Appreciate...Communicate... Accelerate!

You know your business better than anyone, so here are some useful questions you might want to consider. Would it surprise you to learn that "high wages" ranks halfway down employees' list of factors that most influence their performance? For some it's counterintuitive, but "Show me the money" is only a small part of the equation.

Managers predicted employees would rank wages highest, but the most important factor listed by employees as influencing their productivity was "Full appreciation of work done."

Stop and think about that for a moment. What is appreciation? Sure, a raise is a good indication that you value an employee's work, but does it communicate "full appreciation"? What about the second most important factor, "a feeling of being in on things?"

• Does everyone on your team feel that they know what's going on, when, and why?
• Can employees make a clear connection between their work and the company's vision?
• Have they had the company's vision explained to them in real-world terms?

A second study asked, "What aspect is important when your employer communicates with you?" The top answers:

Giving insights on how to be more effective (52%)

Showing how to fit into the company's vision (47%)

Explaining the company's vision (45%)

Engaging on a personal level (41%)

When you drag out the company checkbook, or better yet, before, share the company vision with employees, offer them concrete examples and guiding principles for decision-making and improvement in their performance, demonstrate sincere appreciation for the work they do, and show you care how work fits into their lives as a whole.

It's relatively easy to do on an individual basis, but increasingly hard to build into an entire company's culture.

Barr Corporate Success has improved teamwork, profits, retention, productivity and profits throughout organizations from family businesses all the way up to Fortune 500 companies.

Call Krissi or Jodi today to find out how we can help you hardwire amazing performance into your company!

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Lehner: "Skate to where the puck is going"

Eddie Lehner, executive VP and CFO of SeverCorr, showed nearly 200 area executives just what it takes to get a brand new steel company off the ground -- smart planning, supportive communities, and, most important, persistence. Lehner spoke March 14 to a joint luncheon for the Association for Corporate Growth and Greater Cincinnati Venture Association. A friend and former client of Barr Corporate Success, Lehner spoke compellingly of how he and other steel executives planned and financed the $900M start-up steel mini-mill in rural Mississippi from scratch.

"You're building what?" Lehner was asked

when he initially pitched the project. Some dismissed it as crazy. The steel industry is consolidating and fighting for market share with overseas competitors, but Lehner felt SeverCorr was at "the intersection of opportunity and chance." He anticipated the deal would take 3 months to put together. It took 21 months.

"It's humbling, and perseverance is 99 percent of everything. You have to put in the time, pay the price, keep going 'til you get to 'yes,'" Lehner said.

Why steel, why now, and why in the U.S.?

"Consolidation of the industry has left room for entrepreneurs to slip in underneath," Lehner said.

These entrepreneurs began their "crazy" mission with extensive combined knowledge and a sincere commitment to revitalizing steel in the U.S. They identified obstacles working against existing steel companies, and the largest was transportation costs. The answer: location, location, location.

"Transportation logistics is at a crossroads," Lehner said,

citing the saturation of insterstate highways. If SeverCorr could avoid long haul trucking, using water, rail, and short-haul trucks, savings would be substantial. The team knew any new steel venture would need to be located near the growing automotive manufacturing market in the Southeast. Auto plants for Kia, GM, Nissan, Honda, Mercedes-Benz, and Hyundai are clustering around the Mississippi River in Alabama, Louisiana, Tennessee, and Arkansas, seeking deep water for access from Brazil and Venezuela. Lehner followed the example of Wayne Gretsky.

"I skate to where the puck is going, not where it is."

Efficiency throughout the supply chain is key. SeverCorr benefits from new technology and equipment, with no legacy and maintenance costs from older equipment. The team developed trust with its suppliers; they negotiated consignment deals for raw materials which compact the cash conversion cycle so that the company need not pay for the pig iron until it hits the smelter. SeverCorr is the first domestic steel mill able to roll 72-inch hood stampings for automobiles, capitalizing on a local market not being met. Other factors smoothed the way for SeverCorr. Lehner cited Mississippi Governor Hayley Barbour as "a motivated governor" committed to economic development and willing to offer incentives. The Tennessee Valley Authority was able and willing to provide the vast power required for the mill. SeverCorr took full advantage of Mega-Site certification -- a McCallum Sweeney program that acquires tracts, performs Phase I and Phase II due diligence, and has the sites ready for development. The company bought a 1400 acre "golden triangle" bounded by the airport, river, and rail, breaking ground in October, 2005.

