Dennis Seeds

Shortly after he began with First Financial Bank some nine years ago, Claude Davis felt so strongly about building brand awareness that each year he and his team engaged a study to measure the awareness of the bank in each of the states where it operates. The year-to-year report showed the progress — and the momentum the bank was achieving.

“We did a lot of work,” says Davis, who is CEO, president and chairman of the bank. “It has been about constant marketing, constant awareness building and the consistency and the look and feel of the brand.”

The payoff has been impressive. The bank has locations in Ohio, Kentucky and Indiana. With 1,400 employees and company revenue of about $300 million, Davis has been leading a significant expansion for the bank since 2008. In Indiana, awareness has increased from less than 10 percent to 53 percent. It’s a similar story in Ohio where the bank went from less than 10 percent awareness to almost 50 percent.

First Financial Bank is headquartered in Cincinnati, but Davis has deep Hoosier roots.

Born in Indianapolis, Davis grew up there and went to college in the city, playing point guard for Butler University’s basketball team.

“I think my comfort with the city of Indianapolis and with the state of Indiana, as well as some of the other executives that I recruited who live in or are from Indiana just give you a comfort level and an excitement to look for opportunities to grow in the state,” Davis says. “It also gives you an appreciation … Indianapolis has a great reputation nationally, I have a true appreciation for how dynamic that market is and what kind of growth opportunities we think it provides to us as a company.

“So having that perspective does give you an advantage when you are looking for opportunities and in helping sell the rest of our organization on why that makes sense,” he says.

Here’s how Davis builds awareness in a highly competitive industry.

Go for innovation

With 20 local banking centers, 90 consecutive quarters of profitability and the continuation of a 100 percent dividend payout ratio, it’s no surprise that Davis’ leadership has garnered praise across the banking industry for his efforts to grow the bank despite an economy in the doldrums. 

If you had to pick the “must haves” to grow your business, innovation has to be among them.

“One of the real changes in the business is that you have to be focused on really being more innovative as a company,” Davis says.

That focus, which is becoming more 24/7 every day with the Internet and smartphones, has been spawned by the rapid advances in technology. While you can keep up with competitors and offer every product they do, it only goes so far.

“You always have to be in touch with what the competition is doing,” he says. “We certainly don’t have a lock on good ideas.”

There are a lot of people in the industry who are very innovative and develop interesting ideas that you may choose to follow.

“You have to think about it and look at all aspects and say, ‘What is the best thing for our client, and what can we offer?’

“The challenge is also being in touch with the technology companies that serve the banking industry,” Davis says, “and to make sure you are drawing the connection between your client and what is being developed in the industry — and deciding when is the right time to offer that as part of your product suite.”

It’s not a good idea to second-guess consumers on the subject of technology and online banking.

“Our younger clients start out very electronic-based and just grow with that,” he says. “But what we are finding with our more mature clients is that they are adopting the electronic form of banking more quickly than I would say is common wisdom — and it is because of the ease-of-use. Secondly, with the introduction of mobile banking and smartphones, we are all very comfortable now making transactions online.

“There is actually a much higher adoption rate among all our clients, regardless of age, than what we saw a year ago, or three years ago and a lot more than we saw five years ago. The rate of adoption is increasing among all our clients.”

 

Adopt a ‘client first’ model

If innovation is among the “must haves,” another requirement involves exceptional customer service. To stand out against your competitors, think about how you base your decisions.

“All our decisions have to be based on the client,” Davis says. “We believe we have to be a client-intimate oriented company. We call it being ‘client first’ in our operating model.”

It means taking care of all your customers without any favoritism. It has to cut across every business line.

“For us, that’s from small business to large corporate clients to individuals and in the individual states from those who were maybe just establishing bank accounts and bank business to those who are high net worth and who really need investment advice and stated advice,” he says.

“You try to serve that full-spectrum and serve all of them in a very personalized way.”

To stay in touch with both consumers and developers, it takes doing your own research and tapping into industry research.

“Talk to your own clients about how they want to be served and what products they would like and more importantly, what delivery channels they want to use to interact with you.

“So if you are a consumer client, you want to be able to interact with your bank whenever and however you want to interact,” Davis says. “We have every touch point covered and we are continuously asking consumers what do we not have in our products that they would like to see.”

Gone are the days when competitors are referred to as “Brand X.” Few places is it more clear than the banking industry, where it is now possible to transfer funds online to another banking institution, let alone keep track of all your financial assets by using one product. First Financial launched a product called Panorama by which users can assemble their accounts from all their banks and credit cards on one online site.

Such a step requires some stepping out of the comfort zone for a company.

“It is our recognition that while we would like everybody to do business only with us, we understand that that is not the case with most consumers,” Davis says.

 

Blend the cultures in acquisitions

A third “must have” to employ during the growth efforts pertains to acquisitions. While such growth was often thought to be only in the realm of large companies, small and midsize companies are taking successful ventures into the once-exclusive territory.

The focus, not surprisingly, is that the cultures of the two or more businesses are aligned.

First Financial Bank has had five acquisitions since 2009, three in Indiana and two in Ohio. The company also has a long history dating back to the 1980s of doing more than 20 acquisitions in Indiana and Ohio.

“Cultural integration is the most important part of that process,” Davis says. “It is not the data processing conversion. It is not the financial metrics. It’s how well you integrate the associates of the company you are buying and how well you integrate the clients that are a part of that company you’re buying and making both feel like your company is a better place for them to be.

“Be open and willing to say that they may do something better in one or more areas than you do, and you decide to adopt that practice,” he says. “When you take that attitude, then you create a foundation and a trust level between the two organizations that says you really do value the merger process and it is not just a function of you want to buy their assets and move on.

“Begin with openness: ‘Look, we’re going to take the best of both and not make assumptions, just because we may be the buyer, everything we do may not be better than what the seller has been doing.’”

It doesn’t happen overnight. It can take time to work through that process to really have everyone feeling like they are equal partners in the new combined company.

“You go through a period in any acquisition when you integrate the data processing systems very quickly,” Davis, says.

But for people to move to the new combined company and everybody to feel like they are all in this together, it takes an understanding of what the objectives, goals and strategies are.

“It takes a couple of years typically for that process to occur and to leave behind what that company used to be,” Davis says. “There is typically a lot of loyalty and pride that is built up in that prior company that doesn’t just leave you in three, six or nine months.”

How to reach: First Financial Bank, (877) 322-9530 or www.bankatfirst.com

 

Takeaways

Go for innovation.

Adopt a ‘client first’ model.

Blend the cultures in acquisitions.

 

The Davis File

Name: Claude Davis

Title: CEO, president and chairman

Company: First Financial Bank

 

Born: Newcastle, Ind., about 30 miles east of Indianapolis.

 

Education: Butler University. I majored in accounting. I have served on the board of trustees of Butler for the last 10 years.

 

What was your first job and what did you learn from it?

I was a janitor in a laundromat as a teen. I learned that every job in business is important and has its role if the business is to operate well. As the janitor, you work after everybody else is gone. You appreciate the hard work that many people do that never gets seen by the client or the customer of that business.

 

Who do you admire in business?

The two people that come to mind are Steve Jobs and Warren Buffett — Jobs for his innovative spirit and willingness to take a risk; Buffett for his willingness to think about the long-term, how you invest long-term and how you run businesses for the long-term as opposed to many thoughts today which are about this month or this quarter. I respect his approach to that.

 

What is been the best business advice you ever received?

Hire smarter people than you. It was from somebody I worked with, a mentor, whose name was Mike Ryan. He was the president of Irwin Union Bank when I first started in banking. Don’t let your ego get in the way.

 

What is your definition of business success?

I think a lot about the long-term and legacy as we finish our 150th year of existence, it’s leaving the company that you run in better shape than how you found it when you arrived. If you can do that, then you perpetuate the value of that company into the future.

When the Hollywood Casino Columbus beckoned Ameet Patel a year ago, he knew there was something different about the opportunity.

After 23 years in the casino business, Patel was looking for a personal challenge. An accounting and auditing major in college, he earned his master’s degree from what is now Philadelphia University and started as an accountant at the Sands Hotel and Casino in Atlantic City right after graduation. Next came stints at casinos all over the country, but it was the Columbus venue that piqued his interest.

“It was to not only create and open another casino, which is what I have done before, but I finally had a chance to say, ‘Now is my chance to establish a legacy and a legacy that stays.’”

Patel had a vision of a casino operating on core values that he defined, that were grown organically, locally and uniquely within central Ohio, along with the employee base.

