The latest news and other interesting stuff.
November 30, 2020
While recording the most recent episode of the Hire Smarter podcast, the conversation with Kyle Little provided such great insight to the commodity lumber and distribution side to our industry, we wanted to share full highlights of the conversation.
Kyle grew up in a family lumber business, and is currently the COO of Sherwood Lumber, a family-owned lumber distribution business. We first dive into Kyle’s background, which allows us to draw comparisons between lumber industry patterns in the 90s compared to today. We go in-depth into both the supply and the demand side of commodity lumber, Kyle is excellent at articulating, in simple terms, the market drivers and why we can expect this market volatility to continue past 2021.
Kyle: “I will say without a doubt, volatility for the next five years, at minimum, is here to stay. It started in 2017/2018. It continued into this COVID supply crunch in 2020. And 2021 should prove no different. And the reason for that is….”
Leaders – LBM leaders commonly will complain about the 2020 commodity market eroding profits. Comments like: “Had we not experienced the volatility in the market, we would’ve made our budget.” As if saying, “When you look at our P&L pre-tax profit, understand we are an excellent company outside how the lumber market treated us.” My follow-up question, “What do you plan to do about it?” is usually met with some version of, “We plan on rolling the dice again this year, and 7s and 11s are sure come, as we are due.” Commanding leaders take action to avoid being tricked, duped, or sacrificed by the lumber market. Ask yourself, what are you prepared to do differently in 2021? When evaluating your procurement team, their performance in 2020 might be the best prediction of their performance in 2021. It’s a new world. Please reach out to schedule a conversation; we can help evaluate the strengths and growth opportunities within the team.
Industry purchasing professionals – smart progressive leaders know that a great buyer might add 1-2% points of pre-tax profit to the bottom line company wide. People making a $1m impact on a company’s P&L are being valued accordingly. Please reach out to our team to better understand your market value.
Hire Smarter – Tony Misura
November 13, 2020
Welcome to our latest episode of Hire Smarter. Our mission is to help building materials industry leaders adopt best practices for hiring talent while helping professionals make better career decisions.
In this episode, we look to deliver a greater understanding of the lumber market. 2020 has been a wild year, and particularly explosive to the lumber market. Our guest is Kyle Little, COO of Sherwood Lumber, one of the largest privately-owned lumber distributors in the nation. Kyle has dedicated his life and profession to understanding the lumber commodity markets and has one message for everyone: “the market volatility is here to stay for the next 5 years.”
What defines heightened volatility? For years 2x dimensional lumber was traded at $320 per thousand with a 30% training range, would fluctuate from $220 to $420 ($200 range). The traditional market lows in January and dealers would watch for a summer slump to buy again. Like the Andy Griffith Show, Mayberry, those days are gone. In 2018 the market traded from a low of $300 to $650, and everyone said that would never happen again. In 2020 the market traded from a low of $250 to over $1000.
What are the factors that drove this recent volatility?
What are the drivers of continuing volatility in the future?
What are the best practices a dealer can implement to prepare?
Kyle does an excellent job laying out some clear, concise answers everyone can action. The sign of a high intellect is the ability to communicate explanations and solutions in a simple, direct format. Kyle hits a home run with his insight and direction.
Listen in on Kyle’s methodology and adopt them as your own, don’t hesitate to reach out to Kyle or myself with any questions. http://sherwoodlumber.com
Hire Smarter – Tony Misura
November 2, 2020
What is the most important factor when hiring a leader? At Misura Group, we look for the candidate’s proven history of success. While a degree, certification, or number of years of experience might be on your list of must-haves, does it outweigh the impact of a candidate’s success in a similar environment?
Consider this example from NASA:
On October 14, 1947, Chuck Yeager broke the sound barrier, at a time when the fast fighter planes struggle to reach 500 MPH. Yeager’s most outstanding achievement was December 12, 1953, when he flew his Bell X-1A at Mach 2.435, 1650 miles per hour, over Edwards Airforce Base. The flight did not go as planned as the aircraft spun out of control on all 3 axes, plummeting 51,000 ft in 51 seconds before he regained control at 25,000 ft and landed safely. Scientists believe Yeager’s body withstood 8x G forces, meaning a 200-pound body would feel the weight of 1600 pounds. Imagine battling through that trauma to regain control of a damaged aircraft and land safely, traveling at 1600 miles per hour. https://www.chuckyeager.com/1947-1954-testing-the-limits
Fast forward to April of 1959 – the Mercury 7 Project, the development of the world’s first astronauts, under the newly formed NASA. Why did the list of 7 legendary heroes glamorized in the 1983 movie The Right Stuff not include Chuck Yeager? It was not his age, as revisionist history was spun to control NASA’s image. Alan Shepard was only nine months younger than Yeager, Wally Schirra, one month younger, and John Glenn was 19 months older than Yeager. In actuality: NASA required a college degree, and Yeager had his high school diploma from Hamlin, WV. Yeager was the most successful person in the world in exhibiting the physical and mental prowess related to being an astronaut. He had the proven history of success. https://www.businessinsider.com/14-reasons-chuck-yeager-may-be-the-greatest-military-pilot-of-all-time-2016-3
Know the difference between experience and success
Leaders running a lazy hiring process will talk about the required experience of a candidate. The world is full of people with experience. The perennial bottom 20% of performers have experience, the professionals who repeatedly self-sabotage have experience, but success, on the other hand, is a clear distinction. A history of success in the exact situation, achieved 3 times or more in a similar environment, is the best indicator of future success.
