There is “a tale of two mindsets” when it comes to understanding which employee groups are leaving and why they seek to leave. Furthermore, our research indicates that corporate leaders often fail to understand the nonfinancial priorities of their employees, such as the need for strong leadership, effective communication and career advancement opportunities, while the degree of importance that younger employees place on these nonfinancial priorities varies across geographies.
Companies seeking to enhance their global success need to figure out how to maximize business performance in the geographies they choose to operate in. As they expand globally, they will encounter several salient challenges:
- Attracting talent (especially leadership) to successfully navigate the market.
- Maximizing the performance of local talent.
- Retaining employees in markets with high turnover rates.
This becomes especially important in the context of the existing gulf between employers and employees on talent priorities.
Mind the gap
Generational differences fuel much of current social and political tension in Western Europe and the United States over globalization, nationalism and immigration, according to an in-depth analysis of results from the Pew Global Attitudes surveys.
Older Americans and Western Europeans are more likely than their grandchildren to have reservations about growing global interconnectedness, to worry that their way of life is threatened, to feel that their culture is superior to the cultures of others, and to support restrictions on immigration.
This generation gap is less pronounced in Eastern Europe and is virtually nonexistent in Asia, Africa and the Middle East. Nevertheless, Americans and Western Europeans of all ages are less likely than people in other parts of the world to tout their own cultural superiority and are less wary of foreign influence.
These findings are based on Pew Global Attitudes Project surveys conducted among more than 66,000 people in 49 nations.
As a consequence, although there is a growing recognition that in order for companies to build effective retention strategies they will need to tailor their tactics to account for generational differences, there remains the problem that many corporate leaders may be misreading the priorities among different generations, leading employers to offer the wrong incentives to the wrong employees.
Effectively addressing these challenges begins with a more complete understanding of the local work force, its various segments, and what makes each group tick.
Rather than standardizing talent management, companies should devise country-specific talent strategies with the involvement of local leaders who are as versed on the different aspirations of the generations that make up the work force as they are on other aspects of their business.
Such an understanding could help companies:
- Better address key issues for global expansion and enhance return on investment on talent programs through the design of customized programs that speak directly to employees’ aspirations, ambitions and attitudes (based on the generational cohorts that comprise a given country).
- Enhance leadership capabilities for managing and collaborating across borders and generations, thereby enhancing management effectiveness and business performance.
- Create competitive advantages by helping them stay current on expected work force composition, employee benefit options and preferences and other competitive offerings to determine the best plans to attract, retain and motivate top talent.
For those companies that embrace the concept of “plan locally, connect globally,” understanding and connecting with the aspirations of the demographic groups they are targeting can help them in their efforts to reduce cost and optimize performance on a global basis.
The recognition that customers are a heterogeneous bunch emerged as one of the important ideas for marketers in the last century. With the increasing importance of talent as a competitive factor, the recognition that generations differ around the world may be one of the important strategic avenues for decades to come.
Sherri Elliott-Yeary is the CEO of human resources consulting companies Optimance Workforce Strategies and Gen InsYght, as well as the author of “Ties to Tattoos: Turning Generational Differences into a Competitive Advantage.” She has more than 15 years of experience as a trusted adviser and human resources consultant to companies ranging from small start-ups to large international corporations. Contact her at email@example.com.
When Paul Gaffney became president and CEO of AAA Northern California, Nevada & Utah, the company had more than 4.3 million members, a century of history and $2.6 billion in revenue. At the same time, it was essentially a startup.
That summer the milestone decision had been made by the California State Automobile Association to split up its two big operating businesses, a motor club and an insurance carrier, into two separate companies.
“Whenever you have things combined that have some different business drivers, you end up being inefficient in surprising places,” says Gaffney, who assumed leadership of the auto club in 2010.
He wasn’t surprised to find that the 111-year-old company had gravitated toward a hierarchical culture, but he realized that the transition was a perfect time to reengage employees at the “new” company in a culture that was participative and would drive the kind of ideas needed to excel in the service business.
“So we really wanted to invert that leadership pyramid and put the folks who are on the front lines with our customers at the top,” Gaffney says. “That’s a change for people. People actually like where that’s going, but it’s different than their historical experience. So we’ve had to do a lot of work to explain to people what we mean by that.”
When you’re coming into hierarchical culture, not everyone in the organization may be jumping to start sharing his or her ideas. So the first step for Gaffney was to get people at all levels of the company motivated to play a more active role.
One way to do this is by reminding people how they fit into your company’s vision and mission. Because the company’s heritage had been lost a little bit when it was tied to the insurance business, Gaffney began highlighting aspects of this history using storytelling, for example, the fact that the club invented the eight-sided stop sign.
“We have a historian on staff and we try to make those rich elements of the history of the club very apparent to our employees and in our Via (member) magazine,” Gaffney says.
He encouraged his leaders in the organization to utilize meetings and other internal communications as opportunities to share member stories and anecdotes.
“One thing that we’ve done very proactively is to make sure that our club member is always front and center, even if the thing that we’re working on might seem so ‘back-officey’ that you don’t know how it could be connected to the member,” Gaffney says. “So we tell a lot of member stories. That’s a very important part of our culture, is to remind everyone why we’re here.”
Sharing stories about your company helps employees to connect to your customers and your business in a more participative way, because it facilitates a more personal response.
“It just seems to work well though because it is a tool that lowers the barriers to having dialogue versus monologue, because people can tell you what parts of a story resonate with them, what parts they have questions about and what parts trouble them,” Gaffney says. “Storytelling just seems to be a medium that unlike PowerPoint, really draws people in.”
Another way to motivate employee participation is to ask more questions. This helps draw out people who may be more reserved in bringing their ideas to the table.
“When you ask folks, they usually have things they want to tell you, but when you don’t ask they generally don’t want to bring them up,” Gaffney says. “It’s the rare individual that will proactively bring up something that they know could be improved. But when you ask them, most people respond to that invitation.”
Gaffney now asks everyone in a leadership role at the company to double their question-to-statement ratio.
“The way we find inefficiencies is we try to make the environment one that is really conducive to everyone being curious, because you can’t find inefficiencies by having some specialized group looking for them or by expecting that a couple people at the top will do things,” Gaffney says. “You actually have to have the whole company constantly looking at things and saying, ‘Why do we do this that way? Could we do this more efficiently?’ That has yielded for us a lot of great opportunities that we might not have otherwise uncovered.”
Get with your top people
Gaffney knew his top leaders were historically used to a top-down culture. So to facilitate the transition, he has spent a lot of time coaching the company’s management to help them shift toward a bottom-up leadership structure.
“I spend a lot of time with the folks at the top couple layers of the official org chart, just talking to them about what it means to be in service to the folks who are in service to our customers — so in service to them rather than in charge of them,” Gaffney says.
Providing a model for what you want leadership to look like is important in helping people evolve their approaches and buy into the changes.
One way Gaffney offered this was by implementing a training program to help people examine different approaches to leading. He also decided to run the program personally.
“It’s a leadership development program that is based on reading about leaders in other situations and engaging in a group dialogue of how did those leaders approach the situation, and how did they model the kind of leadership that we’re looking for,” Gaffney says.
In the process, Gaffney realized he had to make some changes in his own leadership style to be more inclusive. As CEO, you are the number one model your managers will look to copy.
“In wanting to be a great role model for how we want every manager and leader around here to behave, that’s helped me even more focus on ‘Hey, am I asking enough questions and reducing the amount of statements that I make?” Gaffney says. “Becoming more aware of that boundary line of when do you really need to tell the organization to do something versus giving it a lot of room to be a healthy organism — that’s a line that is difficult for any CEO to find.”
