Stepping Up Part II: How Leaders Are Rising to the Occasion
Turn on any news channel right now and the headlines are dominated by the health and economic devastation inflicted by the COVID-19 pandemic. There’s no denying the urgency of this moment, and the imprint it will leave on our lives and organizations. But behind the headlines, there’s a different story unfolding.
For purpose-driven business leaders, now is the time to step up and make the right decisions to protect your organization and team members. We’re seeing leaders retool their entire business model in a matter of weeks — and pulling it off. Next-generation leaders are stepping up to the plate to do their part to ensure the business survives. And when it’s time to cut costs, these leaders are skipping over the obvious choices and letting empathy guide them to more creative solutions.
We’re excited to share the second installment of Stepping Up, a recurring series that highlights the incredible stories coming out of this moment. Throughout the Small Giants Community and beyond, leaders are rising to the occasion to do what’s right when it matters most. These are their stories.
In this installment:
Stepping up: imageone
Vulnerable leadership inspired this team to pull together and save the company
This is when we find out if our culture is what we think it is. This is where all of the hard work we’ve put into building our culture shows up. We’ll find out if it’s for real.
Most mornings, Rob Dubé makes a cup of coffee and settles in near a window in his apartment that overlooks Campus Martius in downtown Detroit. An urban core of the city, Rob loves to observe the energy of thousands of people streaming through and going about their daily lives. On a gray morning in early March, Rob looked down at the familiar landscape of high-rise buildings and was met with a surreal emptiness: almost no one was out there.
Rob and his business partner Joel Pearlman are Co-CEOs of imageOne, a managed print services company based in metro Detroit. The day before, they received word that one of their larger clients would be testing out working from home for the rest of the week. It was March 11th, and the pandemic was just starting to enter mainstream consciousness in Detroit.
“I picked up the phone and called Joel,” says Rob. “I told him what I was seeing — downtown Detroit is nearly empty. This is real, and if other companies follow suit, this is going to hit us hard. Let’s get ahead of this.”
Keeping the Team Together
That Friday, imageOne’s executive team gathered for a weekend of intensive planning. Rob and Joel, along with their controller Emily Kmita and president Josh Britton, put themselves to task modeling out the worst-case scenario and financial impact. Pretty quickly, they identified the two priorities that would serve as a litmus test for all of the decisions that lie ahead: they wanted to remain a financially healthy company, and they wanted to protect the financial and mental well-being of their team members. They knew each of those goals couldn’t happen without the other.
“People often wonder if culture really pays off,” says Rob. “This is when we find out if our culture is what we think it is. This is where all of the hard work we’ve put into building our culture shows up. We’ll find out if it’s for real.”
imageOne has team members in eleven different states, and as stay-at-home orders went into place around the country, the impact on its business was swift and significant. A large portion of the company’s recurring revenue relies on people being in the office printing pages, and they watched those numbers decline in real time. New business was put on hold, service calls declined — worst case scenario, they predicted a 70 percent drop in revenue.
“Based on our projections, we knew we needed to make deep cuts to payroll,” says imageOne President Josh Britton. “Making cuts to expenses and travel was easy — the painful part was jobs. Rather than resort to lay-offs, we wanted to share the pain with the objective of keeping everyone together. We decided to put it to the team to share ideas on how we could get through this in one piece.”
After briefing the management team, they made plans for an all-hands video conference meeting on Friday morning to share information with the team and bring them into the planning process. They came up with a simple math problem that projected the reduction of revenue in the worst-case scenario. Josh would lay out the situation and ask for the team’s help in finding additional cuts and deciding how to reduce payroll. Starting the next week, each department would meet to come up with alternative ideas for protecting the financial health of the organization.
“Practicing open-book management gave us a head start,” says Rob. “They know the numbers, they know what an income statement is and they understand the importance of cash. Financial transparency really shows up in times like these — there’s no getting people up to speed, they just get it.”
But financial transparency doesn’t make delivering bad news any easier. Friday morning rolled around, and Josh delivered a clear yet vulnerable message to the team: we need to make payroll reductions and we need your ideas on how we can do that. Walking through their projections, they explained the guiding priorities they’d come up with, and showed what it would look like with full compensation and with reductions. In any scenario, Rob and Joel agreed to forgo their pay during this time.
