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How Dan Roitman keeps the wheels of innovation and entrepreneurship turning at Stroll LLC
For Dan Roitman, much of business is science.
Since founding specialty Internet retailer Stroll LLC in his University of Maryland dorm room 13 years ago, Roitman's career has consisted of an ongoing series of hypotheses, experiments, data analysis, adjusting of hypotheses and formulation of theories.
Roitman's scientific approach to business-building has developed a highly entrepreneurial culture at Stroll, in which team members are encouraged to share ideas, innovate and test their assumptions. It's a mentality that has helped the company sustain a period of rapid growth — 80 percent in 2008 and 50 percent in 2009, followed by a year-over-year 100 percent growth margin from 2010 to 2011. In 2012, the company surpassed $80 million in annual revenue for the first time.
But maintaining a forward-thinking mindset throughout the entire organization isn't something that just happens. It requires CEO Roitman to hire, train and empower his people to achieve the desired results. It's something that was driven home to Roitman during the recession, when he had to suspend the growth of the company for a year due to a lack of additional financing from Stroll's bank.
"That was my biggest concern, because we had always been a growth company," Roitman says. "Then, due to circumstances beyond our control, we had to put a specific order volume cap on the business.
"It really became more about communicating that this is the challenge, everybody knew what was going on in that environment, you had a lot of economic hardship, you heard a lot about layoffs that were going on elsewhere. I have to imagine everyone was happy that we were doing well, but frustrated that we couldn't do better."
Through it all, Roitman has had to focus on motivating his employees, maintaining a sense of transparency, while still encouraging open thought, experimentation and the scientific mentality that had made Stroll a success in the first place.
Embrace best practices
It's easy to say you embrace best practices as an organization. Actually discovering, selecting and implementing best practices from another entity are another ballgame. Even if you are able to discover and select an outside idea that you think will help your business, there is a good chance you wouldn't implement it — at least, not in the form in which you discovered it.
"I once heard a speaker talk about the idea of cloning best practices and how most people don't have a so-called cloning gene," Roitman says. "If I told you, right now, the secret to making a million dollars in 90 days and if you followed my instructions exactly, you'd make a million dollars; most people wouldn't be able to follow it exactly. They'd start to think about how to improve upon what you're telling them.
"Sam Walton would go into any competitor's store, and even if it was a really shoddy store, he'd find something they were doing better than he was doing. Through that process, through a million little optimizations, he became a formidable competitor and then an industry leader.
"So if someone is doing something better than you are, you should at least recognize that they are and be willing to try it in your business as well."
But it is a double-edged sword when it comes to adding new policies and processes to your organization. You don't want to corrupt the external idea, because it was successful elsewhere for a reason, and that is why you want to on-board it at your company. But you also want to give your people an opportunity to think of ways they can improve upon the idea or alter it so it better fits your company's specific situation.
For Roitman, that is where the need for a culture that utilizes a testing-based, scientific approach becomes critical. His team members at Stroll can propose new ideas and changes to existing ideas, but they have to back the proposals up with supporting data.
"If you have a constant, iterative testing philosophy, the barrier to testing is very low," Roitman says. "So if somebody is doing something on, say, the marketing side, you ask yourself about the probability of something similar working in your business. What is the probability of this one idea being more successful than another?
"Ultimately, you have finite resources for your various departments, so you do have to have a mechanism for prioritizing — some kind of filter for what you believe the contribution or change will be."
Roitman ran into a best-practices testing scenario when he and his leadership team noticed marketers in his company's space were having success with video marketing initiatives. Through testing and quantification of the results that Roitman's team believed Stroll could expect, the company was able to implement its own video marketing initiatives.
"Since then, we have won two major awards for our video marketing," Roitman says. "That is an example of us taking a best practice from outside and utilizing it in a way that betters an area of our company.
"In another area, we've also brought in an industry expert to advise us on our shipping costs. It led to us having a 30 percent reduction in our shipping costs (in 2011), and we should have another 30 percent reduction (in 2012).
"We didn't directly adopt a best practice from somewhere else in that case, but the insight from the industry expert that we brought in allowed us to take things to the next level in that area, and it's information we wouldn't have gotten any other way."
Learn from mistakes
Another aspect of having a culture that is focused on experimentation and learning by doing is a willingness to accept mistakes and failure as part of the process. That is, as long as the failure is part of the process and not a part of employee underperformance.
With entrepreneurship as a key building block of Roitman's culture at Stroll, often he is willing to take new products to market, and let the market determine whether the idea was good or not.
"Obviously, it depends on what level you're talking about making mistakes," Roitman says. "But if you inherently have a testing culture, you know you're going to have failures, and it's simply going to be a part of the experimentation process.
"But there are failures of concepts or improvements, and there is failure of performance, which is an entirely different category. The performance category isn't just a matter of experimentation. It's a matter of setting up support structures so that people don't set themselves up for failure. You have to work with them to define goals up front that are realistic and all the general management concepts around that.
"Once you've defined the goals, you need to check in with your people to make sure they are on track and setting up workable project plans."
If you're working with your people to set achievable goals and realistic project plans, it becomes much easier for you and your leadership team to separate a bad idea from a bad performance.
"It's all in the mechanics around your execution, which you need to have in your processes," Roitman says. "If someone just isn't performing, there is an issue there. But if it's an idea itself that is failing, but everyone thought it was worthwhile to pursue and a reasonable move to make at the outset, there is no problem in that case. And you have to cultivate that mentality within all layers of management."
To help guard against large-scale mistakes that could have wide-ranging implications for your company, Roitman says you should put platforms in place that allow you to test new ideas on a smaller level, then scale the successful ideas to larger projects involving more people.
It is a tactic that allows you to commit fewer resources to a project initially, while still getting a sense for whether the idea will work — which is a critical factor as many companies are still struggling with resource management in the wake of the recession.
"That can definitely be something you're doing; we've done that ourselves," Roitman says. "For instance, in our call center, we've rolled out a small-scale test in one area, see how that does, then roll it out on a larger scale.
"In some other areas, we've broken down into teams across different areas of the company and tried different things in each area. That allows us to gain some insight into how we can work with different needs and different management methodologies."
As you go through these processes, you have to keep in mind that your role as the leader is to serve as the traffic cop who ensures that the right type and right amount of resources find their way to the right areas of the organization, into the hands that can best use the resources to produce the ideas and product that turn the highest profit.
"Everything is interrelated," Roitman says. "Departmental activities roll up to the company at large. So my job is to make sure the plan we have communicated is clearly on track, everybody knows the most important things we have to focus on, and there are no other distractions. We have a lot of ideas flying around, which is a good thing, but we still have to maintain focus. As far as the direction you are going, you have to define what is in and what is out — you have to define both."
How to reach: Stroll LLC, (215) 701-3300 or www.stroll.com
The Roitman file
Dan Roitman
founder and CEO
Stroll LLC
Born: Germany
Education: International business and German degrees, University of Maryland
First job: Unofficially, I mowed lawns and shoveled snow. Officially, I had an internship with the Department of Defense after my first year of college.
What is the best business lesson you've learned?
The earlier you can establish the elements of a strong culture, the higher the probability of success of the organization. It starts out with just getting revenue and having a business in the first place, but after that, you need to have a vision and clear goals around that vision, and the right people on board with the proper motivation. Having the right operating conditions helps that immensely.
What traits or skills are essential for a business leader?
One thing that we really focus on in our organization is transparency. After that, you need to be able to develop a really strong vision that influences the organization years into the future. People have to know what they're doing and why they're doing it.
What is your definition of success?
Success comes at a couple of different levels. On a micro level, it's accomplishing something meaningful within the organization. On a macro level, one of the greatest forms is giving back to the community and creating jobs. As we all know, our economy needs sustainable, productive jobs today.
How Don Lowe has adapted to serve a changing market at Franchise Services Inc.
Don Lowe used to run a simple business.
"We had a small offset machine, we printed black ink on white paper, and sometimes we would bind it for our customers," he says. "It was that way for many years."
Franchise Services Inc., which operates printing and marketing services franchises such as Sir Speedy, Signal Graphics and PIP, did one thing and did it well. For decades, it was enough to grow and remain profitable.
But as the 1990s advanced and gave way to the new century, technology started to evolve at an increasingly rapid pace, and Franchise Services quickly found itself at a crossroads: adapt or risk the long-term welfare of the business.
"The digital world changed our world completely," says Lowe, the CEO of Franchise Services. "Our role is now to look at new technology and ask ourselves if it's a threat or an opportunity. If it's a threat, we decide what to do with it. If it's an opportunity, we exploit it. It keeps us very busy, but it's also very good for us."
Lowe has needed to add new technology and new services to fill the expanding needs of his franchisees' customer base — which comprises primarily companies with fewer than 50 employees. Facing their own battles for survival in an economic climate where nothing is a sure thing, the businesses in Lowe's customer base need services beyond printing. They also need full-service marketing support with a heavy emphasis on creating and maintaining a strong Internet presence.
"That is why, over the recent years, we have moved from a print-centric model to one that focuses on both print and marketing services," Lowe says. "We've needed to expand the products and services we offer to our customers. If you think about small business owners, they're always pressed for time; they often can't even spend time on building the business because they're already wrapped up in managing what already exists. So they need help on multiple fronts, and our job is to provide that help."
Providing that help has required Lowe and his team to listen to franchisees and their customers, and gain an accurate read on the best ways to serve customers in a challenging and ever-changing climate.
Know the game
The biggest game-changer for Franchise Services came in the proliferation of Internet-based communication throughout the '90s. In the span of about a decade, the primary conveyance for the written word migrated from paper stock to computer screens. Items that were normally sent through the mail over the span of days could now arrive in your email inbox in a matter of seconds. Internally, filing cabinets gave way to servers as a means of storing data.
"A number of the products we were producing for customers moved to the Web," Lowe says. "Customers could use the Internet to distribute price lists on a daily basis, and even some training manuals migrated to the Internet.
"If you think about it, even business cards, letterhead and envelopes, all that business declined from where it was in the '80s and into the '90s, because we don't send letters anymore, we send emails. That was the first indicator that we needed to start finding some products and services to backfill some of the products and services that were losing traction."
But to find new areas of growth, Lowe and his corporate leadership team had to get plugged in to what their customers needed in a print and marketing services company. For Lowe, that meant studying trends, and frequent conversations with franchise owners across Franchise Services' spectrum of brands.