Because his ideas could easily dominate the conversation, Gaffney says he must make a concerted effort to delegate lower level projects and push decision-making out in the company.
“I don’t think there’s any circumstance where the CEO doesn’t make a couple calls, but out of 100 things, is it 12?” Gaffney says. “Certainly a couple years ago, I think I would have been more toward the ‘We’ve got to get this done and we should do this this way,’ and moved more toward ‘You know what there are only a few things that I’m actually going to weigh directly in on and I’m going to work more aggressively on the other things to make sure that the way that those decisions are getting made is as participative as possible.’”
Although it may require some personnel changes — which it did at AAA — Gaffney says that the real driver of the change in your leadership team is getting people to see the benefit of doing things differently. And this is a more gradual process.
“What I try to do and what I encourage the people who report directly to me to do is to be very aware that we’re asking for a transition in a collection of learned behaviors,” Gaffney says. “To me, the successful way to coach folks through that is not to criticize their historical approach but to ask them some questions about how they might do things differently if they really wanted to be in service to others rather than in charge of others. That takes a lot of time but it can be a very important ingredient in the transformation.”
In this kind of transformation, Gaffney recommends making sure that your top leaders are high in their sense of urgency. Those will be the people who will be worth the big investment of your time.
“Do they tend to be the kind of person who when there’s something to work on, they own it?” Gaffney says. “When there’s something to work on, they believe they have the capacity either to work on it themselves or find the right kind of help to work on it, versus someone who has low urgency and someone who tends to look at circumstances outside themselves to explain why they can or cannot fix something. It’s very difficult to help someone if they’re low in their own sense of urgency. It’s very unlikely that my investment in them is going to help make any change.”
Create an idea system
A bottom-up culture is most successful when you can actually implement ideas into your company to solve problems, innovate and improve. So with more people involved in the decision-making process, you need to teach employees how to evaluate ideas so the best ones rise to the top.
“Everyone is in touch with the emotional goodness of coming up with an idea,” Gaffney says. “It’s a little bit more of a challenge to get people to balance their emotional enthusiasm for something that sounds right and seems to intuitively be a really good idea and then put it through the rigor of could it possibly be big enough for us to actually work on and be excited about.”
Gaffney says to first acknowledge the quality of the idea, particularly if it’s being delivered enthusiastically, then ask questions to turn the thought process back on the employee.
“When trying to flesh out an idea — even if I know instinctively that it could never be big enough or it couldn’t make a profit — instead of sharing my point of view, I try to be in a place where I ask the employee, ‘OK, if you were to run this business, how much do you think you’d sell this for, and how much do you think you’d sell, and how would you go about figuring that out, and what did you think the costs of this thing would be?’ Really what I’m trying to do is get all 2,200 of these folks to think through those things all the time, even in their day-to-day operation.”
Even if the idea doesn’t end up working, pushing employees to find solutions themselves teaches people how to come up with ideas that will work.
“I’m sure there are some people who would rather not have to do that, but those ideas don’t make it anywhere anyway,” Gaffney says. “I think a lot of people react to that by realizing, ‘OK maybe this one wasn’t good enough, but I now know a lot more about what ingredients need to be in my next idea.’”
That also pushes decision-making down in the organizations, which frees your senior leaders up to focus on other priorities and pursue new opportunities as well.
“I think the number one advantage is people have wider ranges of responsibility now,” Gaffney says. “They go to fewer meetings. They have to prepare fewer presentations and that inspires them to just get things done.”
As an example, the company was able to deploy its new finance, HR and payroll backbone in just four short months.
“We were able to do that that quickly because the people that had to do the work had that insight that ‘Hey, there are so many opportunities here, we need to unlock them right away and take a little bit of risk in moving quickly onto a new platform,’” Gaffney says.
“It’s perhaps an inevitable consequence of making an organization leaner, but it’s also the kind of environment that you encounter in a startup, where there’s more work to do than there are people and you have good people in the roles. You give them authority. You let them make decisions; and in my experience people embrace that kind of environment with great enthusiasm.”
How to reach: AAA Northern California, Nevada & Utah, www.csaa.com or (800) 922-8228
1. Engage people through dialogue
2. Be a model of participative leadership
3. Help people evaluate their own ideas
The Gaffney File
President & CEO
AAA Northern California, Nevada & Utah
Education: AB in Computer Science from Harvard College, Cambridge, Mass.
What’s the best piece of business advice you’ve gotten?
Essentially to never stop learning. That has come in a variety of forms, some of them more harsh than others. One of them is to remember that even in moments of great success, you’re just a human being and something else is going to go wrong tomorrow and you better not rest for any period of time on success.
Why do people like working for you?
I’d hope they would tell you that we try to do this in a pretty fun way, and it’s an environment where all 2,200 people in the company speak to everyone else on a first-name basis. I’m Paul out in the field. I’m not the president. And I think that helps people see their work as a pretty natural extension of their life.
What do you like most about your job?
What I love about this company and the businesses that we’re in and the people that are in it is we have no inherent conflict between any other party and the needs of our customers. We don’t have stockholders to please – this company is essentially owned by its members. We have a pretty clear business model that articulates making just a small amount of profit each year that helps sustain the long-term viability of the company and provides great value to members. We don’t sell anything, and as long as I’m here we won’t sell anything where the nature of the sale benefits someone in a way disproportionate to how it benefits the customer. It’s really a blessing to not have any of those conflicts. And most other business it’s not nefarious, it’s just easy for those conflicts to creep up.
Before Zalmi Duchman founded The Fresh Diet in 2006, he’d been on the other side of the employee accountability problem.
“I was the guy taking the extra lunch and taking the extra break and kind of slacking off where I could as a worker,” says Duchman, the founder and CEO of the Miami-based fresh food delivery company with 160 employees and approximately $18 million in revenue.
That’s why in running his own company, Duchman understands the importance of creating a culture that motivates people but still keeps them accountable for progress.
“By realizing that I’m too laid back, I’ve been trying to find that middle ground,” he says. “I don’t want to be this strict company and not a fun company, but I don’t want to be this company that’s not getting anything done because everybody is partying all the time.”
Smart Business spoke with Duchman about how to create this middle ground by improving communication.
Have an open-door policy.
As long as the managers or myself or the other executives are sitting at their desks or they’re online or they’re on their BlackBerry, and they are in real time responding to issues and not pushing it off 24 hours and 48 hours, that will go a long way in making sure there is communication, because you’ll nip it in the bud right away. If you see there is an issue, you can narrow it down to how did this issue happen and who didn’t communicate. And sometimes it’s not a communication issue, but a lot of times, it is.
I don’t come into work in a suit and a tie every day, but I make sure that I’m here. I make sure that there’s an open-door policy. I make sure that everybody knows that even if your title is customer service, at the end of the day if you have a food request or if you have a suggestion in marketing, everybody wears ten hats. Because the guys upstairs and the executives, we don’t just stick to what we do and we all put our hands into everything else, I think that that’s created a culture where people know that if they have an idea they’re not going to be shunned. They’re not going to be told to shut up. It’s very, very open and everybody feels like the business is theirs and they feel like it is one big family. They feel that if they think there is a problem they won’t be scared to say it.
There’s no question that being more involved in day-to-day projects and having a better handle on it and making sure that everybody’s communicating every day has turned into growth, dollars and cents. If you’re on top of the situation, then people can’t really slack off as much. They have more of a drive if they know that the CEO is going to get down to the nitty-gritty instead of asking once or twice a month about projects. It’s also establishing weekly meetings and establishing better lines of communication. It’s definitely helped the projects move faster and the overall quality of the team is better.
