Business Opportunities: On-Line Articles - Greatness Doesn't Just Happen, It's a Choice That Must Be Made

Greatness Doesn't Just Happen, It's a Choice That Must Be Made
By Michael J. McDermott

Gary Erickson is the founder of Clif Bar, a marketer of sports nutrition bars that grew from a cult-like following among endurance athletes and extreme sports participants to become a mass market fitness accessory with a serious "cool" quotient.

In April 2000, Erickson was on the brink of selling his $39 million-a-year company to a Midwestern food conglomerate for $120 million. The very day he and his partner were preparing to complete the transaction, he had a panic attack. After breaking down in tears, he had the sudden realization that he didn’t have to sell.

What changed his mind? Late in negotiations, the buyer told Erickson it planned to move his firm from the California to the Midwest and place it under new management, irrevocably affecting the lives of himself and his employees.

He sent the buyers and their lawyers home. He ended up having to buy his partner out to the tune of $65 million over five years (he had $10,000 in his bank account at the time). It was either a very gutsy move or a very stupid one. Within four years, Clif Bar was a nearly $100 million company, proving it the former.

Small business expert Bo Burlingham says that Erickson made the choice to be great and that his alternate route was driven by the same thing that all 14 of the companies he writes about in his book, Small Giants, have in common: mojo.

"My definition of mojo is the business equivalent of charisma," he observes. "When a person has charisma, you want to follow him or her. When a business has mojo, you want to be associated with that business-buy from it, sell to it, work for it, read about it, wear its T-shirts and caps, etc. I think it’s what you feel when you’re in the presence of greatness in business."

Certainly, there is no shortage of companies with obvious business mojo, and it is demonstrated in many different ways. A case in point is Flooring World, a company that describes itself as, "Houston’s best-kept secret."

Business mojo is the equivalent of charisma, and the best companies have it.

Stephanie Wood launched the company in 1999 as a wholesaler of carpet, tile, stone, wood and laminate flooring to contractors, builders and remodelers. In December of 2002 she opened its doors to the public, offering customers the same wholesale prices available to its professional clients. Her husband, Ray Wood, a long-time territory manager for carpet manufacturer Mohawk Industries, joined the company in 2003.

What gives Flooring World its particular mojo is the depth of knowledge and expertise in which its principals are steeped and their commitment to sharing it with everyone who comes into their store.

"I am third generation in the flooring business," says Stephanie Wood, whose father owned a carpet business and whose grandfather was a lifelong carpet installer. "I literally grew up hearing all about flooring at the dinner table every night. Once I got into my own business, I realized how much I could fall back on that information from all those years ago. I often use that knowledge to solve particular problems that pop up."

EDUCATIONAL PUSH

The Woods have made it their responsibility to teach consumers all about the flooring industry so they can make informed decisions on their own. "We educate them with complete, correct information so they can compare apples to apples when shopping and avoid the pitfalls of dishonest tricks of the trade some flooring dealers use," she says. "It’s not unusual for customers to come in here, then go shopping at other places and realize they know more than the salespeople they meet at those other stores."

Flooring World’s reason for being in business is so that clients can have a place to come where they can be assured they will get what they pay for all the time, Wood says. "We are so committed to the idea that every job must be a quality job that we stand behind it no matter what the circumstances,' she says. "We have replaced floors in cases where the manufacturer refused to stand behind the product, and we make sure to communicate that level of commitment to all our customers."

Flooring World’s mojo has led to an established base of repeat customers for the Woods, and some of those relationships have blossomed into friendships outside the business. The store owners have equally good relationships with their suppliers, she says. The company has been singled out as an award-winning partner by leading vendors such as Shaw and Mohawk for the last four years, and it has been recognized as one of America’s fastest-growing small business by Inc. magazine.

The Woods aim to educate their customers and to make them better shoppers.

"We tend to do business with suppliers who have the same ideas about how to do business as we have," Wood says. "I eat, sleep and breathe this business. From the minute I wake up in the morning until the minute I go to bed, I am all about working on the company profile and taking care of the employees and the business itself."

The Container Store is another small business with definite mojo. Starting out with a single store, it has grown to about 40 locations in 15 states, but it has never lost sight of the things that have made it a great company.

No matter where they may be located, all Container Stores adhere to the formula created by company founders Kip Tindell (CEO and co-chairman) and Garrett Boone (co-chariman) in 1978. For them, the goal has never been growth for growth’s sake. Rather, it is to adhere to a fundamental set of business values centered around deliberate merchandising, superior customer service and constant employee input. Therein lies the company’s considerable mojo.

The Container Store has ranked among Fortune magazine’s list of best places to work for the last eight years, coming in at No. 4 in 2007. Its corporate culture has been studied and imitated by scores of other companies over the years, and its founders were early adopters of the belief that a happy workforce results in happy customers, higher sales and fatter profits.

ONE EQUALS THREE

"One of The Container Store’s core business philosophies is that one great person equals three good people in terms of business productivity," Tindell says. "Employees are our greatest asset, and our philosophy on employee development sets us apart from other retailers."