“What should our core values be in central Ohio?” he says. “That to me was the most interesting and intriguing but also the most challenging part. We were just not building a brick-and-mortar site. It was literally what should be our hiring practices, what should be our culture, and as a result, what should our core values be, and how do we make sure that everybody embraces that.”

Since opening last October, Hollywood Casino Columbus, one of Penn National Gaming Inc.’s 21 casinos and the city’s first, has worked hard at being the new kid on the block who wants to make friends with the neighbors. While it’s been in heated competition with Scioto Downs for market share, the casino, through July, has seen a respectable $190 million since opening.

Here’s how Patel has drawn up core values, put them into practice and built a fresh culture at Hollywood Casino Columbus.

 

Make your foundation

When Patel first arrived in Columbus, the casino was in its infancy — and he quickly realized he had to draw from his experience and craft a new culture, one that he had always wanted to build. The task would be to initiate the steps along the way and keep to his script to ensure the casino would develop optimally.

It was Business 101 — make your business plan carefully and then execute it accordingly. And Patel believed that if you supported the ideals of simplicity and transparency, the odds would be in your favor.

Patel decided to take the simplicity route in sculpting his model employee, of which he would hire 1,400. He knew that many prospective employees would be unfamiliar with the operation of a casino. But as long as they could offer the correct answers to a few questions, it didn’t matter.

“Do you have customer service orientation?” Patel says. “Can you handle 10,000 people a day walking through the doors? Can you function under that environment? If you can bring that, don’t worry about the unknowns because we can teach you the unknowns.”

Patel knew the core values he wanted and he posed them in the form of questions.

“Can you have fun?” he says. “Can you be a good host? Can you be a good neighbor in the community? Can you always be capable of doing the right thing when given choices?

And can you always see ways to improve, particularly financially?

“If you can say yes to these five things — perfect,” Patel says. “That’s what we are looking for at all levels of the organization.”

When those commitments come naturally, you are primed to experience the benefits of a great company culture.

“We have thousands of people working here who go back to their host communities and talk about what a fun culture it is to be here,” he says.

“The most repeated comment I hear from visitors is there is something unique about this property where people are just so warm and friendly.

“Well, that didn’t happen overnight, and it didn’t happen by accident,” Patel says. “It starts from establishing core values, then recruiting for those core values and then executing on those core values. And that is the end result, where people say, ‘Well, this is really unique,’ because when being a good host is part of your core culture and core values, by gosh, the delivery is a lot more than people saying, ‘Oh, just come on. We’ll be nice to you.”

Patel also stresses that core values could drive even your bottom line in ways you had not considered.

“Put it in simplistic words — can you see ways to improve everything that you do?  Today you are coming here just washing dishes. But if you have a suggestion on how we can expedite this and make the dishes cleaner, or reduce the workload, now you have contributed to the bottom line already.”

 

Simplify, and reap your rewards

Using simplistic principles to guide you when you are searching for highly suitable employees will most often bring dividends, but what it may bring to your management team can be another feather in your cap.

“Over the years, I found the best way to simplify things for management teams was to always ask people when they give a complex report to ask for a CliffsNotes version,” Patel says. “When they come back with a 10-page report on numerics, I would ask, ‘What would be a one-page summary?’

“When you force that kind of thought process throughout the organization, people start saying, ‘OK, before I talk to my leader, I know the question is going to come up — What does this mean in one page? What does this mean in two sentences?’”

Common wisdom holds that it takes more time to write a short composition than a long one, and people may shy away from wanting to do a short summary.

“That is always the first reaction that I receive from everybody I have asked summaries from,” Patel says. “And over time, I know a lot of the leaders developed in our company have told me otherwise. That is, the biggest benefit of them being pushed to write summaries or give a one-page or two-sentence viewpoint was that it allows them to think about what they are doing.

“If I asked for a report, and I say, ‘Give me an income statement,’ that is great, people would spend time developing that income statement, and, ‘OK, here’s everything. Now the problem is yours.’ The critical thinking stops there.”

But if you continue to regularly write summaries, it keeps your critical thinking in top form.

“Before you go there you know you will be answering what this all means in one sentence,” he says. “Is the income statement good or bad? Why or why not? And if it is good, do you understand where it is coming from?

“So critical thinking develops for the long run, which I think is a real, real key to success when you get into leadership positions.”

 

Create a transparent operation

Another important tool is to establish transparency as a priority.

“The more transparent we were — I think that has paid off huge dividends,” Patel says. “There was a tremendous amount of community involvement with tours taken by people, social groups and charitable organizations, to let them know before construction, during construction and post-construction that this is one of the real, real unique success stories in almost the entire country.”

Patel had to defuse the perception naysayers held that a glitzy Las Vegas was coming to Columbus, since that was not the case.

“We are very, very mindful of the host community in which we operate,” he says. He found it useful in his effort to be transparent to remind people how a casino has parallels to other businesses.

“I just reference that this is exactly the same regulation that a bank goes through in monetary terms and action — then people relate to that,” he says.

“I am a firm believer in providing known industry references to simplify your message to the public.”

Beyond the glitz and glamour, it really comes down to a normal business. For example, investors put up their money and expect a rate of return.

“To that return, you just have to develop a business model that is a socially responsible business model. If you keep your shareholders happy, keep your employee base happy, keep your community involvement transparent and abide by the regulations, now you are creating a business model that is sustainable over decades,” Patel says.

“We spent a tremendous amount of time educating everyone including a number of employees here. When you hire 90 percent of the employees from the local community, your employees don’t know what it means to work for a casino which is a large corporation and a public entity.”

 

How to reach: Hollywood Casino Columbus,
(614) 308-3333 or
www.hollywoodcasinocolumbus.com

 

Takeaways

Set your foundation first — obviously.

Simplify, and reap your rewards.

Focus on transparency in all area.

 

The Patel File:

 

Name: Ameet Patel

Company: Hollywood Casino Columbus

Title: Vice president and general manager

 

Born: Tanzania, Africa

 

Education: I got my first college degree in accounting and auditing in India. I came to the U.S. in 1987 and received a master’s degree from the Philadelphia College of Textiles and Science, now Philadelphia University.

 

What was your first job? My first job getting a paycheck was at the Philadelphia College of Textiles and Science. I started tutoring undergraduate students in statistics and economics. They were my two major areas in business, and it was a real rough road because I was new, I had a heavy accent, and students more often went with somebody who had gone to Temple University, or had graduated from a local high school.

When you say you are a tutor from Tanzania, who speaks Swahili, and can tutor you in economics not too many students were willing to sign up. So my first paycheck was literally $8 after working 2½ hours at a time. To this day, I saved that pay stub; it has been one of my biggest motivators because that taught me what I had to do, not necessarily what the world had to do but what I had to do in order to succeed in life; that is, to work harder than an average American.

 

Who do you admire most in business? Warren Buffett. By far. One of my biggest motivators has been him. I’ve learned a lot about him by just observing him, reading about him and watching him on YouTube videos. When he does any public speaking, I learn so much about simplicity and making people understand what we do. He is someone I have admired and closely followed literally my entire career.

 

What is the best business advice you ever received? Always simplify things so you understand and so everyone around you understands. When you do that, it's incredible how many people become not only supporters but also followers of what you do because people have some real complex perceptions of what you do. Sometimes people see you are a general manager, so you must be busy, you do so many complex things, it is a $400 million operation, and I would say it is really not. This is really exactly what we do. That is the best business advice I have ever received. It is very easy to make things complicated. Nine out of 10 times people go out of the way to make things complicated.

 

What is your definition of business success? To make sure that you are running a socially responsible business model that is sustainable for decades because it creates an employment base. It is really when you relate the human life element to a business — that to me is your ultimate business success. Can you provide a sustainable living to people who are working with you  — vendors, people in business who are contracting with you as well  — can you provide a long-term sustainable source of living and income? That to me is the biggest part of what I call business success. A lot of businesses become reckless. They go in and out, and it becomes a flash in the pan. A lot of people depend on you. So when you look at thousands of lives depending on a business model, you have to take that as the very core by which you define business success.

 

Shortly after he began with First Financial Bank some nine years ago, Claude Davis felt so strongly about building brand awareness that each year he and his team engaged a study to measure the awareness of the bank in each of the states where it operates. The year-to-year report showed the progress — and the momentum the bank was achieving.

“We did a lot of work,” says Davis, who is CEO, president and chairman of the bank. “It has been about constant marketing, constant awareness building and the consistency and the look and feel of the brand.”

The payoff has been impressive. The bank has locations in Ohio, Kentucky and Indiana. With 1,400 employees and company revenue of about $300 million, Davis has been leading a significant expansion for the bank since 2008. In Indiana, awareness has increased from less than 10 percent to 53 percent. It’s a similar story in Ohio where the bank went from less than 10 percent awareness to almost 50 percent.