What is most commonly the #1 problem with hiring processes? It is interviewing a limited and shallow pool of talent that lacks a proven history of success. If you do not have more than 2 excellent candidates fighting over the position at the end of your hiring process, your process is suspect. Do not settle. Embrace your strengths along with your areas for growth. The solution is simple, fix the problem areas or hire an expert recruiting firm to deliver the high-level talent your company and team deserve.
In 2002, at the EAA Air Venture in Oshkosh, WI, I saw an old guy climb into P51 Mustang and start taxiing down a runway. Like a kid, I start running after the plane, the family in tow, as the deep throaty merlin engines shake the ground. The fighter plane pulls over into side access next to a podium and the pilot Chuck Yeager climbs out. A mass of 10,000 people walking by clueless, as our family is talking with Chuck one on one. It took about 30 minutes for the crowd to figure out who he was. His message was clear: the minute the US Space Program moved outside the authority of the US military, the focus shifted to money, fundraising, image, and profits. The list of NASA errors and tragedies attributed to that bane is long. Here is a photo of my son, Logan, from the day we met a hero.
Hire Smarter – Tony
October 2, 2020
In this episode, our guest is Jim Robisch, Senior Partner at the Farnsworth Group. Jim has been a strategic consultant to the building materials industry for over 30 years, developing strategy plans for companies accelerating their growth, through data and research, not anecdotal information.
We dive into a topic that comes up for Misura Group often – strategy. You can’t operate your way out of a poor strategic position. You can’t develop a large enough sales pipeline or turn inventory over fast enough to make up for a poor strategic position. A truly great strategy is a dynamic force that pulls cultural engagement and P&L performance to the highest goals.
How do you develop an excellent strategy? There is nothing “magical” about this process. Once you collect your data and make fact-based conclusions, the direction should be obvious.
Listen on as Jim shares his wisdom regarding how to create a clear and actionable strategy.
Hire Smarter – Tony Misura
September 21, 2020
Hiring decisions are among the most complex and critical decisions that leaders make. The most effective hiring managers can overcome their personal biases to make data-driven decisions that lead to impactful hires. Biases are part of human nature – awareness is important, but it takes a strategy to outsmart them fully.
5 strategies for overcoming biases to make smart hiring decisions:
1) Acknowledge and avoid personal biases
Personal biases are common, subconscious, or unconscious beliefs about particular characteristics or entire groups of people. They can stem from positive impressions, like the halo effect, or preliminary information, like anchoring bias. Start by educating yourself on the many forms of personal biases to increase your awareness. When making hiring decisions, focus on your scorecard for the position, then collect facts and refer to tangible, job-related reasons for hiring or rejecting a candidate.
2) Use cognitive reasoning over intuition
A cognitive approach is critical when selecting talent. Create vetting questions that will provide a clear insight into the strengths and weaknesses of a professional. Take the time to focus on collecting the facts, not drawing conclusions. If you focus on collecting the facts, the conclusions will be obvious.
“When people believe a conclusion is true, they are also very likely to believe arguments that appear to support it, even when these arguments are unsound.”
― Daniel Kahneman, Thinking, Fast and Slow
3) Speak in algorithms
Speak in algorithms, so the language the team uses is focused on collecting data to complete the math. Math does not lie. To calculate the value of a candidate, the leader must solve the following equation:
Resources x Strategy x Candidate/ Time = Return on Investment
4) Encourage vetting as a team
Vetting is a team event, providing multiple perspectives and a more well-rounded view of a candidate’s fit. Double-vetting is critical to our process here at Misura Group, standing in each other’s blind spots and calling out each other’s biases.
5) Gather indirect reference checks
People lie on reference checks. This is a tough obstacle for companies and corporate recruiters to overcome as their intentions are not shrouded, making a genuinely unbiased reference highly rare. One of the most valued aspects of our vast network in the industry is the ability to call a president to discuss an opportunity that might be of interest, then asking the question, “in your career, who are some of your proudest mentees?” What this is really driving for is a reference on a manager that reported to him years ago. If the president selects this professional from a history of leading 20+ leaders, that is an objective reference – worth its weight in gold. When reference checking, it is tough for hiring companies to feign their intentions and minimize exposure to the candidate. In this competitive environment, losing candidates to other companies once they are deemed “on the market” is a significant risk. Not to mention jeopardizing a professional’s current career position and need for confidentiality.
We are all susceptible to biases. When it comes to making smart hiring decisions, don’t underestimate the value of a 3rd party recruiting firm standing in your blind spot. Give us a call to learn more about our process here at Misura Group.
Hire Smarter – the Misura Group team
September 4, 2020
Welcome to our latest episode of Hire Smarter. Our mission is to help building materials industry leaders adopt best practices for hiring talent while helping professionals make better career decisions.
