The Relentless Pursuit of Better
I don’t remember a time when I didn’t want to be an airline pilot. So when I graduated from the University of Colorado in 1990 with a Bachelor of Arts in English and history and told my parents I wasn’t interested in going to law school as they’d hoped I would but rather that I wanted to go to flight school, they weren’t too pleased, but they also weren’t terribly surprised.
Three years later, after working as a flight instructor and freight pilot flying to Mexico and Central America, I had achieved my dream. I was hired as a first officer for the Delta regional airline Atlantic Southeast Airlines (ASA) in Atlanta. Since ASA was growing very rapidly at the time, the pathway to advancement was clear before me — upgrade to Captain in six to eight months, fly a few more years with ASA, then move on to a mainline carrier such as Delta or United. There was only one problem: the airline work environment.
Like the Hatfields and McCoys before us, no one could tell me who started the feud, but no two groups of workers in an airline environment got along. Mechanics hated ramp workers. Ramp workers hated flight attendants. Gate agents hated flight crews (of which I was a member). And we all hated airline management. Rest assured that safety was never an issue; we were all united in our commitment to safety and self-preservation, but that didn’t mean we couldn’t be nasty and condescending to one another while doing it. Therefore, after having invested six years of my life in pursing my dream career as an airline pilot, I just could not see myself enjoying the remainder of my work life in that environment. So I parked my plane at the Hartsfield airport in Atlanta, and I quit and became a broker of used corporate jets.
From 1996 to 2001, the corporate jet market was exploding, and it was a great time for those of us in the industry. While I do recall that my experience as a pilot was helpful to me in launching my own aircraft sales firm in 1997, it wasn’t until I started my current Evergreen business, TrafficSafetyStore.com, and began hiring larger numbers of employees that the lessons I gained working in the toxic airline environment began to really pay off.
Keep an open mind when hiring
By keeping an open — a very open — mind when it comes to hiring, I’ve managed to go 14 years with extremely low turnover. The only time we’ve had layoffs was after the 2008 recession, when we had to let two people go. We hire almost exclusively through word of mouth, which is a sign of our positive culture.
Also, we hire people who may be overlooked by other companies’ human resources departments. We’ve hired people who have been in jail, people who have had numerous DUIs and people whose wages have had to be garnished for child support. We even hired a man 14 years ago who, at the time, was living in his car and has become one of our most dependable employees.
Approximately 25 percent of our warehouse workers have something on their resumes that would disqualify them from a more traditional hiring plan. But I’ve found that if you see these folks as human beings, not just as resumes, and you set clear expectations for what it takes to thrive at your company, they’ll rise to the occasion.
Be flexible
In order to retain some of these employees, we’ve had to be flexible. While we don’t condone it, if someone has had a DUI and can’t drive, we’ll adjust their work shift for a few months to make sure they can get rides here. One man was missing a lot of work because he didn’t have child care, so we let him bring his son to work for a bit. We let one employee take a sabbatical for alcohol rehab. If you are a good employee, we’re going to work with you. It just makes sense as a human being. What good does it do to take someone who is down and dog pile on them?
Be explicitly clear about what you expect from people
I expect my employees to do a good job and be punctual, which is a sign of respect to their job. Their shifts start at 8 a.m. and end at 5 p.m. I don’t make them punch a card to prove when they got here; they just need to be here on time. If they’re not, we’re going to have a pretty serious conversation. I think people appreciate being treated as adults. After all, we’re equals. They expect a paycheck and health care from me. I expect them to do their job on time. We’re in it together.
Our employees are also incentivized by the fact that we almost always promote from within. That means they can see a goal to work towards instead of feeling like they are going to be stuck in the same job for decades.
Be transparent
We practice open-book reporting, which means every employee sees at least part of our finances and is responsible for making the company more efficient. We have a company-wide meeting every Friday morning, and the guys in the warehouse have a daily debriefing. Together we discuss whether we should channel profits into remodeling to make this a pleasant environment or into hiring consultants to talk to us about culture. This resonates with these guys. They tell me they appreciate the time and energy invested in them.
This also means you have to share bad news every now and then. While it hasn’t happened often, when we have had to terminate people, we immediately bring the whole company together to discuss what just happened. Obviously we don’t share personal information, but we want people to know what their former co-worker did, make it clear that that the person was treated fairly, but also that the company has standards that can’t be crossed.
Our journey together as a team
The motto on the back of our company T-shirt is a phrase that the guys in the warehouse themselves came up with: “The relentless pursuit of better.” We’re on a journey that we’re never going to finish — and every one of us can always do better. It’s so important to put this kind of faith into your employees, especially Evergreen employees who might be with you for decades.
Thanks in large part to the lessons I’ve shared here, TrafficSafetyStore.com has grown from one to 35 employees, and we now have three distribution centers nationwide. We saw 37 percent growth in 2015 and are right on target to finish 2016 with 25 percent growth. We’ll come in just under $15 million in annual revenue this year.