Here’s how Davis builds awareness for First Financial Bank in a highly competitive industry.

Go for innovation

With 20 local banking centers, 90 consecutive quarters of profitability and the continuation of a 100 percent dividend payout ratio, it’s no surprise that Davis’ leadership has garnered praise across the banking industry for his efforts to grow the bank despite an economy in the doldrums. 

If you had to pick the “must haves” to grow your business, innovation has to be among them.

“One of the real changes in the business is that you have to be focused on really being more innovative as a company,” Davis says.

That focus, which is becoming more 24/7 every day with the Internet and smartphones, has been spawned by the rapid advances in technology. While you can keep up with competitors and offer every product they do, it only goes so far.

“You always have to be in touch with what the competition is doing,” he says. “We certainly don’t have a lock on good ideas.”

There are a lot of people in the industry who are very innovative and develop interesting ideas that you may choose to follow.

“You have to think about it and look at all aspects and say, ‘What is the best thing for our client, and what can we offer?’

“The challenge is also being in touch with the technology companies that serve the banking industry,” Davis says, “and to make sure you are drawing the connection between your client and what is being developed in the industry — and deciding when is the right time to offer that as part of your product suite.”

It’s not a good idea to second-guess consumers on the subject of technology and online banking.

“Our younger clients start out very electronic-based and just grow with that,” he says. “But what we are finding with our more mature clients is that they are adopting the electronic form of banking more quickly than I would say is common wisdom — and it is because of the ease-of-use. Secondly, with the introduction of mobile banking and smartphones, we are all very comfortable now making transactions online. The rate of adoption is increasing among all our clients.”

Adopt a ‘client first’ model

If innovation is among the “must haves,” another requirement involves exceptional customer service. To stand out against your competitors, think about how you base your decisions.

“All our decisions have to be based on the client,” Davis says. “We believe we have to be a client-intimate oriented company. We call it being ‘client first’ in our operating model.”

It means taking care of all your customers without any favoritism. It has to cut across every business line.

“For us, that’s from small business to large corporate clients to individuals and in the individual states from those who were maybe just establishing bank accounts and bank business to those who are high net worth and who really need investment advice and stated advice,” he says.

“You try to serve that full-spectrum and serve all of them in a very personalized way.”

To stay in touch with both consumers and developers, it takes doing your own research and tapping into industry research.

“Talk to your own clients about how they want to be served, what products they would like and more importantly, what delivery channels they want to use to interact with you.

“So if you are a consumer client, you want to be able to interact with your bank whenever and however you want to interact,” Davis says. “We have every touch point covered as well as we are continuously asking consumers what do we not have in our products that they would like to see.”

First Financial launched a product called Panorama by which users can assemble their accounts from all their banks and credit cards on one online site.

Such a step requires some stepping out of the comfort zone for a company.

“It is our recognition that while we would like everybody to do business only with us, we understand that that is not the case with most consumers,” Davis says.

Blend the cultures in acquisitions

A third “must have” to employ during the growth efforts pertains to acquisitions. While such growth was often thought to be only in the realm of large companies, small and midsize companies are taking successful ventures into the once-exclusive territory.

The focus, not surprisingly, is that the cultures of the two or more businesses are aligned.

First Financial Bank has had five acquisitions since 2009, three in Indiana and two in Ohio. The company also has a long history dating back to the 1980s of doing more than 20 acquisitions in Indiana and Ohio.

“Cultural integration is the most important part of that process,” Davis says. “It is not the data processing conversion. It is not the financial metrics. It’s how well you integrate the associates of the company you are buying and how well you integrate the clients that are a part of that company you’re buying and making both feel like your company is a better place for them to be.

“Be open and willing to say that they may do something better in one or more areas than you do, and you decide to adopt that practice,” he says. “When you take that attitude, then you create a foundation and a trust level between the two organizations that says you really do value the merger process and it is not just a function of you want to buy their assets and move on.

“Begin with openness: ‘Look, we’re going to take the best of both and not make assumptions, just because we may be the buyer, everything we do may not be better than what the seller has been doing.’”

It takes time. It can sometimes take a few years to work through that process to really have everyone feeling like they are equal partners in the newly combined company. 

“It takes a couple of years typically for that process to occur and to leave behind what that company used to be,” Davis says. “There is typically a lot of loyalty and pride that is built up in that prior company that doesn’t just leave you in three, six or nine months.”

 

How to reach: First Financial Bank, (877) 322-9530 or www.bankatfirst.com

When Paul Murphy was named CEO of Cadence Bancorp LLC, a merger of three financial institutions, he knew the staff would be asking, “Who is this Murphy guy who just bought the bank, and what is he all about?”

But he was not taken aback. He had prior experience as the CEO of Amegy Bank of Texas for 10 years, and the task of building one culture out of three was not an insurmountable one for him.

Murphy’s challenge was to bring Cadence Bank, a 127-year-old institution; Encore Bank of Houston; and a failed bank all under one nameplate. He believed it was first a job of gaining trust among employees.

“People are willing to give you the benefit of the doubt, but to really become committed and trusting, you’ve got to pass the time test,” he says. “You have to get to know them by sharing past experiences, background, how we approach business from big picture things like what type of culture are we trying to create; also in smaller things involving execution and delivery of service and the customer experience.”

While in such a situation you can’t expect that all three entities would have stellar company cultures, you can take the best of what there is and build on it.

“All three banks had elements of good cultures that we wanted to merge,” Murphy says. “But we wanted to raise the level of commitment to values and goals in all cases. We really wanted to hammer home the importance of customer service. We tried to do that in a way that is engaging and memorable.

“I think we are making great strides; we are generating a lot of new business and new revenue.”

With annual revenue of $240 million and 1,400 employees, Cadence Bank is showing the benefits of a strong company culture.

Here’s how Murphy, who in 2011 was named chairman of Cadence Bank N.A., fashioned a new culture by living it, meaning it and being committed to it. 

Make it a good place to work

Murphy had previous experience with a merger when he helped found Amegy Bank in 1990 as Southwest Bank of Texas. With the bank chairman, he bought other institutions, including Klein Bank & Trust and Lone Star Bank and melded them into the fold. It gave him an edge when it came to Cadence Bank, but it still took some hard work.

“It is a combination of spending a lot of time together sharing ideas,” he says. “Credibility is of paramount importance. And communicate, communicate, communicate. You’ve got to bring the words to life. That creates the environment for the culture.”

Driving culture requires talking about it from the top, but it also can occur in situations like conference calls while you look through the nitty-gritty processes to be sure you aren’t micromanaging.

“Have adequate controls, but allow people still to be empowered and able to get their job done — in a sensible and timely fashion,” Murphy says.

Building a company culture is a long-term process that has to be nurtured constantly.

“To me, the culture is much more than posters on a wall,” Murphy says. “It is what you do every day. And when your company’s culture aligns with your personal values and your shared values, adoption is really quite simple.”

To determine the best aspects of the culture to save and nurture, look for those that make the company a good place to work.

“It’s about taking care of employees, providing them with opportunity and chances to advance, grow and expand their careers,” he says. “I think the customer service focus and intensity is something that really worked in all our three cases to be even more responsive — better products, bigger investment in technology and providing tools to customers. That makes that a more robust product offering.” 

Have a culture with a can-do attitude

In a merger, you may have to hire anew to fit the culture you’re creating. That is often a silver lining in the dark cloud.

“We have been fairly aggressive in terms of hiring commercial lenders, for example,” Murphy says. “Where the prior banks had small, almost nonexistent commercial lending competency, we have hired about 65 bankers with extensive commercial experience. That’s the most fun part of the job because you have new talent that is excited about being here, and they are on fire; they can’t wait to get to work. That’s pretty cool.

“We have been really successful in that regard.”

Murphy says he feels Cadence Bank’s culture plays a part in attracting new talent.

“For a highly motivated team of bankers, this is something that they would value, and they’re choosing where they want to be,” he says. “All these people who have joined us to help grow the business — the talent inflow has been phenomenal.

“There’s one man I have been trying to hire for 20 years. He was well placed and doing well. His bank went through a series of transitions. To be part of something that is freshly, strongly capitalized, that has a great board of directors, a good management team and to have a culture with a can-do attitude — so yes, this is something that a superstar team saw as a different place to work, a better place to work where I can do a better job for my customers and be more successful and be happier.”

If you’ve hired a new team, the employees’ first thoughts may be about the sincerity of the new company they’ve just joined.