"You have to understand specifically what the customers' needs and wants are," Lowe says. "Everything starts with the customer. If you don't understand the customer requirements, you won't be able to fulfill them. So you need to listen twice as intently as you speak, so you can determine what those needs and wants are."
You can look to macro-level observations in industry publications to get a read on the next big technology that could affect your industry. But to understand how your business is changing on a granular level, you have to make trips to the front lines. Sometimes, the change that satisfies the most customers in the shortest amount of time is decidedly low-tech and relatively inexpensive to implement.
When Lowe and his team speak with franchisees, they aim to find ways to better connect their services to customers, with an overall goal of improving the customer experience.
"For example, today we provide mailing services at most of our locations, and that is a direct result of understanding that 65 or 70 percent of what we print ultimately ends up in the mail," Lowe says.
"So why don't we go that last mile, provide mailing services to our customers, and even take the printed pieces in the envelopes and take them to the post office? That is an example of why you spend a lot of time figuring out what is happening in the market."
In addition to frequent dialogue with franchisees, Lowe and his team also gather information from customer focus groups designed to provide feedback regarding whether Franchise Services is meeting their needs, and in turn, the needs of the market in general.
"The thing we always try to remember is we don't produce anything at the corporate level," Lowe says. "All of our services are delivered at the franchise-network level. So we have to maintain consistent contact with everyone involved in those relationships, both the franchisees and the customers. There cannot be an ivory tower anymore. If you're not staying in touch with the customer, you're not staying in touch with the business."
Become a change agent
To change with the evolving needs of the market, you need to first construct an organization that is capable of visualizing change and realizing the need for change. At Franchise Services, Lowe developed a change-focused organization by hiring people who aren't afraid of venturing into unknown territory while at the same time being creative enough to devise new solutions to meet ever-changing customer needs.
"It's a big reason why you hire first for cultural fit, then worry about the skill set needed to complete the job," Lowe says. "If the person you hired can't fit the organization, or if the chemistry just isn't right, it's not going to work.
"You might be able to make it work for a short period of time, but you can't build a company with that type of hiring policy. A lot of people know that Jim Collins wrote the book 'Good to Great,' where he talks about the need to have the right people in the right seats on the bus, and it's true. It's not necessarily just about having good people. It's also about having the right mix of people, otherwise the organization is going to fail in the long run."
If you can find employees who are open to and willing to facilitate change, it then falls on you as the leader of the company to provide an environment where they feel the freedom and flexibility to try new ideas and implement new innovations.
Lowe facilitates an environment that embraces change by developing a strong sense of trust throughout the corporate ranks and extending to the company's more than 500 franchised locations. He develops and reinforces the trust factor by ensuring that communication remains transparent throughout the organization.
You and your people need high ethical and moral standards, which set the basis for the amount of trust that you can develop between management and employees," Lowe says. "It's also important that everyone understands what the goals are. We don't have a large staff, so it is important that everyone is aligned with the goals, both on a corporate and franchise level.
"So we talk to our franchisees about their goals and aspirations for their business, and their results, and through that, we develop a team spirit. That helps to drive enthusiasm and gets people ready to show up for work and get busy doing what you get paid to do."
Lowe's willingness to change and adapt, and find people willing to do the same, has helped maintain Franchise Services as a strong presence in its industry. The company's franchised locations generated $448 million in sales during 2011.
"There are certain skills that are required in this business, but beyond that, it quite frankly comes down to attitude," he says. "The people that work well in our environment take instruction, but they certainly also understand the importance of dealing with and satisfying the customers. A lot of what we do comes down to how you adapt to customers and serve their needs, as is the case in just about every industry. A smiling face and a soft voice goes a long way in our business, every bit as much as the professional skills they need to have in order to get their job done at a high level."
How to reach: Franchise Services Inc., (800) 854-3321 or www.franserv.com
The Lowe file
Don Lowe
Franchise Services Inc.
Born: Shelbyville, Tenn. I grew up in Hopkinsville, Ky.
History: I've been in business since I was 12 years old, when I was a paperboy. I'm 71 now, so I've been in business for almost 60 years. I've been a shareholder of this company for the last 40 years.
What is the best business lesson you've learned?
Hire good people, keep them informed and trust them. Beyond that, set the bar high for achievement, and make sure they understand your culture and promote it.
What traits or skills are essential for a business leader?
Vision would certainly be high on the list. You also need integrity, because people need to follow your lead, and it is very difficult to follow someone you don't respect. And if your organization doesn't agree with your vision, you won't have a fair chance to be successful. Also, working hard is still a great trait in this country. If you work hard, it will put you in good places.
What is your definition of success?
It's the opportunity to do what I want to do, when I want to do it and with the people who are important to me, and to get our franchise people to do important, meaningful things to help them sustain their businesses.
How Ann Fandozzi takes a comprehensive approach to growth at vRide
Throughout its history, vanpooling has been very good to Ann Fandozzi's company.
For more than 35 years, VPSI Inc. — which is now branded as vRide — has grown and profited from running vanpools for commuters who want an alternative way to negotiate rush-hour traffic. After becoming the company's CEO this past June, Fandozzi likely could have continued focusing solely on vRide's vanpooling expertise with no ill effects to the company's bottom line.
But Fandozzi saw more. She saw vRide's potential to grow outward from its staple business, with a goal of becoming a comprehensive commuter solutions company. So Fandozzi challenged her company to expand and employ its expertise in new ways.
"My vision, and something that is palatable for us, is really broadening what we do," Fandozzi says. "There really isn't any type of commuter solutions company that does what we do, so that made it kind of exciting.
"When you think about it, we are really at an all-time peak of forces coming together, be it congestion in cities, be it gas prices, be it people's time worth more of a premium than ever before. All of those forces coming together is something that allows us to come in and really offer a unique solution for commuters."
To make her vision a reality, Fandozzi has needed to develop and implement a methodical approach that helps vRide — which generated $75 million in 2011 revenue — identify its target customers and create new ways to serve them by employing internal resources in the most effective way possible.
"If you have a commute of, say, 45 minutes or longer, you might come to us because of our vanpooling reputation," she says. "But as we grow, we'll be able to offer you a multitude of different solutions. We can certainly still put you in a vanpool, but we might also be able to put you in a carpool if you have a smaller group. No matter the service offering, the goal is commuter focus."
Form a vision
To expand your company into new areas, you need a reachable vision, guidelines for achieving that vision, building blocks that will help you turn the vision into a reality and metrics that will help you measure your performance in relation to the guidelines and building blocks.
"Your vision has to be both broad and targeted," Fandozzi says. "It has to be broad enough to capture the various value streams that the business model can deliver but focused enough that you're not trying to be all things to all people.
"When we thought about broadening our company from a vanpool company to a commuter solutions company, our vision was significantly broader, but it was also very targeted from the sense that we are going to go after commuters and focus on solving their needs."
To formulate an achievable vision for vRide, Fandozzi and her leadership team had to connect with the needs and pain points of current and potential customers. It required vRide's representatives to gather customer data and conduct market research with an eye toward finding the holes in the marketplace that vRide could capably fill.
"A lot of it really has to do with delving deep into the customer's world," Fandozzi says. "In order to know where you want to go, you really have to take a step back and see what needs there are from a customer standpoint, areas that being underserved, and those are where the juiciest opportunities will usually present themselves. You go where the needs exist and where potential customers are being underserved.
"In our case, we've been looking at traffic congestion, people who are becoming frustrated with commute times, the state of the economy and gas prices, and people wanting more money in their pockets," Fandozzi says. "We know those are the pain points, and from there, we dig a little deeper and get a read on whether we can expect those factors to increase or decrease over time."
With traffic congestion and high gas prices remaining as fixtures of day-to-day life, Fandozzi's team felt comfortable building a vision around how to address those needs. Then, she moved her company into the implementation phase.
"You don't need to know every step of the 100 steps you're going to take to get from here to there, but in general, you need to have a pretty good plan for how that vision can be achieved," she says. "For us, a big fundamental building block has been the Web and mobile technology."
Under Fandozzi's leadership, vRide has taken steps to create a mobile-device app that can give would-be commuters instant access to potential solutions provided by the company.
"It's the nature of addressing consumers who are on the go," Fandozzi says. "You need an on-the-go solution. You need to automate instantaneous answers for consumers. For 35 years as a vanpooling company, that is a competency we didn't have. So then the question becomes, 'How do you scale to add those competencies?'"
It was a question of whether vRide needed to add new resources and competencies, or find new ways to utilize what was already in-house. Through rounds of organization analysis, Fandozzi's team realized the company had a great deal of physical infrastructure already constructed, meaning scalability would be a mixture of the old and new.
It was a matter of creating new technology platforms and plugging them into what already existed in terms of vans, people and facilities.
"Currently, we have more than 5,000 vans, and there is a set of solutions that works really well there," Fandozzi says. "So the question to the leadership team is, how do those get scaled? Anything from the way the vehicles get serviced and delivered, and anything or everything in between. That is why it really becomes a function of having those building blocks and being very honest with your assessment of whether you have them in-house, versus the items you need to bring in."
Develop a marketing plan
With a vision and implementation plan in place, you need to get potential customers interested in your organization's new direction. That is where a comprehensive marketing campaign comes in.
Fandozzi divides vRide's marketing campaign into various phases focused on educating consumers and driving traffic. Once those phases are fully implemented, marketing can become an effective tool to spur further growth.
"You need to develop a phased marketing strategy that is appropriate for where you are in your development cycle," Fandozzi says. "For us, we are kind of in a heavy learning mode right now, because we are still in the process of putting our fundamental building blocks in place.
"The next phase is once those building blocks are in place, you want to take what you've learned and use it to educate consumers. Then, once everything is place, you can expand your marketing efforts as you grow.
"For instance, we could then say that every man and woman in America who commutes more than 45 minutes to work is our target consumer," Fandozzi says. "But that is a different kind of marketing effort from where we are now.
"The trick is in knowing what phase you are in at that moment but planning for the next one as you are in the current one."
Developing a successful marketing effort around your vision often requires a combination of developing internal expertise and utilizing outside resources. Your internal marketing experts have an intimate knowledge of your business and your customer base. Third-party marketing firms will bring an outside perspective, along with data gathering and research capabilities that your company may not possess.
However, Fandozzi says external consultants should not drive your marketing philosophy. Though third-party firms bring useful skills and resources to the table, you and your team know your business the best.
"You want the latest and greatest, but you want it centrally managed with internal resources," Fandozzi says.
