Perhaps someone forgot to tell Thad Simons that this wasn’t a permanent gig. As interim CEO of Novus International Inc., he was just supposed to keep the seat warm until a full-time leader could be found.
“No one expected me to take the job seriously,” says Simons, who would eventually become president and permanent CEO. “As interim, you’re not supposed to do anything. You’re supposed to just keep the company going.”
But Simons wanted to do more than that. He had been with Novus for more than a decade as general counsel and helped the company establish its own identity after separating from Monsanto Co. in 1991.
“The reason our product is provided is to make up the nutritional balance for good growth and health,” Simons says of his company, which provides nutrition for people, pets and livestock. “Our growth in the whole industry was following the phenomenal growth of the poultry industry worldwide.”
He watched the company grow throughout the economic boom of the 1990s and then fall as the economy struggled and ultimately gave away in the 2000s most of what it had gained.
“What had been very strong demand growth collapsed,” Simons says. “We went down to where we were barely making any money. Your shareholders are unhappy and the staff is unhappy because there are no bonuses and something has to change.”
Simons had a few ideas about how to get business moving again. He had some thoughts on the development of new products and services. He felt like he could make a positive difference for the business.
But these feelings clashed with the opinions of other leaders in the company who wanted to ride out the storm with a strategy that was less risky and more proven.
“One way of looking at it would have been to say, ‘We should hunker down and focus on the core and focus on what we’re strong in,’” Simons says. “There were certainly many people telling me, ‘This is what we should do. We should get rid of R&D and technical support and really look at ourselves as being a strong commodity supplier.’”
Maybe it would have been safer to do it that way at the company of more than 750 employees.
But Simons felt the potential reward of going all out to support his research and development team outweighed the risk of not always getting it right and experiencing a few failures along the way.
He just needed to get some people around him who felt the same way.
Start building your team
Simons launched his plan by getting people who he had worked with placed into two key positions in the company. These positions were the head of sales and marketing and the head of research and development. They were key departments because they have a lot to say about how the company interacts with customers.
“What I had to do was assemble a team around me that shared the same vision for the growth of the company,” Simons says. “The team I put around me were people who had been coming up in other areas but shared that same vision for growth.”
Simons understood why there was some skepticism about his plan at this stage. Both he and his new head of sales and marketing had experienced failure at Novus in their early days with the company. In the case of Simons, the circumstances were eerily similar.
“I was head of business development,” Simons says. “The technologies that I tried to bring to the company failed, because there was a huge resistance in the company to taking new products forward.”
His new head of sales faced similar skepticism because of past results.
“He was responsible for one of our little startup companies, which was in a software business line related to livestock nutrition,” says Simons. “That was also a failure. So my selection of him to be head of marketing and sales was not obvious to most people at the time. They thought it was quite high risk.”
Simons was confident that both he and his colleague had learned from their mistakes. Simons had clearly done pretty well for himself, as he was now the company’s CEO. He felt his colleague was the right guy to have working with him to spread his vision of going all out for the customer.
Who better to have at your side when you’re facing a group of skeptics than someone who knows what you’re going through and believes in what you’re trying to do?
“What was important to me was to have R&D and marketing be very closely aligned in terms of their goals,” Simons says. “I’ve seen that R&D can be isolated from what the customer needs and what the marketing needs are. It was very important we get a structure in place and people in place who understood that R&D is really serving the customer.”
Simons needed people who shared his excitement for generating new business.
“If you don’t have support at that level, you’re not going to be able to push it down in the organization,” Simons says. “It was much the same thing in operations and how to make sure operations were focused on satisfying a customer need.”
Let’s put it this way: If you have a beautiful engine sitting in your garage that purrs like a kitten but doesn’t have anything to power, it’s not going to do you much good. Simons wanted to focus on where his engine could take him rather than how efficiently it ran.
“Efficiency is very important, but in the end, efficiency isn’t going to cause a customer to buy,” Simons says. “It was more important to be a reliable supplier and a responsive supplier. Efficiency was just one of those factors. So it was making sure I had the right team in place to grow the company.”
Simons wanted to build a culture in which the company was always looking for new opportunities to generate revenue and expand its reach in the field of nutrition products.