“People are first going to say, ‘How sincere are these people about this mission? This goal? Who are they; are they really sincere? Are they genuine? It sounds good. I am going to give them the benefit of the doubt,’” Murphy says.

“But as time passes, you've got to be consistent,” he says. “Then you circle back the second time and the third time. And then people will say, ‘You know, they seem to be really committed to this. They talk about it all the time. Maybe they do mean what they say.’”

The bottom line of a good culture is that it drives revenue and profitability.

“One of my favorite sayings ever — how your employees feel is eventually how your customers will feel — leads to a kind of enlightened self-interest,” Murphy says. “Your employees feel good, and know that this is a good place to work. The company cares about its customers and is sincere about doing a good job.” 

Put a focus on attitude

While companies talk about enjoying your work and having fun at your job, Murphy knows there are realistic limits.

“It just can’t be ‘rah rah’ throughout the day,” he says. “I like enthusiasm, but I like sincerity and thoughtfulness as well. If you could put all of those together, then you have something that people can really take hold of.”

If you draw a flowchart about company culture, those three attributes should be radiating from one database called “attitude.”

“Attitude is a huge part of culture,” Murphy says. “Give me a person with a great attitude and a good work ethic and I think the sky’s the limit. But someone with a difficult attitude who’s not willing to be flexible — it’s going to be much harder for that person to be successful.”

While you may expect some employees to step right up to the company culture and engage to the fullest, others will be less likely to engage. It’s important to discover the attitude. Subpar attitudes can weaken the culture.

“That is when you have to hold people accountable,” Murphy says. “Accountability is an important part of our culture. If we are not getting the job done, we need to address the issue and find the root cause. If it is that people aren’t well placed, we have to address the issue. Turnover is never easy, but it is sometimes required.”

Murphy has found that by weaving the aspect of company culture into the annual employee evaluation process, it sends two messages to the employees. The first one involves the employee’s engagement with the culture and the second one communicates the point that the company places a high value on company culture.

“Our annual evaluation process is subjective: ‘Do you embrace the culture? Do you show a good attitude? Are you on board with what the company is trying to accomplish?’” Murphy says. “It is intangible in terms of how it is numerically rated.

“I think they see that if we are putting this into their evaluation, it must be meaningful to them [the bank] or we wouldn’t be going on about it so much,” Murphy says.

“Culture is a commitment of time and energy and training materials. But I think it is worth every penny. I think it is one of the best investments that you can make in the future of a business.”

Down the road, the company culture should continue to be a big part of the leader’s job, Murphy says: “Just continue to communicate, to live by example and to follow-up and follow-through on the little things around customer service to be sure that you are getting resources to people who can resolve customer service issues.” 

How to reach: Cadence Bank, (800) 636-7622 or www.cadencebank.com

 

Takeaways

Make it a good place to work
Have a culture with a can-do attitude
Put a focus on attitude

The Murphy File

Paul Murphy
CEO
Cadence Bancorp LLC
Chairman
Cadence Bank N.A. 

What was your first job?

My first job was washing windows at the bank that my mother worked in. I am from a banking family. Some of my uncles, my mom and my grandfather were bankers. I was probably 13 or 14. I also had a lawn-mowing business where I had several neighborhood lawns. What did I learn? I think the motivation to generate revenue and have more spending money and more impact on your quality of life or work ethic. I think I learned early of the importance of having a good work ethic, of being responsible for taking some financial responsibility for myself as a young person — that was a very good thing for me. 

Who do you admire in business?

I love entrepreneurs. These people go out and start businesses, risk their own capital and walk away from a good job and safety net to create jobs, to bring new ideas to market, to change the world. I think the folks who are willing to do those things are extremely impressive, and we should celebrate entrepreneurs more than we do. 

What was the best business advice you ever received?

Work hard. Be persistent. I think a big part of success in life is being consistent, persistent and effective and follow through on the task ahead. I think that is really from my mom, Sally Wailes. What I learned from her is to be flexible, to not take yourself too seriously, and to have a good attitude even when things are not going your way. Look for the positive things in life; look for the bright side and persevere.

What is your definition of business success?

I think it is a couple of elements. One, to be financially comfortable would be a measure. Doing a good job for customers and creating value for your customers. A tight ship comes to mind. Being well-run, being accountable to shareholders, regulators, all the third parties and vendors. You want to be a good partner with all those groups that you encounter, and being a place that has high integrity and consistency.

 

 

 

 

 

 

Angie Hicks is pleased to note that new categories get created all the time on the eponymous website Angie’s List, where consumers go to find reliable and recommended local service professionals in fields from home improvement to health care.  In fact, she lists one category that is particularly representative.

“There are categories today where services didn't even used to exist,” she says. “My favorite is the pooper-scooper industry — someone to come and clean up after your dog. There was no such thing in 1995 when Angie’s List was launched.”

But that is only the tip of the iceberg that’s one of the biggest consumer website success stories. Revenues for fiscal year 2012 were up 73 percent to $155.8 million. More than 1,000 are employed at the company’s headquarters in Indianapolis.

While that may be impressive itself, Angie’s List earlier this year tallied its 2 millionth household subscription, which was secured 18 months after the 1 million mark was reached. In contrast, it took 16 years for the first million to sign up.

Hicks, who punctuates her upbeat conversations with “Exactly!” “Absolutely!”  “Yup!” and “Right!” is more than the face of the company’s television commercials. As well as the founder, she is the chief marketing officer with an MBA from Harvard University and a bachelor’s degree in economics from DePauw University.

She spoke with Smart Business about the success of Angie’s List, and how an emphasis on quality makes the service stand above other business reviewing services.

Q:  What was the motivation for founding Angie’s List?

A:  We [she and CEO Bill Oesterle] started 18 years ago in Columbus, Ohio, and it came out of when Bill was trying to renovate an old house and was having trouble with a service company. He was familiar with a referral business that had been around in Indianapolis that he had used and started looking around and realized it was unique just to Indianapolis. So we started our own version of that company, and then about a year later I ended up buying Unified Neighbors, the Indianapolis company.

We named it Columbus Neighbors at first, which was kind of our spinoff of Unified Neighbors, but what we realized over time was that people just didn't realize that the list was dynamic. This was pre-Internet days so we were a call-in service in our magazine. We decided to rename it. It was going to be named after one of our friends' mother named Jackie who just knew everybody in town and everything in town. So in many ways, she kind of represented what we were attempting to do.

Then at the last minute, Angie's List was suggested. Bill was a big proponent for it. ‘OK, she is the only employee,’ he said. ‘It certainly makes the story easier.’ Women today control the home checkbook, so it makes sense that it had a female name. 

Q: Has your brand goal evolved over the years?

A: Our brand goal has always been the same — to help consumers find top rated local service providers and especially in the high cost of failure services. For example, going out to dinner, they could undo my dinner. It's not a big expense. It’s not impacting me as much as if I hire plumbers and they do work wrong; it floods my kitchen and I am out time and effort.

So were really focused on those. We started in the home improvement categories; we expanded into auto repair, pet care, lawn care, and most recently the health care industry.  So far we have opted not to review attorneys, but it is something that gets talked about. I mean it would work just like any of the other reviews in that kind of situation. There is certainly opportunity.

Q: You recently made TV commercials and the exposure has been successful, even playing a part in reaching the 2 million subscriber mark this spring. Can you describe your marketing strategy?

A:  It wasn't until we introduced our current ad creative that it really changed. I have only been in the TV commercials for the last couple of years or so. Before that, I would do media and things like that. But it's certainly different now that we have the TV commercials running.

Public relations was always a part of our marketing mix. We started as local marketers. We would open our offices city by city. We usually received good PR in the market as we were opening. It always was a great boost. There would be an article in the daily paper or a TV opportunity. Those were always important for us.

Then it was about probably 2005 or 2006 when we had enough markets open that it made economic sense for us to start advertising nationally versus locally. You obviously get some scale when you do that. We were looking for an alternative to the daily newspapers, so cable television became the vehicle that we tried and have been successful with. So that was the switch. Our marketing mix includes television, radio, online and some print. It's working well. 

Q: Angie’s List promotes its reviews as high quality. Explain your thinking on that. Isn’t that hard to ensure?

A: I think the big differentiator at Angie's List is the focus on the quality of the reviews. We do not accept anonymous reviews. So you are known to Angie's List as well as the company you are reviewing. I think there should be accountability in what you say because people are using this information to make important decisions.

Obviously we have members who are driving the reviews that drive the ratings for the companies, so based on the fact that we have a deep relationship with them because they are members, there are also plenty of ways that we can run algorithms against the data to make sure we've got high quality reviews. If ever a review gets tripped in that process, we actually have a team of people that will look at that review.