“It was the hardest meeting I’ve ever led,” says Josh. “You’re looking at 62 faces on your screen, and it’s going to impact every single one of them. There were a lot of tears, and there was a lot of shock. But I was most overwhelmed by feeling the energy of the call shift in real time. People immediately fell in love with the idea of keeping this team together.”
One by one, people started chiming in to encourage one another and express gratitude. One person spoke up and said, “We’re a family, let’s stick together.” Another team member gave a 5-minute long, impromptu motivational speech. Of course nobody liked the new reality — pretty much everybody spent the afternoon away from their work, adjusting their family’s budgets and calling creditors, but the energy was positive and united.
“After the call, I broke down,” says Rob. “I’ve never been in a position to make a decision that so widely impacted everyone’s financial situation. It felt surreal, I didn’t know what to do next. It was a difficult moment but also uplifting, because there was so much beauty in how it unfolded.”
By the end of the week, they had nearly one hundred cost-cutting and revenue-generating ideas. Ultimately, the team landed in the same place as the leadership team: they would all take a deep payroll cut.
Let the Answers Come from Within
For the next few days, team members went to work generating new ideas. As each team met, they were guided by the two priorities originally defined by the leadership team: to protect the financial health of the company and the financial and mental well-being of its team members. By the end of the week, they had nearly one hundred cost-cutting and revenue-generating ideas. Ultimately, the team landed in the same place as the leadership team: they would all take a deep payroll cut. Not only that, but team members started stepping up behind the scenes to take additional concessions.
“The true test of one's character is what they do when no one's watching,” says Josh. “Team members started calling me offline and offering to be at the back of the line when we start returning to full compensation. They thought others might be struggling more, and they wanted to keep the company together and healthy. Not for merit or accolades – just because they care.”
Josh interacts with fellow Small Giants Leadership Academy participants.
With some team members having more time on their hands, they’re taking the opportunity to get creative and dream up new possibilities for the future. People from across the company have formed an ideation committee for six weeks of facilitated creative thinking. At the end, everyone will take their best idea and pitch it to the company in a Shark Tank style presentation.
“In a way, we’ve been given a gift. We’re using this time wisely,” says Rob. “Most of our competitors have laid off at least a third of their staff, and eventually, they're going to have to retool and get people back in and get organized. We know that we’re stronger together, and we’re proving that we can get through anything.”
Make Tough Decisions Early
Every day is a new day in this crisis, and imageOne’s worst-case scenario projections have yet to come to fruition. So far, the decline in revenue hasn’t been as bad as predicted, so team members haven’t taken the full paycheck reduction they planned for. imageOne also secured a Paycheck Protection Program (PPP) loan, and the team will be back to full compensation by the time the next paycheck hits their bank accounts. With things changing so quickly, the key is staying close and keeping everyone well-informed.
“Information is top priority,” says Josh. “Without it, negative talk gets going and people can make assumptions and it causes panic. We meet regularly and we’re open, honest, and transparent. Information automatically lowers the temperature for everyone.”
Genuine Care for the Team
On paper, the events of the last month would be catastrophic for a small business like imageOne. But all the work they’ve done to define their purpose provides a strong foundation for navigating this new terrain. To ensure they are genuinely caring for team members through this time, they started surveying everyone three times a week: do you feel cared for, connected, and informed? It’s now a company metric included in their scorecard, and the goal is to have 90 percent of team members reporting positively.
Even with social distancing, the team is staying close and keeping tabs on each other’s overall health and wellness. imageOne uses a method called the Simple Six to meaningfully check in with team members and the most important aspects of their well-being: meditation, sleep, nutrition, movement, connection, and gratitude. It’s a practical list that tends to uncover underlying issues pretty quickly, and gives leadership an opportunity to provide support. In the battle of crisis versus culture, culture is winning at imageOne.
They started surveying everyone three times a week: do you feel cared for, connected, and informed? It’s now a company metric included in their scorecard.