I want to have that culture of it’s not based on how long you sit at your desk but what you accomplish. But at the end of the day, you have to have a median. Just managing projects better, keeping a tighter ship by using software online like Basecamp or project management software, that allows me to see that the communication that’s being given is actually being followed. So making sure that I have my hand in more of what’s going on has helped make the workplace smaller in a way.
Be proactive on issues.
When there are very few problems, it means that the communication is flowing and it means that people are talking to each other. If there is a problem, it’s almost always going to come from communication, because this person didn’t tell the correct person or this person thought that they could do this themselves and didn’t bring it to someone else. So I feel that monitoring on real-time basis, especially in a business like ours with so many moving parts — if you’re monitoring the issues of the day, you’ll know right away if there are communication issues.
Usually what would happen is that a company would be in a bad place and then they would realize that, oh my God, we’re in a bad place and it probably happened because no one is communicating and it got out of control. I would tell them to stay positive … and deal with it. Don’t continue to put it off. Establish weekly meetings. It’s a lot easier to talk about it than to implement it, but I feel like you ‘fake it till’ you make it.’ So even if you’re in that bad place, just make a decision that this is going to change and it’s going to change today.
How to reach: The Fresh Diet, www.thefreshdiet.com or (866) 373-7450
As the new president of Burger King Corp.’s North American business, Steve Wiborg was charged with leading a brand suffering from declining sales and a limited menu. Under siege from a market flooding with fast food hamburger competition, it was struggling to keep its foothold in its narrow niche of 18- to 34-year-old male burger consumers.
Yet at the same time, the company was initiating a four-pillar strategy to enhance its menu, overhaul the restaurant image, streamline operations and improve marketing communications, even phasing out the company’s Burger King mascot. Wiborg had the opportunity to apply his 20 years of experience in the Burger King system to help the No. 2 hamburger chain start fresh and expand its appeal.
“When we’re looking at a larger consumer base, we’re really expanding our target to Quick Service Restaurants,” says Wiborg, who became the president of North America and executive vice president of Burger King Corp. in October 2010.
“Any of these changes has to do with focusing on 100 percent flawless execution. That’s really what everything is focused on right now in order to make everything we do or any of those four pillars come to life.”
Today, Wiborg is leading the roll out of these initiatives across 7,200 restaurants. Here’s how he drives execution to help is team deliver results and grow Burger King as a quick-service authority.
Engage your team
To make the brand more competitive, improvements in the new strategy called for the company to add new products, such as salads, desserts and breakfast items, as well as improve upon some existing products, such as a new french fry recipe. Wiborg was also responsible for implementing the company’s new “20/20” design at all of its North American locations, which would create a more attractive and brighter environment for guests. Coming in, he and his leadership team examined research to see where the brand stood in terms of cleanliness, speed of service, food quality and operations.
“That’s always going to be a challenge as we look to innovate off of different platforms and make sure we’re looking at our opportunities from competition,” he says.
But to make the sweeping changes the brand had in mind, Wiborg knew he needed to go outside of corporate to involve people in the process, especially because 90 percent of the company’s restaurants are owned by franchisees.
“It’s really our restaurants and employees that make the change in the end,” he says.
In the past year, Wiborg has added numerous programs and initiatives designed to increase collaboration between franchises and the corporate office. By inviting more employee and franchisee participation, it’s been easier to get people on the same page with consistency and alignment on goals.
“It’s a big system … and getting them all to agree is never going to happen,” Wiborg says. “You get a majority of them to agree, and as long as the other group understands where you are going and what their part of it is, then you’re going to have the best success.”
Because menu innovation was a change that would affect many franchisees, who would end up implementing it at their restaurants, Wiborg selected a handful of franchisees that had been in the system a long time and brought them to the company’s headquarters in Miami. Along with the brand’s vendors and suppliers, they spent three months working with R&D to update the menu to appeal for a broader audience.
“We had to take a look at every single item on our menu and make changes,” he says.
Recent menu additions include everything from funnel cake sticks to a Chef’s Choice burger and a variety of breakfast menu items.
Wiborg says that collaboration with franchises, combined with the initial research the company did in 2010, revealed the areas of the company’s menu and marketing strategy that had strong appeal — flame grilling and the Whopper, for example. But it also helped clarify areas for improvement and opportunities to reach more consumers, such as adding a dessert platform with soft serve ice cream.
Again, many changes in product often come back to execution. For instance, the decision to start cutting lettuce and onions in restaurant creates higher quality sandwiches but also requires more labor.
“There are a lot of things that go into the menu innovation process and how we roll that out,” Wiborg says. “Engagement of our franchisees has helped every step of the way.”
One way the company has improved employee engagement is by making sure everyone works together to set priorities rather than having the corporate office in Miami hand them down. Wiborg says that engaging your team is vitally important.
“I think you’ll be pleasantly surprised at the engagement that you get from your employees when you make them part of the process and not just the execution part of the process,” he says.
To increase collaboration between corporate and the restaurants, the company created a marketing council, a restaurant council, a people council and a diversity council, each made up of approximately 13 franchisees and corporate members.
While Wiborg thought he’d initially have to twist some arms to get people involved, it was actually the opposite. It was just a matter of ensuring the councils were formed to represent a diversity of opinions. So to get a well-blended group, the company’s directors picked half of the council members and let the National Franchise Association, which a majority of the system belongs to, choose the other half.
“The great thing is there is a wide range of thinking on these councils,” Wiborg says. “It’s not everyone thinks the same and we all move cohesively. But if we can come to agreement in these councils of how to move the brand forward, I know we can move the system forward.”
For example, when the people council recognized a new way to improve communication at restaurants through virtual learning, the company introduced the initiative in 2011.
“It has been a great way to actually get things done within the system because it’s not just me of Burger King in Miami saying that this is the way we should do things,” Wiborg says. “It’s a group of 13 franchisees plus Burger King that all across the United States and Canada are coming up with the ways to move forward.”
To build a better and stronger brand, Wiborg also knew that the company needed to narrow the range of excellence. So another challenge of execution was getting franchisees and employees operating in one consistent way across the system.
“We have all levels of excellence,” Wiborg says. “You may go to one Burger King and it’s your favorite Burger King, and then you go to another one and it’s less consistent. So it’s really about consistency.”
Wiborg says that for any brand that has national or global locations, improving brand consistency is often the result of how much support people have out in the field.
“So when you’re talking restaurant image and you know that that’s a very capital-intense decision, in order to move in the right direction, it was about coming up with programs that enable people to do that type of stuff,” he says. “It’s one thing to say we want to do 1,000 reimages in here in 2012. It’s another thing to be able to get there. So just because people know what I’m doing and I’ve been in Burger King a long time, you have to create ways for people to execute.”
That is true for each one of the four pillars the company is implementing. So to help franchisees and employees execute the numerous changes, the company launched a field optimization restructuring program in September to double its number of sales and operations coaches nationwide.
“When you look at operations, it’s one thing to say, ‘We want to have cleaner restaurants serving the best food with the best people and the fastest service,’” Wiborg says. “It’s another thing saying, ‘I’m going to double the field staff for Burger King.’”
Instead of having 80 field people working on operations, the company now has 160 people helping franchisees identify strategies to improve their businesses and offering field support.
“If I’m serious about being the best restaurant and operations company, I think I need to back that up by putting more people in the field working on becoming the cleanest restaurants, the fastest service, the best quality service, and that’s what we’ve done over the last six months here,” Wiborg says.
This added support has helped people stay focused on execution across the board so that no one area or location suffers. If one restaurant needs more help, the company has available resources to accommodate people.
“We have more touches now and we have more people in order to get that more consistent brand up there,” Wiborg says.
Be part of the process
Even through Wiborg felt employees trusted his leadership in implementing changes because of his history with the organization, he also knew getting them to buy in wholeheartedly would take personal investment.