One of the most common complaints we get is that service companies don't return phone calls. That is something that we see as an opportunity to make it better.

A consumer can give a review in a scenario like that. Since there wasn't work done it's not weighted as heavy as when work is actually done so if they just come and mess up the plumbing work it is different from should they not return your phone call.

But it is still important as customer service feedback so the company can be alerted to that information. They are welcome to respond to the concern and make improvements to their business, based on that.

Their rating is an average of the reports of the reviews they receive, so each report counts — just like a school report card. There is an A through F scale, and the search request is also returned based on the grade. 

Q: Are there ever any fraudulent reviews?

A: Every once in a while we will find one. We will find a company that tried to report on itself. There is a cost for that. A, we are very good at finding it when that happens because of our system. B, the cost is that we will stop returning the company in searches. If they are a plumber, we will stop returning them in searches for plumbers. That can be very costly because it is not unusual for us to drive a large portion of  a company's business. A company never leaves the list. So if people look for the company by name, they could see it but, if somebody just searched for ‘Angie's List I need a plumber,’ the name won’t show up. 

Q: How do you keep your employees motivated and on the same page to carry out of the brand promise of Angie's List?

A: We spend a lot of time focused on culture. I am a firm believer that good culture doesn't just happen; you have to cultivate it. We empower our employees to do what is right to help the consumers and focus on core ideas. Take your work very seriously; don't take yourself too seriously. Be honest. Be frugal. It is just those basic things. It's both by talking about it and also leading by example that creates that kind of culture. 

Q: What do you foresee on the horizon? What are you working on in your R&D department?

A: There are a couple of things. One is continuing to expand our member base, making sure that consumers are finding the best companies they can, but we are also spending time thinking about ways that we can help improve the interaction between consumers and service companies: ‘Here is the company that I want to call or want to get in contact with. How can Angie's List help facilitate that communications cycle?’ Getting a quote, getting it scheduled, that whole process. So we are spending a lot of time thinking about the real opportunities there. 

How to reach: Angie’s List, (888) 888-5478 or www.angieslist.com

The Hicks List 

Angie Hicks
Founder and chief marketing officer
Angie’s List

Born: Ft. Wayne, Ind.

Family: Mother of three children and lives with her husband in Fishers, Ind.

Education: Bachelor’s degree in economics from DePauw University, in Greencastle, Ind., which named her a 2007 Distinguished Alumni for Management and Entrepreneurship. Master’s degree in business administration from Harvard Business School.

Awards: In addition to the distinguished alumni award from DePauw University, she was named a Torchbearer Award winner in March 2009 by the Indiana Commission for Women in recognition of her entrepreneurial accomplishments and for providing a positive example of the influence women have on their community and the state of Indiana. 

Her causes:

She is nationally known as a consumer expert.  She has raised awareness to attempts to gag consumers from freely discussing customer service experiences; pitfalls in the real estate industry; and home improvement safety. Hicks has issued calls for action in several areas, including health problems caused by lead paint, radon and mold. She is also an advocate for accountability and fairness in the consumer ratings and reviews niche.

She currently serves on the DePauw University Board of Visitors. Hicks also is a co-founder and past member of the Board of Directors of The Governor Bob Orr Indiana Entrepreneurial Fellowship Program, which provides a two-year fellowship at an Indianapolis-area business to graduates of Indiana colleges and universities or Indiana residents. 

On her competition:

There are certainly online players, but I always remind people that if you add up all the online players, it is still very small to the total service industry. We follow a very old-fashioned way of doing things — you literally just ask your neighbors, you ask your coworkers, things like that. We collect about 65,000 consumer reviews each month covering more than 550 home and health services.

 

Four years ago, Jorge Gonzalez didn’t have to be told that economic factors were not conducive for banks to report good earnings. There were indicators everywhere: the economy was weak, the real estate market was weak, interest rates were down and regulatory costs were up.

While those uncontrollables made it challenging to reposition City National Bank of Florida, of which he was president and later CEO, Gonzalez had a plan. And it worked. Last year, the bank had the best year in its history. Net income was $190.2 million, compared to $34.4 million in 2011. Revenue for 2012 was $190 million.

The success caught the eye of several suitors, and Banco de Credito e Inversiones of Chile purchased City National Bank in May from Bankia of Spain for $882.8 million, which was 1½ times its book value.

Gonzalez’s plan centered on having the right foundation in place to create the scalability and the proper infrastructure to support growth.

“You can’t just start to grow organizations,” he says. “So many times when we run across companies that have very good growth plans on the top line relative to how they are going to acquire new business, they haven’t necessarily thought through how they are going to be able to absorb and manage it once it is in the door.”

Gonzalez also issues a caveat. There is more to a plan than words on a piece of paper.

“You can have the best business plan in the world but if you don’t have the right people to execute the plan, you’re not going to get home. You’re not going to be able to get across the finish line.”

Here is how Gonzalez made sure the foundation of the organization, the backbone, the people and the technology were all in place and had the scalability to create a larger organization. 

Build a rock-solid foundation

There is an undeniable benefit to having an organization’s foundation in place before successful growth can occur. Gonzalez envisioned a simple “if-then” approach.

“This allowed us to do two things,” he says. “No. 1, accelerate the growth because we were ready to take it on, and No. 2, navigate the less-than-easy landscape economically because the different ingredients were in place that were necessary to be able to execute our plan.”

When you are about to build the foundation, identify the empirical formulas.

“The foundation to any business is, No. 1, people,” he says. “In our business, I like to say that our money is not any greener. It is about having the right people in the right seats.

“So we spend a lot of time making sure that we have people who have the right skill sets, the right experience, and very importantly, are willing to operate within our culture.

“It is one thing to hire good people, but if they don’t fit into the organization’s culture, then ultimately you don’t have people performing at high levels.”

When repositioning a company, you need to have the strength and presence to lead you through some turnover.

“We had turnover of probably 50 percent of our employee base over the last four years as we’ve repositioned the company,” Gonzalez says. “But the 50 percent turnover was intentional. Sometimes the people that were in our organization had the right skill sets for the company at that period of time, but may not have had the right skill sets for the company that we were trying to build and the objectives that we are trying to reach three or four years later.

“It is just too important of a factor to not deal with.”

As for the “50 percenters” who made the grade, they need to understand how the culture has been redefined. The values need to be clearly defined and presented in a bottom-up approach.

“I wanted everybody to participate in trying to define and agree to what that culture should be,” Gonzalez says. “We made that a very critical component of the things that were in our plan that we needed to work on.”

The effort should be about defining the culture, having engagement, and everybody making that decision and sticking to it, he says.

“I think a lot of organizations do a good job of talking about core values. They do a good job about talking about culture, but then in the execution of that, it is lost.” 

Empower and measure

Empowerment is a big part of culture because people need to be empowered to take a sense of ownership of their respective businesses. Culture in many ways is the motivational quotient that may be the difference between business success and failure.

“The leader needs to be able to delegate the decision-making and the authority to the people who are executing the jobs day in and day out,” Gonzalez says. “Give them the ability to make decisions within certain parameters. Outside of those parameters, then we need to have a sit-down conversation. But they need to feel empowered to be able to go run the business.”

Another way to look at the parameters is to think of them as guardrails.

“We kind of set guardrails for ourselves,” he says. “In other words, we want to operate within these rails so we give people the leadership to say, ‘Hey, between these ranges, go do your thing.’”

It is essential to have measurable objectives that you want to accomplish over a period of time.

“I am a big believer in that if you don’t measure things, they typically don’t happen,” he says. “So that is also part of going back to culture. Each line of business has key performance indicators and metrics that we focus on because, again, if you can’t go back and assess or measure relative to what you set out to do, then how do you assess whether you are able to accomplish that or not?”

Write into your culture a goal of adaptability, about how important it is to be flexible.

“If you are not adapting, not changing, I think you are almost falling backward,” Gonzalez says. “Part of our core values is embracing change. We have to be able to adapt, and our plan can’t be so rigid that it doesn’t allow us to adapt with whatever uncontrollable wolves are out there.”

Much of the culture is really just about standard operating procedures.

“There is nothing I’m talking about here that is exotic in its execution,” Gonzalez says. “It is more about executing simple blocking and tackling techniques and how to operate a business.

“But sometimes people get lost in the complexities and forget about the basics. So focus on things that are really creative to the organization, things that really move the needle, and try to execute those to the best of your capability.” 

Stress accountability

When accountability is discussed when talking about an organization, it also means employees being accountable to each other. Its value rivals that of family bonds.