Do I miss flying for a living? Every day. But I must acknowledge that as a result of my decision to quit working as an airline pilot, I have built an Evergreen business that is providing a good living to more than 35 families, including my own. I’ve also been home for far more anniversaries, birthdays and parent-teacher conferences than I ever would have been had I stayed in the airline industry. Having said that, though, I still always look left and check out the cockpit whenever I board an airliner — old habits die hard.
Will Snook is the CEO of TrafficSafetyStore.com.
Happy New Year From The Tugboat Team
Dear EJ Reader,
Happy New Year! We are delighted to join you in celebrating the end of one great year and the beginning of another at Tugboat Institute and the Evergreen Journal. Thank you for your passion, energy and dedication to our Evergreen community.
Reflections of the Past Year
Through the weekly distribution of the Evergreen Journal, we continued to chronicle important stories and ideas directly from our members. A heartfelt thank you to each of our EJ contributors for this tremendous gift you have given to our broader community.
In addition, we had a memorable 2016 with our Tugboat Institute Summit as well as our Fall Exemplar Visit at Jack Stack’s SRC in Springfield, MO. We’ve distributed talks from both events in the past few months and our library of talks will continue to grow through the new year.
We welcomed three new Tugboat team members: Dan Benetz as CFO, and Sean Zak and Jennifer Guo as Member Relations Managers for Tugboat Institute.
Lastly, we were honored to have a feature article about Tugboat Institute in Conscious Company Magazine in November. Meghan and Maren, the founders of the magazine, both joined us in Sun Valley last June and added to everyone’s experience.
Looking Ahead
From our perspective, 2017 is an important growth year for Tugboat Institute. The quality of our events, vitality of our community and health of Tugboat Institute are highly dependent on growing our community of value-aligned Evergreen leaders. We can’t overstate how important it is and how grateful we are to those who make valuable member candidate introductions.
New Innovations
Together, we’re continuing to co-create relevant and engaging innovations. We recently launched the Certified Evergreen™ program and encourage your management team and employees to participate. Certification gives your organization a publicly identifiable association with the highest business and operational standards that adhere to the Evergreen values.
Final Thoughts
All this is to say we have much to be proud of in our Evergreen community and Evergreen movement. Our efforts are destined to change the way society thinks about business. Evergreen entrepreneurs are building long-lasting, purpose-driven companies where success is something that is shared between owners and employees.
We look forward to a bright year ahead.
With Gratitude,
Dave & The Tugboat Team
Profiting from Millennials
There has been so much discussion about millennials, yet who do we really mean when we talk about millennials? Millennials include 32-year-old parents with college degrees and 10 years of work experience as well as high school seniors. Mark Zuckerberg and my high-school-age daughter Kelsey are both considered millennials, yet their interests and stages in life could not be more different. So how do we start to understand this group, which is poised to become a crucial demographic for all Evergreen entrepreneurs?
New Frameworks You Can Use
We started an in-depth demographics research project to become better advisors to our homebuilding-industry clients and quickly realized that we could help executives in all industries. Some 9,000 hours of research later, we published our findings in our new book: Big Shifts Ahead: Demographic Clarity for Businesses. In this article, we will highlight some of the millennial findings.
We decided to dig deeper and come up with better definitions for millennials and all generations. We analyzed the population by age, creating new generational definitions by decade born that dated all the way back to the 1930s. We gave each decade a name that represented one of the great demographic shifts they led, such as saving, work/family balance and the sharing economy. We found that businesses that identified these shifts prospered, while others failed.
We identified four major influencers of demographic shifts, noting that the same influence affected the generations differently based on their age at the time. These four big influencers (call them disruptors, if you like) are:
- Government policies
- Economic cycles
- Technological advances
- Shifts in societal acceptibility
The millennials born in the 1980s are different from those born in the 1990s and far different from their parents. While both the 1980s and 1990s generations number 44 million in size and comprise 3 million more people than those born in the 1970s, they spend very differently.
Older Millennials
1980s millennials, whom we dub the 1980s Sharers for their contributions to creating the sharing economy, have higher college graduation rates than any generation before them and graduated into the worst economy in more than 80 years. Compared with those born just 10 years earlier, they were 7 percent more likely to be living with their parents and 10 percent more likely to be single and childless at their 10-year high school reunion. Today, they have already formed 20 million of their 24 million households and are starting families and moving to the suburbs in increasing numbers.
Because of the economic disruption early in the Sharers’ adult lives, they borrow less and spend wisely. They will share your products and services with others if that makes financial sense. More than half (56 percent) of people under age of 35 said they would willingly share their location to get a discount coupon compared to 42 percent of those over 35. This group has no qualms about paying to jump into a stranger’s car or stay in a stranger’s house, partially because someone has shared that the stranger is safe.
Younger Millennials
1990s millennials, whom we dub the 1990s Connectors for the connections they keep on their smartphones, continue to graduate into a slowly growing economy. Jobs have been increasingly easy to attain for most, yet many remain underemployed because their skills and desires don’t match employers’ needs. Compared with the 1980s Sharers at the same age, 4 percent fewer drive, 3 percent more live with their parents, and another 3 percent more live with roommates. Observing what happened to the older millennials, they behave quite conservatively and take few risks.