"That is why you assign and train a leader who is centrally responsible for your marketing vision, because that is the person who is going to really understand where you're going as a company, what building blocks are in place and what phase of marketing you're going to need to be in for each phase of growth — are you in a heavy learning mode, or a heavy execution mode, and so forth.
"Those are the people who will be in charge of bringing in experts along the way to help them execute on each of those facets."
If you make a misstep in your marketing, learn from it quickly and correct it — and have those systems in place from the outset.
"You're testing along the way, fully preparing to fail," Fandozzi says. "One of the things we do here is we like to learn fast-forward. You want to do something quickly and you want to learn from it quickly. Failure is OK if you learn from it, but you want to do it and correct it quickly. You are trying to fast-forward the entire process so that you develop definite answers on what you can move forward with."
How to reach: vRide, (248) 597-3500 or www.vride.com
The Fandozzi file
Ann Fandozzi
More from Fandozzi on self-assessing as a business: There are several modes of self-assessment. One is having some conversations about just looking in the mirror with the leadership team and saying, 'Hey, this is where we need to go and this is where we are.' Another is bringing in experts, because sometimes you need a fresh set of eyes since you are just so close to the business, and it's tough to see. One of the hallmarks of good leadership is knowing when to ask for help, and looking at experts instead of thinking that you have all the answers.
The third method is looking around at adjacent industries and seeing how they've been able to solve similar problems, to also free up your thinking. So, you may be stuck, but they're going to bring in an expert and give you an expert solution along the lines of how you're already thinking.
Fandozzi on hiring and retaining top talent: That is always the silver bullet to a business, having the right people. It comes from a multitude of sources. First and foremost, it comes from having the right screening techniques in place to make sure that as we're bringing in people, they're the right people. There is a lot of ownership on the part of the leader to make sure the vision is exceptionally clear, that people aren't hunting in the dark and hoping they find the right answer.
There is a lot of personal ownership, for example, in order to develop and work with my people, I overinvest. People tend to underestimate how much investment this takes, but overinvesting on tools, resources — making sure we've put the right metrics in place. Then, it's taking a step back and seeing if they can do it. It's guaranteed you are going to make mistakes along the way, but you want those mistakes to be smaller-sized, and you want the wins to be bigger, and you want to course-correct as you go.
How John Myers unified Rentokil North America around a common strategy
In a way, John Myers is not unlike the guy who paints the foul lines at the local baseball field. He defines boundaries.
The president and CEO of Rentokil North America, the regional wing of Rentokil Initial — a U.K.-based facility management company that provides, among other things, pest control services — has been tasked with integrating a company that has changed dramatically over the past decade. At one point, Rentokil's North American footprint consisted of about a dozen operations sprinkled throughout Ontario, the Mid-Atlantic States and Florida.
Then, over the span of two years, Rentokil acquired a trio of pest control companies. With the acquisitions of Ehrlich, Presto-X and Watch All between 2006 and 2008, Rentokil's growth exploded. The company expanded to nearly 80 locations in 35 states.
But with those acquisitions came differing cultures, policies and processes. Myers had to get everyone aimed in the same direction.
"Most people will tell you that acquisition plans and models fail because the integration wasn't done as defined," Myers says. "But it can be really hard to do. You have disparate businesses with long histories and a strong belief in their culture, and there is either a reluctance to integrate or companies integrate too quickly and kind of throw the baby out with the bathwater."
Myers had to figure out a way to balance the best practices of the acquired companies with the need to create a uniform set of objectives and values under the Rentokil umbrella.
"When I first started here, I was new to the business and rather agnostic toward each of the brands," says Myers, who took over the company at the end of 2008. "What I saw was that everyone agreed that we needed to change, but when I started making changes, they all said, 'No, what we meant was, you need to change those guys over there.' Everybody wants to change; they just don't want it in their area, because change is hard."
Myers solved the challenge by starting at the top, with his own leadership team, and working his way down.
Identify the themes
Myers needed to simplify things. With bits and pieces of varying cultures, processes and objectives fluttering around the company like pieces of confetti, he had to vacuum everything up, sort it out, keep what was relevant and discard the rest.
It's a process that requires a set of ground rules. And those ground rules are formulated on the management level.
"It's tricky, because these have been successful businesses in their own right, and they're used to doing things their own way," Myers says. "The natural tendency is to say that you've been successful using the techniques you already had in place, so why would you want to change?"
To combat that type of resistance, Myers gathered his leadership team and tasked them with helping him set the strategic vision for the company — a long-range vision to serve as a set of end goals for every business unit. Any goal or strategy that existed among the acquired companies needed to help Rentokil progress toward its strategic vision. If it didn't, Myers' team would discard it.
The strategic vision sessions also helped identify areas of the acquired companies that aligned along common themes, giving Rentokil an area of strength to leverage.
"The good news is, we really looked at our businesses and realized they had some very common elements in their cultures that we could rally behind," Myers says. "For example, we believe in providing the highest level of customer service in the marketplace, and not everybody believes that should be a part of their strategy.
"As an example, you can compare a small hardware store to Home Depot or Lowe's. The small hardware store will give you personalized service. Home Depot or Lowe's — while they're both very successful companies — might provide a different level of service while trying to compete more on product selection or price. We are more like the smaller hardware store in that we've made customer service part of the culture of the business."
Customer service became one of the five strategic thrusts for Rentokil, as outlined in the plan formed by Myers' team. Along with customer service, Rentokil also formed objectives around organizational capabilities, operational excellence, operating at the lowest cost possible while still maintaining high service standards and delivering profitable growth.
The development of the five strategic thrusts was critical for Rentokil and any other company trying to define its future strategy and goals. Once the pillars of the strategy are defined, you have to allow the company to be guided by those principles over time.
"The reason these themes are important is, as we work on tactics, if we can't easily slot something we're working on under one of these, we shouldn't be working on it," Myers says. "That is why it's important to maintain those thrusts.
"In a change management environment, you can't change the themes every day. You can't have a flavor of the month, because people will start to get confused and question whether your strategy and objectives are real. We just finished the third year in which we've operated under the same five strategic thrusts."
Roll it out
With the playing field outlined by the strategic pillars you have constructed, your next step is to tell the entire organization how it will accomplish the goals related to those pillars.
Myers began by rolling the plan out to everyone on the management level of the organization, followed by a rollout to the organization at large.
"First of all, we have an annual management meeting where we present our key tactics under each of the strategic thrusts," Myers says. "I present the thrusts, then I present the initiatives that we are going to implement in the coming year to support the strategic thrusts. We stand in front of our entire management team and tell them what we are going to do.
"The second thing we do is we then have regional meetings in which every colleague in the company attends, and we make the same presentation. Every technician, every sales representative, every office manager, from front-line colleagues all the way to the top, are all hearing the same message, and they're hearing it from the executive leadership team.
"Usually, I have a vice president on my team go out and present this material to every colleague, face-to-face."
After the initial rollout, you have to perform frequent maintenance in the form of direct communication from the top. Myers reinforces the strategic thrusts and tactical initiatives through monthly CEO messages, delivered to the entire Rentokil organization throughout North America.
"I'd say nine of the 12 messages I have each year relate to a strategic thrust and one or more of the initiatives associated with it," he says. "So I will say simple things like, 'As you know, we believe in delivering outstanding customer service. So today I'd like to talk to you about a new initiative that was launched just last week. We talked about it at our recent company meeting, but I want to give you an update.'
"It's the old idea that you have to tell them and tell them again, because people are busy in the day-to-day world. You need to reinforce the idea that there really is a plan and you are following it."
The message needs to come directly from you as the head of the organization. The further down the ladder you delegate your reinforcement communication, the less impact it will have. That's not to say communication involving a department head or direct supervisor is irrelevant, but on matters that involve the direction of the whole company, your words carry the most weight.
"There are two main reasons why this kind of communication has to come from the top," Myers says. "First off, I go back to the fact that everyone is busy and working hard, so getting a reminder of what the top boss thinks is important helps to refocus what you work on. It's like you always hear about finding out what's important to your boss and working on that.
"The second thing is, it's reassuring to the organization to be reminded that there is a plan, and we're sticking with it. You're not trying to figure out what you'll do each month."
Myers' unification plan has taken root and helped propel Rentokil's growth. The company generated $350 million in North American revenue during 2011 and continues to maintain a strong market share in its space.
"Ultimately, people are motivated to buy in to a plan when they know three things: What are the expectations, how are we doing against those expectations and what are we going to do to get better in the areas where we're not delivering at the level we want?" he says. "When there is clarity around the plan, there is greater opportunity to implement the plan in a timely and effective manner. By reinforcing the message from the top level, it does those things better than just hoping it happens." ?
How to reach: Rentokil North America,
(610) 372-9700 or www.rentokil.com
The Myers file
Education: B.S. in marketing, University of Vermont; MBA, Mercer University, Atlanta campus.
What is the best business lesson you've learned?
I'll give you two. The first one is to share the risk as well as the reward. I'll never forget a job I once took in sales management. I was new to the company where I was working, and I decided I would negotiate a deal with a customer myself. It didn't go well. My dad told me that I wanted to show everybody that I could do it myself, but it's not about that. It's about the team delivering the desired result. That should have been the goal, not me trying to ensure that I'd deliver the result myself. I should have brought other people onto the project.
The second thing is knowing that everyone wants to do a good job. Your role is to ensure that everyone knows the expectations, knows how they are performing against those expectations and knows how you'll work together to improve the things that aren't working out.
What traits or skills are essential for a business leader?
I get asked that all the time by college graduates. The first thing I always tell them is to lead with humility. My view is that our frontline colleagues and customers know what is needed in the marketplace, and it takes humility from the leadership team to remind yourself of that fact. You have to have the humility to ask for insight and advice from the people closest to the customers.
What is your definition of success?
Success is utilizing really strong methods to deliver strong results. We use a phrase here that I like in our leadership training: Success versus excellence. If the concept of your methods is robust, the predictability of your success is better.
It's like in golf. You can hit a good shot once in a while, but you can't repeat it if your swing isn't good. You can sometimes find success with bad methods, or you can consistently find success with good methods.
How Peter Kellett took a comprehensive approach to client service at Dykema Gossett
Peter Kellett is an attorney. He's also the chairman and CEO of his firm, Dykema Gossett PLLC. But Kellett will be the first to tell you that he is more than just an attorney leading attorneys.
Behind Dykema's approximately 400 lawyers in 11 nationwide offices is a support staff that interacts with the firm's clients on a daily basis, handling administrative tasks, billing and accounting, and other tasks essential to prompt and comprehensive client service.