“I wanted us to build upon what I thought was a strong technical base that we had in the organization and to leverage that to provide more value to our customers and to provide it to more customers,” Simons says.
Engage your team
Simons wanted to help Novus in the present, but he also wanted the company to be more prepared for the next economic downturn. He needed to build a way of doing business that promoted diversity and was constantly cranking out new ideas and new products.
“I knew the cycle would turn again, and I wanted us to be ready,” Simons says. “I wanted us to avoid being caught in this down cycle the next time it came. I knew that would require having other products that were going into other parts of the livestock industry. That would actually deepen our business with our customers.”
Simons’ task now was to sell his team on the idea. He had surrounded himself with supporters, but he still needed to get them fully bought in to his idea of pushing research and development if this was to work throughout the company.
“This needed to be their plan,” Simons says. “It wasn’t just done in one day. It was done over the course of sharing ideas back and forth. But eventually we all came together in one room and then we broke into small groups and took on different components. HR led a workshop talking about the people side. Communication and marketing took the reputation side. People from sales took on the growth side and product leadership took on the profitability side. They all came back together into the big group and came back with some ideas.”
Let each department get together and just throw
ideas on the table to get the discussion going. Your job is to keep it focused on the ultimate goal, which in the case of Novus was to find better ways to serve customers.
“Try to cut through some of those things and build a consensus around what’s most important,” Simons says. “When there are still too many things to do and priorities have to be set, it comes down to the CEO to do the final allocation of the resources.”
But short of you needing to step in and do that, you’re trying to promote a culture of participation. It will help you work through most doubts that people may have.
“People can deal with a lot of uncertainty if they are aware of what they can do to affect it,” Simons says. “So what we’ve tried to do is make them aware. If we’re going through a very good time, we don’t want them to lose sight of the challenges that could come up in the future.”
Simons thought that a company that always had an eye on the future would be more prepared and more in touch with its customers.
“People will feel empowered and they will be working on the right things, because they’ll understand what is really important and what’s not really important,” Simons says.
Simons knew he had to provide some backbone to his push for innovation.
“It’s nice to have lofty goals, but if there is nobody working on it, you’re going to be disappointed at the end of the year,” Simons says.
Key accountability documents, or KADs, help make sure that doesn’t happen.
“We say around here, ‘Is it on somebody’s KAD?’” Simons says. “We all know if it’s not on somebody’s goal document, it’s not going to get done. That’s one of the ways we check internally with each other. Who has the accountability for getting this done?”
The trick is to come up with metrics for the different things you want to do so that you can have that accountability and know if you are making progress.
“The organization starts by saying, ‘These things are important,’” Simons says. “These are the things we’re going to measure ourselves against and, therefore, measure you and measure the organization against. We expect you and your area to have your own project. It has to be one that meets the Novus guidelines.”
Simons doesn’t mandate the numbers and tell his people what he expects them to achieve in each area.
“We have an expectation that each one of the regions will have local initiatives,” Simons says. “We don’t know what the needs or opportunities are as well as they do. We report in our journal report on what they are doing. That recognition causes people to do more of those good things. If you don’t recognize it, they don’t know it was a good thing to do.”
It didn’t take long for the board at Novus to realize that Simons was doing many good things and that it could remove “interim” from his title. The company’s president and CEO was promoting more outreach to customers, and that outreach has expanded around the world and played a part in the company reaching $949 million in 2009 revenue.
“We wanted to better understand what the local conditions for the poultry industry were in Mozambique,” Simons says. “We had no presence in Mozambique.”
So the company set goals for establishing relationships in countries such as Mozambique. It brought a scientist from Mozambique to St. Louis so that the company could learn from her and she could learn from Novus.
“The money we spent bringing her here and having her as a fellow and carrying the cost of her housing is really small compared to the benefit we will have by avoiding mistakes and by going into a market and actually bringing value to the customers there,” Simons says.
It’s the type of work and effort that Simons envisioned for Novus back when he was just the interim CEO. By diving into new opportunities, Simons is confident that Novus is more prepared for the drastic swings that can hit the economy.
“We’ve greatly diversified our product range so we now are not only present in the poultry industry, but we are present across all livestock,” Simons says. “You need to always be open to learning something new and be open to different opportunities.”
How to reach: Novus International Inc., (888) 906-6887 or www.novusint.com