“You have to be part of the process and lead throughout that process in order to be a good leader,” he says. “It’s one thing to say you want the process, it’s another thing to be part of the process.”
To help restaurants embrace the new menus, store images, marketing and operational improvements, Wiborg has been actively involved in discussions and implementations with restaurants. When they began to do the reimaging, Wiborg went out and visited franchisees in a 13-city tour. In the meetings, he worked with franchisees to take them through the new programs and help them understand the timelines, details and execution process.
The company did the same thing with the menu platform rollout. Wiborg often invites groups of franchisees from the NFA or larger franchisees in before rolling out new programs to get their feedback and figure out what support they need to be successful.
“I roll them out for them first and they help kind of shape things a little bit and work on the communication piece,” he says. “So it’s not just about Burger King. It’s about our franchisees and Burger King. If they are more successful, we’re more successful.
“The key to success of Burger King is helping all of our franchise businesses be more profitable and the best QSR business out there. Their engagement, the councils, working hand in hand helped us overcome that and get everyone moving in one direction.”
Wiborg says the four pillars — menu, restaurant image, operations and marketing — probably won’t change but will continue to evolve at different levels. For instance, the restaurant reimaging has already begun, with much of the progress anticipated to take place in 2012. On the other hand, menu innovation is something that Wiborg says is ongoing.
“I think Burger King is two things,” he says. “One is it’s a restaurant company and the second is it’s an operations company.
“Our biggest opportunities are moving all of those four pillars constantly and making those changes with the menu innovation, restaurant image and so on.”
While the company’s global revenue for the third quarter of 2011 was slightly higher than in 2010 — with $608.1 million — only time will tell how these changes play out and how consumers and employees will embrace them.
“I’ve seen a lot of success in the building blocks of what’s to come,” Wiborg says. “Now it’s about the executing part over the next year.”
How to reach: Burger King Corp., (305) 378-3000 or www.bk.com
The Wiborg File
President of North America and executive vice president
Burger King Corp.
Education: B.S., Northern Illinois University
Burger King fast facts:
- Founded in 1954, Burger King is the second largest fast food hamburger chain in the world.
- The company operates more than 12,300 locations serving more than 11 million guests daily in 76 countries and territories worldwide.
- In 2009, BKC was recognized by Interbrand on its top 100 “Best Global Brands” list and Ad Week has named it one of the top three industry-changing advertisers within the last three decades.
- In October 2010, the company was purchased by global investment firm 3G Capital, which is focused on long-term value creation.
Wiborg on menu innovation: Every time we roll out a menu, we look how that fits into our brand. The different things that we’ve rolled out, whether it be toppers or different products or Chefs Choice Burger, it really needs to take the place of something else but be a higher quality. … So it really doesn’t stretch our brand it really stretches the ability for our consumers to want to go to Burger King.
1. Get your team engaged in key changes.
2. Provide support in areas of focus.
3. Be personally involved in the transition.
“One of the hallmarks of successful companies is being open-minded and receptive to ideas for improvement from the employees, who are closer to the work than the executives are. It’s kind of built into your DNA. Either you are or you aren’t receptive. You have to be curious and receptive and then be willing to work with it. Then you need to set up a pattern and a tempo of consistency on this topic. If you do it once, and it goes away — a flash in the pan idea — it becomes not effective. If you do it every year, you’ve been doing it for 10 years, people come to expect it, and it becomes part of the culture.” — Chip Perry, President and CEO, AutoTrader.com
- Be receptive to ideas for improvement.
- Foster a collaborative environment.
- Reward employees who suggest innovations.
Two months into his role as president of American Beverage Corp., Kevin McGahren-Clemens was looking at a company that had realized a $40 million loss. The 500-employee, $150 million beverage company was in a dire situation.
It was January 2009 when American Beverage’s parent company, Royal Wessanen, had trouble with its European business. In order to raise cash to focus on that area, the company decided it would need to sell its U.S. divisions, starting with its strongest, American Beverage. That April, American Beverage’s previous president left the company for a job with a competitor. McGahren-Clemens, who had been hired in 2006 to aid with some of Wessanen’s other divisions, was called on to run the day-to-day operations until American Beverage was sold. However, within a couple of days on site, he realized the business wasn’t in good shape.
“Due to poor fundamental management over time, results were becoming impossible to deliver so financials began to be increasingly manipulated to achieve targets,” McGahren-Clemens says. “No reliable financials existed, meaning no clear picture of profitability by product line, channel or customers existed either.”
Not only did the company have an unclear financial picture but prior management also had built an organizational structure with little involvement, communication or transparency with the broader work force and its focus as a consumer products company was wrong.
“The company had been managed for quite some time with a very short-term focus of delivering quarterly earnings instead of building any sustainable value for the long term,” McGahren-Clemens says. “Very little time or money was ever invested in consumer research or marketing as the organization’s focus was on short-term sales customers and not relationship building with consumers.”
The company was taken off the market and a turnaround effort began with McGahren-Clemens at the helm.
Evaluate the business
American Beverage’s previous president led the company behind closed doors. Since very little information was shared throughout the organization, McGahren-Clemens had to evaluate everything within the business to understand where to start.
“It was a situation where we really had to start from scratch because this person who was running the company, everything went through him and he was now gone,” he says. “In some ways it was easier that way. We literally just revisited and challenged everything. Basically, we just took the company apart over the next three to nine months to really understand what we had.”
Since a lot of information was unclear, McGahren-Clemens had to prioritize and become clear on the fundamentals.
“I put together a top 10 ABC priorities list, and that’s literally how I explained to everybody what we were going to do,” he says. “The first step literally was confirm and clarify financials because we had no idea what we were working with. Nothing was as it seemed. Things weren’t as possible as they looked and thoughts were not in the right place, and everything was manipulated. It was like driving a car that had no speedometer, no gas gauge, no anything, yet you had to operate it day to day.”
Establishing those fundamentals was critical, but the way to do that was to make sure everybody in the company was involved, which was not the way things were set up before.
“It was really getting everybody involved, breaking down walls between functions, making sure everybody was talking, making sure everybody had input, gathering information from everybody we could,” he says. “Everybody knew a piece, but they didn’t know how it all worked together. So it was gathering all the information and getting all the brutal facts on the table so that we could say, ‘What do we have? What do we go do?’”
When your employees are not clear about how the company is performing or what is truly driving the performance, you have to gather that information.
“It’s kind of a combination of doing your own analysis and getting as much information as possible and just objectively looking at it versus what does everybody think it is,” he says. “You have to look at customer lists, your profit by customer, your product line, what’s selling and what isn’t selling. In time, you really do have to contact all the people in the company who have knowledge and have more of a dialogue with them and try to pull out of them what’s working and what isn’t working. How else will you know beyond the numbers and what the numbers are telling you what’s working and what isn’t working? There’s no manual for gathering this information when it’s not clear what’s true and isn’t true.”
Before going any further, ABC needed a new senior leadership team to help turnaround the company.
“I started by first working on ultimately gathering the strongest senior team possible because you can’t do anything difficult within a fairly large organization alone,” he says.
“As we stand right now today, there’s only one holdover, which was the HR person. Operations, sales, marketing, finance, and IT all turned over. There’s usually a transition period like that because in a situation like this or anywhere, it’s hard to really attract the talent you want until you have some stabilization. You have to work with what you have, and that’s what we did for a while. As we began to get some stabilization and I had a better handle on the situation, I could go out and recruit people. I could very clearly explain what they’re getting into and, at the same time, explain the opportunity, which was fantastic because it is a lot of fun being apart of building something from scratch.”