Connectors watched their parents, and older millennials, go through the Great Recession. Many of them experienced real financial struggles as children and were the first generation to experience staycations instead of vacations. As a result, they spend cautiously, eschewing credit in favor of debit cards.
In a survey, 73 percent of Connectors agreed that as a society, we have given up on the concept of privacy. That means they are willing to share lots of information in return for convenience and discounts. That attitude gives companies a lot of room to collect valuable information on these potential customers.
Connectors use their phones for just about everything. They trust reviews by strangers and deplore salespeople because they would like to eliminate all middle men, instead purchasing what they need on their phones. Sell to them directly. Make it as easy as possible for them to buy on their phone. Make sure their friends tell them great things about your products and services. Connect with them.
A New Buyer
Most Evergreen CEOs have perfected selling to their peers, who tend to be 1950s Innovators, 1960s Equalers and 1970s Balancers. We understand them. Millennials — 1980s Sharers and 1990s Connectors — behave much differently. To improve our sales and marketing to these young adults as well as all of our customers:
- Change the internal marketing conversation from broad identifiers such as “millennials” to more specific categories, such as the decade in which they were born.
- Enhance the decade-born discussion to include life stage (single, married with kids, etc.), gathering as much data as possible about them.
- Recall how the four big influencers (government policy, economic cycles, new technologies and societal shifts) affected each group, especially in their teen years.
By segmenting the generations this way, I believe companies can have far more productive sales and marketing meetings, targeting their customers more effectively and thus growing profits. It is clear to me that the millennials born in the 1980s and 1990s will be the driving force of the economy for years to come, and Evergreen companies need profits from the millennials to accomplish their Purpose.
John Burns is the CEO of John Burns Real Estate Consulting.
Why Cash Isn’t Always The Best Motivator
Cash is the ultimate carrot, right?
Not necessarily. Especially for Evergreen entrepreneurs. We are building businesses based on passion, principal and Purpose. We want our employees to be part of our mission, and although people might believe money is important, it’s not the ultimate motivator.
We have given a lot of thought to bonuses at Acceleration Partners, my 9-year-old marketing firm, and are moving to a system that focuses more on experiences and meeting employee needs in a more personalized way.
For truly special bonuses, we’ve started something exciting at AP. We’re rolling out our own version of a “Dream Program,” where we subtly collect ideas—dreams, wants or preferences—from employees in interviews or casual conversations. Then, when the moment is right for a bonus, we turn to that catalogue for inspiration.
Just recently, we sent someone on a trip to Napa—plane tickets and a paid-for hotel—because she had always wanted to visit wine country. Another colleague wanted to take his kids to London, so we are flying them out before a conference this fall when they will have extra time to sightsee.
Buying tickets for a travel experience or giving an employee an opportunity they never would have had otherwise is not that expensive—often less than what a bonus check is expected to be. But a free vacation is a wallop of a gift. Employees are touched that we noticed their interests and that we helped create a long-lasting memory connected to the business. It creates loyalty.
On a smaller scale, about a year ago, we launched a program called TINYpulse to get a better read on our employees. TINYpulse is an employee engagement software platform that offers surveys, peer recognition and performance reviews. We use TINYpulse every week to ask people questions and to send cheers. I send personal thank you notes to employees when I notice they’ve been doing a great job. This kind of weekly recognition is supremely motivating to employees, and many have told them my comments made their day. People can handle stress and hard work if they feel supported. If they are just getting cash bonuses as a reward and no emotional support, the job starts to become transactional.
Cash, whether in the form of a bonus or salary, is not actually a great stimulus for great work, with the exception of a few functions such as sales. Several years ago, I read an exciting book: Drive: The Surprising Truth About What Motivates Us by Daniel H. Pink. It explores intrinsic motivators vs. extrinsic and why people do things. If people are motivated entirely by money, there is always someone out there who is willing to pay them more.
Evergreen companies need high-quality people who are invested in their work, and they need to avoid turnover. At Acceleration Partners, we focus on paying people in the 80th+ percentile while also working hard to recognize them as individuals. This provides an environment that makes them want to get up and go to work. And when someone comes to them with a better offer, it makes them think twice about what they value and would be giving up.
And we now surprise them with our new bonus program. We don’t want anyone changing jobs just so they can make $5,000 more somewhere else.
As a result, our turnover rate for top performers is very low. They are deeply invested in our company, and I don’t believe anyone has ever left with money as the primary motivator.
Rather than hand my employees a bonus check, I’d much rather hand them tickets to Hawaii and an experience they will never forget that is more personal.
Robert Glazer is the Founder & CEO of Acceleration Partners.
Great Customer Service On A Shoestring Budget
In my earlier years, I thought I was going to be a lawyer. I sure didn't plan to be a customer service strategist. But through serendipity and a strong interest kindled by early front-line jobs, I've had the good fortune to work in one aspect of this field or another since the late 1980s. As entrepreneur/partner, then owner/CEO of International Customer Management Institute (ICMI), and now as a writer and speaker, it’s been fun to watch customer service evolve into what it is today: a powerful brand differentiator.