In this follow-up episode on the colossal merger between Builders FirstSource and BMC, Tony meets up with his close friends and LBM dealer presidents, Gary Poulos and Russ Kathrein.
Having first-hand experience with BFS and BMC, Gary and Russ deliver insights about what makes these companies unique, the opportunities ahead for the now $11B business, and how this event will permanently change how the manufacturers and lumber mills interact with the national production builders.
What are the actions mid-size independent LBM dealers need to take?
Awareness is the greatest agent for change. As these colossal giants merge it will create significant opportunities for those companies that are best positioned. Don’t hesitate to reach out for a conversation and learn the best ways to improve your talent acquisition and retention program.
Hire Smarter – Tony Misura
August 28, 2020
Welcome to our latest episode of Hire Smarter. Our mission is to help building materials industry leaders adopt best practices for hiring talent while helping professionals make better career decisions.
We all woke Thursday to the news that Builders FirstSource and BMC were merging, creating an $11B company. Our guest today is Jim Robisch, the legacy strategist at the Farnsworth Group. Focusing on building materials supply chain for over 30 years, Jim and the Farnsworth Group have delivered excellent strategic planning to the industry. Jim and I discuss the advantages and opportunities this merger creates for the manufacturing suppliers, general contracting customers, and the LBM dealer competitors. Jim gets right to the point delivering actionable steps leaders at every level of the supply chain can take to leverage the new market.
Manufacturers now have one account, an $11B account, to serve to simplify their mission.
Tract builders splitting their business between BFS and BMC for competitive pricing can no longer be a strategy.
LBM Independent Dealers – what is your counter move?
Jim points out this might be the greatest step the industry has taken to align the supply chain to focus on the largest single-family new construction builders, the top national tract builders. This alignment and focus will generate significant efficiencies for all parties. Jim’s insight might surprise you as he defines the market opportunities that this bold, smart move creates for the independent dealers.
We also give some guidance to professionals who are measuring the immediate changes in their career path. The best career moves come from thoughtful planning, respecting the highest level of confidentiality while creating more options. Focus on your personal and professional goals and what is best for your families, making certain you are taking steps to drive the changes that most benefit your career. Life does not happen to you; if you take purposeful action, life happens for you.
Hire Smarter – Tony Misura
August 10, 2020
Onboarding is a key step for any organization introducing a new leader to their team. Understandably, most organizations have their own processes in place tailored to fit their unique company structure and culture. From completing paperwork and setting up a workspace, to meeting and building relationships with the team, these steps are necessary to integrate a leader into a new mindset and organizational flow.
If you don’t have an internal process in place, Harvard Business Review provides a great place to start: https://hbr.org/2019/06/how-to-onboard-new-hires-at-every-level
As recruiters, we partner with companies to find and hire talent, becoming a long-term ally to help organizations achieve continued success. After the hire, we continue to act as a resource and include onboarding as part of our process to ensure a smooth transition and avoid any unanticipated obstacles. This helps to accelerate the level of communication, awareness, and trust for both leaders and the new hire.
How does our onboarding complement an existing internal process?
While an internal onboarding process is critical for new hires, the addition of our outside perspective and pre-existing relationship with our candidates can help create a higher level of success. We have a series of conversations over the course of 6-12 months, focusing on 5 key areas:
- Clarity of the role and responsibilities
Understanding what defines success (and how it is measured) is essential. Making sure the individual has the authority to drive results over what they are accountable for will determine their level of empowerment. Knowing how to deliver the value that will produce the impact that leadership considers the highest priority will gain momentum and respect quickly.
- Power of candid communication
Candid communication about sensitive topics that directly impact the health of the business is essential. Building relationships with this level of trust and transparency can take varying lengths of time, depending on personality types. A common challenge is aligning the rate of the relationship building with the urgency of the issues. Great organizations are committed to the language and messaging used daily to communicate their values.
- Organizational commitment
Is the company leadership following through in their commitment to support the role and its initiatives? This includes providing resources, time guidance, mentorship, added staff, equipment, and access to needed information.
- Relationship building
First, the candidate must be aware of the key stakeholders who are critical to their success. Prioritizing the time and space for those relationships to develop on a foundation of trust can take extra effort.
- Cultural nuance
In many organizations, some of the most important cultural discretions don’t appear in any handbook, despite being essential for employees to understand. Knowing the expectations around speed and timing to deliver an impact, and how that affects the company’s cultural foundations, can define winning and losing.
August 4, 2020
Building materials industry leaders with a proven history of success are in high demand! Discover the wealth of talent in our network:
LBM and Millwork Turnaround Expert
- 5 turnarounds, 1 greenfield $4.5 to $12m first year
- Inherited $21m grew to $30m in 3 years, successful lumberyard with a failing door shop
- Door shop was worst in the market, implemented lean efficiencies, production quality and accountability resulting in 19% profit increase in first year
- Trained and developed Assistant GMs to take locations over when he moved to the next store
Multi-Unit General Manager
- Increased revenue from $40m to $55m in 4 years for 6 locations including full-line lumber and building materials, truss manufacturing, and windows and doors
- Improved operating income by 35% and EBIT by 33% for a regional millwork distributor
- Increased revenue by 70% over 4 years for a building materials supplier with multiple product lines
- Hit 10-12% net profit in 3 months of 2020
Other available top candidates:
- LBM Executive Leadership
- Manufacturing Executive & Sales Leadership
- LBM, Truss, Millwork Operators
Don’t see a description of the talent you are looking for? Our network grows larger every day – let us put you in touch with highly-talented executives, operators, and sales leaders ready to make an impact.