If those employees aren't engaged in providing an excellent client experience, it can damage the relationship before an attorney has a chance to sit down with a client.
Since becoming CEO a year ago, Kellett has made it a point to recognize the important role each person plays in the client experience, and he has focused his efforts, along with the efforts of his leadership team, on uniting every person, in every position in the firm, around a common goal: serving clients with the highest possible standards.
"It is a work in progress, but I am deeply committed to improving all of our levels of client service," Kellett says. "That is not to suggest that they have been deficient, but in this environment today, it is really important to distinguish any service — whether it be a legal service or any other type of service — in how you deliver service to your clients and customers."
Driving that level of customer service throughout Dykema — which generated $174 million in revenue during 2011 — has required Kellett and his team to remain vigilant in listening to customers and maintaining a dialogue with employees, as he continually gauges the needs of clients and works with his staff to figure out the best way to meet those needs.
Look outside
To start promoting a comprehensive client service philosophy, Kellett had to broaden the firm's concept of what it means to serve clients.
"I believe, and our management team believes, that the notion that the only service a law firm provides to clients comes from the lawyers is mistaken," Kellett says. "Survey data would show you the average client has more interpersonal contact collectively with the nonlawyer staff than with the actual lawyer who might be representing them in a given matter. There is so much support that goes into the client relationship. It could be making sure an invoice for services is properly formatted or making sure a communication is properly delivered. If a client wants to see something by email, we have to make sure it's delivered by email and not snail mail."
They are matters that might not be directly related to the actual legal work done for a client, but if the firm fails to handle the support tasks in an efficient and effective manner, it will eventually have a negative impact on business.
"The services delivered by people who aren't lawyers comprise much of what the client sees, and quite frankly, you can fall down in that regard if you aren't careful," Kellett says. "It's so important to the client's overall feeling regarding how they're being served by the firm."
With that in mind, Kellett went directly to Dykema's clients, soliciting feedback on the service experience that the firm was delivering. Representatives from Dykema interviewed many different clients, asking questions related to a number of different client service areas. The firm representatives brought the feedback gleaned from the interviews back to the leadership team, which then used the feedback as a component of a firmwide client-service training initiative.
"We report the information back to the membership of the firm in a way that is understandable and teaches different lessons about what we do really well, as well as the areas in which we can look to improve," Kellett says.
"We have also brought in specialists to do client service training workshops — in fact, we recently had an officewide session for all our nonattorney staff, which was moderated by an expert in client service delivery. The goal of the session was to try to raise consciousness on everything related to client service."
The feedback and the client service training workshops produced a set of client service standards that all staff members at Dykema are expected to know and promote. Kellett and his team fashioned the standards into a set of basic statements that clearly outline, in a straightforward fashion, what the firm will deliver to clients.
"It's nothing that is high-level, but it is straightforward and understandable, and it transcends different practices and offices," he says.
Kellett's initial information-gathering process finished with a follow-up component. Late in 2011, firm representatives conducted a series of follow-up interviews designed to gauge the process that the firm had made in improving its approach to client service.
"We went back to the first group of clients we interviewed and talked to them again," he says. "We asked them to honestly grade us. How did we do in responding to some of the things you wanted to see us implement on your behalf?
"Then we go back to the office and hold people accountable to that feedback. If someone here at the office is in charge of managing a client relationship, you are expecting them to lead on this issue of improving, responding to and being attentive to the things your client wants to see you deliver."
Motivate your employees
Providing excellent client and customer service is important not only to the people you serve outside the organization but also to the people you employ internally.
A focused company is a healthy company with employees centered on a set of common goals. That, as much as improving the client service culture, was a motivating factor for Kellett.
"I would tell anyone in leadership that it is important to develop a comprehensive customer service plan, not just for the value proposition but also for the health of the organization," Kellett says. "You're trying to do more than just motivate. You're trying to excite.
"If you are in a service business, you want to get your people excited and feeling very positively that they know what is expected of them. Because if folks in a service organization don't know what is expected of them, they won't always do what is optimal for service delivery."
By training your people to deliver the best possible customer service experience, you're investing in them. The end goal is to please your customers, but the entire process of customer service training is focused on allowing your employees to perform their jobs at a higher level.
"It is important that you are sending a loud message to your entire organization that you see value in your people," Kellett says. "You are investing in them for a reason, and that is a powerful message to send. I found our staff has been very receptive and appreciative of the fact that management thinks they are important enough for management to invest time and resources in them."
It's especially important if you run an organization in which one group of employees often basks in the spotlight, while others toil in obscurity. With that type of setup, it can become extremely easy for resentment to build if those behind the scenes feel underappreciated.
Kellett prevented that at Dykema by ensuring that he crafted communication specifically aimed at the nonlawyer staff in the firm.
"When I'm communicating with the nonlawyer staff, it is certainly tailored more toward the likely activities they will be engaged in and the community they're likely to be serving," he says. "In fact, some of our internal staff's client base is composed of their own co-workers.
"When it comes to our IT staff at the firm, a big part of who they serve is made up of users within the firm. That's a really big part of the message, telling them that no matter what they do, they're involved in client relations.
"If your service is internally focused, you're still helping those who are externally focused to provide excellent service to your external clients. You are as important as anyone in that broad chain of client service delivery."
Ultimately, the behavior you exhibit toward your employees is the behavior they will exhibit when dealing with clients and customers. If you communicate frequently and thoroughly with your people, they will do the same with your customers. And that leads to a stronger, more positive relationship between your company and the people who purchase your products and services.
"You can't communicate enough with your people, and they can't communicate enough with your clients," Kellett says. "They want to be kept updated more often, rather than less often. You can never assume that they know what is going on just because they're sophisticated or have been through the process before.
"Tell them more, when in doubt. Or you can always ask them to tell you when to stop talking and start listening. That is something we have learned collectively as a firm: Your people want to be kept apprised of what's going on, as do your clients. And they want to know sooner rather than later." ?
How to reach: Dykema Gossett PLLC,
(313) 568-6800 or www.dykema.com
The Kellett file
Born: Detroit
Education: B.A. in history, University of Michigan; Juris Doctor, Wayne State University Law School
What is the best business lesson you've learned?
I'll give you two: One is to not try to do everything, or you'll risk getting nothing done. You have to try to set priorities and not try to do everything at once. The other is something that I was once told: It's amazing how much an organization can accomplish when no one cares who gets the credit. We're trying to build teams that are focused on client service, with a shared-credit approach to that, and it has been really beneficial for us. Credit will fall where credit is due, but let's not worry about that. If you have that type of environment, you won't have people insecure or worried about getting their due.
What traits or skills are essential for a business leader?
First and foremost, it's honesty. You also need to be a good listener. That doesn't mean you have to listen to everyone ad nauseum, but you do have to be a good and fair listener. And ultimately, you have to be decisive. Admit your mistakes, learn from them and move on. If you can package all of that, you're well on your way to being successful.
What is your definition of success?
Achieving a reasonable performance from a financial and business-goals standpoint, which preserves the culture and integrity of the organization. It requires a balancing act. Businesses are in business to do well right now, but you need to preserve the long-term integrity as well. If you're chasing the top dollar, it can't come at the expense of the culture.
How Karen Caplan stays focused on leadership at Frieda's with top-shelf values
As the daughter of her company's founder, Karen Caplan is a hands-on leader.
That's a good thing and a bad thing. The good thing is, she has detailed knowledge of everything that happens at Frieda's Inc., the specialty produce wholesaler she leads as president and CEO.
The bad thing is that knowledge can sometimes draw her into operations-level matters that take time away from matters of strategy and goal setting for the company at large.
At times, it is a challenge for Caplan to simply cruise at 30,000 feet, without the cockpit radio humming to life with a request to dive in for a closer look at a certain project in a given department.
"I'm guessing it's pretty common for most CEOs, especially if they're homegrown, as I am," Caplan says. "It's so easy for somebody to come in and get you dragged into some detail that you don't really need to worry about."
In the more than quarter-century that Caplan has led Frieda's, which produces revenue in excess of $50 million annually, she has learned how to keep her distance from matters that don't require her attention by delegating responsibilities, building a sense of mutual trust with her employees and, quite simply, learning to say no.
"I don't quickly react when someone asks me something or requests I get involved in something," Caplan says. "Earlier in my career, my knee-jerk reaction was to solve the problem. But I've found that's not the best way to lead a company. I've been very vocal throughout the company that I'm not a detail person. I say it to myself; I say it out loud. It's going to mess things up when you get me involved in the day-to-day stuff."
Set it down
Caplan's mother, Frieda Caplan, who now serves as the company's chairman, founded Frieda's in 1962. Caplan joined the business in 1977, followed by her sister and COO, Jackie Caplan Wiggins, in 1983. With the business developing into a family affair and Karen taking the reins as president and CEO in 1986, she began to take stock of herself as a leader and how the mother-daughter leadership dynamic at Frieda's would behave moving forward.
Caplan says the tendencies of her mother and sister initially spurred her to develop boundaries regarding leadership responsibilities. As a young executive, she enrolled in a Dale Carnegie leadership course, which gave her the initial framework for effective delegation.
"My sister and mom are both 'knee-jerk reaction, everything is urgent, solve it now, do it now' kind of people," Caplan says. "I remember taking the course, coming back to work, and I remember saying to them, 'When you have a really urgent issue, write it down on a piece of paper, set it aside and let it sit there for seven days.
"'If, after seven days, you look at the paper again and the problem is still a problem, I want you to mention it to me at that point.' That eliminated 99.9 percent of the issues, right there."
Caplan also learned to stay away from areas of the company that didn't overlap her background in sales and marketing. Through trial and error, she quickly learned that if the issue involved pricing or logistics or other areas apart from her background, she was more apt to make a problem worse by getting involved in the matter.
Over time, and through repetition of the message, Caplan has empowered her employees to tell her when she's complicating matters through her involvement.
"Pricing and logistics are very tactical matters in our business," she says. "I give direction, but when I get involved any deeper than that, it's just not a good thing. And my employees know it. Everyone gives me that look that says 'Karen, stop.'
"I've given everyone around me permission to tell me to stop. I feel very strongly that I can't just have a bunch of 'Yes, Karen' people around me. If all you're going to do is tell me yes, I don't want you here. I want you to stand up and tell me what is going on. You're not going to get fired for it. In fact, I'll actually respect you more."