I’ve enjoyed meeting and talking with Tugboat Institute members these past few years — if you’ve been to a Tugboat Institute Summit, we may have crossed paths a time or two. One thing Evergreen CEOs have in common, beyond their commitment to the 7Ps: Most don’t have significant investor money to throw at customer service (a good thing because, as with other aspects of building a strong business, that’s not often the best approach). Yet, service is exactly where the 7Ps really play out.
Good customer service is essential for any business to thrive. It doesn't matter how big your company is, who your competitors are or how entrenched they may be. If you have a product the market wants and you deliver on customer care, you win. All else being equal, if you demonstrate genuine regard for a customer’s service experience and your competitor doesn’t, you’re likely to earn loyalty and continued business. Conversely, if you drop the ball — if service isn’t easy, or if you let a customer’s complaint slip through the cracks unaddressed — that customer is likely to look for greener pastures (and will probably tell others about the experience).
So, how can an Evergreen business create a successful customer service approach without breaking the bank? Through all of the change I’ve observed over several decades, here are some recommendations that have staying power:
Be True To Your Brand
Most Evergreen CEOs take pains to imbue their products and marketing with a distinct personality. But they may not extend that to their customer service channels — and that’s a huge missed opportunity. You don’t want to pack your product full of character and greet your customers with a canned response. "Thank you for calling XYZ Company. Press 1 to speak to a representative" is not delightful. Take the time to make all of your messaging, across every channel and customer touch point, true to your voice.
Set The Right Foundation Before You Get Big
If you’re still a small company, now’s the time to get your processes in place — before you get so large that customer concerns become overwhelming. To get started on a plan that can scale as you grow, there are a few things to consider:
- How, when and where will you interact with customers? Identify a sensible mix of channels: web, mobile, social, phone, email, etc. Then determine who “owns” the overall approach that includes those channels. (The industry term is to shape a “customer access strategy.”) Many smaller companies can’t afford the luxury of a dedicated customer service team, so employees often pull double duty — and ownership and accountability are essential. By cultivating the right channels for the right purpose, you can create substantial efficiencies. Some new entrants are making a big difference. Social media can be an effective and affordable way to engage with customers, for example, and more companies are harnessing mobile tools such as text to great effect.
- What are your customer service standards? I have a mantra: No unnecessary heroics, please. We've all heard stories of companies going to extraordinary lengths for customers — hopping on a plane to hand-deliver a product that didn’t ship on schedule, for example. Impressive, sure, but heroics mean that you’ve dropped the ball somewhere earlier in the process. Ideally, you’ll never have to go to such extremes, but you do need to establish parameters for service. What does it mean to deliver quality? How far do you go with empowerment? What are you willing to do and how far are you willing to go for customers? Make sure everyone in your organization knows the answers to these questions and can deliver for the customer.
Bake Post-Mortem Reviews Into Your Process
Assessing your customer service activity should be as regular as reviewing your P&L. Taking note of and learning from these interactions creates a feedback loop that, in time, will minimize the need for customer service interactions.
One of the innovations Uber brought to taxi service is the ability for customers to provide immediate feedback. Today, you can survey customers through the channels that make the most sense: personalized email, text-based, dial-pad input following a call, and others. In an era when customers are fatigued from being over-surveyed, it’s notable how high the response rates can be for transaction-specific surveys that are short and easy.
Internally, track customer engagements by type. What are they? Billing problems? Technical support? Orders not arriving as expected? Difficulty understanding products or services? A well-oiled customer service approach can help improve virtually every aspect of your business by pinpointing operational and manufacturing hiccups, informing your marketing team about what customers need and want, and providing fodder for Pragmatic Innovation.
Set An Example By Engaging With Customers Yourself
Most Evergreen CEOs are great about this by virtue of living their Purpose and putting People First. John Bogle, founder of The Vanguard Group, was known for regularly carving out time to spend on the phone with customers in the call center. By doing this, he not only better understood customer needs, but he also saw firsthand the areas of service that needed attention. Above all, he sent a clear message to the rest of the team: Customer service matters.
The most successful companies view customer service as an opportunity, not an obligation. As you nail this aspect of your business, you’ll reap rewards in all the others.
Brad Cleveland is the Principal of Brad Cleveland Co. LLC.
How Saving Newspapers Made Me Evergreen
When I tell a new acquaintance that I'm in the print news business, I can predict the response: Their brow furrows. Their voice lowers. They offer their condolences: “Oh, I’m sorry.”
But me? I’m all smiles. Because I run a newspaper company that’s profitable and growing.
I cut my teeth in the industry on the advertising side, beginning with the Houston Chronicle in the glorious 1990s. Business was good, and I got a solid education in all aspects of the print media world.
Eventually my wife and I returned to our hometown of Pflugerville, Texas, and I went to work at the nearby Austin Business Journal. I noticed that information about local construction projects was scarce to none. The things that affected neighbors’ day-to-day lives — like when a road would be built, what kind of businesses would be allowed and whether there would be a Starbucks — weren’t being covered by the local media. These issues were newsworthy to our little enclave, but not, apparently, to reporters.
