The thinking company

The Executive Committee (TEC) member William Gregg of Anaheim, Calif.-based SDC Technologies Inc., a specialty coatings company with 100 employees, has chosen to do what few small companies do – really get "out of the box."
I don’t mean this in a pejorative way at all. Gregg’s goal is to create exceptional performance and velocity throughout his business and in his marketplace. The results? In the last three years, SDC has grown its revenues 20 percent annually and, get this, maintained average gross margins of 85 percent. This is in the specialty coatings business, folks – not diamond or gold mines.
This month, I would like to tap into what Gregg has done, with the thought that you might want to employ his "thinking company" ideas as you march into 2005.
Here’s what he did, in a nutshell. He created an online training program based totally around SDC’s vision and values. He followed up his e-learning activity with post-training discussion groups, putting the online concepts into a real-world context. And, he tied the employees’ successful completion of these courses to their annual performance review.
More specifically, SDC used a six-course outline that included the following components:
1. How you as an employee positively influence workplace culture.
2. How you can prepare to be a leader, not a follower.
3. How you can then take the initiative and lead the way.
4. As a manager and supervisor, what must you delegate?
5. As a manager and supervisor, how can you motivate?
6. As a manager and supervisor, what workplace knowledge do you need to perform your job?
Not everyone bought in. Scheduling issues and personal demands got in the way for some employees. Some simply didn’t find this process a fun thing to do on a volunteer basis. It was no more than that. You volunteer for it.
Gregg would be the first to admit he needed an internal champion to make this work – in this case, his human resources person. But that wasn’t enough. He found an outside vendor to design the training courses, which in his situation had to work across two continents.
His HR person had to define the specific core competencies required at each level of their 100-person firm. That wasn’t easy because many people were wearing several different hats.
Remember, this was an online effort from the beginning. It started from the top, beginning with Gregg. He says that what he learned about leadership as chief executive officer of SDC more than paid for the cost of the e-learning commitment. He also adds that workplace reinforcement is absolutely critical to success. Reinforcement brings in the nonbelievers.
The crux of the aftermath of an e-experience like this forces the following issues to the top: What is a learning organization? Is that us? Do we have a genuine corporate vision, and do we believe in it? Are we using our company’s various resources to learn from one another to improve our respective individual and team performance? Why is it important for us to be a learning organization to begin with?
Let’s recap some important stuff. What we’re talking about here is how a small business can use big-company learning technology to excel in its marketplace. I see a few important drivers and ingredients to make this work:
1. A CEO who says, "This is a good idea – I support it."
2. An internal HR person or outside consultant who can help
select the appropriate e-learning modules that match the company’s stated vision and values (Hint: You have to assume they are in place).
3. The formation of carefully formatted, small, in-house discussion
groups that meet on a regular basis to process, integrate and implement e-learning output.
4. A "house" champion, if you will, who gets the naysayers involved in
becoming "learning organization" participations. At startup, at
least half of the organization won’t sign on.
This is truly a long-term program owned by employees, but driven by the CEO. Gregg points to the fact that without it, SDC’s management-led buyout earlier this year would not have happened.
So here is an ancillary issue to consider. At what point should an owner consider hiring a full-time HR person, the quarterback, to make a true "learning organization" become feasible?
I’ll go out on the limb on this one, which many of you know I have done before.
I suggest that if you have 25 full-time employees or more, you should start thinking seriously about getting an HR person. What they can bring to the party is enormous with respect to your firm’s future employee growth potential.
As a footnote, the other day I was visiting a TEC member who was just about ready to meet with his 401(k) banking group to analyze why their 2004 nine-month results were so dismal. His HR person walked in, interrupted our meeting and suggested to the CEO that the 401(k) people meet with a select hourly employee group.
This group, you see, works in an environment where any question is a fair question of management, or an outside vendor. This HR person practices the precepts of a learning organization. If you participate, if you are willing to grow, you have the right to ask and know. I like it. How about you?
Until next month, just remember: You are never too small to think big. You are never too small to be a learning organization. Until next month, make learning a competitive weapon in your arsenal of success.
Harry S. Dennis III is the president of The Executive Committee in Wisconsin and Michigan. TEC is a professional development group for CEOs, presidents and business owners. He can be reached at (262) 821-3340 or at hiduke@aol.com.
December 17, 2004, Small Business Times, Milwaukee, WI