor lifestyle. They choose to spend their time away from work in the outdoors. That can include a variety of activities — Olympic trap shooters have worked at the store, a professional kayaker works here now — but they all do something. It all ties back to the outdoors and what we do, and we all do it because it’s fun. We’re here at Cabela’s because it’s like a toy store for us.
What are some of things that make a Cabela’s shopping experience special?
There are several hundred wildlife displays throughout the store. Everywhere you’re shopping, you’re surrounded by wildlife from all over the world in full-scale displays. In the back of the store, there are two aquariums with fresh-water fish.
There are also clinics, demonstrations and events at the store for free. When you walk in on a Saturday, you’re surrounded by activities — you can try out a product, sample food, and take part in a lot of things other retailers don’t do. Customers come here all the time on the weekend just to see what’s going on because they know they’re going to have fun.
Unique to the Allen store is a master ammunition reloading specialist, a former Marine sniper, who teaches reloading classes at the store.
Any other ways this store varies from others in the Cabela’s chain?
All the concepts of Cabela’s are still here, but in a scaled-down version because we don’t have the second floor. One thing that’s different is that instead of entire sections of the store dedicated to the wildlife displays, they are incorporated throughout the store so they are everywhere you shop. The goal with building this concept store was to somehow find a way to give the customer an experience that’s equally as exciting as that of the Fort Worth store but within a smaller environment.
Allen was built with a one-story floor plan, different lighting, fixtures and layout, which makes it a more efficient building. Going forward, all of the stores will be built more or less like Allen’s.
Would you recommend that other companies open businesses in Allen?
Absolutely. I’ve been in retail for 10 years, mostly in management positions, and this has been the friendliest, most enjoyable retail environment of the five or six markets in which I’ve worked. It’s because of the great customers in the community and the great amount of talent working here — from young people going to school to retired men and women. There’s a really diverse candidate pool with a lot of talent in this market. I can say, hands-down, that Allen’s a great place for someone to come and start a business.
Steve Andognini is general manager of Cabela’s Allen. Reach him at (214) 383-0502. Reach the Allen Economic Development Corporation at www.allentx.com or call (972) 727-0250.
Insights Economic Development is brought to you by Allen Economic Development Corporation.
During the life cycle of any business, there are successes and missed opportunities. Even the most accomplished business leaders tell me that while they were ultimately successful, they committed missteps along the way. Often, they attribute these missed opportunities to inattention or “blind spots” that, when looking back, should have been obvious. Why is the seemingly obvious often missed?
Successful business leaders tend to be confident, independent thinkers. This independence can lead to insulation, with an overreliance on an individual or small cadre of the management team.
Other members of the team, or individuals deeper in the organization chart, are heard but not necessarily listened to. At best, they are heard through a filter of preconceptions held by the senior leader or inner circle, thereby limiting the value of the input. At worst, they are completely ignored.
While few have perfect vision, business leaders can limit their blind spots. An outside perspective from experienced resources can provide informed foresight in advance of making critical strategic decisions. Better decisions increase management effectiveness and drive results. How can you gain this invaluable outside perspective? There are several alternatives we have found to be effective, alone or in combination, including:
- Thoughtfully constructing a company advisory board
- Participating in a reputable business forum
- Engaging a qualified consultant
- Obtaining an investor partner
Public companies always have a formal board of directors with regulated fiduciary obligations. Private company boards of directors tend to be much less formal, with wide variances in effectiveness and impact, depending on the particular company.
In both cases, the formal statutory board is typically dominated by insiders. We have found the establishment of an advisory board consisting of just key company leadership and several outside individuals to be effective in providing needed external perspective.
These individuals can have specific industry or functional expertise, such as sales or operations. Their input is typically independent of management’s internal preconceptions.
Multiple business forums exist that can provide peer-to-peer external perspectives, providing business leaders a sounding board for strategic decision-making.
Solis and its portfolio leaders are members of the Young Presidents’ Organization (www.ypo.org), Sage Executive Group
(www.sageexecutivegroup.com), and Vistage (www.vistage.com), among others. For a business forum to be effective, it must provide a confidential format in which senior leaders can feel comfortable candidly sharing and receiving insight.
Many senior leaders roll their eyes when we suggest hiring a consultant to assist in providing external perspective. We agree that consultant relationships, inappropriately qualified and structured, can be ineffective.
Hence, it is critical to thoroughly vet a potential consultant and clearly define expectations. Create objective criteria against which to measure the success of the relationship and design compensation accordingly. By tying compensation to clear deliverables, you’ll limit the chances of a consultant relationship becoming the negative stereotype.
The most transformative way to gain an outside perspective is to bring in an equity investor partner. If the investment relationship is correctly structured, the partnering can be a powerful source of external knowledge and experience. Professional investors bring experience across many companies, often in different industries. This often surfaces insight that business leaders didn’t know they didn’t know.