The company’s munificence in the area of employee perks is legendary: free yoga classes, on-site dry cleaning and car washes, a subsidized cafeteria, weekly chair massages and a family friendly work schedule of which about 10% of the workforce avail themselves.

Legendary, too, is its obsession with customer service, a devotion that earned The Container Store a mention in the book "Discovering the Soul of Service," by Dr. Leonard Berry, a leading expert on service quality. Most of the company’s employees begin their careers at the store level, where they are indoctrinated with the corporate culture, especially relating to service standards and company values. Most business owners know all about "digging deep" when it’s needed to achieve success. For Paul McKim, however, it’s been all about diving deep.

The story of Deep Marine Technology, recently named No. 6 on Entrepreneur magazine’s Hot 500 list of fast-growing companies, is a classic tale of adversity turned into opportunity. A professional diver for many years, McKim was hobbled by a back injury suffered during a deep dive in the Gulf of Mexico. Rather than sidelining him from his profession, however, the accident served as a launching pad for a new business venture.

Deep Marine Technology’s mojo comes from a combination of sources, including the allure of the rarely explored undersea world in which it operates and the drive of its founder. “I have a passion for what I do," McKim says. "For me, success is not a destination at which you arrive but a journey in which you continue to participate."

The building owner was convinced, and Rancatore opened the Lexington store in 2005. "Sometimes luck plays a role in these things," he admits.

Container Store's corporate culture has been imitated by scores of companies.

Launched in 2002, the company started out providing comprehensive subsea services to the offshore oil and gas industry. It expanded its offerings over the years and now includes a deepwater construction group, commercial diving group, DOV (directly operated vehicle) group and intervention systems group. Like most companies with business mojo, Deep Marine Technology owes much of its success to the people who work there, McKim says. As the company approaches the $100 million mark in annual revenues, he points to his employees as the critical ingredient. "It is the hard work and dedication of the people who work here that have made Deep Marine Technology what it is today," he says.

Companies with mojo can be found in just about every industry and business niche. For example, the call center industry is hardly known as a hotbed of quirky innovation, but at least one company in that industry has built that reputation for itself.

Beryl is a company focused on helping organizations grow revenue and build lasting customer relationships by connecting people to healthcare. It is also a company whose roster includes a full-time employee with the official title of Queen of Fun and Laughter, and where the CEO and COO dress up in matador outfits for a company holiday video version of "Dancing with the Stars."

"Success is not a destination, it's a journey in which you continue to participate."

"Our mojo is created by our people, whom we call coworkers," says Paul Spiegelman, the company’s cofounder and CEO. "Our mojo is a sense of intimacy that is created in a people-focused environment where everyone understands the vision and is passionate about our ability to live it."

The call center industry in which Beryl participates is widely known for its low morale, high attrition, anemic margins and off-shoring to foreign countries. Beryl has turned that around by creating a culture that engages and empowers its workforce, resulting in double-digit annual growth, margins four to five times those of its competitors and attrition rates that are a fraction of the industry norm.

"We are a premium provider that has built a brand and reputation for world-class customer service," Spiegelman says of the company he started with his two brothers. "Most importantly, we have won seven awards as an employer of choice, most recently being chosen as the No. 2 best medium-sized company to work for in America by the same company (Great Places to Work Institute, Inc.) that produces the Fortune 100 awards."

Spiegelman is reluctant to talk about the intertwining of his own identity with that of his company. He allows, however, that it is "hard to deny that the business is a reflection of me and vice versa." While he is often asked what "secret sauce" Beryl used to develop its culture, there is no simple answer to that question, he says.

BOOTSTRAP APPROACH

"My two brothers and I initially started our business with a bootstrap approach and no specific business skills or training,” he explains. “The values we were raised with obviously have driven our very basic approach to business: Treat people well and they will deliver."

Spiegelman and his brothers quickly realized there was a direct relationship between how they treated people and the bottom-line results of the business, which only encouraged them to do more, he says. They formalized their approach in Beryl’s "Circle of Growth" philosophy, which states that if the company treats its people well and earns their loyalty, that will result in customer loyalty.

"If we attain customer loyalty, that will drive profit into our business," Spiegelman says. "As a privately-held company with no outside investors, we have made the decision to invest those profits back in our people to give them better tools and resources to do their jobs, and the cycle just continues."

Texas Air Composites’ business mojo derives from what found and CEO Randy Harran describes as its decision to be more like a monkey than a gorilla.

"Through our years of experience maintaining, repairing and overhauling commercial and regional jets, we’ve found that remaining niche-focused and entrepreneurial and embracing a family culture and a small business model has been the key to our success," he says. "There are plenty of big gorillas out there, but we want to be the monkey - able to swing from tree to tree as needed, always maintaining flexibility."

"There are plenty of big gorillas out there, but we want to be the monkey."

The primary drivers in the company’s industry are turnaround time and cost. "Since we don’t have a lot of money, flexibility is our critical competitive advantage," Harran says.

The business philosophy behind Texas Air Composites is built on three basic principles: job security for its employees, opportunities for career advancement and opportunities for economic advancement. "If you have a culture that thrives on those principles, people will always want to come to work here and stay here," Harran says.