I had an idea: What if we built a business journal for the Average Joe? One that treated the opening of a new Mom-and-Pop pizza joint like it was news? Because on a neighborhood level, it is.
My wife agreed to support my burgeoning entrepreneurism. I sketched my thoughts out on a piece of paper, drew up a business plan and, armed with a $40,000 personal line of credit, set up shop in the game room of our house. A small group of writers and designers and I worked our butts off to crank out that first edition in September 2005. Then, we held our breath.
Back then, I couldn't even afford voice mail — I just had a caller ID box (remember those?). After the first issue was delivered, I saw that 10 businesses had called to inquire about advertising with us. Our next edition's ad space was sold out in two weeks. We’d found a formula that worked, and it still works today.
In our first five years, we grew like crazy, adding 10 papers and about 60 employees. As of October, we have launched our 23rd paper. We reach more than 1.7 million households around the state and have 185 employees. We expect to pull in $25 million in revenue this year.
Our business works because we have a strong central Purpose: to build communities of informed citizens and thriving businesses through the collaboration of a passionate team. We provide quality reporting without editorializing. We cover elections, but we don't endorse candidates. Readers appreciate that we care about what’s happening in their backyards. Local business owners appreciate our coverage. Advertisers appreciate having their messages delivered to their most likely customers.
Although my business may differ from other Evergreen entrepreneurs’ because of the publishing industry’s unique concerns, I’ve learned some lessons in the last decade that I think are broadly applicable:
A Little Dead Means A Little Alive
I firmly reject the notion that print is dead; my company is proof that it’s alive and well. While Community Impact Newspaper was growing by $5 million to $6 million in revenue a year, the traditional newspaper industry was well into its downward spiral. Digital ad sales couldn’t keep up with operational costs, so papers cut jobs. When they cut jobs, content suffered. And when content suffers, readership suffers. And without readers, you can’t sell ads. These papers continue to fold at a disheartening rate.
But that doesn’t mean you can’t come up with a better model. We don’t have a huge digital presence, but that gives us the freedom to not care about clicks. So we go to the city council meetings that traditional local media now ignores because they don't generate clicks online. We sometimes cover stories that only a small number of households care about. In the micro-niches we cover, print wins.
We’ve embraced Pragmatic Innovation to reach a highly engaged audience where they live: through their mailboxes. Using a fine-tuned targeting system developed in-house, we can deliver news — and serve ads — down to the carrier-route level.
Pay Now Instead Of Later
A trusted mentor once advised me to get libel protection. I took a chance and went without — and sure enough ended up getting burned. Insurance, lawyers, financial counsel — these are areas where the risks of cutting corners are too great.
This applies to staffing, too. Early on, we passed over a highly qualified candidate to fill a key position in the company to save money. Ironically, the person we hired instead ended up stealing from us. Luckily the person we should have hired in the first place was still interested, and remains with us today.
Own Your Own Destiny
With more than 20 papers and 50 people selling ads, the logistics of targeting and printing has become complicated. We built an internal system that allows for greater automation, but our printing vendor could not keep up. We needed our own plant, so we invested $15 million to build a state-of-the-art facility that will allow us to scale comfortably and effectively. We’ve bought inserting machines that help us target at the household level — something that would be very difficult with an outside vendor. Editorially, these presses allow us to deliver even more targeted, relevant news to our readers.
Investing in a printing plant in this day and age might seem crazy, but it gives us the tools we need to grow. I’d rather take the risk and own my own destiny than continue to rely on outside vendors who can’t keep up with what we need.
Lean In To Your Fear
As People-First entrepreneurs, we have to protect not only our own livelihoods, but also those of our employees. Do I sometimes break into a cold sweat worrying about that $15 million printing facility? Absolutely. But I believe that fear is good. It’s healthy. Because of my fear, I don’t take anything for granted, especially my people, without whom I would have no company.
Let’s be real: Business is hard, and every minute as a business owner — providing jobs, solving problems — is a blessing for which I thank God every day.
John Garrett is the CEO of Community Impact Newspaper.
What Evergreen CEOs Need To Know About Working With Millennials
I lived in my car on and off for nine months in 2009, when I was 21 years old. I slept in grocery store parking lots and spent 18 hours a day working for free in a city hundreds of miles from my home. All with the hope of starting a business in the real estate industry to fund my passion.
Does this bust any of your myths about millennial workers?
Since that cramped but productive time in my life, I have gone on to launch six successful businesses in Nashville, Tennessee. The Purpose of my Evergreen company, Aerial Development Group, has always been to empower people, sustain the planet and utilize capitalism as a force for good. I call this Excellence with Impact. We combine commitment to excellence in our products and services with dedication to impacting the world around us; we’ve sold over 290 homes, elevated 18 communities, sponsored 112 orphans in Africa and supported 12 local outreach programs.
And of the 28 people on my staff, 12 are millennials—my peers. I give them a lot of credit for our success.
Some stereotypes of millennials are based in fact. They need a lot of affirmation and attention. But with the right support they can become a major asset to your company.
Millennials are uniquely dedicated to personal development. They want to keep learning and rise within a company. Believe it or not, they are self-motivated and driven. But CEOs need to make sure they keep millennials focused on the broader mission of the company as well as their own achievements.