Make it cultural
To ensure that the strategy people aren't dragged into tactical or operations matters, you need a clear organizational structure with a separation of responsibilities. Often, the most effective way to create and maintain a firm organizational structure is to incorporate it into your strategic planning and core values.
If the concepts of personal and team accountability are promoted as part of the culture you live each day, they stand a much greater chance of taking root as foundational principles that everyone in the organization embraces.
"Everybody knows their responsibilities," Caplan says. "The key is to have a high level of trust with the people you work with."
Caplan says the best strategic planning processes are often homegrown. Third-party consultants can help you craft your strategy, mission and vision, but if they aren't leading you in the direction you want to take the business, you're probably wasting money and time.
"About five or six years ago, I said I was sick of strategic planning and tired of hiring consultants to take me and a group of my high-level people off-site to form a consensus around the company strategy," Caplan says. "I cannot tell you how many times that did not work.
"So my sister and I decided that we knew what we wanted to accomplish. We worked with our CFO, who is excellent in strategy, and the three of us met for about two hours a week over the span of a few months, creating our company vision, mission and strategy."
Caplan and her sister centered the company on four key values: personal accountability, service orientation, trust and playing fair.
"Those are what we stand for," she says. "If you cannot trust the people on your team to do what they're supposed to do, to go the extra mile and show personal accountability, you have the wrong people on your team. And that is how I feel confident in delegating the tactical issues. There is a very high level of trust in our company. We talk about it every day, and we show it through our actions."
Hire for trust
Effective delegation requires a sense of trust throughout your organization, and trust needs to develop as a pillar of your culture. But the pillar will crumble if you don't hire trustworthy people who align with your company's values.
Finding and hiring those people means putting job candidates through a thorough, exhaustive interview process — particularly for management-level positions. And if you hire people who don't fit with your culture and values, you need to either find another place for them in the company or send them packing.
"A good mantra is 'hire slow, fire fast,'" Caplan says. "We spend a lot of time in the hiring process. Our standard is we interview people three different times, by three different people, in three different places. Every time you bring someone back, they look worse. They always look fantastic on the first interview.
"You bring them back, someone else interviews them, and suddenly, they don't look so fantastic. By the third or fourth interview, you're probably starting to see the real person. So you don't get hired at Frieda's very quickly."
During the interview process, Caplan and her team don't want to know just about a candidate's professional accomplishments. The interview process delves into the candidate's personal life and personal motivation.
"In interviewing people, you can ask them about why and how they made certain decisions or how they prioritized their life," she says. "I don't want to simply talk about someone's work life. I ask them about their passions in life, about the last book they read, about the things they do on the weekends. That tells me a lot."
Once a hire is made, the pressure is on to take the raw materials that prompted you to offer the candidate a job and cultivate them in a way that allows you to get the most out of that person. You can plant the best seeds, but they won't grow without adequate sunlight and water.
"The thing to remember is, your core values can't be somebody else's core values," Caplan says. "They have to be your own. If I didn't live personal accountability every day, if I wasn't prepared for all the meetings I'm called to attend, if I didn't respond to emails quickly, everyone would say, 'It might be listed as a value, but it doesn't apply all the time. Karen doesn't live it.'
"So, whatever you say the company values are, those are the real values. You hire to those values, you live those values, and if someone isn't living the values, you move them off your team — no matter how wonderful they might be in their position."
How to reach: Frieda's Inc., (800) 241-1771
or www.friedas.com
The Caplan file
Fast fact: Frieda's introduced the kiwi fruit to the U.S. in 1962. The company now distributes more than 600 varieties of fruits, vegetables and specialty food products throughout the country.
What is the best business lesson you've learned?
To treat all people with respect. Everyone gets treated the same, regardless of the role they perform in the company. When someone enters the office and I see them, I say good morning to them by name. You have to make sure that no one is anonymous. If you can address your people by name, you'll have a much higher level of engagement.
Caplan on firing fast: It is never easy to fire someone. That is something else I learned at the Dale Carnegie management course. If you ever aren't affected when you have to fire someone, you should probably get out of management. But if you are fair, if you have given someone every opportunity to correct their behavior, you can stick by your decision.
I remember with one individual — she hadn't been with the company long — and I sat her down and said, "You're not happy, I'm not happy, and we can't continue this way." That was pretty straightforward.
You know immediately if someone isn't a good fit. What happens when you hire someone, within the first week, you know if you've made a good hire or bad hire. Every manager, every CEO will tell you the same thing. And if they weren't what you expected, your gut feeling is to give them more time. We are so ingrained in this country to give everybody every opportunity to correct their behavior. But unfortunately, one week of tolerating becomes one month becomes a year. Soon enough, you have someone who has been on the team for more than a year, and you're saying to yourself, "I knew they weren't right for us from the first day on the job."
How Mark Baiada used a new branding initiative to join the past, present and future at Bayada Home Health Care
There was a little disappointment at first.
After 37 years operating as Bayada Nurses, company founder and President Mark Baiada stood before members of his nursing staff and relayed the news: The word "nurses" was to be eliminated from the company's name. As of January 2012, the company would operate as Bayada Home Health Care Inc.
It wasn't a decision taken lightly by Baiada or his management team. But it was a decision they felt compelled to make.
"My wife is a nurse, we've been a nursing company throughout, so to drop 'nurses' when it had been in there for so long, I think there was a little disappointment," Baiada says. "We still have nurses, but it's not part of our official name now."
Baiada and his team made the change as part of a wider rebranding initiative, recognizing that the scope of in-home health care services offered by the company had grown beyond nursing to include services such as physical therapy, occupational therapy and speech therapy.
The challenge for Baiada and his team was to unify employees in the many different disciplines around the company's core mission and goals and to ensure that every employee, no matter the occupational field, felt accepted by and engaged with the rebranded organization.
"We created a new logo, with a larger dove icon, to symbolize the Bayada Way, a document which lists our guiding mission and values," Baiada says.
"But we also wanted it to come to symbolize the extent of our services and the fact that we were doing more than nursing. The culture of excellence that had grown up around our nursing staff — we wanted to be sure our clients associated the same levels of compassion, excellence and reliability with all of our services.
"It was really a case of wanting to be fair to all parties."
Communicate clearly
Baiada says the initial resistance to losing the word "nurses" in the company's name was motivated by nostalgia more than anything else. Ultimately, the nursing staff wanted reassurance that the company still valued its nursing heritage and would preserve it alongside the effort to identify the Bayada name with a wider service offering.
Baiada took steps to reassure the nursing staff that the nursing practice would continue to be held in high esteem within the company. But with nurses seeking reassurance over their future role within the company and employees in other disciplines enjoying the recognition implied in the company's new name, Baiada stepped back.
He surveyed the situation and saw the opportunity to use the rebranding initiative as a means of strengthening the connection between every employee and the mission of the company.
With a properly crafted message, he could renew the sense of purpose throughout the organization, re-energizing the entire workforce, regardless of role or background.
With more than 18,000 employees and operations in 26 states, Baiada encouraged a method of cascading communication that started at the company's headquarters, eventually reaching all of the organization's local offices with multiple forms of communication.
"We had a series of meetings, we rolled out a new website to let people know what we're doing and why we're doing it, and we also sent out some mailings," Baiada says. "We had a lot of positives from the communications office, which handled the communication all the way down to the local offices, which then handed things out and supported the local nurses and field staff.
"If we had a meeting with 20 people, we'd have an introduction. If people couldn't make it, they'd get something in the mail."
Every move Baiada and his leadership team made had an eye toward rallying the workforce around the guiding company principles of compassion, excellence and reliability. That included altering the outward appearance of all employees by outfitting them with new uniforms. Bayada issued new scrubs to nurses and new uniforms to the other field employees, all bearing the company's new logo.
"Everyone received new name tags and new uniforms with the new logo," Baiada says. "It was another way to mark the change and another way to get it out in front of everyone. Almost everyone got something with the new logo on it."
Ultimately, Baiada wanted to make the change real to everyone in the company. He wanted to immerse everyone in the new Bayada brand. If employees feel connected to the company's future, they'll be able to take more of a sense of ownership in the company's mission and goals, which will strengthen the culture in turn.
"What you have to remember is, Enron had a beautiful mission statement, but they didn't follow it," Baiada says. "You need a sense of commitment that what you are putting down on paper and communicating to everyone is something that you are following continuously.
"If you aren't following it, you don't have integrity. And you want your people to agree to it, so you want to get a dialogue going and keep it going. What is in your heart also needs to be in their hearts."
Start a dialogue
Baiada began to facilitate dialogue well before the rebranding initiative took effect.
If you want your employees to own the change, you have to let them buy in to the process.
"We conducted focus groups with our employees and additional focus groups with people outside the company," Baiada says. "We conducted focus groups with clients and customers at-large and referral sources and also did surveys. What we really tried to determine was the key characteristics that are important.
"What we found was the research reiterated that the Bayada Way was pretty much on target as a set of guiding principles. When people needed help, they wanted compassion and reliability."
But generating a renewed focus on the company's guiding principles was only the first step toward fostering employee engagement. Baiada wanted to engage his people on a continuing basis, allowing employees throughout the Bayada organization to have a say in how the company embodies its foundational principles.
The engagement that employees feel in your brand, mission and values will show in the relationships they build with clients and customers.
"Happy employees and satisfied employees make for happier clients, which means we get more business," Baiada says. "We've brought an analytic statistician on staff, and the research shows that when we compare our employee satisfaction, our client satisfaction and our business growth, they are highly correlated. They say it's hard to find a good tomato, and it's also hard to find a good nurse or therapist.
"So when we get them, we have to take care of them. We need to focus them, give them a voice, respect and honor them. If you respect them and engage your people, you'll be able to build a team that can meet your clients' needs."
Engagement is about stimulating the thought process within your people. You want your employees to frequently think about the end users of your company's product or service and how those people benefit from it.
"Knowing the stories of the people you serve helps employees put a human face on the work they do each day, and it also helps spur ideas around the subject of building better customer service.
"A success for us is when a client improves to the point that they don't need our services anymore," Baiada says. "We share those kinds of client stories, and we're continually trying to put them in writing and record them on video. It's all about getting that message out there, even in ways you might not immediately realize.
"For instance, all the photography on our website is images of actual clients and employees. We don't use stock photos or actors."
Though he can't be everywhere at once, Baiada also recognizes the value of a visible, accessible organizational leader in maintaining a dialogue with employees and reinforcing the mission and values.