Contact us a (612)326-3006 or firstname.lastname@example.org.
July 20, 2020
“Knowing yourself is the beginning of all wisdom.” – Aristotle
Many great general managers have developed through a sales career path. The leaders who are the most successful have a high sense of self-awareness to the genetic code and permanent imprinting their innate sales mindset delivers – both the strengths and vulnerabilities. After 20 years of studying leaders’ performance in varied situations, one constant remains: as the intensity and pressure increases, sales-minded leaders often slip, stumble, or crash in the same areas. My goal is to help raise your awareness.
First, we must seek to understand: What makes a great sales professional?
The best sales professionals are excellent at business development – the ability to cultivate new customer relationships, capturing more market share. The key to being excellent at business development is the ability to confront, shed, flip, and convert customer objections while facing rejection. The best sales professionals move efficiently through every objection looking at the situation as an invigorating challenge; thinking like a sales professional is a well-practiced mindset. Business development professionals see a crowd of people or a target list of companies and focus on the potential of new prospects with the adage, “I know I can help everyone in the room.” In every failed sales call, professionals assess the point of rejection, adjust their approach, and they are off engaging new potential customers with newfound insight and even more confidence. Energized by the freedom the sales role provides, the simplicity of individual achievement, and the direct rewards for success, their passion radiates. Salespeople possess a depth of confidence, optimism, and perseverance that is formidable.
What are the traits and mindset of the top business development professionals?
Rugged Individualistic: “Overcoming all odds” describes some of the best sales professionals. The freedom and simplicity of looking in the mirror to create solutions is a typical pattern for success. Improving their skills and expertise is a continuous practice done with great enthusiasm. They are doers vs. coaches.
Motives and values: Sales professionals share the motives and values of serving their customers and individual achievement. Competition is at least a primary motive, if not the oxygen on which salespeople survive, overshadowing collaboration.
No fear of rejection (selling yourself): Humans’ general fear of rejection is real and limiting if not debilitating for many people. Steve Jobs’ method for moving through this fear was his “Reality Distortion Field.” Steve was able to convince himself and everyone around him to believe almost anything with a mix of charm, charisma, bravado, and persistence. Walter Isaacson’s biography on Jobs states, “It (RDF) was said to distort his co-workers’ sense of proportion and scales of difficulties and to make them believe that whatever impossible task he had at hand was possible.” The ability to distort reality to yourself is powerful to overcome the fear of rejection.
Social Magnet: These are optimistic and high energy individuals, geared for action. Enjoying social events to attract new relationships is a critical skill for sales professionals. People are attracted to personalities that possess high energy, confidence, and optimism. People generally are more drawn to those who are motivated towards action, enjoying life, with an idealistic perspective on events.
Proficiency Overcoming Objections: The secret to being great at overcoming objections is about creating and defining value. What determines value is subjective; therefore, the most successful salespeople understand the more extended the list of value offerings, the greater the opportunity to close the sale. The mental pull to create lengthy offering lists and quickly re-rank information based on the subjective values and needs of your customer becomes a subconscious behavior in the best sales professionals.
What are the traits of the best general managers?
The best general managers are compensated based on the size and quality of teams they build, the cultural competency of that team, and the level of complex problems they are adept at solving. The P&L keeps score as the ultimate report card, but mind you, it is merely a reflection of the results from the three top traits.
Building great teams: The best leaders take special pride in the development, advancement, and achievement of team members. Coaching and evolving the skills and expertise in others is their greatest reward. A great leader is the antithesis of being the rugged individualist. Coaching and developing people and refraining from being the “doer” or “performer” can be a tough habit to break.
We identify the difference in traits as “Captain Kirk” or “Lone Ranger” personality types. Each brings excellent skills, but only one is a leader; the other is an individual contributor with inherent limitations.
Creating a culture of competency: The first step is embracing the values of the team and customers. Defining the motives and values is an external process requiring collaboration and input of the entire team. High performing cultures provide people with the ability to measure their performance, and the collaborative synergy elevates everyone on the team. Great leaders carefully balance collaboration and competition, as they are wise to the dangers of a miscalibrated culture.
The sales mindset often struggles with trusting others, and a team collaboration process is counterintuitive. Sales minded leaders, when facing increasing pressure, usually choose to isolate themselves from the team to find an individual solution, limiting the team’s power and halting momentum.
