How a Little Toilet Paper Saved a Multi-Million Dollar Company

“My mother loved me to pieces,” wrote humorist Roy Blount Jr. “And I’m still trying to pick up the pieces.” Blount explores his relationship with his mother in his book <i>Be Sweet</i>, which anyone raised in the South will recognize as the advice we often received.

I often use that advice along with the other constant admonitions my mother gave me as a young boy to use the words “please” and “thank you” in my career in the turnaround industry. My own interpretation of being sweet is that I treat everyone with respect. That’s the way my momma raised me.

When I visit a failing company for an assessment or when I take over as Interim CEO, the situation can seem depressing. These companies are not on Fortune’s 100 Best Companies to Work For, to say the least. Their employees work for the anti-Googles of the world: there is no free gourmet food, no celebrity visit, no bocce ball court or bowling lanes.

The employees know the company is in a bad situation. They’ve heard rumors about bankruptcy, layoffs, salary cuts. Most likely they have had very little communication from the higher ups to dispel what may or may not be only rumors.

Then I show up. A total unknown. About as welcome as a skunk at a garden party. I need to turn that negative emotional tide quickly so I can do the job I’ve been hired to do. I need these people on my team, and I want to give them hope about their futures. I can’t give them free gourmet meals – but I can buy them toilet paper.

I’ve mentioned this story before as a lesson for CEOs to watch their raging egos, but it applies for this situation as well. A very smart Ivy League Ph.D lost his $50 million company. He practically threw the keys at the bank considering all he kept from them, and I was called in to try to save his company.

Minutes after I arrived the executive assistant asked for $20 so she could buy coffee and toilet paper. Seems the CEO’s wife, the Dragon Lady of El Paso, as she was not so fondly referred to by the employees, had severely rationed coffee and toilet paper and they were out. Not a square to spare.

The company was losing millions, but saving a few dollars by limiting the staff to two rolls of toilet paper a day is kind of like unscrewing the light bulb in the fridge of your McMansion to save on electricity when you’re months behind on your mortgage payments. It won’t make a darn bit of difference except in the Demoralization Department.

I reached into my wallet and took out $100. “Go to that Sam’s Club I saw on the way in here, buy as much coffee and toilet paper as you can. Bring it back, put it in the break room, and tell everyone, ‘Compliments of Lee.’”

From then on, the staff loved me. Nobody lost his or her job, and we sold the company, in full, six months later.

Other times getting buy-in from employees is as easy as saying “please” or “thank-you.”

When I assume the role of Interim CEO, I need the assistance of the staff there. They may need to stay a little late to prepare a report for me, which they have to do in addition to their regular jobs. A simple, “Thanks, I really appreciate it,” to let them know that I know we’re all pulling a little more than our weight to keep the ship afloat, goes a long way. It’s always a shame that so many of them get this strange look in their eyes like I’ve said something odd. To them, I have. They aren’t used to hearing appreciation for doing their jobs.

Treating people with respect goes a long way towards helping build loyalty with a staff, especially when turning around companies. I spend a lot of time picking up the pieces, but not as a result of too much love.

Have you thanked someone lately? Who?

8 Tips for the Entrepreneur in Us All

Who said running your own business or managing your own team would be easy? Most people I interact with, whether CEOs or managers, function in at least one role as an entrepreneur.

I compiled the top actions to which they credit their success, so that I can share them with you. You’ll notice that they are all actions because moving forward is the most important element of running a successful operation.

1. Take smart risks

Don’t be reckless, but you must make bold moves sometimes. Caution is important, but beware of too much circumspection. Any growing business will require risks on its path forward – make sure you choose the risks with the most potential for reward to cost ratio.

2. Hire wisely and accept that you won’t be able to do everything yourself

One of the biggest challenges leaders face is letting go of certain tasks they should no longer be doing. But tying your time up with things that others could do will only hold you back. Learn to delegate, choose the right people for the right positions and make it your personal challenge to train them well at the tasks you pass along.

3. Spend money on healthy business growth

Penny pinching seems to be a wide-spread attitude as well as a reality in the years since The Great Recession. It’s an admirable change in many ways, and I encourage you to be cautious financially and eliminate unnecessary costs. However, don’t be afraid of spending money on development. It takes money to make money – trite but true.

4. Learn from mistakes and don’t let them devastate you 

Mistakes are a part of life and business, and you will inevitably make them. What matters is less the mistake and more that you learn from it. In addition, you have to learn to move on from your mistakes. Dwelling on the mistake will not make you a better businessman – dwelling on the lesson will.

5. Make ambitious goals

Some days you may want to conquer the market in your field, while other days you may feel burdened just maintaining the status quo. Set ambitious goals, share them with your team and use them to motivate yourself and to hold yourself accountable. You started a business to grow it – not to maintain it. Ambition does not mean outrageous. Make them possible, but make them ambitious.