“This is a reshuffling of the deck that really caters to people who are purpose-driven,” says Josh. “I have a deep sense of hope and faith in this moment, and that comes from the 61 other people in this company. That’s the only place I need to look to believe in what we’re doing, why and who we’re doing it for.”
Stepping up: FLOCK
EMPATHY IS SAVING MY company
"So even when faced with this imminent and shocking loss of revenue, the math was simple: since profitability means good jobs, then we’ll remain profitable as long as we can."
Lisa Wise is co-founder and President of Flock DC, the unifying identity between a family of real estate companies in Washington D.C.: Nest DC, Roost DC and Starling DC. Lisa’s companies keep 52 people employed and aggregate 6.5 million in business annually.
Lisa built her company one door at a time, and she’s determined to protect her organization and the people it serves. In her own words, Lisa shares how they're surviving right now and why she is relying on empathy as her engine.
Empathy is not a common keyword, shall we say, in the property management industry. Or in business in general. My industry in particular has earned its reputation. Common wisdom suggests that in order to succeed, a landlord must resist all her empathic urges or simply fail. But expressing empathy — in word and action — is what feeds me. I wish more people would try it. I wish our culture allowed for it. Some people have no idea how good it feels.
Public Health Over Profit
Since this crisis began, we have operated under the philosophy that it’s better to risk making tough decisions too early than bad decisions too late. In early March, long before any states began to issue stay-at-home directives, we furloughed our maintenance team, while projecting a $225,000 monthly drop in revenues. This has resulted in not so much a financial gap to bridge as a yawning, terrifying chasm. But there was no question: we needed to prioritize public health over profit and even solvency. I knew that working quickly to solve for the worst possible scenario would help us save Flock in the long run.
As every good leader knows, the buck stops at the top. What every good leader also knows is that when the bucks run out, the top should be paid last. Tragically this ethic is practiced so infrequently in the U.S. that it becomes an exception to celebrate and the rarest demonstration of servant leadership. Owners paying themselves last should be the rule, not the exception. I am the person who hired our teammates; they and their families rely on me for their livelihood. How could I possibly accept a full paycheck during this time?
Roost DC's "Free Little Pantry": Grab something if you need it, drop off something if you’ve got some to spare.
Keeping the Team Together
I took a 75 percent pay cut for the duration of the crisis. I asked our management team to accept a 5 percent cut; in response they offered 10. They also offered to halt their retirement savings payments so that the company could save on our 401k match program. We are running on fumes, operating in short-term crisis mode; hoarding cash that doesn’t need to go out the door. We are focusing on payroll and small business vendors and covering bills that would threaten our credit worthiness or expose us to liability if they went unpaid. Everything else — property taxes, utilities, scores of other invoices — have been put on ice.
As for the rest of the staff, we are resetting the financial clock every 14 days in order to guarantee their salaries for the following six weeks. We’re still offering 100 percent employer paid benefits and health care. My financial models are continually evolving. There is no long-term financial plan because that would be an exercise in futility and frustration, given things are changing so quickly. But we know nonetheless that nothing will be the same once we emerge from this crisis, and so a long-term vision for our company is emerging, driven by a staff that is incredibly, doggedly motivated to make it work.
The Flock team celebrating together.
Profitability Means Good Jobs
I’ve always known that any company I started would be anchored in generosity. To that end, I’ve always measured profit not in dollars but in the number of good jobs we create; good jobs that mean people can not just pay their bills but enjoy their lives. I want to create career paths and provide healthcare and ensure people have time with their families both now and in the future. So even when faced with this imminent and shocking loss of revenue, the math was simple: since profitability means good jobs, then we’ll remain profitable as long as we can.
I’ve always measured profit not in dollars but in the number of good jobs we create; good jobs that mean people can not just pay their bills but enjoy their lives. I want to create career paths and provide healthcare and ensure people have time with their families both now and in the future.
Those Impossible, Unthinkable Words
The hardest moment I’ve ever experienced in any job anywhere came just two weeks ago, when I had to tell my employees that we needed to be worried for our livelihoods. I told them the leadership team was working on continuity and I shared our short-term planning in great detail. I told them I was thinking of them twenty-four seven.