Complex problem solving: The best complex problem-solvers gain energy from a methodical process. Scrutinizing “what is the problem to be solved?” saves many colossal blunders. Define and rank the top three most critical factors to make the decision, with great discipline to not allow more than three. Why only three factors? If you nail the right three factors and rank numbers 1-3 weighted precisely, it will enable you to focus your data collection where it makes the most significant impact and minimizes the most risk. The review of the data set as a team event to thwart individual bias increases the probability of sound decision making. If the decision is not clear, you simply have not collected enough data. No fear of pessimism from exceptional thinkers; they often start with worst-case scenarios and build up from there, allowing them to thrive during crisis situations. Bankers, engineers, and scientists are excellent decision-makers because they lack the traits and mindset that makes sales professionals good at business development.
A sales mind is action-oriented, and they quickly lose energy and patience in a methodical process. Intuitive thinking and looking internally to solve problems are their preferred method. Sales minds have a subconscious pull to extend the list of critical factors from 3 to 23 if left alone. Remember the selling process of creating a lengthy list of offerings to close customers; it is a subconscious mental program for salespeople to have that long list to provide the ability to sell themselves and others on their intuitive conclusion. The “reality distortion field” has no place in a critical thinking model.
Sales-minded leaders and professionals who want to be general managers – Increase your self-awareness of who you are by focusing on your behaviors under pressure while facing high-stress situations. Develop a method for constant assessments from people around you. Pick your virtual technology such as Microsoft Teams or Google Docs and create a simple evaluation card for the team to score their leaders and peers 24/7. You might consider the following traits listed on this sample evaluation card.
Every company is unique, and there is not a universal perfect mix of sales and leadership traits that fits every general manager position. Understanding how opposed sales and leadership traits are is the first step to increasing awareness. Celebrate your slips and stumbles as learning and growth opportunities. If the culture honors transparency and embraces slips and stumbles, they can be useful in avoiding the crash and burn.
Leaders – as you evaluate your current teams and look to grow your organization, be aware of the different key traits needed for individuals to be successful. Do you have the right people on your team? Are they in the proper role? Give the Misura Group team a call, and we’ll support you in identifying the unique traits needed for your teams to be successful.
Hire Smarter – Tony
June 15, 2020
Steven Levitt, the renowned Harvard and MIT economist and author of Freakonomics, did a study on people who were perplexed to make a significant life change, e.g., looking for a new job, getting engaged, or divorced. The results: those who made the giant life change were much happier than those who remained stuck. But here is the best part, the decision to turn their life upside down was not after a thoughtful process considering second and third outcomes, they made the leap based on a coin flip. Levitt asked people who were on the fence to flip a coin over whether they would become engaged, end a marriage, or change jobs – heads you make the change, tails you do not change and remain status quo. Levitt used his Freakonomics Podcast and FreakonomicsExperiment.com to attract 22,000 participants and received about 13,000 surveys, following up on their level of happiness over the next six months. Here is the link to his working paper report. https://www.nber.org/papers/w22487
Levitt: “People may be excessively cautious when facing life-changing choices. If you are torn between adventure and stasis – between doing something and nothing – take the adventure. Odds are you will be happier for it.”
“So there’s a status quo bias. Let’s just say of thousands of people making big real-world decisions we find that the changers, the ones who shake up the status quo, do better. Well, if that’s true, then that’s a really important message because what that means is whenever you’re on the margin, you should have a default rule, which is I go for the change.”
The enlightenment from the experiment is not that we should be flipping our lucky silver dollar to determine our decisions. Still, it sheds light on people’s tendency to resist change at the expense of happiness. The idea of changing jobs might sound like an exciting adventure and a terrifying experience at the same time. Fear is commonly the winning emotion at an expensive cost. We are willing to suffer while drudging our way, trying to protect the idea of certainty that usually does not exist at the level we perceive.
List your top 3 favorite restaurants, your top 3 vacation locations, the top 3 universities you hope your children attend.
Now, name off the top 3 companies that would be best for furthering your career.
Few people can answer the last question, yet it might be the most critical question to reach your personal and professional goals.
Why does the best talent pool remain distant from the hiring company’s recruiting activities? Generally speaking, candidates and hiring leaders do not have a network of relationships to overcome the fear of the known surrounding, making a career change.
Career certainty does not exist, but at Misura Group, the combination of our network, process, and commitment to lifelong relationships helps candidates de-risk job changes by understanding the opportunities open to them. Our role in pre-scouting cultural alignment, career path growth, compensation valuation, and attention to confidentiality creates a smoother transition and higher probability of success.
Hiring leaders, is your candidate pipeline missing the best talent? Embrace the limitations of your network and connectivity reach. Know the difference between an average and top-level performer, and how that compares to your existing talent pool. Our one focus is connecting with top performers in the building materials industry, which provides the ability to elevate the quality of any talent pool. Contact the Misura Group team, and we can give you the support to raise your hiring standards.
Hire Smarter – Tony
June 1, 2020
Interested in improving your critical thinking skills when faced with emotional, bias, and prejudice-charged situations?
The most recent book from Malcolm Gladwell, Talking to Strangers, delivers some answers but, more importantly, drives us to start asking the right questions. The book weaves together stories about increasing our self-awareness and our tendencies evaluating people, strangers.
