Faced with an industry that was shrinking by nearly 40 percent, Bryan Putt and his team at American International Relocation Solutions LLC (AIReS) realized that things were about to change in the relocation services market. Due to the onset of the recession in 2008, drastic changes in the housing market and the fall of several banks and institutions, companies and employees alike became more reluctant to relocate.
With a new business approach in the company’s future, Putt, president of AIReS, a global relocation services provider employing more than 300 people and having annual revenue of $180 million, had to think of new ways to continue to grow despite a shrinking market.
“The biggest challenge was leading into 2009 and recognizing that the realities of the economy were going to have a profound impact on our business, both from the standpoint of our clients being directly affected and … the reality that a fundamental part of our business is the real estate market,” Putt says. “The devaluation in many cases of people’s property values created a situation where a lot of people who historically would have been open to a relocation for their companies have had to evaluate that with a much different perspective than they did for the 25 years leading up to that.”
Putt now had a choice to make. A common response is to prepare for survival mode and look to where cuts can be made, but Putt knew there were ways around that. Rallying his team, the decision was made to focus more on customer service and making sure clients understood the current relocation market.
Here’s how Putt focused on thriving instead of just surviving in a shrinking market.
Collaborate on your plans
Before Putt went ahead with any proposed direction for AIReS, he made sure that the plans were a collaborative process that included his senior team and had buy-in from the company.
“Our senior leadership team got together in 2008 and looking forward we said, ‘OK, all the signs are that it could be really bad. What do we want to do? How do we want to deal with this?’” he says. “It really was a function of everybody on that team having a strong belief in what we do. There was a consistency in terms of our vision and where we want to go and how we want to get there.”
That type of understanding within the organization is something that took years to create, but it has been one of the biggest factors to the company’s success.
“Building a culture that’s collaborative to begin with is paramount,” Putt says. “I’m one guy in the organization and honestly probably the least important individual in the company on a day-to-day basis. I’m very fortunate to be surrounded by really awesome people … who believe in the mission. They get it. They believe in what they’re doing, what we’re doing and they’re turned on by it. You’ve got to build a culture that is wrapped around that kind of singular focus of who you are, what you are and is a collaborative one.”
Having the ability to leverage that collaboration will help eliminate hasty reactions and will make people more comfortable about where your business is going.
“We go through a strategic planning process and not having a knee-jerk reaction is built on people feeling comfortable to put their ideas on the table within that group and to validate the thinking behind it,” he says. “Challenge each other in terms of the assumptions that are being put forward and the ideas, but always at the underlying level of that is what’s best for your customer. Focus on how you take care of the client and how you best service your customers because that’s what leads to profitability. For too many organizations the first thing they think about is the P&L. They focus on profit — dollars and cents, return on investment. The first layer of focus has to be on the customer. On the heels of that, profitability is going to follow.”
Changes in direction are oftentimes met with opposition. How a leader goes about making those decisions plays a big role in creating buy-in.
“If you happen to be the owner of a business and you get the 51 percent call and make the final shot, you can always walk in and provide a mandate or a dictate that says we’re going this way,” Putt says. “The problem is the minute you do that if you truly have people opposed, they’re not going to be pulling in the same direction as you. At best they walk out of the room kind of indifferent. They may not openly work against the agenda, but they’re certainly not going to be 100 percent in it trying to help you go in the right direction.”
Investing in a collaborative process and getting consensus on where you’re going helps eliminate doubt and puts employees at ease. That collaboration within AIReS led to the decision to retain employees and focus more on customer needs.
“It boils down to that point where everybody on the team and everybody in the room can be into that process and at least say, ‘Maybe that’s not exactly how I’d do it, but I buy in and I’m good to go and I’m with you all the way.’” Putt says. “Building that consensus is absolutely critical. Invest the time. If people are pulling against it, if they’re fighting where you think you need to go, invest the time in understanding what their concerns are and why. Try to understand how you can address those concerns, get them onboard and get that consensus built. It’s a big investment in time, but it’s well worth it.”