At Aerial, we have multiple strategies we use to manage millennials (as well as everyone else in our office). Specifically, we have a platform in place to make sure millennials are heard. Giving them time with management shows that we care about their growth as well as the growth of the company. This not only motivates them, but it also keeps our company sharp.
One tool we’ve found particularly effective is the Monday Morning Pow-Wow. Everyone has a chance to share their new ideas and suggest innovations—nothing is off the table. From assistants to executives, everyone receives equal respect in these meetings, and magic has had a tendency to enter the room during this time.
Then there’s the daily tool millennials particularly love called Align. The web-based management app lets everyone see the priorities of the company and the individual departments and then breaks down these priorities into specific tasks. It’s a nice, clear way for employees to see how everything they do contributes to the company’s goals.
We also do quarterly individual reviews to make sure everyone is working to achieve their goals as efficiently as possible. Although millennials tend to value Purpose over a paycheck, they can still be motivated by money. We always say, “We’ll give you a raise, but you have to show us why it makes sense for the company.” This is an empowering and educational exercise for all. It allows them to have some control over their rise in the company while also teaching them to think more like CEOs who understand the connection between raises and value creation.
It’s not all easy. I’ve found that I need to constantly remind my millennial employees of the big picture; otherwise they get bored and feel like they aren’t doing something with their lives. I have to show them why performing even a mundane task has meaning and contributes to the larger company and, sometimes, the world.
For instance, I recently went to Haiti to help set up an entrepreneurial program so the citizens there can create their own opportunity and won’t have to rely entirely on NGOs. When I returned, I had a meeting with my staff and showed them a video that reflects our company’s core values, why conscious business matters and how the work we all do will affect this particular project in Haiti. Through this little bit of extra effort, my entire staff was energized by my solo trip, and they feel good about staying home to keep the company going in my absence.
Make sure your Evergreen company has a Purpose, whether it is environmental or People First-oriented. This is what our generation demands. We grew up on Disney films in which the wealthy character was painted as the greedy villain every time. Millennials care deeply about the world and making it better. More than 75% of us say it’s important for a company to give back rather than just make a profit. We want our lives to affect others in a continuous and tangible way.
The Evergreen way will attract millennial clients and customers. A strong Purpose will attract and keep millennials as employees, as well. Open your doors to them. Mentor them. You’ll be astounded by their vision and capacity for change.
Your Evergreen company will be richer for doing so.
Britnie Turner Keane is the Founder and CEO of Aerial Development Group.
How Being Evergreen Helped Us Raise Millions To Fight Cancer
From the time I was 12, I knew I was going to be an entrepreneur. I had been running businesses of various types since I was in the sixth grade, including a student newspaper, which was shut down when the principal realized I was making money from it.
When I traveled around the world after college, I realized building a business to make money wasn’t going to be enough. My future business needed to have a strong Purpose that would allow me to give back while growing my company.
In 2007, when I was watching The Amazing Race on TV, I had an idea. I thought about how much I’d like to take part in an event like that, and I guessed other people would, too. I decided to start a business creating unique, fun events. Running had always been a passion of mine, and a few months later I launched the Great Urban Race as part of Red Frog Events. More than 150 people took part in the first run, and within a year I took it on a nationwide tour.
Until that point I had been working by myself from home. After the Great Urban Race, I brought my brother-in-law on-board to help and together we launched Warrior Dash, the first obstacle race series in the country to feature fire jumping and mud crawls. It was an instant success, selling out 2,000 spots within hours. We had pioneered a new industry.
As our company grew, we moved into an office space in Chicago complete with adult tricycles, candy machines and foosball tables. We were focused on the growth of the company but equally focused on creating a lasting culture for our employees. I decided that we would never sell the company or have an IPO — that we would embrace the Evergreen path, and with it, a better lifestyle for all of us.
Our customers were having fun at our events, and our business was growing in size and profitably. With our success, I felt it was time to start giving back, but I wasn’t sure which way to go. We partnered with St. Jude Children’s Research Hospital locally for one of our events in Denver, and it was then that I learned about their incredible, life-saving work. I fell in love with their mission. They were providing free cancer treatment to any child from around the world and producing groundbreaking medical discoveries. I knew we could make a major impact on the organization and was determined to figure out how we would incorporate them into each of our ventures. During the first few years of our partnership with St. Jude, we raised more than $5 million for the hospital through methods such as offering ticket buyers a chance to add on a donation to St. Jude.
A couple of short years later, I surprised the whole company by flying everyone to Memphis, St. Jude’s home, for our annual retreat. Touring the hospital and seeing kids who have to go through daily treatments affected all of us. That was the moment we, as a team, committed to something bigger. In 2013, we pledged to raise $25 million to help build and equip the St. Jude Red Frog Events Proton Therapy Center, the first center of its kind dedicated solely for child patients.
The St. Jude Red Frog Events Proton Therapy Center officially opened in December 2015. With proton therapy, doctors can precisely target cancerous cells while sparing nearby healthy cells and organs. Young children will no longer be subject to unfocused, high doses of radiation that can damage their developing brains.