You will find examples showing even the best critical thinkers leaping to unfounded conclusions, persistently blind to the facts presented, crippling their ability to evaluate people. Further, once those findings are made public, the human ego sets them in stone, doubling down on what was an inadequate assessment from the beginning. The examples diminish respect for the superior intellect or expert skill of the liars, shining a light on how those deceived are unknowingly complicit, entrapped by their self-conceit. The willingness to be proven wrong publicly might be the most powerful trait of a great critical thinker.
Gladwell shares a compelling study pitting artificial intelligence against New York City judges on their effectiveness granting bail to 554,689 defendants from 2008- 2013.
When predicting, “who was most likely to commit crimes while out on bail and most likely to show up for their trial,” it was no contest; the computer was more effective forecasting by 25%.
What is more shocking – of the top 1% most likely to repeat crimes based on the historical facts, the Judges released 48.5%. Nearly 50% of the most apparent repeat offenders were miss ranked by professionals trained to detect liars.
Who had the most information on the defendants, the Judges or the computer?
Who had access to the most irrelevant information might be the better question. Judges had the defendant’s previous record, age, what happened the last time on bail, where they lived, and work. The judges also had the testimony of the prosecuting and defending attorneys, and the information shared in the courtroom. And they had the evidence of their own eyes. “What is my feeling about this man before me?”
The computer had only age and the rap sheet, a fraction of the information the judges had, yet the computer made better decisions.
It is clear meeting the person face-to-face, seeing their eyes and hearing their stories, was the debilitating factor.
Malcolm references another example of how orchestras made smarter hiring decisions when they started having auditions behind a screen. Taking the right information away from the committee allowed them to make better hiring decisions. The information gleaned from watching them play is irrelevant. How big, small, handsome, homely, or their ethnicity is unrelated to how well they perform.
How can you apply the lessons from these examples to improve your vetting process?
Internally, Misura Group’s double-vetting process has some hard-fast rules.
1) Use standardized questions: There is only one list of key performance outcomes and behavioral traits per position. As a group, make that decision before interviewing starts and rank them.
2) Protect objectivity: Do not share notes before interviewing. Force each interviewer to develop their individual assessment.
3) Phone/blind interviewing: Studies show face-to-face engagement encourages biases. Create a blind interviewing phase for your process. Video interviewing has its place around developing trust but know that it impedes critical assessment abilities.
What measures do you put into practice to maintain your humility, persistently collect new data, and give space to new conclusions? Contact the Misura Group team to learn more about how we implement these rules in our double-vetting process.
Hire Smarter – Tony
May 18, 2020
Moving through this COVID-19 crisis, each company has a different circumstance based on a myriad of factors. The common element, the environment, has become more competitive. Leaders are assessing and realigning their talent to increase responsiveness to match the new market demands. What might have been an acceptable company and employee alignment based on needs, capabilities, and performance in 2019, is no longer a fit. The distinction between an optimistic view of a professional deemed to be developing and the realistic assessment of an underperformer is difficult to escape in this new world.
I hope this article provides a template for leaders as they move through evaluating talent, both current team members and new candidates. By the way… I do not interview, I vet. Interviews can quickly become an over-rehearsed event of two people lying to each other. Vetting is collecting information, assessing the source, motives, and accuracy, then triangulating that information from other sources. Most importantly, re-ranking the dataset as heavier-weighted, new information is collected. People are like a ticker tape on the NYSE, some valuations rise, and others decline based on life events, personal growth, enlightenment, and the leaders and environments in which their performance is taking place. Projecting whether they will be successful in your situation requires the best critical problem-solving process.
The following are the top 3 items we coach leaders through during the hiring process, along with a printout of the most effective vetting tactics and questions. Click here to download
Creating a Data Mosaic: Financial and cultural performance data are the ultimate report card and an effective barometer for predicting future success. Critical thinking, done well, is limited by the quality and quantity of facts collected, considering the duration of the time frame from which the data is sourced. Are you looking at a puzzle piece or the entire picture? Perpetual re-ranking takes extra effort. The result should be a mosaic providing a clear picture.
Bias Awareness: To be human is to be biased, unconsciously, subconsciously, and otherwise. Relying on multiple interviewers, with one party that has no connection to the position being filled, can be effective. The tendency to lower standards, fill the position quickly, and overestimate the leader’s ability to develop and train people, are just a few common biases. Remaining explicitly focused on collecting, ranking, and weighting the facts can highlight the trajectory of future performance and guard against individual and group biases.
Post-traumatic growth: Be clear and decisive in your evaluation, conclusion, and communication. People will respect the leader at a higher level when the assessment is delivered candidly, highlighting strengths to build on and weaknesses to be improved. Self-awareness is a powerful gift. We often see rapid growth in the most stubborn people after they have been terminated, fired. Being fired is an outcome that is challenging to avoid; people often respond with newfound determination and energy, leading to Post Traumatic Growth.
We take the position of being a career coach first. No one wants to fail in their career – collaborating with professionals to solve the puzzle together increases the information flow. The more information collected, triangulated, and properly ranked yields a better result. The rewards of accurately evaluating professionals with transparency are huge. Looking out for people by increasing their self-awareness as you align towards a common goal, with a mutual commitment to transparency, will help you win the Best Leader of Year contest.