Decide your direction
When the signs that the relocation market would shrink began to appear, companies approached the situation in different ways. Putt was set on differentiating the business.
“We said we were going to retain our talent and we’re not laying people off,” he says. “Our knowledge capital is the value that we bring. We made a conscious decision that rather than try to hunker down and cut and save our way to profitability, we opted to aggressively sell our way through the recession. Our approach was somewhat unconventional in comparison to certainly what we saw others in our marketplace doing and that was looking at different ways to cut their costs and try to save their way into a positive financial position.”
Before making these types of decisions in your company’s future, you have to first understand your market position and value proposition.
“Anybody sitting in that position and saying, ‘OK, I think we’re going to have a declining market; we have all these things going on. How are we going to deal with it?’” he says. “You’ve got to have a pretty strong understanding of your value proposition and how to leverage that. It’s having an objective, realistic perspective of where you sit in the market with value proposition in comparison with the client base and the competition that’s sitting out there.
“If you are a commodity-type provider and the market is just shrinking in general and you can’t bring a new value proposition, it may not be the right decision to retain all your staff and continue to invest that way. You may just have to ride the wave because of where you’re positioned in the marketplace.”
When times become tough and you have to change course, try to avoid instinctively looking to make cuts within your organization as a first reaction.
“I wouldn’t tell everybody to continue to invest, plow into it, and sell your way through if all of the markers are telling you it’s going to go the other way no matter what,” Putt says. “If you do have a strong culture organizationally and if you focus on your people, the first approach from my perspective is not to cut. Try to find that yes. Try to figure out how to retain your knowledge capital.”
A lot of times there is that kneejerk reaction to tighten the belt. However, there is a time and place for doing that.
“Certainly assessing your cost structures, cutting out unnecessary expense and limiting the expenditures is all part of any good organization even in best of times,” he says. “That knee-jerk reaction of ‘we’ve got to cut’ is amazing because a lot of times the first thing people want to cut is in the sales force, but they’re the folks that are out there in market bringing you business. The idea that you can just hunker down and spend a year or 18 months or whatever and just protect what you’ve got — I don’t subscribe to that theory.
“If you’re not actively working to sell and grow, you’re dying and shrinking. There’s no such thing as ‘just stay level and hunker down.’ If you’re not actively out prospecting, the reality is some of your existing wells are going to dry up. Even in the worst of times regardless of the industry you’re in, cutting the sales force to me would literally be one of the very last steps I would want to take. There are other avenues to look to before you start cutting out the hunters in your organization that are going to bring the opportunities in the front door.”
In the case of AIReS, the customer is the company’s focus. Putt made certain not to eliminate the critical things that would make the new direction successful.
“If you have a focus on the customer as your primary reason for existing, generally the first reaction isn’t let’s get rid of the things that make the customers happy,” he says. “Building that into the organizational DNA is probably the most important thing and that’s a long-term process. You don’t build a team or react to scenarios when the bad times come along. That’s a process that during the best of times you’re focused on building an organization that thinks about what’s coming down stream. You’ve got to be cycling through that process all the time.
“When you’re staring into an inevitable negative situation you have to take the right steps. You’ve got to have the managerial courage to do it, but it’s figuring out the priorities of when and where and not doing the easy things because it looks good for a quarter.”
Meet customer needs
Now that Putt had decided on a direction for AIReS and got buy-in from his company, he had to understand where the company could better meet customer needs.
“One of the big areas of concern is the real estate market,” Putt says. “You want to move your staff members and their families around. Probably the most valuable asset they’ll ever own in their lives is their home, and the market is plunging precipitously depending on where you’re sitting.
“The home that that transferee owns that was worth a half a million dollars a year ago is suddenly worth $350,000. It’s pretty easy to say, ‘Aha, this is a great area of concern for our clients. How can we help them with this? How can we add value in the process and support them through this?’ We can’t go in and suddenly make that house worth $150,000 more.