The community welcomed the plant, and more than 9,000 applied for the 400 initial jobs. Recent announcement of a Toyota plant to be built 70 miles from SeverCorr is yet another boon.

SeverCorr's talent management is also an update to traditional models. Lehner said the company has a covenant with its workforce, an egalitarian philosophy stressing

"commitment, knowing what we're doing, and why we're there. "

With construction expected to finish this October, SeverCorr is positioned to revitalize the domestic steel industry, and spark development throughout communities in the rural south. The day it opens, the mill will be the largest solid waste recycler in the state of Mississippi. Despite years of effort, months spent in hotels, and more than 900 pitches to financiers, Lehner speaks enthusiastically of the journey.

"It's not often you get to advance your field like that," Lehner said.

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Strengths Can Become Weaknesses

Investor and financier extraodinaire Warren Buffet has said that most people could be as successful as he if they got out of their own way. While leaders have coping styles which enable them to get beyond daily crises, some of those coping styles can trip them up in the long run. Are you defeating yourself with one of the following tactics?

• Avoiding confrontation. Sometimes the stronger you are, the more you avoid confrontation. "I don't want to upset people," you say, but it may be that you fear losing control.
• Hiring great advisers, but not listening. It's difficult to change habits, which have been reinforced over time, but ignoring your most insightful colleagues isn't the answer.
• Not acknowledging when you're wrong. It's somewhat horrifying, initially to think, "If I'm wrong about this, I may be wrong about other things." It takes great strength to admit being wrong, but builds a strong team mentality and eliminates the protectionism that perpetuates mistakes.
• Not dealing with reality. Same situation -- if you can't handle one reality, others are sneaking up on you. Confront and deal with reality.
• Waiting too long to cut your losses. Your stick-to-it-iveness has served you well in many situations, but throwing good time, money and effort after bad won't always bring about turnaround.
• Dwelling on strategies without following through. While it's lovely to behold your strategy from afar, execution is key. Strategy is a process -- not ironclad marching orders -- that helps you move forward purposefully. Yes, you will find flaws, but can adapt and move on to success.
• Relying on analysis over instinct. Logic and reality don't always synch. The market moves fast, and over-reliance on analysis sometimes takes more time than you have.
• Trusting instinct over analysis. Yes, this contradicts the previous pitfall -- but either extreme can be disastrous. Let's face it: Desires and wishful thinking can distort your "gut feeling." Ground yourself in reality, without getting buried in analysis.
• Playing favorites. Rewarding "brown-nosers" might gratify your ego, and temporarily make your life easier, but will poison team dynamics and cost you talent and turnover.
• Mocking what you don't understand. Nobody knows everything, and taking the position of interested learner increases your knowledge and understanding. Dismissing new info as unimportant can mean missing huge opportunities.

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Lehner of SeverCorr to Speak March 14

I’d like to personally invite you to join me and the Greater Cincinnati Association for Corporate Growth and the Greater Cincinnati Venture Association as we host Eddie Lehner, CFO, SeverCorr on Wednesday, March 14. Eddie is both a personal friend and former customer. The deal at the heart of his topic, Raising $900M To Build A Steel Company in Rural Mississippi, was named the 2005 “Deal of the Year” by Project Finance Magazine. The topic comes at a time when U.S. manufacturing industries and the surrounding issues of outsourcing and jobs are on the minds of the American public, corporate management, and elected representatives.

SeverCorr will use low-cost technology to produce high-quality steel, a market largely served by U.S. Steel, Mittal Steel and AK Steel, which employ more expensive techniques. If successful, SeverCorr could prompt a whole new wave of steel industry investment in the United States. SeverCorr believes it has other advantages over its northern rivals: It's non-union and strategically located near several automotive manufacturing facilities. SeverCorr has been recognized for the unique way in which the financing was structured. The majority of the vendor payments are linked to the long-term performance of SeverCorr. GE Commercial Finance has backed the plant with over $440 million. Eddie has local roots – earning his degree from UC and starting his career in Cincinnati’s Deloitte & Touche office. I’m excited about the opportunity to hear Eddie speak and hope you can join me Wednesday, March 14 at the Hilton Cincinnati Netherland Plaza’s Hall of Mirrors! Registration is at 11:30, followed by the luncheon and presentation from 12 to 1:30 p.m.

