In my last posting I wrote about characteristics of effective leadership, branding, communications and design. The following story shows how one company has embraced these principles for commercial success.
Some months ago, my design colleague at Orange Keel Branding and Design, Muna Lallas, introduced me to her client EarthFresh Foods Inc. I will always be grateful for this introduction as it not only generated some revenue for me but it gave me the opportunity to learn about a pretty remarkable company and its leader, Tom Hughes.
As part of my exploration of the potential of aligned focus (see previous post - What is common...), I will be interviewing corporate leaders who appear to be effectively aligning their leadership style, brand management and communications efforts. I'm starting with Tom.
One of the first things that strikes you about EarthFresh Foods is that it appears to be a pretty simple business. It is involved in all aspects of the potato business from seed breeding, seed production, tablestock production, packing and distribution. It also sells some carrots and onions but this is pretty much a potato business. However, as I have learned from working with farmers in the wine business, any enterprise that depends upon Mother Nature, the vagaries of weather, and the harsh realities of food retail, digging deeper shows a complex undertaking.
In business for over 50 years, EarthFresh has had its share of ups and downs. According to Tom, the company was near going under in 2004. When asked what created the recovery Tom replies, "Luck."
As he goes on to tell his story though you begin to realize that the Kroc quote is key to Tom's 'luck'. The realities of the company's financing were such that failure to secure a favourable outcome would shutter the plant. As President, Tom was concerned that the existing owners were fully prepared to allow that so rather than take the bullet, he found his own source of financing from a mezzanine bank. So began his personal battle to move the company back from the brink of extinction.
His strategy revolved around the Hedgehog Principle which is based on an ancient Greek parable that states: "The fox knows many things, but the hedgehog knows one big thing."
Jim Collins developed this idea further in his classic 2001 book, "Good to Great." According to Collins, organizations are more likely to succeed if they focus on one thing, and do it well. By doing so, they can beat their competitors and become truly great businesses.
An organization can find its "Hedgehog Concept" by making three separate assessments. First, it can understand what its people are truly passionate about. Next, it can identify what it does better than anyone else. And last, it can determine where it's good at generating revenue.
The right way forward is where all three answers intersect, and it's this central position that is the "sweet spot" for the organization's strategy.*
Tom determined that the sweet spot for EarthFresh was - potatoes. This product of the good earth drove the passion, economics and ambition of the company AND it's employees.
He took the company out of the carrots and onions business and decided that they would become "really good at potatoes and using our expertise in the field to carve out our sustainable points of differentiation." That was his determination to be authentic about what the business could and would do.
The company's 'luck' continued in 2009 when the economic downturn that had such a grave impact on North American business caused the company's bank to seek a way out. Tom found a way to buy back the business and continue to swim back toward the surface.
"From the very beginning I knew we had to keep the team together," Tom observes. "One way in which you accomplish that is to share the big picture and let the entire group know that they have contributions to make."
Tom himself is the beneficiary of sound coaching from his Advisory Board. The Board includes Millard, a former CEO and Tom's mentor. Also on board is his daughter. This group acts as sounding board, reality check and critic encouraging Tom to achieve consensus while taking ultimate accountability and authority.
"We collaborate very well and I think my team understands that with authority comes accountability. We do not have a blaming culture here but neither are any of us permitted to sweep errors under the carpet. This has created a great atmosphere of trust throughout the company," commented Tom.
Tom realized early on that if he was going to rescue the company he would need the full and enthusiastic support of everyone from the executive suite to the factory floor to the fields. He also recognized that the entire team would need to have clarity on performance expectations and company commitment. Whether born of the tough times re-starting the company or just from a conviction that all hands on deck is the right course, Tom is intimately involved in virtually all significant decisions. In fact, any expenditure in excess of $500 must have Tom's approval.
"I seldom refuse, I just need to know what's happening. My team doesn't view it as meddling. In fact, when I'm not here they adopt a 'What-would-Tom-do' approach and frankly that means we all understand our common objectives."
Tom is also intimately involved in major sales efforts as he wants the prospective client to know that the commitment from EarthFresh is comprehensive - from Tom to the warehouse foreman, everyone is well coached on client expectations and the commitment to deliver excellence. When challenged if his sales team objects to his role Tom states, "Quite the opposite. I take no cut of the increased compensation they receive so everyone seems pretty pleased about the approach."
It is on this front that EarthFresh really impresses. And, while they are innovators in the potato business - more and more attainably priced organics; ready meal complements such as Celebratoes!; exclusive varieties Klondike Goldust and Klondike Rose - it has embarked on unexpected initiatives with its employees.
The company recently moved to a state-of-the-art plant in Burlington, ON. Its previous plant on Browns Line in Etobicoke just wasn't up to the task of seeing the company into its next growth phase. Moving your plant is not especially unique in business but one of the genuinely innovative activities undertaken was to offer a shuttle service to many of its employees.
It is not uncommon, in businesses where production line and warehouse employees are a feature, that when the plant moves those people are out of work. Surely EarthFresh could have easily found new, skilled labourers in Burlington but keeping in mind Tom's stated ambition to "keep the team together" the company now shuttles people from the old plant location to the new. That's an expense many corporations would forego. As Tom explains though, "You can't always approach your financials from a purely quantitative perspective. There is a qualitative aspect that must be taken into consideration especially if one operates a company that truly believes in the long-term benefit of creating a culture of caring. It is critical that we ensure cultural continuity and reality."
The caring goes beyond the shuttle too. EarthFresh has a well-equipped, modern gym for its employees to maintain their exercise regimes and fitness levels. There are weekly exercise and fitness and yoga coaching sessions.
EarthFresh is driven by genuine, authentic passion; by focus; by a determination to go get the next big thing if it makes sense to the entire organization.
To conclude, as Tom said, "You can't always evaluate and justify every action just from a quantitative perspective. You can however always add a qualitative evaluation to ensure that the principles of the company are followed and nurtured. That's where our success has come from and where it will sprout in the future."
My thanks to my friend Bob Woodcock, (http://www.thepulsecheck.com/) for his counsel in preparing this article. And further thanks again to my colleague Muna Lallas (http://www.orangekeel.com/) for the introduction to EarthFresh and to Tom Hughes for his sharing.