“What you can do is you can add value to your selling process of helping your clients and helping the individual transferee come to grips with the realities of the market.”
Since AIReS’ clients’ livelihoods are at stake when they decide to relocate, the company decided to focus on helping them understand the current market.
“A big part of what we had to do was to go through a coaching process with each of the transferees to help them get a truly objective perspective of what the value of their home is,” Putt says. “You need to move through your employer and you need to sell your house. If you’re not realistic about what the value of your home is in today’s market, you’re not going to be able to sell your home and you’re going to go through a process that’s a lot more painful.
“So it was helping people get that realistic perspective and investing the time with the transferees to help them understand the market so they can make good knowledgeable decisions that helps them and it helps their employer.”
AIReS used its knowledge capital to the max in order to provide its clients with better service and understanding than before.
“It’s spending that time and being a problem solver for them as much as being simply a service provider and really leveraging that market knowledge we have of dealing with 400 or 500 corporate clients,” Putt says. “It becomes a process of evaluating what they’re doing and sharing good solid strategic business intelligence with them to help them obtain their goals.”
To help clients achieve their goals, the process was simple.
“You have to ask,” he says. “Go to your market and ask the questions and understand what their pain points are and where they’re seeing things not generating the kind of results they want to generate and then evaluate how you can help in that respect. The term ‘think outside the box’ is overused at this point, but come up with innovative alternatives to help clients overcome what’s occurring in their market. Generally, there are alternative ways to tackle a problem or concern that is going to be more palatable than just going down the path the way it currently is.”
The new direction of AIReS helped the company overcome the potential trouble of a shrinking market.
“We saw good returns on our investment even in the face of a really difficult year, and 2010 and 2011 have continued with even more healthy growth,” Putt says. “Our overall market shrunk somewhere between 30 and 40 percent, yet we were able to maintain an 11 percent growth rate. We have to continue to focus on building our team, recruiting and retaining great people who buy in to our culture and get it.
“We also have to continue to focus on the core services we deliver … and continue to automate and streamline and find efficiencies of our underlying activities so we can focus more time on the client.”
HOW TO REACH: American International Relocation Solutions LLC, (412) 788-0461 or www.AIReS.com
- Form a collaborative environment to create a unified business.
- Avoid kneejerk decisions and make customers your focus.
- Find unmet needs of customers to differentiate your business from competition.
The Putt File
Born: Indiana, Pa.
Education: Attended Indiana University of Pennsylvania and studied information systems.
What was your very first job, and what did you take away from that?
I was an office cleaner. That taught me that you have to focus on what you’re doing. Sometimes what you’re doing isn’t fun. Sometimes there are days when what you do can be a dirty job. If you focus on doing it well and you take care of the end user, it works, it pays off and there’s value in it.
What is the best business advice you’ve ever received?
Take care of the customer, and if you do that, profitability will follow. That was an epiphany for me. If you don’t focus on the customer, none of the numbers will matter because they won’t keep coming back. That was a defining moment for me in terms of defining my perspective of business.
What advice do you give others?
One of the things I tell people during orientation is you’ve got to have passion about what you do. Life is too short to just show up for a paycheck. You’ve got to do something in your life that you can connect to.
What geographies are you seeing the most relocation in?
It’s global. Within the U.S. there are key markets where you see a lot of corporate presence so you see a lot of relocation tied into those markets. On the international side, there is a heavy concentration and interest in the BRIC countries. Brazil, in comparison to what it used to be, is heavy. You wouldn’t compare it in the same way to China, but as a representative percentage against what they used to be, Brazil is a hot spot. China is huge right now because Asia is booming. The Chinese government is doing a pretty good job of setting a regulatory and investment environment where companies are comfortable. Then there are the traditional markets such as the U.K. and Singapore.