Although we don’t require it, we encourage all our racers to fundraise for St. Jude. At each domestic Warrior Dash, participants who raise more than $300 receive access to a VIP area, complete with showers, a private tent and gear check. They receive extra benefits for giving back, and we donate all of that VIP package money to St. Jude. We also produce and host an annual Mardi Gras-themed fundraiser in Chicago, Beads for Hope, where all revenue goes directly to the hospital. We constantly work to raise awareness about St. Jude in all of our communications and events.
In 2012, the year before we made our big commitment, we launched Firefly Music Festival in Dover, Delaware. We knew it was a risky industry to enter and expected the inevitable losses we had in the first year. Word about our festival spread, and in Year Two we more than doubled in size with 65,000 attendees. I remember being on stage during the Red Hot Chili Peppers headline set with some other Red Froggers and exchanging quiet high fives. Today, solely through Firefly, a type of event that typically does not produce mass fundraising opportunities, we’ve raised nearly $200,000 for St. Jude through on-site donations and donations during the ticket-buying process.
We’ve already raised $13.5 million in three years towards our $25 million target. Because we stand on our own, we can take risks and keep our dedication to St. Jude at the core of our business. We regularly host visitors from St. Jude at our events and learn about the patients St. Jude treats. They keep us inspired. Our entire team will be going back to the hospital later this year, and we are well on our way to meeting our donation goal by our target date of 2022.
Joe Reynolds is the Founder and CEO of Red Frog Events.
Why Do So Many Evergreen CEOs Revere A Guy Who Fixes Diesel Engines?
Every fall, Tugboat Institute co-hosts its second major event of the year called the Tugboat Institute @ Evergreen Exemplar Visit. Last week, I traveled to Springfield, Missouri, along with 50 other Evergreen CEOs to learn about Jack Stack’s version of open-book management called the Great Game of Business (GGOB).
Why does his management approach resonate so deeply with us? Perhaps it is GGOB’s emphasis on People First and Pragmatic Innovation. Or perhaps it’s just the openness, honesty, empowerment and fundamental goodness that the system promotes—an echo of the employee relationship that many Evergreen leaders are working to build with their teams.
Stack doesn’t have an MBA or even a college degree, but he has been a gleeful student of business all his life. Like everybody’s favorite mad scientist, he’s been running experiments at his laboratory, Springfield-based SRC Holdings, best known for its skill at remanufacturing industrial engines.
In 1983, Stack and a few friends and fellow SRC employees put up $100,000 and borrowed $9 million at an 18 percent interest rate to buy the then-money-losing firm from dying International Harvester (IH). From the start, Stack took a radically different approach to managing SRC—one born of desperation, not genius, he insists. The day after the acquisition closed, Stack and his management team realized that they had forgotten to negotiate an IT agreement with IH. IH had turned off all their computer systems and access to all of their data from customer orders to payables.
So what did he do? He called all of his employees into the break room and line by line rebuilt their income statement and balance sheet together on a huge whiteboard. Everyone had to pitch in to help fill out the information. That “huddle” became the beginning of a weekly meeting with all employees to share the detailed financial information of the past week and to go over forecasts. They celebrated wins and addressed shortfalls.
He begged everybody—even the janitors—to help SRC get to profitability and to pay off the company’s bank debt. They didn’t have much time. He saw that few people understood the financials, so began training everyone on the team on the “rules of business,” using sports as the metaphor. How can a baseball team take the field if they don’t understand the rules of baseball? And, why will the team members engage if there isn’t a “scorecard” that shows whether they are winning or losing? And, why work hard and take the risk of suggesting improvements if they don’t have “a stake in the outcome?”
These three gamification ideas working together—teaching the rules of business, providing a clear scorecard and sharing in the success of winning—are the basis of the Great Game of Business.
Today, SRC’s equity is valued at hundreds of millions, the company has paid out over $100 million to retiring former employees, and thanks to its employee shareholder program, everyone in the company continues to benefit from SRC’s profitable growth. The 28 percent annualized return SRC has delivered over the past 33 years is superior to Berkshire Hathaway’s. More importantly, when we toured his facilities and watched his son lead a huddle, it was clear that people love working at SRC.
With the help of journalist and author Bo Burlingham, Stack has been hammering the drum of his version of open-book management for decades. Their 1992 book, The Great Game of Business, is a classic that every entrepreneur should read. Stack happily shared his wisdom with us over two exciting days, with Burlingham contributing a pearl of wisdom or a dig from time to time. From the first night we all gathered in the lobby of the Doubletree to learn about the great game, it was clear this was a group eager to play.
Like a lot of other Tugboaters, I was electrified when I first heard Stack tell his story, at Tugboat Summit in Sun Valley last year. I raced back to my bookkeeper and announced grandly that we would henceforth adopt open-book management. “What is it?” she asked. “I’m not exactly sure, but I want to try it,” I said. “Does it involve opening the books?” she asked. “Yes,” I said. “Well, we have less than $1 million in sales and three employees. So your idea is giving me a panic attack.” (Did I mention that I am married to my bookkeeper?)