The next step in the turnaround was to confront the brutal facts and communicate those throughout the organization.
“The key is being very objective about the state of the business absent biases about what it used to be or you want it to be — you have to focus on what it is now,” McGahren-Clemens says. “In my mind, this is the single most critical step in any recovery because nothing matters if you don’t fix the right things. Next, with the help and full buy-in of the senior team, you need to set very clear priorities as a team that, in turn, are clearly communicated to the entire organization in a very candid, transparent way. It is important to then create a true dialogue with everyone in the entire company by truly maintaining an open-door policy and walking around a lot to gain input, answer questions and dispel rumors. And then provide regular updates, both by e-mail and in person about your progress.”
To do this McGahren-Clemens met with 100 of the company’s employees one-on-one to gain a better understanding of what could be done and explain where the company needed to go.
“I believe the key is engaging everyone in an ongoing dialogue about how they personally fit into the big picture and why elevating their own game is crucial to our success going forward,” he says. “Once our situation had stabilized and moved out of crisis mode, since I only had around 100 salaried employees, I felt it important to sit down with each person individually for about an hour to connect directly. I would start by asking each person if they knew what had happened and why and whether they understood where we now were and what challenges we faced. Inevitably, people underestimated the seriousness of our situation, both past and present. Most importantly though, I would then ask everyone what performance barriers or morale issues they face plus what they thought we still needed to do to improve the company and our ability to complete a full turnaround and begin driving profitable growth.”
He had to be careful during this process not to scare his best employees away from the company but also make it clear that the company needed a change.
“From the very beginning, it was always challenging striking the right balance between creating a sense of urgency by explaining to people how dire the situation really was without being demoralizing or scaring people,” he says. “It’s a balance of painting a picture of, ‘This is a very, very challenging situation, but we can get out of this,’ and, ‘There is a lot of upside for people who help us with that.’ With the one-on-ones, you can tailor that message and tailor the questions much more specifically by reading the individual. How much do they understand or not understand? Some of them just had no idea how much the company made before or how little we made now or what the problems were. Some people want to know, and some people don’t want to know, and the reality is you’re trying to get a read on who those people are because that’s who you need going forward.”
To help get ABC to sustainability, McGahren-Clemens needed to find those individuals within the company who had the ability to be leaders.
“One thing I’ve always found to be true is, in general, there are some hidden gems within your organization that can move up to the next level,” he says. “Don’t immediately think you have to do everything externally. It’s going to be better if you can pull somebody from within who has some knowledge of the organization. Who’s acting without asking and doing the right things? When you really ask around and start to talk to people, they all know who’s who and who’s pulling their weight and who makes a difference and the same names begin to come up. You have to get out there and ask because it’s not going to be necessarily evident, but in times of crisis, it becomes a little more evident than normal.”
Now that a leadership team was in place, the right people were found and brought in, and progress was being made on understanding the circumstances of the company’s struggles, it was time to start putting plans in motion.
“It was very clear to me from day one that it wasn’t a situation where we could just cut our costs. It was about fixing the business and growing out of it. I believe all sustainable growth begins with a thorough knowledge of target consumers combined with engaged employees who have full access to information and the necessary tools to do their job — such as clear priorities and budgets — and none of those conditions existed.”
McGahren-Clemens had to switch the focus of the company from the short term to a long-term focus on branding and consumers.
“In the consumer marketing world of products, it always starts with spending, and there is a delayed gain on the profit because you’re going to have to invest first in market research to understand consumers, understand your competitors, understand what your product brings to the party, what gaps there are and its further investment to go fix those gaps,” he says. “We had products we had to improve the quality of. We had to add vitamins to our juice products, we had to change the packaging, we had to add benefits, and that’s time and money based on the consumer research. Then you have to go out to the market and support those products. Those are the basic steps that most brand companies do ongoing, but we literally had to start.”
Not only did the focus of the company need to change, but the employees needed to start thinking differently as well.
“It was getting everybody internally to understand that it is ultimately what the consumer thinks that matters, not customers,” he says. “Customers are very, very important, but those retailers and distributors care most about what the consumer says too. We had to go out and say, ‘We don’t know how good our products are. Let’s go do taste tests. Let’s get consumer thoughts.’ There were a lot of brutal facts that came up that you have to go out and be willing to hear. That commitment was something we had to build internally.”
With McGahren-Clemens’ leadership, the hard work of ABC employees and a renewed focus, the company has made a rebound.
“The company has been totally made over, and we have a great foundation from the ground up,” McGahren-Clemens says. “You can go in and renovate a house or you can take the whole house off and start over and that’s what we did. We know all the pieces and feel very good about the infrastructure and the talent and processes and the potential, and we feel we are just starting to scratch the surface. All of the investments we’ve made in consumer research, product enhancements, innovation and marketing the last three years are just starting to bear fruit.”
The journey from 2009 to today has been a long one. It took teamwork, communication and a unified focus to get there. The biggest key for McGahren-Clemens was to never let the task at hand bring him down.
“Don’t get too caught up in the enormity of the situation or the challenges or the tasks and just take it one day at a time,” he says. “Focus on ultimately where you want to be and know you can be and just work toward that. Trying to stop and think about how much has to be done can be overwhelming.
“I wish there was one clear formula or one sequential order of steps that would make it very cut and dried for people in a similar situation, but I liken it to a football game where you’re calling audibles along the way. You have a game plan, you practice it, you have a lot of ideas, you’ve studied your opponent, you know what has to happen, but the reality is you’re still going to have to make adjustments throughout. You have to be flexible enough to do that. You have to have a series of steps you’re ready to pursue and an order to them and a way you’re going to approach things, but you also have to be open to reading new information as it arises because it’s going to arise all the time.”
HOW TO REACH: American Beverage Corp., www.ambev.com
You need evaluate the business to understand what the problem areas.
Once you know the situation and where to start, communicate those facts to your employees.
Once you have buy in, put your plans in motion.
The McGahren-Clemens File
American Beverage Corp.
Born: New York City
Education: Studied economics at William and Mary and received a MBA from Northwestern
What were your biggest fears during the turnaround?
Looking back, I didn’t really think that much about it because it wasn’t productive. But if some of our biggest customers had said, ‘We’re not going to buy your product anymore.’ We wouldn’t have been able to get through the stabalization period. If Wessanen had not supported us and just decided to shut it down, but they did support us and were great throughout. Or if a lot of our talented people had walked out saying, ‘This is too big a risk. I don’t know how it’s going to turn out; I’m just going to leave.’ Any of those scenarios, particularly losing the talent we did have, would have been very damaging.
What has been the best business advice you’ve ever received?
I remember having a manager once where we were in a pretty bad business situation where things weren’t going the right way. We were managing a cheese business at the time and he just stepped back and said, ‘All right everybody, remember it’s just cheese.’ The whole room just burst into laughter. I’ve used that so many different times and kind of had to use it in this situation.
What is your favorite American Beverage product?
It would be the one that’s selling the best right now; the Daily’s Frozen Pouch. It really is a great product. I also like the Little Hugs. I buy cases of it for my kids and the whole neighborhood drinks it and I drink it as well.
If you could switch places with somebody for a day, who would you switch with?
It would be fascinating to be the chairman of the Communist Party of China right now. They are such a hybrid between old-line communism and new-age capitalism and there’s no script for what they’re trying to accomplish as they become a global power economically, but at the same time their social freedoms are lagging behind. It’s fascinating how that’s going to play out and I would love to understand all the different tensions within the country.