6. Don’t box yourself (or others) into one role

When people find something they are good at (especially if others notice it and praise them for it) they tend to keep returning to the same activity. This is great for becoming a specialist in one specific area, but being an entrepreneur and business leader means doing much more than specializing. By the same token, let people try new things and experiment with new roles – you never know what hidden talents you’ll uncover.

7. Challenge your business model and operational plan routinely 

Can you name a single business that was successful throughout the centuries without changing the way it operated? I can’t. Look at your business plan and the way you operate – find one thing that exposes you to a lot of risk and find one thing that may leave you behind if you don’t change it now. Brainstorm ways to improve these areas and see if any of the improvements are viable. Consider potential mistakes that could take a huge toll or technological advances of which you have not yet taken advantage.

8. Don’t be greedy

When business leaders taste the sweetness of success, they want more and more and more. This natural ambition is a fantastic catalyst for growth, so don’t lose it! But you must ask yourself if the actions you are taking now may only benefit you in the short term while proving detrimental in the long term. Don’t let the desire for instant gratification and visible success cloud your judgement.

What are some points you would add to these tips to help your fellow entrepreneurs run an even more successful business?

Your Employees Always Know

Have you ever thought to yourself, my employees have no idea what I make, or they have no idea what our profit is on this or something similar? Well let me tell you something: you’re wrong.

There are no secrets in a company. Your employees know.

I once took over at a refrigerator warehouse company and began my job by dramatically slashing the owner’s salary, which was not simply too high for the owner of a failing company in need of a turnaround professional but too high for the owner of any company this size. Oh, and I also fired his grandmother whose salary was also a pretty penny too high.

Later that same afternoon I was surveying the warehouse which was a mile away from the offices and headquarters, and a forklift driver pulls up alongside me. He says, congratulations on firing grandma and reducing the boss’s salary – he should never have been making so much money.

Not only did this random employee already know that I’d done both of these things, but he knew that grandma was on the payroll and the boss was making way too much beforehand.

I’m telling you – your employees always know. There are no secrets.

That leads me to a few pieces of advice:

1. Ensure that all of your employees sign a non-compete/non-disclosure confidentiality agreement. All of them, no matter their position.

2. If you have things that truly must be kept secret, think longer and harder about who has access to that information, what computer(s) it resides on, etc. Despite the fact that everyone is working on or around it, I’m sure that the secret formula for Coca Cola is still secret.

3. Accept that certain information will be public, and use the knowledge of its publicity to your advantage.

What have you been surprised to learn that your employees know?

The People You Want in Your Business

There are all kinds of people you don’t want working for your business. If I did a list post of those kinds of people it would be a mile long – a 100-part series.

But there’s one kind of person you do want: you want the kind of person who is internally driven.

This is a rare person indeed.

If you started your own business you would be described as an entrepreneur. That means that you are, 10 to 1, internally motivated. Perhaps money, fame or success is a driving force, too, but one way or another, the drive to take the actions that lead to those things is intrinsic.

Finding similar people is not easy.

I recently had the pleasure of working with a company where nearly everyone I spoke to was motivated internally (this was not a turnaround – the CEO was just experiencing an interesting situation and needed some advice).

As I spent a little time at this company, I had the opportunity to speak with a number of employees. Every single employee (who are called team members, not employees) I spoke with declared his or her intent to stay with this company for the long run. Employment at this company was “a career” and “not just some job.” It didn’t matter what their pay was or what their titles were. Each and every person I spoke with said that the kind of person who never fit in at this company was “a lazy person.” Every person here wanted to succeed because this was a culture of big moves, success and hard work. And they loved every minute of it. Multiple people said that this was the first place that they didn’t feel like they were going to work. They were finally doing what came naturally.

And as I tried to figure out what kind of company I was surveying, I realized that it was one where the employees were very carefully chosen. They were not just hired to do some job. They were brought in to be a part of a team where everyone was driven to succeed – and not for external reasons but for internal ones.

I encourage you to seek out those kinds of team members who are internally motivated to succeed and to do a great job. They’re hard to come by, but I assure you your company will benefit as a result.

You Are Always Leading by Example

If there is such a thing as good leadership, it is to give a good example.

– Ingvar Kamprad

If you know me or you’ve been reading my blog, you know how much I value this concept.

I’ve seen a poor example be the bad leadership to bring down many a company.

If you take a little extra cash out of the register, your employees will feel okay doing so, too. If you speak negatively about your customers, your employees will do the same. Are you a gossip? Expect your employees to become gossips as well.

It doesn’t matter how many inspiring speeches you give about doing the right thing and the amazingness of your company. Your word means nothing if your actions – which are all examples – are poor.

We all lead by example. Make sure yours is a good one.

Click HERE for another post on leadership.

Do you lead by a good example? How so?