“You are part of a team,” Gonzalez says. “If you are not doing your job, you are letting the company down, but you are also letting down everybody else around you.”

Try to make sure people understand that their contribution to your plan is key to the success of everyone else around them.

“If they truly believe in the culture and that they are part of this big family, then they are letting the family down,” he says. “Your job is to create that accountability both from a leadership standpoint but also from a peer standpoint so that everybody feels there is a responsibility to the best of their capability.”

Accountability comes in many different forms. Gonzalez uses a lot of real-time coaching, assessing and a lot of feedback.

“We take the opportunity when we see somebody doing something right to recognize them right away,” he says. “When we see somebody who needs help, we want to deal with that situation right away. I think sometimes there is a tendency to want to put that on your to-do list and unfortunately, you never get to that list.”

To make the feedback process as successful as it can be, it should be a continual process.

“It’s not just a once-a-year process whereby people sit down for 30 minutes and get their performance review and then go back to doing what they were doing,” Gonzalez says. “We try to make it an ongoing part of the management style over the organization.

“In other words, we want people to be given real-time assessments of how they are doing. And it’s not just the things that need improvement. It’s about reinforcing the correct behaviors and the results. We spend a lot of time on that.”

For the underperformers, you may either coach them up or coach them out, but always prepare for the unexpected.

“Make sure you always have a list of people that you are talking to in the marketplace that are potentially good hires for the organization. If you have an unexpected departure, you don’t want to just hire quickly,” Gonzalez says. “If you are not prepared with a list of people who you have been recruiting over a period of time, then you are probably more prone to make a quick decision that may not be the best one.”

How to reach: City National Bank of Florida, (800) 435-8839 or www.citynationalcm.com

Takeaways

Build a rock-solid foundation.
Empower and measure employees.
Stress accountability among workers and management.

The Gonzalez File

Jorge Gonzalez
President and CEO
City National Bank of Florida

Born: Miami, Fla.

Education: I got my bachelor’s degree from Florida International University in Miami in finance and international business and am a graduate of the Kenan-Flagler Business School Executive Leadership Training program at the University of North Carolina. 

What was your first job and what did you learn from it?

My dad used to make custom kitchens for people, and that was kind of a part-time job. The one thing that it taught me was to have a significant work ethic and the discipline to make sure that the things that have to be done are done. And the other thing was that my dad always taught me that you have to take care of your client. You have to make sure that when you deliver a kitchen that it is of the quality they expect it to be.

Who do you most admire in business?

I do read a lot of former GE CEO Jack Welch’s books. He has a very simple style of management that I can relate to. I like the things that he says, and I’m not sure how much of those, depending on the business, you can execute or not. But I really admire people who are entrepreneurs and take the risk to start a business based on an idea. The luxury of my business is that I get to meet so many different business owners and listen to their stories of how they started out of their garage or just ran across a business idea and now they have this $50 million or $100 million business. The entrepreneurial spirit and perseverance and the unwillingness to give up, and the willingness to take risks to me are characteristics that I find extremely recognizable.

What is the best business advice you have ever received?

No. 1 is don’t give up; persevere. That’s from my father, Jorge Gonzalez. I don’t think there is a substitute for hard work; the relentless desire to achieve something — that cannot be replaced. Going back to people, that’s somewhat in your DNA, in my opinion. I think you have that or you don’t. It’s very hard to instill. It can be done, but it doesn’t come easy. The other thing is to always do the right thing, in other words, always take the high road. I think those are two important pieces of advice that I try to live by every day.

What is your definition of a business success?

I think so many times you measure success on your own terms, but ultimately I think the true definition of success is how your clients feel about what you are doing, and if they are sticking around. Sometimes we get too caught up in measuring our own success when really we should be asking our employees and our clients if we are being successful.

 

"On Point" by Patrick Hiller

For the second year in a row, Abacus Solutions has won a workplace award, and I’d like to tell you that it was the result of a very detailed plan — but it wasn’t. It started with a simple premise of respect and teamwork. Along the way, we learned specific behaviors that attract and keep talent. 

Our efforts to create a great place to work have been paid back many times over in employee and client loyalty, as well as in profits. Here are specific ways your efforts to improve workplace culture bring a return on your investment. 

General productivity

When employees feel respected and enjoy coming to work, productivity rises. If you foster a culture of teamwork, then people are less likely to be worrying about competitive advantage over each other and more likely to be focused on advantage over competitors.

This directly impacts the bottom line because you are not adding more people to the payroll to drive business. Teamwork gets the job done with less personnel and better results. 

Better ideas

Creating a safe space where employees are free to try out new ideas and then get honest and respectful feedback about them means you are getting the best out of your in-house brain trust.

Discouragement and a dismissive attitude breed passivity. Respect and encouragement breed innovation. With a global marketplace competing for business, you want to be the company with the best ideas. 

Retention and new talent

We’ve all worked jobs in our career where we had to deal with a nasty manager or co-worker. Employees know that when they find a supportive place to work it elevates their everyday lifestyle.

We have very little turnover at our company and rarely lose a team member to competitors. Part of this is being very selective of whom we bring onboard.

Retention is also about paying people what they are worth. We look at the going rate for positions and reward talent and extra effort financially. And, when you have a great workplace culture, it also makes it easier to attract the best talent for new positions. Word gets around. 

Client interaction

So now we get to the client-facing side of where workplace culture meets bottom line. At Abacus Solutions, we help customers leverage IT to solve business problems with managed solutions and infrastructure improvements. This is where our high employee retention rate is such a bonus. Clients genuinely fear having to deal with a changing roster of support.

High retention lets us give them what they want — a stable resource that knows their business inside and out. In-house retention translates into client retention.

Here is another way workplace culture helps us meet client needs: personal initiative. By empowering employees to make decisions and paying them well for their work, clients get the best of our team without multiple layers of accountability.

Every week we get an email from a client about someone on our engineering team who went the extra mile to solve an issue. 

Strategic planning

As CEOs, we are responsible for looking at the big picture and making sure the company continues to grow and evolve in the right direction. It’s hard to do that if we are intimately involved in every detail.

I can tell you that it feels great to know that I am not needed on a daily basis. I can focus on adding clients and growing partnerships. The proof for us that this kind of workplace culture brings meaningful ROI is the growth in revenue and profitability we’ve enjoyed every year we have been in operation. 

Patrick Hiller is the CEO of Abacus Solutions, an IT solutions provider in Atlanta, Ga., specializing in vendor neutral solutions that help companies manage IT to protect and grow core business. Contact him at www.abacussolutions.com

 

 

"Business Philosophy" By Robert Castles

In business, the customer is always right — true or false? Well, it’s not always that clear cut. Sometimes the customer knows what he wants to achieve, but fails to share that business knowledge with you. This insight gap can prevent you from delivering a relevant product that meets his needs.

This type of situation, unfortunately, happens quite often, especially for software companies like PMG. Often our customers request a certain product that may not be the optimal solution for what they are really trying to accomplish. Our philosophy is putting our customer’s business needs first, rather than leading with our technology solution.

“Business First, Technology Second” has proven to be the winning ticket for both our customers and our business. At first glance, letting non-technical customers define our technology road map may seem counterintuitive, but it has enabled PMG to grow and thrive, even through the recent economic downturn. 

Get in step with your customer

Not understanding the business issue behind the product request can lead to long development cycles, changes in direction, delays, and a possible solution that doesn’t quite meet customer expectations — leaving both parties frustrated.

Before embarking on developing the solution, you must first define the problem in business terms. The key is to engage customers to understand the underlying business issue. The information uncovered will help you deliver a more relevant solution and ultimately more value, which results in a satisfied customer. And satisfied customers lead to more business with additional referrals. 

Walking the talk

At PMG, we walk the talk. Last year, a major customer was insistent that we offer a native iPhone app for our service catalog solution. The customer wanted the app so that users could request items from the field. This was a major developmental undertaking that was not currently slated on our short-term technology road map.

In time, we discovered the real business issue was the significant delay in the approval process when executives and managers were away from the office, without access to the catalog. So the actual need was not the ability to submit requests from a mobile device, but to approve them.

This information dramatically narrowed the scope of the project, allowing us to almost immediately deliver a more relevant solution. Now executives are able to process approvals on their mobile devices, driving down the request processing time, which was the major issue from the beginning.

Had we proceeded to develop the solution that was originally requested, it would have taken much longer to deliver and cost more. Additionally, the solution would have been much more complex, which would have risked low user adoption altogether. 

Crawl before you walk. Then run with it.

Investing the time and energy to form a true partnership with your customer will ensure success for both parties. Too often our customers are in a hurry to get a project completed. As a result, they skip steps and move ahead too quickly, instead of taking the time to have additional conversations to ensure that you fully understand the nature of their business and the scope of the issue at hand.