"You have to start out with an open door and a willingness to let people in," he says. "If you have a story to share or an issue to address, here is my phone, here is my email. If you find something isn't right around here or you feel something is going on that is disconnected from the Bayada Way, let me know.
"Hopefully, you'll be able go to whoever is in charge of your area first, but if you need to contact me directly, I'm accessible."
Hire for the culture
Achieving buy-in with existing employees is critical to the success of any effort to rebrand the company or refocus on your cultural values. But every bit as important as your existing employees is the employees you don't have yet.
The reinforcement or erosion of your cultural values can hinge in large part on the quality of the hires you make and whether those people can align with the foundational principles of your organization.
As the leader of an organization that provides in-home care to clients who might be struggling to overcome disease or disability, Baiada believes his company's culture of compassion is essential to success and is a critical pass/fail measurement in the hiring process.
Job candidates are presented with Bayada literature emphasizing compassion as a core value alongside operational excellence and reliability.
"We try to be clear in our materials about who we are and what we stand for," Baiada says. "A lot of people take a job based on what they think it is or isn't, and when they start working at the job, it's not the same thing that they expected.
"For example, if a person is working primarily for money, this really isn't the place for them. If you don't like working for the clients and serving them, you're probably not going to like the job."
To develop a deep understanding of a job candidate's behavior and thought patterns, you need to put the person in a work situation during the interview. Bayada's team asks scenario-based questions and tries to uncover real-life examples of on-the-job situations in which the candidate demonstrated an adherence to Bayada's core values.
Baiada says reliability is often the hardest to gauge, and if there is a hiring mistake to be made, it will often involve hiring a person who otherwise fits the mold of what you're looking for but has reliability issues.
"Some of our care is on a one-on-one basis, so if someone doesn't show up to work, we have a crisis on our hands in trying to find a replacement," Baiada says. "You can get a feeling for compassion based on how someone behaves in the interview process. You can measure excellence in their performance.
"But the reliability factor can be harder to gauge.
"Ultimately, if you're serving people, you want to find people who are motivated by serving people. That's one of the biggest keys to continuing to strengthen our culture moving forward. It's that focus on people. We like helping people, and the job can't satisfy you if that doesn't push your buttons."
How to reach: Bayada Home Health Care Inc., (856) 231-1000 or www.bayada.com
The Baiada file
History: Founded Bayada Home Health Care Inc. in 1975 as RN Homecare. The company was subsequently renamed Bayada Nurses, and then rebranded as Bayada Home Health Care on Jan. 17, 2012 — the company's 37th anniversary.
What is the best business lesson you've learned?
It is all about people. It is getting the right people connected and capable of serving our clients, and in making the Bayada Way come true as they carry out their responsibilities. We have a lot of people who make that happen each day.
What traits or skills are essential for a leader?
In our system, you have to be compassionate, excellent and reliable. If you can model that and make that come true, we'll be in a great position to do what our clients require.Baiada on keeping an eye open for small-scale factors that can make a big difference to the culture: I am a nut like that, personally. I hope we have enough people here like that, to keep things going forward. I am kind of a stickler for connecting the details to the bigger picture. And that takes constant attention. You are always trying to draw a connection. You're always asking if everything is coherent and connected, if there are any disconnects. Is there any way we can be doing things better? It is a matter of being attentive, like coach, teacher or chef. You have to be attentive to it all, with an eye for improvement.
How Pascal Houillon unified Sage North America around a single brand
Sage North America was a company in hiding — or at least its name was.
When Pascal Houillon was appointed president and CEO of Sage North America in 2011, the specialty software solutions company was known to the North American marketplace by many different brand names. But "Sage" wasn't one of them.
Depending on which of Sage's products or services you used, you might have known Sage by any number of names — and your experience as a customer might have varied greatly from brand to brand.
Houillon, who had led various global regions for parent company Sage Group PLC since 1997, knew Sage North America would never leverage all of its resources and realize its full potential under such a fragmented setup.
"In my vision, I wanted to bring this group of brands together as a singular company with a consistent customer service experience and a consistent way to go to market," Houillon says. "The flag that I've tried to focus everyone on is the Sage flag, the Sage brand. Right after I took this position, we dropped all of the product brands, which we have become known for throughout North America, and merged everything into one master brand called Sage."
But it wasn't as simple as a name change for the 3,000 employees working for Sage in the U.S. and Canada. To sow the seeds of change and allow them to take root, Houillon needed to define what the unified Sage brand would embody, the vision for the company moving forward, and then communicate that vision in a manner that would create belief and buy-in across the entire Sage North America footprint.
Houillon recognized from the outset that it would be no small task.
"It's a big transformation when you're taking a group of companies with their own specific products and characteristics and merging them together," he says. "You're trying to form one company with one common customer service experience."
Define the brand
As a veteran leader within the Sage organization, Houillon had spearheaded branding initiatives in other countries and regions. Apart from an emphasis on the Sage name itself, the other main component lacking in Sage's North American branding approach was a focus on customer solutions.
Because Sage had become so fragmented, the company had aligned along product lines. Each segment of the business was driven by the production, promotion and sales of a particular product.
In a commodity-driven business, that approach works. But in the solutions-driven, customer-focused business that Houillon wanted to create, it missed the mark.
"We believe the Sage brand should mean we give our customers the freedom to achieve their visions for their own businesses," Houillon says. "It is not about software or technology. It is not about the product by itself. Our customers are often small and midsized businesses that don't have their own IT departments, so the Sage brand has to be a customer brand.
"It is not about promising that we are going to change the world with our technology. It is that we are going to give our customers the means to achieve their own goals and ambitions."
Houillon and his leadership team pared Sage's 11 North American business units down to four product lines, all focused on delivering customer solutions instead of promoting and selling a particular product.
"The first line is small business, the second one is midsized business, the third one is our credit card processing line, and the fourth line centers on verticals of a specific area or industry, such as IT solutions in the construction industry," he says. "That was an important step in moving the focus from products to understanding the needs of our customers."
Changing the field of play was a critical initial step, because the following steps focused on shifting the mentality of several thousand employees, who had been cultured to sell product, not find solutions.
"In a product-focused organization, you focus on developing your products, and after that, your salespeople focus on selling the product as it is," Houillon says. "When you move to an organization and a vision that is more focused on marketing and customer solutions, you're not developing a product and then figuring out how to sell it.
"You're first analyzing the customer's needs, then you move into the product development phase. Then you focus on the types of services you're going to develop around that product. That is why this type of process takes time. We've been on this journey for well over a year."
Manage the process
To help redefine the Sage brand, Houillon needed to redefine his company's connection to the marketplace in North America. Shortly after Houillon took over, he helped initiate a series of projects aimed at defining a new beginning for the company.
"I asked Sage employees from different levels in the organization to work on different projects, and in the end, we would select the three to six different projects that we would ultimately work on and move forward with," Houillon says. "In total, about 150 people were involved in the different projects, along with others who gave some inside information about their department to our project teams. It was really incredible how people stepped up and invested their time in these projects."
Houillon and his management team ultimately selected four projects out of the 11 total projects. Sage North America focused on those projects as the initial steps that would redefine the brand.
By involving employees in the projects and initiatives that would shape the future of the company, Houillon spurred the new Sage brand off the boardroom table and into three-dimensional reality.
For several thousand employees, the idea of a new, unified Sage brand began to move from an abstract concept to something living and breathing. It was a critical step that, in many ways, served as the ignition switch for the entire process, as employees took a sense of ownership in what Sage would become.
"In the beginning, I think you have a lot of nostalgia," Houillon says. "People are hesitant to drop the name and the brand that they have been working for and possibly have been working for over a long period of time. I'd say, for the first six months, people were excited by the change but also afraid of the change.
"Everybody wants to change, but nobody wants to have to deal with the consequences of the change."
Houillon realized he needed to give his people an opportunity to express their thoughts and concerns over the elimination of the product brands in favor of a unified Sage brand. He couldn't minimize how his people felt, but at same time, he couldn't allow nostalgia and a fear of change to derail progress.
To Houillon, it wasn't a matter of neutralizing the emotional attachment employees felt toward the old brands. It was a matter of taking that emotional attachment and moving it to the Sage brand.
"People have to have the ability to speak up and express themselves, because it is normal that they'd have an emotional link to the previous brand," he says. "Having that emotional connection isn't a bad thing. It's a matter of viewing that emotional connection in a new way, with a focus on the Sage brand. I wanted to take those emotions and move them to Sage."
As the initial rebranding projects began to bear fruit, the new, unified Sage brand developed an increasing profile with the company's customer base. As customer feedback started to filter in, Houillon used it to deepen his employees' connection to the new brand.
"After a bit of time, the employees start to see that the Sage brand awareness is rising, they see the feedback from customers, and they see that the customers like the change," Houillon says.
"Previously, customers had to deal with several product brands, and now they're dealing with a single brand for everything. The customer adapts to it, the employees see that, and they see it is a positive reaction.
"I remember getting some emails from customers who told me it was about time that Sage reorganized under one brand. They were tired of having all these different products with different names. When an employee sees that type of reaction from customers, it is much easier for your people to see the company is moving in the right direction."
Keep communicating
Once employees started buying in to the concept of a unified Sage brand, Houillon needed to keep the momentum going through his communication strategy. To help strengthen the effort, he hired an internal communication specialist, eventually developing internal communications into a department of three.
The internal communications department has become responsible for developing messages that are initially rolled out at the local level, at each of Sage's offices throughout North America, and then combined with large-scale communications from Houillon and his team at the North American headquarters.
"In our meetings, every quarter, I will speak, as will some of my colleagues," Houillon says. "We'll have about 20 different locations where everybody participates from their own location.
"It was critical for us to change the way we have internal communication, because it used to center on a single product line and now it is more of a global company communication. It is critical for me to explain the vision, explain where we are and ask for feedback from Sage employees. I wanted to be genuine and transparent, because a lot of the time, it is about what people see."
Houillon also used his communication opportunities to focus people on the value proposition of the Sage brand — in other words, explaining why it is advantageous to customers and, in turn, to Sage to remake Sage as a unified brand.
Sage's leaders had previously tried to straddle the fence between maintaining the product brands and moving toward a unified brand, but old habits are hard to break.
"About three or four years ago, we had a product called Peachtree, which is accounting software," Houillon says. "We renamed it to Sage Peachtree, but after a while, everyone just went back to calling it Peachtree."
The leaders at Sage quickly discovered it was necessary to completely rename the product under the Sage brand, and it was relaunched as "Sage 50."