Obtaining an investor partner doesn’t have to mean ceding control of your business. For example, there are financial firms that take minority equity stakes in private businesses — albeit typically with “ratchet provisions” that increase ownership if the company underperforms — and our firm has pioneered a true 50-50 partnership structure. When selecting a potential investor partner, key factors to keep in mind are the experience an investor partner brings, your level of comfort with the partner and the chemistry between the two parties.
An outside perspective can help business leaders make better decisions and produce superior results. See what you’ve been missing.
Craig Dupper is the managing partner at Solis Capital Partners (www.soliscapital.com), a private equity firm in Newport Beach, Calif., focused exclusively on lower middle-market companies.
Laurence Mawhinney’s recession story is all too-familiar. His company took it on the chin, losing 25 percent of its workforce in the U.S. and forcing those who remained to do more with much less.
“Our team was experiencing enormous change in a very short time frame, and we had stopped investing in our people as part of our cost-cutting,” says Mawhinney, the president of Fisher & Paykel Appliances North America — which is the regional wing of New Zealand-based appliance manufacturer Fisher & Paykel.
“It was necessary at the time but very damaging to the morale of our team. And all of this is going on while the macro picture is pretty ugly out there. The general feeling among people wasn’t very positive.”
The challenge for Mawhinney was to turn around the mindset of the 200 employees in Fisher & Paykel’s North American footprint.
“We’ve had to refocus our team, help people become positive and forward-looking,” he says. “We’ve started to reinvest heavily in our team, and that has really helped to grow our business. It has helped reset our people’s minds to a positive state and realize that the company is focused on the future, focused on helping them and growing the business.”
But Mawhinney’s investment wasn’t just monetary. He and his team committed countless hours strategizing, communicating and promoting the culture.
Mawhinney and his team aimed their leadership agenda at one overarching goal: to strengthen the culture of their company, restore employee confidence, then harness the power of a newly motivated workforce to propel their region of Fisher & Paykel into the next chapter of its history.
“Once we realized that the way forward was pretty clear and we had more blue sky than dark clouds, that is when we saw that we really needed to change, to focus our culture and reinvest in our people,” Mawhinney says. “We needed to convince them that the company was on track and this was going to be a good place to work both now and in the future.”
Get the message
Nothing much has changed in terms of values over the years: Honesty is still the best policy.
When Mawhinney started to see evidence that the recession was loosening its grip, he didn’t try to minimize the damage that it had done to the business. In his communication with his people, he acknowledged the severity of the crisis, the extent to which it had damaged morale throughout Fisher & Paykel’s North American region and the distance that everyone would have to cover on the road back.
As the calendar progressed through 2010, Mawhinney kept employees updated on the financial state of the organization and gave them a clear picture of what areas of the company were performing well and not performing well.
“You have to be very honest, you show them your bottom line, you show them the areas that aren’t performing, and then you show them how to turn it around,” Mawhinney says.
“People are very understanding. It was a very difficult climate, so it’s not like people were driving home, listening to the radio and hearing good business news. It was all very negative. Everyone understood that and took a mature approach to realization of what we had to do to turn the business around.”
Mawhinney realized that the reassurance he could offer to his people was minimal at first. Once the economy started to show some signs of improvement, nobody knew if the improvement would be major or minor, fleeting or sustainable.
In addition to keeping employees in the know, the most important action you can take in that type of situation is to give employees a voice. You can’t simply mandate that they follow your prescribed plan of attack. You have to allow them to question the status and stability of the company and put your future plans under the microscope.
Though you may want everyone to completely buy in to your plans and fight the recession as a united front, each person has to come to his or her own conclusions about the situation.
It’s your company, but it’s their livelihood.
“What we did was centered very much on getting individuals together and listening to them, hearing what their concerns were and addressing the group from the perspective of really trying to understand what they’re going through, then presenting them with a strong business plan that we worked to develop together and using that as the way forward,” Mawhinney says.
“That was really a key to turning around the morale and the individual mindset throughout the company from a negative one to a very positive one.”
Crisis communication is usually about treading water. Employees simply want to know whether the ship is sinking — igniting the boilers and plotting a direction is of less importance until your people are confident that the company’s future is stable.
“At first, your communication will be along the lines of, ‘When do we stop making cuts? When can people stop worrying about whether they’ll have a job in the future?’ They want to know what steps you are taking to provide stability and eventually perform a turnaround,” Mawhinney says. “In our case, our people wanted reassurance that the company wasn’t just taking away and cutting to save.
Once the economy leveled off and we were able to stabilize the business, we started to demonstrate our commitment to the future. We were able to reinvest in our people and show them some wins, which was really critical.”
Grab some wins
A long-held truism in baseball is that pennants aren’t won in April, but they can be lost. The same can hold true when facing a turnaround or recovery in the business world.