Taking the time to help your customer assess intended goals is critical to achieving success. But, even more important, is to ensure that the goal is tied to a business outcome. Unless decisions are made in the context of driving a business outcome, you may spend a lot of time deploying a solution that does not provide substantial value. 

Robert Castles is principal of PMG, a provider of enterprise service catalog and business process automation software. Reach him with your comments at rcastles@pmg.net or (770) 837-2301.

 

Dr. Thomas “Tim” Stover admits it hasn’t been easy paddling upstream, and he’s been doing it for years in the health care industry. Stover has been trying to convince hospital staff, doctors and the public that the solution to the health care crisis isn’t to spend less to treat sick people, but to help them not to get sick in the first place.

Stover, president and CEO of the 5,200-employee Akron General Health System, has spent considerable time, effort and money trying to change its mission to a different side of the health care continuum — the prevention and wellness side.

“When you talk about trying to cut the costs or bending the cost curve in health care or in the sick-care model, the only real way to do that is to change it to a well-care model,” Stover says.

By Stover’s accounting, he and his team have spent about $100 million over the years to basically keep people out of the hospital.

“That’s not what most CEOs and hospitals are supposed to do,” he says. “The way we are paid right now is to fill the place up. We are dealing in a volume-sensitive industry, and we are trying to do everything we can to decrease the volume, but the sick-care model really incentivizes you to get sick or stay sick. I think that is totally upside down. It is the wrong message to send to our community.”

The recently enacted Affordable Care Act (ACA) has been turning the examination light on the health care system more than ever. While the ACA is designed to make health insurance coverage more affordable for Americans and reduce the overall costs of health care, confusion and anxiety have arisen over the interpretations of the law, and many critics are not convinced the measure will save expenses.

Here’s how Stover and Akron General Health System are taking a concept that goes against the grain — and gives the customer what he or she wants and needs. 

Find a better way

Keeping expenses in line is a fundamental principle of basic economics. You have to judge whether your expenses are too high in light of your sales.

But Stover’s education and experience were telling him that there had to be a different and better way for the health system, which had revenues of $600 million last year.

As he saw it, the only way to cut costs or to bend the cost curve in the sick-care model was to change it to a well-care model. The next step for Stover was to consider what patients really needed. There will always be a need for the sick-care model, but the well-care model is the wave of the future.

“In this area, the expectation for excellence in Northeast Ohio is a given by people who use our services,” Stover says. “So when people walk into any of our institutions, the first thing they expect is that they are going to get the best care that you can get in the country, and pretty much they do.”

While researching the demand for treatment, the ability to analyze cause and effect brings dividends. Stover saw that the ax was falling on what government was going to pay for. Reimbursement was seemingly dropping on a daily basis.

“This effects how services are delivered because the demand is for you to deliver excellence on a daily basis. You’re getting measured on that and fined if you don’t do it [under the ACA],” Stover says.

Drilling down even deeper into the challenge you face may expose some other realities. Stover saw the dilemma he was in and the frustration it caused.

“At the same time as you are trying to deliver that level of quality which is an expectation in Northeast Ohio, you’ve got to do it for a price that is less than everybody else’s,” he says.

Be creative about the buy-in

If you have decided to go in a direction that may rub people the wrong way, you are going to ruffle some feathers. You may have to convert everyone from the bottom up to follow your new idea.

Stover and his team use a “white coat program,” which involves shadowing a doctor. For instance, one of the local community board members will spend a day with a doctor to see first-hand what it takes to meet the challenges of 24 hours.

The experience was particularly successful with one board member who criticized how expensive it was to deliver health care.

“It seemed to him to be very easy to take cost out because there appeared to be a lot of redundancy with everybody checking everybody else multiple times to make sure everything was right,” Stover says.

The board member spent a day with a cardiovascular surgeon and observed a heart operation.

“He was fascinated by the fact that he said the doctor’s nose was 6 inches from that woman’s heart,” Stover says. “He said, ‘The thing I realized that day was I looked around the room and there were 17 people taking care of that one patient. I also realized that you can’t outsource that business or that cost to China’ — which is what he did when he was operating his company.”

Another high-level holdout was a physician who was the chairman of medicine, who was an infectious disease doctor. It took Stover four years to turn around the doctor’s approach.

“He said, ‘You are crazy,’ and, ‘This will never work,’” Stover says. “I made it a personal endeavor to convert him.”

To bring him around, Stover kept him engaged in the effort and showed him the results it was bringing. A particularly effective method was to add the doctor to a medical advisory board of 12 physicians that the health system had in place.

“I wanted him to hear what we were doing,” Stover says. “We were deciding about the programs we were going to put into our facilities, the equipment we were going to buy, why we were using one type over another type of program.

“Those were decisions he had never given input on before; over time, what we were trying to do sunk in for him.”

Stover says that when the doctor retired he had become one of the biggest cheerleaders for the health system.

“He said the best things that ever happened to Akron General were the health and wellness centers,” he says

Have skin in the game

If people don’t think they have any skin in the game, whether it is tangible or intangible, there is no reason for them not to just do whatever they want to do, suffer the consequences of that and let someone else pay for them getting back in a state of wellness, Stover says.

So he narrowed his focus.

“This is not about the success of the Akron General Health System, but this is about the wellness of our Akron community,” he says. “The entity that should be doing that should be taking care of you when you are sick. It’s just that most health care systems don’t do that.”

By establishing wellness facilities that offer exercise equipment, physical therapists and rehabilitation nurses — and charging a fee to encourage commitment — outpatient services are blended with the lifestyle change service.

“We don’t charge a lot for the memberships,” Stover says. “Our Health & Wellness Center — West (Montrose) facility is full. It has 9,000 members. Of the members, 285 are doctors.”

While Stover has been CEO and president for 1½ years, he has been with Akron General since 1993.

“I just knew years ago that we needed to take health care to the patient — we should not make the patient come to us,” he says. “I think that’s arrogant. So I knew that was right. I had practiced for 30 years, and I was not from this system. I was from the other system so there was an immediate distrust of me for the first five years.”

The old adage that persistence pays off rang true.

“I just kept saying the same thing over and over again: ‘We’ve got to keep doing the right thing. We shouldn’t be afraid of this. We need to embrace this concept.’”

At some point, people will start to listen, Stover says.

Unexpected benefits may be the reward for your persistence. Stover has been getting interest in the well-care program from all over the world.

“We can show them our model, show them the success that all of these facilities basically break even before year three; usage of all the facilities usually more than doubles, sometimes triples in the first six months because people have a choice where to go for therapy — and they choose us because it is convenient,” he says.

A for-profit partnership has been formed between Akron General Health System and a local developer that not only finances but also builds facilities for other parties.

“We have business leads all over the country and actually at some point, we will be going to China because the developer has business leads in China,” he says.

“They are seeing the same thing. Their hospitals are full of sick folks. And they have to figure out how to keep them out.”

How to reach: Akron General Health System, (330) 344-6000 or www.akrongeneral.org

 

Takeaways

Look for and focus on a better way to do business.
Be creative about the buy-in once you have a plan.
Have skin in the game to ensure involvement.

The Stover File 

Thomas “Tim” Stover, M.D.
President and CEO
Akron General Health System

Born: I was born in Wheeling, W. Va. I practiced medicine in Wheeling before moving to Akron in 1981.

Education: Bachelor of science and doctor of medicine degrees from West Virginia University. Stover completed internship and residency in obstetrics and gynecology in 1976 at Akron City Hospital. He completed business courses at The Weatherhead School of Management at Case Western Reserve University and at the Wharton School of Management before completing his MBA at the University of Tennessee in Knoxville.

What was your first job and what did you learn from it?

My first job was actually working for my dad, Harl ‘Ben’ Stover. He was a small-business man in the small town that I grew up in of less than 600 people. He ran a general store, and he worked on cars. What I learned from him was that he took care of the family with that business. If he wasn't working, and doing the right thing by the customer, the people could drive to the big city to get what they wanted. He taught me a lot about working hard. He knew the basics of business, which were first to treat the customer right and then they will come back. That's the way I feel about patients too.

Who do you admire in business?

The system that I admire, because I was a patient there, is the Mayo Clinic. It is an enormous system but when you interact with the system, it actually feels small. The staff pays incredible attention to detail. I had to go there for a very serious illness. The reason that it is successful is not just because of the medical expertise and the research, but it was how the clinic delivers service. The first thing that hit me was that they were nice people first, and then they were really smart. But they didn't try to impress you with the fact that they were really smart first. They try to impress you with the fact that you actually mean something to them and that they were treating you the way that they would want to be treated.