"What we have done is to redefine the global value proposition, and by doing that, what we have done is analyze all of the product brand value propositions and move them to a Sage brand value proposition," Houillon says. "It adds more value to the Sage brand, and it helps us explain how all of our employees play a big role in this new connection and this move to a new brand.
"We want our customers to see excitement about the move. We don't want them to call up and get a sense of resistance from the employees they encounter. If the customers see a sense of excitement among the employees, they'll see that the change is a good thing."
However, Houillon acknowledges that performing a fundamental branding change often means taking a step back to clear the path for a leap forward, and all that you can do as the leader is continually reassure your people that you're making the right move for the company.
"This isn't a linear progression," he says. "Embedding a new vision with employees is a process that will create fear and expectation at the same time. Most of the time, things won't improve right away. In fact, things will often get worse at the beginning. But things can't get worse forever, and once you've reached that point, you try to build success.
"That's why you need to be transparent; you need to explain exactly what is going on and what will happen. If you let your people believe that everything is going to be better simply because you're changing, that is a big mistake. You have to be flexible and pragmatic in a time of transition and let your people know that when things go wrong and mistakes are made, it's a normal part of the process."
How to reach: Sage North America, (866) 996-7243 or na.sage.com
The Houillon file
Pascal Houillon
President and CEO
Sage North America
Born: Lyon, France
History: Houillon joined Sage in 1989 in sales and held a number of management positions as a regional director and sales director before leading the Sybel business when it was acquired by Sage in 1995. In 1997, he became CEO of Sage France, and in 2005 he also took on responsibility for Sage in Belgium, Brazil, Switzerland, and Morocco.
What is the best business lesson you've learned?
Being patient, which is sometimes not one of my qualities, I will say. As a leader, you tend to be very strong-willed, which means not only do you know where you want to go, you can get upset if it's not exactly the road you want to take. That's why you need to show some degree of patience with others. You need to be clear about where you're going, but flexible about the road taken.
What traits or skills are essential for a business leader?
You need to always have a mentality where you're willing to question the work you have done. You have to be a bit of a paranoiac in that you're never satisfied with the work you have done, that you're always looking at your work with a critical eye. You always want to do things better, and that has to be a constant in the way you think.
What is your definition of success?
When our customers say we've had an impact on their company. If we can make a positive difference to our customers, at the end of the day that's success to me.
How Andy Farbman plots his next moves at the Farbman Group
Andy Farbman doesn't want to fix everyone's problems.
The president and CEO of Farbman Group knows his business — and any business with designs on growing — can't try to be all things to all potential customers. It's a recipe for strained resources, exhausted employees and ultimate failure.
So Farbman has led his real estate management firm with an eye toward smart, selective growth that emphasizes areas in which his firm has traditionally excelled.
"No matter what you're trying to accomplish, you're always looking to go downwind or down river," Farbman says. "You are not trying to fight the current. You are trying to find a path of smooth sailing or places where you can leverage your natural inertia and not have to fight what is going on around you."
In particular, Farbman focused his company — which generated $200 million in revenue from property rentals in 2011 — on receivership work for banks and real estate in the health care field.
"Those are the areas where we really tried to shift a lot of our focus during the recession," Farbman says. "We have always been very well skilled in and out of the court system in the state of Michigan, and we are now in 11 states as a receiver.
"The other niche in Michigan has come about through its aging population and really strong hospitals. We have developed our presence in the [health care] industry over the last four years, to the point that we are now working with five of the 10 largest hospitals, focusing on their real estate needs outside of the hospital campus — areas such as office buildings and ambulatory services."
Planning ahead for effective growth requires you to have an accurate read on the markets you serve and an accurate view of the strengths and weaknesses within your business. It also requires you to motivate your workforce, rallying your people around a common mission and a common set of goals that will allow your company to achieve that mission.
Identify your strengths
Over the course of the past five years, a large number of commercial real estate firms have purchased apartment properties. Due to several factors, residential space made for an easier investment, and easier return on investment, than commercial space.
"The adequacy of capital was more significant, and it was an easier industry to be invested in," Farbman says. "As a result, a lot of firms have gotten into the apartment business over the past few years."
But Farbman declined to place a large amount of resources into purchasing and managing residential properties. Despite the lucrative potential in an industry still trying to crawl out of the real estate market crash of 2008 and '09, Farbman felt it wasn't the right fit for his company.
"What we have done, really over the last 12 or 13 years, is remove that skill set," he says. "We did not believe we were the best in the world at managing those types of properties, so we didn't focus our efforts there."
If Farbman does not believe a particular business opportunity will play to the strengths of his business, he does not pursue it. Even if you see money practically growing on trees for other businesses in a given space, you won't achieve the same outcome if you can't commit the right resources to your own venture into the space.
Farbman says you should readily recognize the strengths of your business. You can always try to find new ways to leverage those strengths, but you should never abandon those areas of strength and abruptly turn in another direction.
"I think your strengths pop out," Farbman says. "You can study trends and figure out trends and try to adapt the resources you have to follow those trends, but organizations — and particularly organizations that have been around for 35 years, like ours — have a natural skill set. It maybe isn't as obvious as a left-handed pitcher, where a kid just naturally picks up a ball and starts to throw left handed, but it is still pretty obvious. It shows itself."
Remaining true to your strengths means remaining disciplined about what business you accept. Apartment properties don't represent the only area where Farbman's firm has turned down business. Every week, and sometimes every day, Farbman and his executive team are confronted by tempting, yet difficult, decisions regarding whether to take on a new business opportunity.
"There isn't a day that goes by where we don't turn down business," he says. "We want to do a great job for our clients, but we don't believe we are one-size-fits-all. We have been asked to expand some of our businesses into other marketplaces, and that might be an area where we have reached out for a bit of help.
"A client might want us to be a street broker or a property manager in a city where we don't have a lot of history. In those cases, if we take the business, we've had to find a partner who knows the market and the lay of the land better than we do."
But in order to steer clear of areas that might not play to your strengths, you first have to know your organization's strengths. That requires you to evaluate your organization and develop an extensive understanding of what resources you can employ and what skill sets and areas of expertise your people possess.
"You have to look within your organization and see the assets that you have," Farbman says. "You have to evaluate what your assets are. In our organization, our two primary assets are capital and brainpower. Whenever you are dealing with a distressed asset or a troubled asset, you are trying to find a kind of special sauce for operating it, something that might lead to more revenue or decreased expenses. Once you figure out that special sauce and are trying to sell it, it's something that becomes natural and obvious because it is already being implemented."
Farbman's philosophy centers on a desire to utilize the resources already in-house before looking outside the firm to add more firepower. It's an approach aimed at creating efficiency and minimizing waste. Acquiring new resources — be it more people, more capital, more infrastructure or anything else — requires the use of resources in and of itself.
"We spend a lot more time figuring out ways to utilize the resources that we have instead of looking outside to bring in more resources," Farbman says. "The biggest internal struggle today is probably that the profitability and longevity of organizations often aren't aligned. I'd say every CEO has to focus on the long term in addition to the short term, and how to keep their P&Ls in order."
Lead your people
Farbman's focus on his firm's areas of strength would never yield results if the approximately 200 employees at the Farbman Group weren't aligned on a common set of goals aimed at leveraging those strengths. Farbman routinely engages his team and reinforces the goals and mission of the organization so that when they interact with customers or think of new ideas, it's all with the end goal of enhancing the Farbman Group's position in the marketplace as much as possible.
"I would definitely say that is part of our special sauce as a firm," Farbman says. "We have an internal committee that meets once a month.
"It is a place for anyone in the organization to step up and propose new ideas for how we can either run the business better, because we might have a skill set that we might not be utilizing, or it might be as simple as the way we are recycling paper. There might be a better solution, no matter what the question is."
Farbman and his executive team reward employees who create ideas that are ultimately implemented by the firm. It is a simple step that has been taken by many CEOs over the years but a necessary one if you are to reinforce your messages to your employees.
"It's a monthly competition, and we give rewards to people who create opportunities for the organization or just make us a better place to work. In some cases, we might reward financially based on the savings that take place.
"But it's important for us to take these ideas that start on the ground level and hold them up for the rest of the organization to see. When you manage 28 million square feet of property, you have all of these employees doing these different things day to day, and there are amazing things that are found at smaller properties, which you can end up implementing at bigger properties."
Farbman says you can never underestimate the impact of giving employees a voice within your company. You can set goals and fashion a mission statement, but if you give your people the means to discover new and better ways to realize those goals and achieve the mission, they'll develop a sense of ownership in what you're trying to accomplish.
"It's an approach that empowers your people," Farbman says. "One of the ideas that came out of our committee forums was a flexible work schedule. We have a lot of single parents who work in our accounting division, and our accounting division isn't necessarily an area where our people need to interface with a bunch of other employees. They don't need to keep consistent hours. A 10-hour, four-day-a-week workweek is quite advantageous to some people.
"So there are intangibles that might not pop out the same way that a money-based reward or a promotion might, but it is more focused on lifestyle. In all cases, it helps keep people engaged in what you're doing, and it can help reduce turnover in certain areas."
If you engage your workforce in helping to construct the policies and procedures that will help you achieve your goals and mission, it also paves the way for effective delegation of responsibilities. Engaged employees are more willing and able to take on new responsibilities and own them.
"My executive team does a really good job of empowering people throughout the organization," Farbman says. "We want to give our people every opportunity to make their own decisions. It's something that really has to happen by example. You can't Monday-morning quarterback your folks in the decisions they make. You might evaluate the decisions and why they made them, but you don't cut off their knees. If they made a commitment, we live up to that commitment as well."
Ultimately, if you are empowering people to take on new tasks and entrusting them with an increased level of responsibility, you want them to make decisions. It might be a right decision or a wrong decision, but regardless, making no decision is worse than making a wrong decision.
"You can't be afraid to make mistakes, because if you don't make decisions, you'll stagnate as an organization," Farbman says. "With my little kids, I play a game called 'this or that.' It's a game where you are forced to make a decision and not push it off until tomorrow.
"I used to be an athlete, and most of the great leaders in my life have been some kind of coach. So I strongly subscribe to the idea that if you're running the football, you better hit the hole as hard and as fast as you can. Even if you take the wrong route or hit the wrong hole, it still gives you the best chance to succeed. You have your moral compass and your gut to follow, and I believe that your gut, for the most part, leads you in the right direction." <<
How to reach: Farbman Group, (248) 353-0500 or
The Farbman file
Born: Royal Oak, Mich.