Hire Smarter – Tony
May 4, 2020
The challenging times of COVID-19 are clear and present, and the levels of direct impact are varied. One silver lining of this time is the power that quiet time creates. It is common for us to be caught up in the fog of the day-to-day fray and lose perspective of our personal and professional goals and values. If you have been furloughed, you have the benefit of personal reflection and find yourself interviewing to seek greater alignment with your goals.
I hope this information empowers you to guide your future.
The following are the top 5 items we coach professionals through while seeking their next career. For a printout of our Top 10 Interview Prep Best Practices for candidates, click here to download!
Be thankful: If you are interviewing, you have your health, experience, curiosity, values and purposeful drive. Continue to journal in your Thankful List; it is highly motivating and will keep you focused.
Take inventory: Counting the jars of peanut butter in the kitchen and knowing your burn rate will determine your time expectation. Selecting the right career move is done best with ample time, 3 months for most and up to 6 months for executives. If you have less time, recognize that gaining a job might be more important than selecting the right career move. Don’t stop your career search once you are employed.
You are more than your career: Insecure overachievers, which fits most high-performing professionals, struggle with the idea of being unemployed. The frequency of this insecurity is a common root cause of poor career decisions.
Hit the gym: Whatever your physical workout schedule was, double it until you are employed. Science has proven it will dramatically reduce your stress levels and help you make better decisions. Equally as important, your level of infectious energy will become an aura around you and will be noticed by hiring authorities.
Time management: Spend 2 hours a day on networking and interview preparation. Spend 6 hours a day on expanding your skills. Determine that One Thing that has been an obstacle in your proficiency and immerse yourself in the topic.
If you are a building materials professional considering your next career move and are concerned about confidentiality, please reach out to the team at Misura Group to help you find the right opportunity.
Be empowered – Tony
April 20, 2020
Professionals are rewarded over a given day or week or month for what they do.
Professionals are rewarded over the length of their careers by what they learn, which requires a much different behavior.
My personal goal: carve out at least one hour every day for thinking and learning.
No one knows what challenges are on the other side of COVID-19. What we do know, in every crisis, the teams with the best people grow and win market share. Sharpening your talent evaluation practices will be an even more critical skill in the weeks to come. Reviewing your tactics to retain your top performers will be front and center as the general market pie shrinks and competition increases.
Lazslo Bock, the VP of HR for Google, grew the business from 6,000 to 60,000 people. He shares his top 10 best practices in his book Work Rules!
Laszlo and Google’s commitment to “hiring people better than you” through their aggressive growth stage is compelling. The best hiring practices have strong data and science elements to the process to guard against biases, combined with a large, high-quality talent pool, this is a powerful combination.
Enjoy this video interview he did with Cade Massey, Practice Professor at Wharton People Analytics.
April 6, 2020
Adversity comes in many different forms, with loss being a central theme. Loss of a loved one, loss of a seemingly certain, stable, predictable lifestyle. Depression is the human struggle with adversity from the past. Anxiety is wrapped around an imminent uncertainty of future events. Left unchecked, our thoughts can take over in unhealthy ways.
Adam Grant, Wharton Professor of Psychology, is one of my favorite authors. He has teamed up with Sheryl Sandberg, COO of Facebook, for a sequence of excellent videos sharing specific tools we can implement in our daily rituals as we move through the current events.
The videos promote their co-authored book, OptionB: Facing Adversity, Building Resilience, and Finding Joy and website, www.OptionB.org, which are committed to helping people build resilience and find meaning in the face of adversity.
Mum Effect – Making people feel invisible by not engaging. “How are you today” can be a powerful shorthand for empathy.
Affective Forecasting – Humans are generally poor judges of their future emotional states, often choosing fatalistic visions. Replace the words “always” and “never” with “sometimes.”
Self-Confidence and Self-Compassion – Approach yourself with the same level of kindness you would show a good friend.
The Platinum Rule of Friendship – Treat others the way they want to be treated.
Take Action and Help People – Don’t ask for permission to help.
Thankfulness Journal – Writing down the positive areas of your life is the key to building more.
Bounce Forward – Psychologists have discovered that when facing adversity, some don’t recover, they bounce backward, but those that bounce forward and grow stronger from the experience gain the advantage.
In normal times, it’s common for people to take on challenges, struggle and make mistakes. We help professionals through the post-traumatic stress behavioral loop of life. What amazes me is the growth that comes on the other side. Helping professionals grow beyond adversity to reach their personal and professional goals is our shared purpose at Misura Group. I hope you find these videos helpful. – Tony
March 27, 2020
Welcome to our 9th episode of Hire Smarter. Our mission is simple: to educate building industry leaders with best practices for hiring talent while helping professionals make better career decisions.
This is a longer episode with some important information we don’t want you to miss – so we’ve outlined some key moments below.