What's the best business advice you have ever received?

I heard a great line the other day: ‘Cash is king and profit is an opinion.’ I love that, so I'm going to remember it. I know exactly where that pertains. I know there is a way we take care of patients clinically, and then there's a way that we get paid, and somehow they don't connect. The chairman of my department when I was a resident told me if you take great care of patients, both clinically and with your personality, people will be able to pick that up and they will come back. If you are bringing your ticked-off personality with you to work, the patient senses it and the customer definitely gets it, and you really just need to leave that at home.

What is your definition of business success?

When I took this job as a doctor I thought I would be paying attention to the finances as much as I would be to the patient. Well, I was wrong about that. I am paying attention to the finances. But I still think that the proof of the fact that you're doing it right is the ability to be sustainable. I think the measurement of success to me is that actually people come back.

 

When Mark Mizer talks about partnership, he doesn’t have to think hard to find an example of it involving his company, RDP Foodservice LLC.

Last summer, a huge power outage afforded RDP the opportunity to show how an independent food service company partners with its customers.

“We took our tractor-trailers out to restaurants, and we collected their product because we had power and refrigerated the perishables so they wouldn’t lose their product,” says Mizer, president and the oldest grandson of company founder Richie DePaolo, who popularized not only the silver dollar-size slice of pepperoni but also the cardboard box for pizza.

Being an independent supplier right in the area has its pluses, but the premise that his company as an independent is a good fit for independent restaurateurs can’t be overlooked.

“Once you realize that you want to be the champion of independence, and you can go out and tell that story of being an independent yourself, it really helps clarify what your role is and what your job is,” Mizer says. “We decided, ‘OK, that is going to be who we are going to fight for. Those are the ones we want to create partnerships that we can help grow.’”

Here’s how Mizer aligns his company’s role as an independent food supplier to his customers, who are independent restaurants, and how the two grow in success together.

A journey to an identity

Developing your identity, that is, your brand, takes considerable thought. And maintaining it over a period of years is no small feat. RDP’s journey took it from a small business to a large enterprise.

The company originated in the 1930s as a family-run grocery store, and in 1957 added a food service business, primarily catering to pizza houses. From 1985-96, the company was part of Sysco Corp., the largest food service company in the world.

“But Sysco decided to dismantle the company, and our family decided to go back to being independent, and we started the whole process over again,” Mizer says.

RDP had drifted away from its identity while under Sysco, and the years there showed the company that food service is a huge, multibillion-dollar industry where it was a drop in a bucket.

When a company is in the position to assess its identity, it often happens at a crossroads. For RDP, its exit from Sysco was prompted by the family members that they had to stand for something.

“What we felt we needed to stand for was the independent restaurateur, the guy who creates that local flavoring in your community or in your neighborhood,” Mizer says.

Mizer and his team looked back on the company’s history and how it supported the independent restaurateur.

“He is the flavor of this country,” he says. “Someone has to go to bat for those guys. When there are people who move away from town and move back, they don't come back to relive their childhood by going to a corporate restaurant. They really want to find that neighborhood place that represents their childhood.”

Likewise, if you are visiting another city, you don’t want to experience it by going to a corporate restaurant like the same ones in your town.

“So you go to Baltimore, Md.; you want to find that guy who has those crab cakes,” Mizer says. “He has been making them for three generations on the beach, or near the water. That is where you get the flavor of your community.”

Once you realize that you want to be the champion of independence and you can tell the story of being an independent yourself, it really helps clarify what your role is and what your job is.

“So the whole industry became a little bit easier for us,” Mizer says.

Make the effort to hustle

Once your identity has been clarified and your role planned, it’s time to take action — and to hustle.

“I think one of the reasons why we are still here is my grandfather and my uncles just outhustled everyone; it was that dedication where they were manually checking orders to make sure they were correct, working ungodly hours all the time,” Mizer says.

While today’s employees don’t manually check orders off a clipboard, there is a new and better idea.

“I think computer technology today has kind of evened that playing field,” he says. “The technology that is available to me as an independent is the same technology that the big corporate people are using.

With technology as a tool, all players in an industry can work toward perfection — getting your order at the price you negotiated without any errors at the time you want your delivery.

“That's what we are all going to; all the things that my grandfather and uncles had to do in years past are now being done by a computer,” Mizer says. “If we all get to perfection, then how does that customer make his decision?”

This is when differentiation comes in. Call it added value or a bonus. Mizer calls it personality.

“I think for the very first time now, personality becomes a little bit more of a factor,” he says. “We not only have to sell you Heinz ketchup, we have to put a personality behind it — which is how do we help you grow your business? How do we create an experience for you buying from RDP that the other companies can't create?”

Going it alone — as an independent — is actually a strong point, he says. While conventional wisdom may say there is strength in numbers, Mizer can politely disagree; RDP’s annual revenue tops $164 million.

“Independence is a strength; independence isn't a weakness,” he says. “When you open your own restaurant or whatever that might be, you are putting your own personal interests on the line. And when you do that, you may feel like you have to go to a corporate giant because those corporate giants get the best deals with the best products or the biggest selection. That's not necessarily the case in food service. Bigger doesn't necessarily mean better.

“We think we are as competitive as anybody,” Mizer says. “We think that when we are helping the independent restaurateurs, they shouldn't have to sacrifice anything by working with another independent.”

Motivate with mottos

One of the last steps in securing your identity is to get all employees on board with the program. That means engagement in the mission, which when brought to fruition, creates a sense of satisfaction.

“When they get a chance to see that they can actually put their thumbprint on the growth of a company, it is really invigorating to them,” Mizer says.

While everybody at your company plays a role in your success, they need to realize how they fit in with selling a product that may not be unique. It’s the experience that will make it different from the competition.

“Every year we have these little mottos that we use like motivation throughout the year,” he says. “They are all part of it, so one year, it was 'Move the needle' and if there wasn't something in this organization that moved the needle, then we cut it out and didn’t use it anymore. We went with a different approach.”

Mizer and his team use a motivational phrase to help keep the excitement going.

“Last year, we had the motto ‘Create the experience’ and that was everybody in this company realizing that for a customer to be satisfied, we have to create an ultimate experience, whether it is from the receptionist to the salespeople to our drivers, to how we treat them to special events, you really create an experience for that relationship because we don't sell anything that is unique.

“I don't sell iPads. You want an iPad? You have to buy it from Apple. We sell Heinz ketchup, which you can buy from anyone, from a grocery store to any of my competitors, so you have to find a reason to create that experience.”

Mizer’s motto for this year is ‘Pull the rope.”

“We all realize for a restaurant to be successful, every department within this company has to work together; we all have to pull the rope at the same time,” he says.

Mizer passes his enthusiasm weekly with the senior management and three different huddles throughout the company with all the employees.

“Then they are hearing it from the passion of me so they all understand exactly what our goals are,” he says. “If there is something that we need to do a better job of, we will voice it then. But everybody needs to know that every department has to work closely together pulling that rope.

“This is what's on our plate for this week. This is how we can be a better company.”

How to reach: RDP Foodservice LLC, (614) 261-5661 or www.rdpfoodservice.com

Takeways

Take a journey to an identity.

Make the effort to hustle in your business.

Motivate with mottos to keep the troops engaged.

The Mizer file

Mark Mizer

President

RDP Foodservice LLC

Born: Dayton, but I moved to Columbus right afterward.

Education: Upper Arlington High School, then I graduated from Ohio University. I studied business communications, and then I actually studied to be in the fashion world. My first job out of college, I went to work for The Limited, and it really set the tone for that kind of outside-the-box thinking.

What you was your first job and what did you learn from it?

My very first job was dragging clay tennis courts. I think I learned that people depend on you and punctuality. And if you're not there, you’re going to lose your job.

Who do you admire in business?

I admired a guy named Dick Solove. He has passed away. He was known as being a really tough businessman. Yet when he got older, he gave back to Ohio State University. They named the cancer hospital after him. Solove taught me the importance of giving back to the community and how important that is. Also the Les Wexners of the world. I think what I find interesting in business leaders are the ones who are successful, but yet they want to go down in history for more than just that. They are the ones who want to give back to the community.

What is the best business advice you ever received?

Sam Walton said, ‘The true CEOs of our company are our customers. And they can hire and fire us at any time by just buying their products from somebody else.’ That is one I use a lot.

What is your definition of business success?

I think the definition of success really is the ability to change the lives of not only your customer base, but of the lives of your employees. We really are a team over here with my two cousins who are executive vice presidents, Rich and Chris DiPaolo.