In today’s business environment, a focus on innovation is what helps keep companies relevant, thriving and primed for the future. Without it, your business falls behind, becomes an afterthought and will get passed by someone who can do it better. Innovation is the lifeblood of many corporations and it is something that you have to put a lot of effort and thought into in order to create and maintain that type of environment. Whether it is finding ways to shake up your organization, looking at solutions from different perspectives, or understanding what the customer expects from you next, you have to be willing to try whether you fail or succeed. That is what innovating is all about. Below is a sampling of what three CEOs previously featured on the cover of Smart Business Pittsburgh had to say about developing innovation.
“You have to always be able to challenge somebody to step out of their own bubble and look at it from a customer basis, but also from a very fresh angle. You have to make sure that you don’t get stuck with a certain way of looking at things. You always have to be able to challenge what you do and look at it from a different person’s perspective, a different market perspective, or a different requirements perspective because only then will you be able to overcome these problems and get this aha effect.”
Andreas M. Schulze Ising, president and CEO, Advanced Polymer Technology Corp.
“I’ve always found that the answer always lies with the customer. You have to get close to the customer and you try to understand and gain valuable insights from the customer that no other company can see. The decisions and the directions you take become very clear very quickly around what you should do. You take innovation that is driven by customer needs or customer insights, that’s what I would focus on whether you’re a company that’s doing well or a company that’s in need of a change in strategic direction.”
Sam Liang, president and CEO, Medrad Inc.
“You have to do a little bit of both innovation by design and innovation by discovery. You really have to constantly be redesigning the organization internally to match the customer voice and match the trends that are coming—being able to design things very well—designing systems, designing solutions, designing approaches, but at the same time put yourself in discovery mode. You know what you know, but you don’t know what you don’t know. You have to go out there and try to discover new things, so you need both design and discovery in the innovation process.”
Stephan Liozu, president and CEO, Ardex Americas
- Achieve an aha effect through gaining different perspectives.
- Gain insight from your customer base to form new innovations.
Design and discover new innovations to boost your creative effort.
John Dubis has had to embrace a change mentality from the very first day he started at St. Elizabeth Healthcare. He had to lead the charge on a merger between St. Elizabeth and the old St. Luke Hospitals and now he has to implement the changes driven by health care reform as well as continue to grow the system.
Today, St. Elizabeth is a 7,300-employee $1 billion health care system and the ability to implement new initiatives in the industry is critical for the continued success of the system. Dubis, president and CEO, has been running hospitals for a long time. He has worked for academic medical centers, children’s hospitals, inner-city hospitals and large community hospitals and that experience is paying off.
“The good thing for us is because we have such a high-quality mantra, that has a natural tendency to be more creative and innovative,” Dubis says. “So our ability to see things differently, to take calculated risks, to be more innovative, we already have a culture like that.”
While the changes in the health care industry will alter how things have been done for quite some time, St. Elizabeth has prided itself on being one of the elite systems in the country. Looking for best practices, high-quality service initiatives and more efficient practices is what St. Elizabeth does best.
Here’s how John Dubis keeps St. Elizabeth Healthcare on the cutting edge of its industry by adapting to and accepting change.
Become more efficient
Since St. Elizabeth acquired the old St. Luke Hospital system, the health care system has been on a mission to improve operations and become more streamlined.
“Anytime you do a merger, you’ve got challenges,” Dubis says. “The good news is that the cultural fit of the two organizations was very good. Once we became one system, we were quickly able to take advantage of the commonalities that we had and take advantage of the opportunities to create more efficiencies and reinvest savings in more efficiencies and other new services that didn’t exist in this market.”
One of the ways Dubis and the folks at St. Elizabeth became more efficient was by consolidating services. The biggest example is the consolidation of its OB programs.
“At one of the former St. Luke Hospitals, they were delivering two babies a day and losing $3.5 million a year and at the other major St. Luke Hospital, they were delivering three babies a day and losing $3.5 million a year,” Dubis says. “We were losing $7 million a year on OB services. We decided to consolidate all the deliveries at the main hospital, the St. Elizabeth Edgewood campus, and by doing that we concentrated 5,000 deliveries in one place. We took the $7 million in annual savings and invested in redoing the entire OB service area physically from a floor perspective, and programmatically, we put in place a high-risk OB service, which this community never had.
“We were able to improve the quality of care rented to patients, we were able to improve the quality of care rented to premature kids, and we were able to save $7 million a year in the process. We took those dollars and started reinvesting into other clinical programs. So we really have enhanced the system overall and concentrating specialty needs in the right places that need to have them.”
It is critical in any business that you look to find areas where you can consolidate services or divisions to save money that can be put to better use.
“We wanted to eliminate unnecessary duplication of services which are costly, use those cost savings and expand the clinical programs in the community, both in terms of enhancing what we currently do and creating new services that didn’t exist,” he says. “That’s the focus that we have. Our mantra is quality. This organization learned many years ago that quality is the most important thing, not just for patient care, which is obviously our first priority, but also quality has shown to be good for business. It keeps you financially solvent and prospering because you’re able to do things in a more cost-effective high-quality manner and the resources that you get as a result of that goes into this cycle of upwardly investing and new and different activities for the patient’s well-being.”
The ability to reinvest is extremely important when trying to grow and improve any business. Health care reform is putting pressure on hospitals to make these types of improvements to enhance the system as a whole.
“There are really only two strategies that make sense in terms of dealing with that,” he says. “One is to grow your business, grow your volumes, and grow the market that you serve so you can get additional resources through that mechanism. Simultaneously and maybe even a little bit more importantly at this juncture, is beginning to be very cost efficient in terms of providing the services that you do provide, but in the same process not reducing the quality of what you’re doing. That may seem a little bit contradictory, but really it isn’t, because research has shown if you produce high-quality outcomes, patients tend to come to those types of organizations, which means your volumes tend to grow, which means you have additional financial resources that allow you to keep that reinvestment cycle going upward.”
Foster a change environment
While reinvestment is a very promising way to make business better, there is a lot of fear and anxiety by many about the future in the health care field. You have to make sure people feel at ease about the direction you’re going and it starts with your internal environment.
“The thing you have to do more than anything else is communicate, communicate, communicate,” Dubis says. “You have to make sure that everybody understands what the strategic goals of the organization are, that they’ve had a part in developing those goals, and to make sure that people are properly directed and rewarded for the achievement of those goals. By creating that level of constant communication and alignment of incentives and purpose, that’s how we’ve seen ourselves grow and develop and get better and better year after year.”
It’s never enough to just talk about it and assume things will get done. You have to work hard at forming that kind of environment and make sure you demonstrate it from the top of your business.
“It obviously doesn’t happen overnight, but there has to be a commitment at the top level from your board and senior leadership all the way down through the ranks of every employee in your organization,” he says. “There has to be a clear belief and clear example shown by the top echelon of the leadership ranks that the direction we’re going in is the right direction. You really have to get down to a lot of personal communication and a lot of personal involvement of employees in the process.”
Communicating direction is always critical, but it also takes involving employees in the process to help cement their understanding of new changes.
“They have to be part of the strategy and then they have to obviously be a key part of the solution,” he says. “They have to be part of developing the solution in terms of what they’re going to be responsible for and what they’re going to be held accountable for to make sure that we are achieving the goals that we have to achieve. It all comes back to constant communication from top to bottom and bottom to top. That’s what makes the alignment happen, the understanding happen and the teamwork happen to accomplish the goals that you set out to do.”
It’s easy to say just keep doing what you’re doing. However, if you have that mentality you won’t survive in any industry. You have to accept change.
“You have to be adaptable,” Dubis says. “You have to be able to assess your environment — whatever your environment may be — and make the changes and improvements that will best serve your customers that will utilize your facility. If you’re not adaptable, if you’re not open to change and innovation, you’re leading yourself down a road for bad things and potentially extinction or maybe being bought out by another system that can do it better.”