Education: I have two degrees from the University of Michigan, in social science and economics. I'm halfway through my MBA at U of M, and probably will be for the rest of my life.
First job: I had a bagel and newspaper route when I was 12 years old and my brother was 15. We sold warm bagels with cream cheese and The New York Times door-to-door on Sunday mornings. Even though it was a starch-oriented business, it was very fruitful for us.
What is the best business lesson you've learned?
If you buy it, you own it. Properties have many little intricacies that go into running them, whether it is utilities, cleaning or tenants that might be disgruntled. When you buy a property, you commit to managing all of that. It goes back to the fact that we turn down business every day. Because it's not enough to just get a good deal. You have to be committed to everything that comes with it.
What traits or skills are essential for a leader?
You have to be confident in yourself. When you go to sleep at night, you have to be confident in the decisions you made during the day, because people have to know that you believe in the decisions you have made. But along with that, you can't take yourself too seriously. Here, we have pingpong tables next to the offices, and there is always a football being thrown around somewhere in the building. So we try to remain playful and have a good time. It keeps the juices flowing.
What is your definition of success?
The ability to balance business and life. One of my biggest commitments I have made is that I will be home to tuck my kids into bed, and I can miss their bedtime for a maximum of 10 days a year.
How Mark Weinstein focused BioClinica on the future during the depths of the recession
It was the first half of 2008. For 15 years, the company that became BioClinica Inc. had developed a strong presence as a medical image management business in the clinical research solutions space. Mark Weinstein, the company's president and CEO since 1998, had been on board for most of that run.
"It's been a good business, a dominant business, but in March 2008, we decided to really broaden the business and go into a new area for us, what we call e-clinical solutions," Weinstein says. "It's technology and solutions related to clinical research. We were stepping beyond our core business and entering a new space, but our strategic plans were intact."
Everything was smooth sailing until the fourth quarter of that year, when the economy slammed into a wall, plunging into its worst recession since the Great Depression. Weinstein needed to keep BioClinica on course, continuing to grow its e-clinical solutions business, but he now had to do it in a climate of extreme volatility and adversity.
"When that happened, we had to do what everybody did, which was figure out how to keep the business going and stay profitable throughout the downturn," he says. "That was a big challenge because we had just stepped beyond our core business.
"The good news is, we did fairly well, we maintained profitability and continued to grow the new business, but our revenue ramp wasn't quite what we anticipated when we went into the space."
But keeping the ship on course wasn't as easy as maintaining a steady heading. Weinstein and his leadership put in months of work behind the scenes to ensure that BioClinica could continue to grow. The company generated $68 million in service revenue last year, up from $62 million in 2010.
Know your strengths
When the recession hit, Weinstein and his team had to do what a lot of company leaders were doing — assess the business and figure out which areas needed which resources in order to help minimize the effects of the downturn as much as possible.
Weinstein knew BioClinica's best bet was the company's primary competency — clinical research. He and his team quickly came to the conclusion that the company needed to focus on new ways to employ what it does best.
"We know clinical research very well, and we always approached it from the management of medical images as it relates to information using clinical research results," Weinstein says. "So we wanted to stay within clinical research, but we needed bigger markets to go after."
Within the broader category of clinical research, Weinstein decided to pour more resources into technology. With the recession driving business volume downward, e-clinical solutions became more than a new area for BioClinica to explore. It became essential to the company's ability to weather the recession and emerge from it in a position to continue growing.
"We knew drug development was going to continue, but the challenge we had was knowing that pharmaceutical and biotech companies, as well as the world in general, became kind of like deer in headlights for a while," Weinstein says.
"So the question becomes, what do you do with your business to try and maintain profitability? Something I have always stressed to my people is that when you hit a down market, the last thing you want to do is exit that down market in a weakened state."
You can't adjust the flow of resources in your business without creating a domino effect. Scaling back timetables on projects, reallocating dollars and reallocating manpower all take a cumulative toll on the organization. Your reasoning might be sound, but if you don't keep your people in the loop, all they're going to see is chaos and upheaval. Morale will suffer and, in turn, so will your culture.
Weinstein says a CEO's obligation to his or her people in a time of upheaval boils down to one word: transparency.
"Transparency was a big thing for me because it wasn't just my issue personally; it was a company issue and a market issue," he says. "I didn't see it as everybody's issue to try and solve it, but I was very open with everyone.
"In some ways, it was actually better from a communication standpoint than some other market situations you might find because everybody in the world knew things were changing. The issue was that we had to do our fair share as individuals and a company to respond to that."
Weinstein relied on the company's organizational structure as a vehicle for communication. He focused on developing solutions with his department managers, who then rolled those solutions out to their areas of the company.
The goal was to maintain as much of a sense of normalcy as possible throughout the organization. BioClinica was responding to an economic crisis, but Weinstein didn't want that feeling to permeate the company ranks. He wanted his people to remain focused on driving growth and finding solutions.
"We started with our executive team and just worked the process," Weinstein says. "It was pretty similar to what we would be doing in a normal budgeting process. The issue was, the situation was somewhat fluid due to the down market, and nobody knew how long it might last.
"It was a little scary there for a while, because the economy worsened faster than anything I could remember in my career. But I wasn't alone in thinking that, and everybody understood that they had a role to play in being a part of the solution."
Face your customers
You can put the best crisis plan in place, plot out every detail and allocate resources perfectly, but it won't make a bit of difference if sales dry up. If your customers aren't buying what you're selling, you're still in a world of trouble.
Weinstein knew he couldn't just focus inward on his own strategies and processes. As the economy worsened, he had to look outside the company and make sure his people were still connecting with the people and organizations that purchase from BioClinica. He couldn't strip mine the customer-facing areas of the company if he expected it to emerge from the recession in a healthy state.
"We wanted to make sure that customers didn't see us as retreating, so we deemed anything customer-facing to be highly critical with regard to resource allocation," Weinstein says. "Things like development work might have changed, the rate of change of some of our products and services might not be as fast as we would have liked otherwise, because we had to gauge what the business could support and afford.
"But we didn't want to do anything that would have affected aspects of the business that are client-facing."
When the full force of the recession hit, Weinstein and his management team started to receive inquiries from customers as to the financial stability of the company. Weinstein looked up on it as an opportunity to reinforce confidence in BioClinica.
"We deal with all of the top pharma companies — the top 25 in the world plus 75 percent of the top 50," Weinstein says. "In any given month, we're sending invoices to about 170 pharma companies. So we did have more inquiries than usual relative to making sure that we did have financial stability, because drug development is going to be the key to their success. The last thing they needed was one of their vendors associated with their clinical research having financial difficulty.
"The way you quell those concerns is through simply being honest. You need to be open with people about where you stand."
If you try to sugarcoat an issue or dance around a problem, it will come back to bite you. It's only a matter of when.
"At the end of the day, we are all measured from the outside market from a financial perspective," Weinstein says. "So for me to say something is happening that is not going to happen, I am delaying something that is going to be causing a much bigger problem if people have valued me based on expectations that are going to change. You really need to manage the expectations."
However, managing customer expectations can be more easily said than done, especially if the matter involves an employee who wants to make a big impression.
Sometimes, younger employees who are eager to make their mark or simply haven't mastered the art of managing expectations, will overpromise on a project, which could damage your firm's reputation. Depending on the size of the account and the influence of the customer, such a misstep can potentially have long-reaching consequences.
"Sometimes, you can have a person who sees a risky situation with a project, but rather than be the bearer of bad news, they'll tell the customer that they can get the project done without mentioning the risk level involved," Weinstein says. "That type of situation can end one of two ways: Either you get it done and you're a hero, or you don't get it done and you have very poorly managed the customer's expectations.
"So I always tell people to err a little bit on the side of losing the excitement of being the hero and more on the side of helping the customer to understand the risk you are undertaking. That way, nobody is disappointed.
"Clinical trials never happen as you plan them. As a vendor, one of our roles is to fix problems when they occur. To tell the clients that there will not be problems is not the right answer in most cases."
Your customer-facing people have to know what constitutes a major risk. As BioClinica continued to grow in the e-research field during the recession, defining the boundaries of what made a given project a suitable risk came down to judgment calls at the executive level.
Ultimately, any decision on risk tolerance is an educated guess. You research the numbers, you measure the resources you can put into the project and you gauge the expectations of the customer. Beyond that, there are no guarantees. You can only trust the judgment of the people around you.
"We've amassed a tremendous amount of experience in our business, and anytime you're able to rely on people with experience, it's to your advantage," Weinstein says. "I feel very comfortable that I can sit down with the right group of people, and I feel confident that we can figure out pretty quickly whether the project under consideration presents a risk that is appropriate for us.
"You can take the risk, but make sure everyone involved understands the level of the risk. The customer could always tell you that they don't want to take that type of risk."
If you have to walk away from a project because the risk is too big, it's never an easy decision. But if it comes to that and you've built your corporate culture on a bedrock of integrity and honesty, the right answer should be obvious when you get on the phone to the customer.
"It has to be part of the fabric of who you are as a company," Weinstein says. "If you're talking about walking the walk like you talk the talk, I really do require that here. It can be difficult because those are never easy decisions. You want to minimize the number of decisions like that. But you simply have to stay true to the fabric of what you are as a company and who you are as a person." <<
How to reach: BioClinica Inc., (267) 757-3000 or
The Weinstein file
Born: Washington, D.C. Raised in Richmond, Va.
Education: B.A. in economics, University of Virginia; MBA, College of William and Mary
First job: I filled foundations with dirt in a new housing development. I did it by hand, one shovel at a time, then tamped it down so the concrete foundations could be poured. I was 15 at the time, and that as much as anything convinced me that I needed to go to college.
What is the best business lesson you've learned?
As saying I've always enjoyed is, 'Life is what happens when you're busy making other plans.' The path your business takes between here and the realization of your vision is not a straight line. There are a lot of curves and road switches. You have to constantly re-evaluate where you are headed. A good vision two years ago might not be a good vision now.
What traits or skills are essential for a business leader?
I am a big believer in having a strong ego rather than a big ego. A strong ego elicits feedback and makes people want to share things with you. A big ego just turns people away, which is never good. You need input from a lot of different people to run your business the right way.
What is your definition of success?
Seeing the people around me thrive personally and professionally. I am not responsible for the personal lives of the people who work here, but I can help foster a balance between their personal and professional lives. If you have a good personal life, it will help you have a better professional life.