You can easily register by calling 866-500-ACGC or visiting www.acgcincinnati.org for secure online registration. Please feel welcome to invite anyone who you think would enjoy hearing Eddie’s insights.

See you there!

Krissi Barr

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ACG Recap: Harlow, Williams and Wood Share Strategies, Experience

Turnout was tremendous and discussion lively at the ACG Cincinnati Deal Maker panel discussion and luncheon February 14, 2007. Despite inclement weather, more than 160 gathered in the second floor lounge at the Queen City Club to hear Pat Harlow, Contech President, CEO and Chairman of the Board; Dave Williams, Chemed VP and CFO; and Frank "Bo" Wood, Secret Communications CEO share their experiences. Moderator Jack Wyant of Blue Chip Venture Company asked the distinguished panelists for three "reasons" for their success, missteps in deal-making, and advice they would offer those interested in the profession. Pat Harlow's three attributions for success were defining market segments, knowing one's limitations, and maintaining a management structure that has a burning desire to win. Of mistakes made, he jokingly said, "My tenure -- none so far," following up with an informative anecdote about having been too conservative. He advised pursuing appropriate and judicious synergies, and consistently delivering and executing.

As learned through 17 years and 25 acquisition efforts with Chemed, Dave Williams' best practices for success are:

1. Be prepared to walk. Chemed seeks out "diamonds in the rough," and walks away from deals that veer in any other direction.
2. Avoid "I just bought you so I must be smarter than you" thinking. Moving too quickly can destroy some of the market advantages just purchased, and deals bring more results when people are treated honestly and with respect.
3. Once informed and ready, move quickly. An initial study period is highly advisable, but once strategies and processes are in place, move decisively.

As for missteps, Williams cited having unnecessarily bought the competition over which his company had already gained market share. He advised strongly against ever creating or customizing your own software.

Frank "Bo" Wood, now with Secret Communications, but known by many from his previous prominent role in radio with stations such as WEBN, cited differentiation, recognition of people's boredom, and maintaining close, somewhat egalitarian relationships with those who work for him. "Wear a tee-shirt once in awhile," he advised.

Wood's mistake: "The 60's and memory loss from that time of my life, I think." He intimated that there's not enough time for lists of "could've, should've, would've" but that all of life is a learning experience. He advised that it's better to sell too early than too late, and holding out for more money can often cost you more in stress, tough negotiations, and energy that could be better spent on the next deal. "Too many things can happen that will devalue your offering, and then you really lose."

Wyant closed the presentation by thanking the panelists, and recapping words and themes which had emerged, including "Respect the people and the process."

To learn more about ACG Cincinnati or to join online, please visit http://www.acg.org/cincinnati/.

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Purpose

Because Barr Corporate Success believes in achieving results through strategic thinking and disciplined action, I'd like to first describe this blog's purpose. To succeed in any endeavor, it's useful to begin with some end in mind. Many blogs are spontaneous expressions of what's happening in people's lives, both inner or outer, but this blog is grounded not in personal need for expression, but our desire to enable others to reach heights they had not thought were possible. Your time is valuable, and we respect it. Here, we seek to share useful, practical information for increased execution, understanding, achievement, communication, teamwork, job satisfaction, efficiency, retention... all those factors which lead to both amazing performance and a more satisfying and profitable work life for all. In a word, the purpose of this blog is leadership. In this space, we will be sharing events, activities, books, articles, links, and personal insights from and by business leaders, as well as thought-provoking materials from a variety of sources which can shift your thinking, give new perspective, and spark creative solutions to any challenge. Some entries may be short and factual, some longer and more esoteric, but all will focus on informing, inspiring, and leading. We hope you both enjoy and learn from each and every post. Let's get to work! Return to Barr Corporate Success -- http://www.barrcorporatesuccess.com