Develop change strategies
Leading through a period of change is a tough task. You have to make sure that you are heading down a path that your company agrees with and can understand.
“First of all, you have to explain what the situation is and then secondly, explain what strategies you want to employ that will ensure your ability to continue doing the things you want to do,” Dubis says. “You communicate the growth strategy, you communicate the efficiency strategy, and you communicate the consolidation strategy and make sure that people understand it’s not what’s good for one part of the system, it’s whatever affects one part of the system affects all of the system and creating the good for the whole is much better than the good for one organization.”
St. Elizabeth has been going through a number of changes over the past few years and more will be coming. Understanding where to start has been crucial.
“The first question we need to ask ourselves is what’s in the best interest of the patients and their families,” he says. “That is absolutely the most essential question. From there, we cascade down and figure out what are the resources needed, what are the barriers, what are the political issues, whatever they are. That is the first cut. We look at what’s the biggest impact we can make for the dollars we have available. We go through criteria starting with whether there are any safety issues that need to be addressed.
“Secondly, what are the enhancements or new services that are going to be of most benefit to the most number of patients? Thirdly, we get down to new clinical programs that we have determined the community has told us they want. Lastly, we look at replacing equipment that’s used for life. That’s the tree we go down in terms of prioritizing what we do.”
Planning your changes is an important part of being able to adapt to change easily and effectively. You have to understand where changes can have the biggest impact.
“You should set a decision criteria tree in terms of how you’re going to look at things,” Dubis says. “Secondly, you need to get broad-based input into that process. It can’t be something that’s done in my office or the chief operating officer’s office. It’s got to be something done in conjunction with literally the entire organization. You should be getting ideas from the ground level and looking to push that upwards so you can have those discussions. Then you need to provide a draft plan of what it is you want to do so that associates, managers and board members and all other interested constituents can have their say in terms of what makes best sense. Obviously, it’s management’s final call to make the decisions, but once you get that consensus built, it makes the process a whole lot simpler.”
However you go about your changes, you have to make sure you remain positive during the process.
“Don’t look at the glass half empty; look at it half full,” he says. “It’s easy to get negative and pessimistic about what’s going to happen in the future. I frankly look at it as an opportunity to lead ourselves in a different way that could be even better than what we have today. When people get negative about things and pessimistic, they tend not to be very creative or very innovative and that’s where I think the future lies for organizations that do those two things very well. This is not a time for the faint-hearted. This is a time for people who embrace changes and see this transformation we’re going through as an opportunity and not as a negative. This is a new world in which having a strong desire to embrace change and work within the abstract and uncomfortable zone of unfamiliarity is what it’s going to take to guide your organization to be successful down the road.”
HOW TO REACH: St. Elizabeth Healthcare, www.stelizabeth.com
- Find areas you can save money and become more efficient.
- Make change part of your culture.
- Develop strategies to decide how to implement the best changes.
The Dubis File
President and CEO
St. Elizabeth Healthcare
Born: St. Louis
Education: Graduated from Washington University in St. Louis and received his master’s in health administration from Washington University School of Medicine
What was your first job, and what did you learn from that experience?
My dad was a waiter, and when I was 12-years-old, I was 6 feet tall so I passed for 15 and I started working with my dad in the restaurants. What I learned from that is not only good organizational skills … but more importantly, I learned about the importance of customer service.
What is the best advice you’ve ever received?
Never give up. I learned in life you should never give up, because every day brings an opportunity to make something better. The only time that you can’t is the day that you don’t wake up. I believe that very much. If you really work through things and think things through, not only on your own but with a group of talented people, you usually can find solutions. You may have some failures or you may have some set backs, but if you keep pushing for the long term, usually you can do pretty well.
What do you see as the most important change hospitals are going through?
We’re going to have to become more customer focused in terms of dealing with our patients, creating a more positive patient experience both on the inpatient and the ambulatory side. The public is demanding that more and more. The other thing would be innovation. The ability to accept change and to make changes happen because the world will be different, and you have to develop new strategies and approaches and systems to deal with it.
If you could have a conversation with anyone, who would you speak with?
Jack Welch. I got to know Jack Welch through his first book and when I read it, the emphasis on the importance of having talented people in the organization and the process that they go through annually to do that, I thought was one of the best things I had heard on how to make your organization successful. He’d be someone I’d like to talk to and probe a little bit more into his thought process.
Don’t take this the wrong way, but Lars Bjork has found his share of headaches as he’s dealt with his company’s rapid growth over the past few years.
It’s a great problem to have, right? As an untold number of American businesses have struggled just to tread water, and numerous large, well-known companies have undergone very public bankruptcy proceedings, Qlik Technologies Inc. has been heading in the other direction. The business software solutions company, which brands itself as QlikTech, has sprouted from $44 million in 2006 revenue to $226 million in revenue and 1,000 employees in 2010.
But fast growth still puts great stress on a business. For Bjork, QlikTech’s CEO, the question of growth has largely become a question of finding and retaining the best people.
“We employ a lot of people, we hire a lot of people, and the challenge is, how do you continue to sustain a certain rate of that, because we want to continue to grow the business,” Bjork says. “The growth numbers for us over the past few years have been substantially higher than the average company. So, how do you keep the quality high for the hires you make, but still bring on a lot of people? Within that, how do you onboard them, and get them ingrained with our culture and values that we hold to be so important within QlikTech? That’s the challenge: How do you find people at this growth pace, and how do you get them on board in a way that they can thrive in this type of environment?”
At QlikTech, hiring isn’t just an issue for the human resources department. Every leader in the company, including Bjork, has taken an active role in ensuring they attract the right type of people for the growing business and can retain them. It requires not just an eye for talent, but a well-defined culture and an understanding of how all the puzzle pieces need to fit in order for the employees and the business to remain successful.
If your stated hiring mission is to find employees who fit your culture, you’re saying a lot more than you might realize. Even if you have distilled your core values down to a few bullet points that can easily fit on a lunchroom poster, you won’t find a single type of person that will easily fill the mold you have created.
Some people aspire to be managers. They want to climb the organizational ladder and become less specialized as they gain more experience. Some people want to drill down in their area of specialization and carve a niche for themselves. You have to find a place for both in your company, because your company won’t be able to function if it doesn’t have a balance of aspiring leaders and aspiring specialists.
“We think that people who are going to be attracted to a company like ours will want to continue to develop professionally, they’ll want to work within a team and have a social element to their work,” Bjork says. “Some of them want to continue to grow in their specific role as the company continues to develop. Some have higher aspirations to ascend to the managerial level. What we try to do is avoid a common mistake that a lot of businesses make, which is to simply take the best expert in a given area and make them the leader. As an example, you might take the best doctor and make him the head of the clinic. But your best doctor might not be your best leader.”
Bjork and his leadership team strive to achieve that balance by putting job candidates through a rigorous series of interviews, in which a candidate’s personality is assessed from different perspectives.
“It’s not only a direct manager doing the interviews,” Bjork says. “It could be the manager’s manager, or a person in a peer position. It could be a member of HR or another senior person. It does make it a bit of a tedious process, because if you want to hold standards high, you tend to be picky, and you’ll probably have to look at more people.”
Ultimately, Bjork is trying to get past a candidate’s interview façade and uncover the real personality traits. Whether the person is interviewing for a managerial role, a sales role or any other position, Bjork simply wants his team to be able to make an honest assessment.
“I want to see how people present themselves even more than I care about what they say,” he says. “It’s also about what they don’t say and what they don’t ask. It’s about finding out their interest level in the company and what we do. Is there interest very limited, are they mainly concerned with getting their foot in the door and getting a job?