I was alone in my home office, saying these impossible, unthinkable words, and knowing in my heart of hearts that despite these dark circumstances this was also one of the greatest moments of my professional life. I was occupying the intersection of concern, ingenuity and innovation, panic, anxiety and adrenaline, uncertainty and grief, exhaustion and sophisticated planning. In that moment, I was my very best self.
Stepping up: VIvayic
DRIVEN BY PURPOSE, NOT FEAR
“I don’t have a crystal ball. We’re realistic about the uncertainty of the future — all I can do is be transparent about the steps we’re taking to prepare."
At the end of a company-wide, virtual town hall in early April, Vivayic’s leadership team answered questions submitted by team members. It didn’t take long for the question on everyone’s mind to come up: how will COVID-19 impact the business?
“I told them the truth: I don’t know,” says Co-CEO Doug Kueker. “I don’t have a crystal ball. We’re realistic about the uncertainty of the future — all I can do is be transparent about the steps we’re taking to prepare.”
Let Your Values Lead the Way
Doug’s response reflects one of Vivayic’s core values: authenticity. No matter what, they show up real and vulnerable to teammates and clients. Vivayic develops strategic learning solutions, and they’ve yet to see a significant drop in client services. As organizations around the country adjust to working from home, Vivayic is already ahead of the curve — its team has been fully remote for 13 years. But even though it’s largely business as usual inside the company, the reality is that everyone is still impacted by what’s going on.
The Vivayic team together for team meetings.
“There is growing dissonance for me,” says co-CEO Seth Derner. “The outside world seems to be filled with panic and chaos and yet our world, within Vivayic, seems to be near normal — other than a few more small “co-workers” in the background.”
As the leadership team — Doug and Emily Kueker, Seth and Carrie Derner, and Candice Gouge — began to notice this tension within themselves, they decided to proactively address it with their team members. In times of crisis, you run the risk of letting fear and worry paralyze you into inaction. They wanted to remind the team of Vivayic’s purpose in the world, and let that drive them instead.
“I’m not afraid to be vulnerable and say I don’t know what’s coming next month. My mantra is to stay flexible and stay rooted in who we are.”
Naturally, they turned to their core values as the lens and framework through which they would communicate with the team. Vivayic’s core values are the secret sauce to its culture and they guide how everyone on the team lives and works on a daily basis. With 33 team members distributed across 13 states, their values connect them to one another and empower each individual to make the right decisions for the company.
“People are looking for leadership right now,” says Emily. “We want to offer a sense of stability and calm amid the chaos. We’re putting together a series of blog posts called ‘Building Together’ for our team that translates each of our core values into small, impactful actions they can take every day to build others.”
Consider the feeling of dissonance Seth described. How could the team deal with the dissonance of their relative security while the outside world is hurting? He pointed them to their core value of ‘Initiative,’ which is represented with a discarded gum wrapper from one of Seth’s favorite business fables.
“As the story goes, a CEO observed her employees deal with a gum wrapper that had been left on the floor,” says Seth. “Many ignored it, others noticed it but did nothing about it. Finally, someone stopped to pick it up and discard it. That person took the initiative to do a little thing that would improve the situation for everyone else.”
Vivayic’s team members now found themselves with hundreds of “gum wrappers” around them: hospitals that need supplies, neighbors that need assistance, and clients that need help responding and staying focused on their goals. If they are truly living their values, now is the time to take the initiative to pick up the “gum wrappers” in their communities and for their clients.
Wisdom From Experience
Like many, Vivayic’s uncertain what the future holds. They're unsure if they'll feel the most impact in three months or three years. But when you talk to their leaders, you get the feeling they’re not scared to tackle whatever challenges come their way. It’s in their name: derived from ancient Sanskrit, Vivayic’s name translates to “wisdom from experience.” There’s a certain confidence that comes from knowing that no matter what, your foundation — your purpose, your values, and your vision — will remain unchanged.
“One of our values is durability,” says Doug. “I’m not afraid to be vulnerable and say I don’t know what’s coming next month. My mantra is to stay flexible and stay rooted in who we are.”