Inspired by Stack’s early days, I experimented. I hunted for small ways I could give my employees a taste for the highs and lows of entrepreneurship. Like any company attempting to make a go of open-book management for the first time, we fretted over whether the system would fuel conflicts and jealousies.
It’s all been a bit clumsy at times, but my small team has embraced the game. I’ve seen them get excited about the rules of business and our numbers and feel the business buzz.
The Great Game of Business is a constantly evolving process, though. Did I come to Springfield with questions? You bet. Boy, did I get answers. I realized I was making this more difficult and less fun than Stack would have. First, you have to train people. Second, you have to get them working and interacting as a team. Stack and GGOB team member Steve Baker taught us that to make it work, you have to overcome the enormity of the challenge by making a game of it—literally.
In fact, Stack strongly encourages “mini-games” designed around 90-day goals that attack specific issues or opportunities in the business. Say the busboys in your restaurant chain carelessly throw away spoons to the tune of $10,000 a year. Create a “save-the-spoons” mini-game and reward the players with half of the gains through a progressively better set of gifts. For example, give a nice monogrammed mug to each busboy for hitting a modest goal and a French press for doing much better than that. Or suppose your bicycle manufacturer built two dozen folding bikes three years ago that are now unsold and unloved? Create a “brilliant mistake” mini-game to quietly usher the oddballs out the back door in steeply discounted private sales to cyclists with a sense of humor.
Our group was inspired and moved by the presentation. When we asked Stack what we could do to thank him for his hospitality and gift of his learnings he said, “Just buy me a beer the next time you see me. A Miller Lite would be preferred. And, care for your people and your families.” That’s the kind of guy Jack Stack is.
Stephane Fitch is the Founder of FitchInk.
How My Scars Led Me To The Evergreen Path
My journey to creating an Evergreen company began at MCI. Although it was a multibillion-dollar company, it operated like a startup, competing against industry giants such as AT&T in a David vs. Goliath environment.
It was the perfect starting point for me. My father, a career FBI agent, had told me that I was unlikely to ever join the bureau. But a friend of his, who worked in pharmaceuticals, told me I’d make a great salesperson. MCI gave me the chance to hone my sales skills, but after a few years I realized that to truly grow into a leadership position, I’d have to move beyond my MCI cubicle.
So when the opportunity arose to join a startup that was building an internet billing company, I jumped at the chance. This was 1995, when people were still skeptical of handing over their credit card details online. We had an innovative third-party solution, and our company, iBill, was an instant hit with revenues to match.
The company was a balance sheet success and grew to be a fairly large business, but when it was sold in 2002 after the dot.com crash, I didn’t have the big payoff that I’d dreamed about and felt the whole experience had been unsatisfying. Amazingly, although I was a founding member of the team — I had provided seed money and hired the team — I had less than 1% on exit.
It came as little surprise to me that two years after InterCept bought us, our company essentially went out of business. The experience was a lost opportunity. We could have been PayPal, but it never came to fruition.
The problem was, finances aside, we were not building a sustainable company. Instead of focusing on careful growth, we paid absolutely no attention to our customers and served every single dark corner of the internet. To keep up with the explosive growth of the internet, we made bad decisions in every area of the business — strategy, HR, execution, clients, etc. The upside: I learned a lot about a growth-at-all-costs mentality.
The company’s demise left me with plenty of scar tissue. It’s not a company I look back on fondly. I was determined to make sure the mistakes we made wouldn’t go to waste.
In 2007, we launched 3Cinteractive, a mobile consumer engagement platform that helps our clients build more profitable relationships with their consumers. To avoid past mistakes, I built my company around three main principles.
First, it would be sustainable. The business would take on little debt and have few investors. My partners and I would own it and be able to make all of the decisions.
Second, I wanted to focus on doing something important for world-class clients. At iBill, we had taken on any client we could get (embarrassingly most of them ended up being porn sites) rather than making sure we had a core group of reputable business partners. Now we proudly call Walgreens, Disney and Best Buy our clients.
Finally, and most important, I wanted to support and nurture my employees. After iBill’s sale, it was the staff that lost out the most, and I wanted to build a learning culture where I could work with great people and treat them fairly.
It hasn’t all been smooth sailing at 3Ci, and that’s when our principles have mattered the most. Bad experiences, market downturns, ill-advised hires and miscalculations could have killed us if we had not lived by our principles. They have guided our decision-making and helped our company achieve greater success for all of us.
They also have given voice to our employees and stakeholders at important junctures. For example, when we were deciding to take on modest debt, our employees rightly questioned how this move would create customer value and opportunities for greater returns, and not put our business at unnecessary risk. That debt has since been paid back.
We encourage these kinds of discussions because they mean our employees have a sense of ownership and are growing along with the company. When I see our employees with stacks of books on their desks to further educate themselves, I love their aspiration and strive to help them in every way I can.
The lessons I learned from my first failure have helped build a strong culture, and we hope that by continuing to follow the Evergreen path, we will make good decisions and build a long lasting, principle-driven company together.
John Duffy is the Founder and CEO of 3Cinteractive.