“That’s why I ask the question, ‘What do you want to be when you grow up?’ It’s not meant to offend anyone, it’s more about getting to the point of deciding what you would do if you could choose. If everything was laid out in front of you, what would you do? It doesn’t mean that you have to aspire to be a high-ranking manager. You can be fine in your role, and developing your expertise in that area. But you still want to develop that skill set, and you can articulate that in way that holds up.”
No matter which way a job candidate leans – toward a career in management or a career in their field – the different kinds of personalities and skill sets that can thrive in a high-growth company need to have one common trait: the desire to grow along with the company. No matter how that trait manifests itself in a given employee, Bjork says it is essential.
“You’re looking for very driven people, people who want to accomplish something,” he says. “They get things done, they want to be given a lot of responsibility, and they aren’t afraid to be held accountable for it. When we hire someone, we point out what we would like the company to do, then you figure out explicitly how to do it. That is why we hired you.”
Strengthen the bond
QlikTech is now headquartered in Radnor, Pa., but the company was founded in Lund, Sweden in 1993. With operations that serve customers in more than 100 countries, QlikTech decided to use the company’s birthplace as a central location to indoctrinate new employees in the culture and values. Once a job candidate has passed the interview process and accepted a job offer, QlikTech sends the new employee to Sweden for a week of training.
“We still have a lot of our company’s heritage in Sweden, and our R&D is there,” says Bjork, a native of Stockholm. “So we send all employees there for an introduction week, where we go through our culture, our values and teach some of the key processes. It’s a very interactive week, where you have to work with other nationalities as well. It has happened where we have pulled people out of their employment because they couldn’t make it through the week. It doesn’t happen often, but we have done it in the past.”
The training week in Sweden is a test as much as it is a primer. The interview process can reveal a great deal about prospective employees’ personality and character traits, but the training week tests their ability to stay motivated to succeed in the QlikTech environment.
It’s the gap that every company has to bridge when onboarding new talent: taking the hire from concept to practice. In order to feel motivated, new employees have to feel the energy and passion that their coworkers and managers have for the company. Particularly in a growth-oriented environment, as conditions are changing at a rapid pace, employees need to feel a sense of motivation around moving forward and working toward what’s next for the company.
As with many things in a business, it all starts with the example set at the top.
“You have to walk the talk, you can’t talk the talk,” Bjork says. “There is nothing you can put on posters on the wall. You have to live a culture by showing it through actions. It’s like with kids, it’s not what you tell them to do, it’s what you show them to do. Otherwise, the message becomes very empty and shallow.”
Be a motivator
Once new QlikTech employees come back from their training week in Sweden, their sense of motivation determines how far they will ascend professionally, and how far they will help move the company. At some point, the questions asked during the interview process, the lessons taught in training and the example set by management has to result in something tangible in the employee’s performance, otherwise you might have to call the hire itself into question.
“I’m trying to embrace the fact that motivated people will do more than people who are not motivated,” Bjork says. “They have to feel to a very great extent that their piece of the puzzle adds up to something that becomes very successful, both for them and the company. It’s especially true for younger people. Many young people have grown up in an environment where financial stability is something that they have taken for granted, so money is not the No. 1 motivator for them at work. For my generation, and especially my parents’ generation, that was a much bigger motivator. For younger workers, it comes down to ‘I want to be involved, I want to make an impact, I want to learn more.’ That is how you’re training them, and that is what drives their motivation.”
Once you have set the example, and believe you have motivated your growing work force to a satisfactory level, that isn’t the time to let up with your communication. As the leader, you are in the spotlight at all times. You need to recognize that motivating your employees is an ongoing process of taking the raw-material talents and skills that your employees bring to the table each day and converting them into the momentum that powers your company for future growth.
“A culture is defined by how people interpret the organization when they walk in,” Bjork says. “People need to see an open environment, a flat organization, a place where it is easy to approach anyone. People here know they can walk into my office, my door is open almost all the time, and you can simply be yourself. I don’t need to point out to anyone that I’m the CEO. They know I am CEO, so I just want to be myself when I interact with everyone. That is where the example starts, and it’s true for any senior manager. Recognize people, give them praise, talk with them about what is going on in the business. Don’t sit in the ivory tower. Continually motivate your people and promote the idea that you are working as a team.”
How to reach: Qlik Technologies Inc., (888) 828-9768 or www.qlikview.com
The Bjork file
Born: Stockholm, Sweden
Education: Business administration degree from Lund University, Sweden
What is the best business lesson you have learned?
Trust your people, because they can work miracles for you.
What traits or skills are essential for a business leader?
You need to be comfortable with hiring people who are better than yourself, in the sense that they are experts in their field, and you are willing to be a good listener. You need to be comfortable with not allowing yourself to just have a bunch of yea-sayers around you.
What is your definition of success?
It is the ability to meet or exceed expectations, whether that expectation is from an employee, a customer or a shareholder.
Scott Sumser had a moment of doubt as he prepared for his first day at work as president of Athens Foods Inc.
“There’s a sense of pride that you worked hard to get to this point,” Sumser says. “But there was also an enormous amount of anxiety. ‘Hey, can I do this? Have I bitten off more than I can chew?’”
Fortunately for Sumser, his nerves settled and his experience began to kick in.
“You have a bag of experience that you carry around with you,” Sumser says. “It really doesn’t matter what you do. You get to reach into that bag and use your learning from everything.”
Sumser decided the best course of action in leading the 200-employee fillo dough producer was to be what he was, a curious new employee.
Be a sponge
People take the transition too seriously. It’s important to show people that you have aptitude and that you’re in the role for a reason. But I think you really need to be a bit of a sponge. Use your two ears and one mouth proportionally in a new situation. Listen twice as much as you talk. Ask a lot of questions and admit when you don’t know something. You build credibility much faster than feeling like you’ve got to know everything right out of the chute. Further down your life cycle, it’s important to use leadership as a driving force. But initially, it’s better to create those relationships so that people feel like you’re willing to learn and listen rather than just come in and do.
Get to know names
It matters a lot. Everyone is going to know your name and the more you can do to learn theirs, the better impression you’re going to make. One tool I use is we have a plant of 150 to 200 people depending on the season. So I have HR take a picture of everybody who is working here. What I try to do is if I know I’m going to be in the plant, I’ll take a look at their picture. It will tell me what department they are in. It gives me one more tool to make sure I’m sending the right message that everybody, no matter what you do, matters to the success or failure of the company.
Take the stage
It’s probably good to have an all-employee meeting right out of the chute. Otherwise, depending on who you were able to tackle getting to know everybody, there’s going to be somebody who feels like they really didn’t understand who you are. It doesn’t have to be enormously formal and you can still use your one-on-one time and continual learning. But depending on the size of your organization, it’s just important for people to be able to hear you speak and find out what your background is. That kind of squelches a bit of the rumor mill. They hear it from you as far as what you are trying to do.
Be open minded to the current way the team gets things done. Too many leaders come in and try to put their stamp on too many things. It’s best to try to learn. You may think you have a better way to do something, but it may just be your opinion instead of the best way to do it. Do keep good notes for your first 30, 60 and 90 days of all your observations. That really allows you to go back after you feel like you’ve created a good relationship with folks and remember what you saw. You think you’ll remember it at the time, but keeping good notes of what your observations were - good, bad or indifferent - really helps you refresh your memory.
Athens Foods Inc.
Founded: 1958. Athens is the world’s largest producer of fillo dough and fillo products.
Sumser on first impressions: Don’t judge your team too quickly. First impressions are a great data point. But once the smoke clears and people begin to act how they normally act, you get to better understand what people bring to the table. It may align with your initial feeling or it may not.
How to reach: Athens Foods Inc., (216) 676-8500 or www.athensfoods.com