You won’t slingshot your company to new heights of profitability and success in the initial weeks and months on the rebound, but the initial wins you do get, however small, are crucial for building the momentum that you will need to ride later.
Without those early wins to galvanize your company and build employee confidence, your recovery plan can stumble out of the gate and you’ll find yourself behind from the get-go.
As Fisher & Paykel started to rebound in the North American marketplace, Mawhinney made it a point to emphasize early wins to his people and demonstrate the importance of small victories at the outset.
“We started to be very successful with our outdoor products that we sell,” he says. “We were able to pick up market share in our outdoor division, which was very profitable for us, and it made for a nice improvement to our bottom line.
“Another big win was when we started to bring individuals together for retraining exercises, our cultural reinforcement and cultural understanding. They’re sessions that we have been running for over a year now.”
In the training sessions, Mawhinney and the leadership team placed the recession and recovery in a historical context. The real victory was in showing employees the staying power of the company. In more than seven decades, Fisher & Paykel had weathered numerous recessions and downturns and had overcome it all to develop into an industry leader.
“We sat down as a group and talked about the culture of the company,” Mawhinney says. “We talked about the history of the company, how the culture evolved due to that history and where we have come from. This company is over 70 years old, and we have been through similar cycles before.
“We used that history to draw analogies to where we are, what we have been through and how we’ve bounced back. That history, and the resilience of the culture, was very useful as far as getting people to understand that what we were going through was a cyclical event. It wasn’t a singular catastrophic event. We had been through this before.”
Early wins improved employee confidence in the future of the organization, which in turn strengthened their belief in the guiding cultural principles of the Fisher & Paykel organization — which is essential to any rebound or turnaround. Without a strong culture, your business isn’t healthy, regardless of the economic climate. Without a strong culture in a down economy, your business could face an existential threat.
“The culture has to be in everything you do,” Mawhinney says. “Everyone needs to be included at every level of your business. It’s important that your team understands that your culture can be a competitive advantage. In today’s environment, that can make the difference.”
Reinforce your culture
Mawhinney added momentum to the initial wins by continuing to link them back to the cultural principles of the organization on a daily basis. If employees can see how their daily tasks help advance the culture, and advance the success of the business overall, it can serve as an important motivational tool.
It’s something Mawhinney demonstrated by involving people in the strategic planning process.
By giving employees a view of, and input into, the strategic planning that was aimed at pulling Fisher & Paykel out of the recession, Mawhinney and his leadership team were able to give employees a sense of the steps management was taking to improve the company’s outlook, and how each person’s job affected the company’s ability to realize its goals.
“We had to develop a new strategy for a difficult time, and everyone was involved in that strategic planning,” he says. “The core values are clearly defined throughout the organization, and our teams have integrated those core values into everyday processes so that they are transparent to all.
“It includes defining the culture and defining a plan to implement the culture, which is really key in terms of stabilizing during difficult times and having that strong culture that can really carry you through.”
Mawhinney’s emphasis on promoting initial wins and on strengthening the culture has had the desired effect. Fisher & Paykel is exiting the recession with a renewed focus on the future. The company has begun making new hires and reinvesting in its existing workforce and has rebounded financially. The company’s North American operations generated $124 million in revenue during 2011.
“Maintaining a culture is really a function of having a strong training culture, as well as mixing the old with the new,” Mawhinney says. “What we found through these pretty challenging times is that the experienced and longer-term employees have really helped the new hires that we have made.
“Our new employees need to understand that our culture is different from what you might normally experience in a U.S.-based company, and it really helps us.
“We believe that you need to have an open culture. That is what I think we really have. It’s a culture where you can feel free to speak your mind and that if you have ideas, put them out there. If we can’t use them, we’ll at least consider them for later.
“It’s critical that employees feel a sense of ownership in what they do. Encouraging an open and creative culture will really help your business, and as the leader, you have to walk the talk if you want that type of culture.” <<
How to reach: Fisher & Paykel Appliances North America, (888) 936-7872 or www.fisherpaykel.com
The Mawhinney file
Born: Stratford, New Zealand
First job: I worked for Television New Zealand before joining Fisher & Paykel, where I’ve worked for 21 years. I’ve worked in the U.S. since 1997.
What is the best business lesson you’ve learned?
Innovation is great, but the bigger question is whether it solves a problem. You need to ask what your problems are, and respond to that. I’m looking for the people around me to offer solutions when they encounter a problem.
What traits or skills are essential for a business leader?
You must have a creative spark, and have the ability to incubate new ideas. That means you have to demonstrate the kind of leadership that allows you to develop a creative culture in your organization. Also, you have to help employees see that what they do each day really matters to the company.
What is your definition of success?
Achieving positive results for retailers and shareholders, which will continue to allow us to invest in the future growth of the business.