Positive company culture pays off for remodelers

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Jim Strite, Strite Design + Remodel

Coming into Strite Design + Remodel [1] was an eye-opener for new employee Rita Galbreaith. When she was hired a few years ago owner Jim Strite and others at the Boise, Idaho, company told the administrative assistant that team members set personal and company goals annually. Yeah, sure, thought Galbreaith. Experience working elsewhere told her such goals were nothing more than means for management to make more money.

Not at Strite. There, every employee really does set personal goals and contribute ideas to form mutually beneficial company goals. "It has changed my life, both business and personal," says Galbreaith.

The process is part of the design-build firm's positive company culture. "New people don't get it with our company culture," admits Strite. "It takes a little while." When they do get it, they realize that they are part of a unified and upbeat group, working toward a shared mission to "provide excellent service, on schedule, within budget, through honesty and team approach."

Buy-in by all employees as well as trade contractors and vendors is essential for a company culture like Strite's to thrive. That positive culture in turn has a powerful impact on a remodeling company's success. By engendering a consistent, supportive, best-practices operation, remodeling companies that have a positive culture also have happy, productive personnel; highly satisfied clients; optimum profitability; the strength to survive hard times; and the ability to grow.

Worlds apart

It's one thing to wing it, hoping to sustain an affirmative work climate, and quite another deliberately to structure and nurture a positive culture in a company.

"I've had it both ways," says Patrick Condon, whose Finished Basement Company runs an office in Denver and two in the Minneapolis-St. Paul area. "The difference is worlds apart."

Condon has always had high standards for Finished Basement Company [2], but he used to try to control everything himself to make sure those standards were met. "That never works," he says. Since formally establishing a positive culture at the company five years ago, "our work environment is so much better," he says, "and the results are through the roof. We're so much more efficient."

Even during the recession, when calls were down 30 percent, Finished Basement Company's volume and close ratio went up. Knowing that everyone in the company regularly applies the values and decision-making approach he espouses, Condon can trust that his standards are being met in every aspect of the business--and can focus his energy on growing the company.

Two years ago Dave and Peggy Mackowski sat down and compiled a manual of values, practices, expectations and procedures for their Raleigh, N.C., company, Quality Design & Construction [3]. They already had a lot of the contents in writing, but it had never been consolidated.

"The experience was one of the best things we have done for our company and our team," says Peggy. This is not the standard employee manual of policies and administrative procedures, which the company also has. Instead it is a broader reference that keeps everyone attuned to the company's values, goals and expectations, that is, the principles that define the company's way of doing things.

Quality Design & Construction employs "a well-mixed team" of workers with complementary skills, says Dave. Thanks to a clear statement of company standards, though, "all the values are matching." The result, says Peggy, is "a team of individuals who enjoy their function within the company, each bringing a specific skill set to the task and hand and all working together towards common goals." Dave adds, "We don't have to be involved" in every aspect of the work but can be confident of getting "the outcome we're looking for."

Saltshakers and systems

How can remodelers create a positive company culture? Neil Harvey, of Francis Harvey and Sons [4], Worcester, Mass., says a positive working climate "begins with trust, and you need to have systems to have trust." With systems to guide them, all participants in the team - employees, suppliers, and trade contractors - know what is expected.

"You develop a united front," says Harvey, in which everyone works toward an agreed-upon goal. The company is "proactive rather than reactive." Everyone is encouraged to ask questions, express opinions and identify emerging or potential problems. Instead of defensiveness and fear of criticism, workers freely discuss concerns - for example, a client communications breakdown or a potential schedule-busting situation. Others in the company offer suggestions or step forward to help.

Condon's company systems are built around "saltshakers," or givens. "Our job as owners is to set the table for our team," he explains, maintaining clear standards and a clear approach to decision making. A saltshaker sits on the table as a rule known to all in the company. (One saltshaker at Finished Basements, for instance, is that "there are no lone rangers," we work as a team.) The more saltshakers on the table, the more consistent the result and the more prepared the team.

Each company is different, but a structured system that supports a positive culture has these basic components.

1. Written standards and goals

The company needs to articulate overall goals and standards as well as practical guidelines for everyday work performance. As Harvey says, a complete set of documents addresses "all aspects of the business, so that employees know how they are expected to act in any situation." These documents include at least a company mission statement, a statement of annual goals and plans, procedures documents and an employee manual.

"Every three years, or sooner if needed," we review the mission and values" on which the system is based, says Strite. "Last year we developed a vision statement and a proposition statement to further define ourselves and assist us in knowing where we are going and why."

2. Employment and hiring

Every employee needs to be comfortable working in an open, team-spirited environment. Some current workers may not fit that business model. Veteran carpenters, for example, may be highly skilled but set in their ways. Changing over to a positive company culture often entails making staff changes.

Condon had to do it. "It was a painful transition when I changed the rules of the game," he admits. "A handful of people embraced" the new culture, but Finished Basement Company saw an "almost complete changeover" of staff.

About eight years ago one of the Mackowskis' competitors called them to say he was laying people off. He hoped Quality Design and Construction might want to hire them. Through attrition and layoffs over an 18-month period, the Mackowskis replaced inflexible employees with crews from the other company (no longer in business), gaining a seasoned, compatible team that is enthusiastic about the Mackowski company culture.

Many remodelers use commercially available personality assessment programs to better understand members of their team and determine whether job candidates will fit in. By doing this Strite has built a team of positive players who now average 14 years with the company. The Mackowskis also require trade contractors to sign an agreement that they will conform to Quality Design and Construction's values and standards.

3. Meetings and monitoring

Weekly management and production meetings in a company with a positive culture emphasize honest, open communications. Information is shared, ideas are offered, problems are aired, and company values are reiterated. "We are continually reading a book" on best business practices, says Strite. At meetings, team members make presentations based on book sections and raise points for discussion.

At weekly project meetings with clients, lead carpenters at Francis Harvey and Sons take "temperature reports" of customer satisfaction, says Neil Harvey. If the satisfaction temperature is less than excellent, the lead documents the problem, resolves it or solicits help from the Harvey team during internal company meetings.

Periodic reviews--monthly, quarterly, or annual--also keep company team members informed, provide a forum for brainstorming, and reinforce company values.

4. Rewards and support

Like everything else at Finished Basement Company, Condon distributes performance bonuses on a team-wide basis. When a project is sold effectively, is completed on time, yields a healthy gross profit margin, and achieves a high level of customer satisfaction the whole team is rewarded.

Jim Strite pays tribute to his employees on an ongoing basis. "We continue to invest in our people and continue to tell them how valuable they are," he says. In addition to business books, he funds training and professional development programs for team members.

The Mackowskis keep rewards unpredictable. "A Christmas bonus becomes an expectation," explains Peggy. Special rewards "here and there go further and are appreciated more." Not long ago, one Mackowski employee mentioned in casual conversation that he worried about a dead tree in his yard. After a tree removal contractor finished at a Quality Design and Construction job site, the Mackowskis sent him to the employee's house and paid to have his tree taken down.

For most employees, working for a remodeling company with a positive culture is reward in itself. They take pride in consistently delivering successful projects and achieving rave reviews from clients. Clients too appreciate working with such an upbeat, quality-focused, well-run company. Referrals and repeat business come through despite economic dips because the relationship of trust and even friendship is in place. And if former clients don't call, companies with a positive culture can do the calling, with the expectation of good results.

"We can go to past clients," says Dave Mackowski, and ask, 'Things are slow for us; do you need anything done around your house?'" Often they say yes. Why not? They know how Quality Design and Construction gets things done, and they like it.