Culture club Featured

5:24am EDT April 29, 2003
Imagine posting a 17 percent gain in sales in 2002, and adding 77 employees and 50 percent production capacity to meet growing demand for your products, including the five you launched last year.

To top it off, a prestigious trade journal places your company third in its annual readers' poll.

Lots of companies report big sales gains year over year, especially upstarts that are early in their life cycles. But we're talking here about Medrad Inc., a relatively mature company, one that was founded in 1964, went public in the early '90s and later was acquired by a German multinational, Schering AG.

And the sales growth in 2002 wasn't a fluke; Medrad, the 1,183-employee, Indianola-based medical imaging products manufacturer, achieves double-digit sales gains from year to year as a virtual routine. Over the past decade, its revenue has grown an average 15 percent a year, to $254 million in 2002.

Without question, the top brass at most businesses would be proud to report those kinds of results.

But don't expect John Friel, Medrad's president and CEO since 1998, to take much of the credit. He won't.

"I don't do anything, I don't make anything, I don't design anything, I don't sell anything, so the real work of this company is all done by other people," Friel insists. "My job is to create the environment for those people to be successful, and I believe if I'm out and get a feel for what the real workers are doing, then I think it enables me to do a better job of creating the environment for them."

And Friel does this in a very hands-on manner. He participates in the monthly new employee orientations. He rides along with the sales reps, takes a turn on the third shift with the plant maintenance crew, works in the assembly plant and sits in with the customer service representatives, just to experience what it's like in the other corners of the company.

At Medrad headquarters, where finding a parking space can still be a challenge even after 150 of the 850 local jobs moved to the company's Heilman Center site in O'Hara Township, Friel has no reserved space.

Still, he remains keenly aware that employees know whether the gestures are genuine or gratuitous.

"Employees will know whether you're living this stuff or not," says Friel. "They're very smart."

Friel, who first became involved with Medrad as an auditor with Deloitte & Touche, at the time Touche Ross & Co., joined Medrad in 1988. As its CEO, he's continued to champion the corporate values he says trace back to the company's founder, Martin S. Heilman, a physician who cobbled together the first angiographic syringe in his home kitchen.

Medrad's success, says Friel, rests on upholding the three interdependent purposes for its existence: to improve the quality of health care; to ensure continued growth and profit; and to provide an enjoyable and rewarding place to work.

"It's the people," says Jay Trischler, a senior quality assurance technician who commutes from Neville Island to Medrad's RIDC Park assembly facility every day, to explain why he has stuck with Medrad and why it's the best job he's ever had. "I do believe that it's the last place I'll ever work."

Virginia Dailey, a 14-year Medrad veteran, started as a temporary employee and worked in several departments, including finance, before an opportunity came along to manage a new unit of the human resources department -- the employee satisfaction center, the first point of contact for employees seeking HR information.

It came as part of a job rotation program, in which employees are given an opportunity to try out new positions and decide whether the post fits them.

"It was almost like getting an entirely new job," says Dailey.

"It's wallpaper"

Walk through the hallways at Medrad and you'll likely see a "Wall of Fame," neat rows of scores of letters from customers and suppliers lauding individual Medrad employees for their performance. You'll also see large placards that bear the signatures of Medrad employees throughout the company who have committed -- voluntarily -- to the corporate goals.

But Friel says that building a cohesive corporate culture requires more than going through the motions, on the part of both employees and the company.

"If you're just giving lip service to something, then people know you've got a nice thing on the wall, but that's all it is, it's wallpaper," says Friel.

Medrad sets high goals for each department. Management sends out monthly surveys to customers and demands high performance of the company in every category, striving always to reach the highest level, benchmarking itself against best-in-class companies.

"A lot of it has to do with providing the multiple reinforcement mechanisms to get the culture ingrained into the fabric of the organization, is what I say, and you can't do just one thing, you can't just have an announcement and say we're going to have good culture," says Friel.

And there is ample evidence to support the notion that the corporate culture hasn't been a matter of decree. Multiple others outside the company's walls have endorsed Medrad's performance.

Medrad has merited Malcolm Baldridge National Quality Award site visits, been named one of the 100 Best Places to Work in Pennsylvania by the Best Places to Work Institute and has received a Healthy Workplace Award from the Pennsylvania Psychological Association and a People Do Matter Award from the Pittsburgh Human Resources Association.

Communication counts

The keystone in the corporate culture at Medrad undoubtedly is communication, which can only be described as ongoing, thorough and exhaustive. On the simplest level, the barriers to communication are lowered, for instance, by everyone remaining on a first-name basis, no matter what the respective rank or positions might be.

One employee suggests that Friel would be almost insulted if he were addressed as "Mr. Friel." That may be an exaggeration intended to make the point, but Friel clearly is comfortable with informality.

He stops in a corridor for a moment for a casual chat with an employee who has just taken on a new job, asking her how she likes it. With no fear of the self-effacing gesture, apparently, Friel is depicted as Uncle Sam on an internal communications poster a short walk down the hall.

Perhaps the most visible symbol of the company's commitment to communicate is the monthly report that Friel issues to all Medrad employees. He says he's heard that scraps and pages of it are hung on refrigerators, in cubicles and even in frames in office and the walls of employees' homes.

"I'm told that this is the most widely read document in the company; everybody reads it," says Friel.

It's easy to see why. The simple, straightforward report is packed with news and information about the company, its employees and its customers.

Remarkably short on the hyperbole that is commonplace in employee communications tools, it delivers the facts in a cool, direct manner, sans a lot of hype or fanfare. Employees receive recognition for their accomplishments and contributions as well as updates on how well the company is doing in reaching its objectives.

There's no scolding or "you can do better" exhortations when objectives aren't meant, just a statement of the facts, presumably an acknowledgement that a committed work force knows how to respond appropriately and will do so.

The March edition, for instance, comprised at least a dozen pages of data, ranging from what the competition is doing to reports on where the company stands in relation to its self-imposed goals to notices of recognition for individual employee achievements and contributions.

A caring culture

If there is a single event that embodies the commitment that Medrad has to its employees and the community, it is probably the Medrad Day of Caring, one of nearly two dozen volunteer and fund-raising events the company holds annually. Each year, in an effort coordinated by the United Way, Medrad gives all of its employees a day off with pay to volunteer for a charitable cause.

Employees volunteer to work at a variety of social service agencies. The event lifts the spirits of the employees for weeks afterward, says Friel, and reinforces the values of teamwork, community responsibility and work/life balance.

And, Friel says, it serves to support the company's recruitment efforts. Social responsibility on the part of businesses, says Friel, is attractive to prospective employees, particularly new graduates.

Can it be sustained?

A question that remains, and one that Friel and others in the company acknowledge, is whether Medrad can sustain the corporate culture that drives growth and profitability and keeps the company at the top of its industry.

"It's one of the key questions," Friel says. "How, as you grow, do you keep the culture?"

The answer may very well lie in Medrad's ability to keep the lines of communication open and how effective it is in preserving the close-knit relationship that exists among the company, its employees and its customers.

"That's one thing we've been able to keep, almost the family atmosphere," says Dailey, the 444th employee hired by the company and one who has seen it from a variety of perspectives in the many jobs she's held at Medrad.

For her, it hinges largely on one factor.

Says Dailey: "I think a lot of that's going to depend on how we communicate."

For Friel, it's an ongoing process that isn't a simple add-on. Rather, the practice of building culture is a self-sustaining one, something that becomes part of the corporate ethic.

"It's got to become ingrained," says Friel. "It's not dependent on individuals. Its not dependent on me." How to reach:Medrad Inc.,