0:45 – Introduction
2:05 – Chris shares how he got into the industry
10:25 – One of Chris’ greatest successes & failures
19:50 – Lessons learned from Chris’ greatest mentor, Peter Dachowski
46:35 – The importance of a blameless culture
49:55 – Leading through a crisis & how to handle the current situation
54:35 – How the coronavirus is different from other economic crashes
56:05 – Chris shares the most critical step to crush your competition
1:12:40 – Closing thoughts & take-aways
In this episode, we address coronavirus (COVID-19) and leadership through uncertain times. Under normal circumstances, most leaders face the challenge of controlling emotions and remaining fact-based and disciplined in their decision-making skills. The current shock over the virus epidemic and economic whipsaw is causing panic, fear and impulsive decisions from many leaders in the industry. Our guest today is Chris Kliefoth, a client but also, most importantly, a long-time industry friend. Over the years, Chris is a proven leader with ice water in his veins – he does not get rattled. His career came up through Morgan Products, the millwork distribution business now owned by Andersen Windows, eventually joining CertainTeed, where he built and led the cement siding business. He then went on to grow Nationwide Industries from $10m to $70m in sales, surpassing the private equity ownership’s profit expectations. Today, Nationwide Industries is a manufacturer of fencing hardware and locks serving contractors, dealers, OEM, and wholesalers nationally. Chris is generous and candid with sharing insightful responses to the following questions:
How were Chris’s most significant success and failure both wrapped in building the CertainTeed Cement Siding Division?
What are the greatest lessons learned from his mentor? (Peter Dachowski – CEO of Saint Gobain Isover/ CertainTeed Corp from 1996- 2011)
What are the core elements of leadership communication?
How do you avoid tunnel vision leading through a crisis?
How do you gain an advantage over your competition during a crisis?
Do you know what your strategy switching costs are?
What are the biggest mistakes you should be waiting for your weakest competitors to make?
Chris’s answers to these questions are direct, simple and actionable for every leader. What steps are you taking to fight PTSD from 2008/2009? What are the many ways this situation is different? Access to cash and market liquidity, relatively low debt in the construction industry, short supply of homes and apparent pent up demand.
In the 2008/2009 crash, the weakest leaders did not react quickly enough. What if in 2020 the mistake is cutting people too fast? Ask yourself, what is the fatal error your competition is waiting for you to make?
Hire Smarter – Tony Misura
March 23, 2020
Everyone is doing their part to “flatten the curve” by staying at home and remaining socially distant. This can take a toll on physical and emotional wellness, for both extroverts and introverts alike. Here are a few resources to help you stay positive and productive during this time.
Working from home? How to stay productive:
- Establish a routine
- Create structure
- Move around!
- Reduce stress
- Stay connected
Stay connected and collaborative:
Working remotely doesn’t have to mean working alone. Here are a few tools to help teams stay collaborative and connected:
Extra time on your hands? Now is a great time for personal and professional development!
Binged about as much Netflix as you can handle? Instead use your free time to update your resume, improve your LinkedIn profile, or learn a new skill!
What we’re listening to:
With the abundance of video and the increasing popularity of podcasts, there is a lot of excellent content to keep you informed and entertained. Here are a few ideas from what our team is listening to right now.
Clear your mind:
Exercising your mind is just as important (if not more) than physical exercise during a time of social distancing. Meditation can be an excellent way to stay sharp, stay positive, and clear your head.
March 13, 2020
Welcome to our 8th episode of Hire Smarter. Our mission is simple: to educate building industry leaders with best practices for hiring talent while helping professionals make better career decisions.
It’s a quickly evolving world in the commercial and residential construction and building products supply chain. The first phase was recognizing the industry’s inefficiencies. Now we are well into the second, which is “what to do about it.” As most already know, McKinsey & Company, the worldwide respected consulting firm, has delivered some great research data and foresight to the industry. https://www.mckinsey.com/industries/private-equity-and-principal-investors/our-insights/strategy-in-the-face-of-disruption-a-way-forward-for-the-north-american-building-products-industry
The truss and component industry is front and center providing solutions. The dealers who are most effectively alleviating the onsite labor constraints for general contractors will continue to gain share. With this new state of the industry in mind, we are excited to have Todd Drummond, who has been an operator, consultant and leader to the truss and components industry for his entire career. Todd is generous, candid and sometimes direct in helping us raise our level of awareness to a few critical questions:
What is the industry average profit for a truss plant, when owned by a manufacturing company?
How is that different from the industry average profit for truss plants owned by a lumber, millwork and building products dealer?
What are the differences in team culture and financial performance between a below average or above average Truss Plant General Manager?
What are the most common misconceptions and pitfalls in running a truss plant?
What would have a greater impact on leaders, a higher IQ or a higher level of humility?
Todd is clear in delivering direct answers. Conservatively, LBM dealers are leaving behind 10 points of profit on a $10m truss plant, that is $1,000,000 uncaptured profit. Todd outlines how most LBM dealers have truss and components that make up 10-20% of their sales but deliver 50% of the entire company profits. The demand for the product, high profit opportunity, and unique specialization of skillset requires dedicated attention. Lumber dealers committed to moving banded 2×4 units in and out as fast they can struggle with embracing the complexity and value of manufacturing. What is more important, a higher IQ or greater humility? Consistently overcoming the need to make other people think you know the answers might the best step in improving your truss plant.
Our clients have been impacted by Todd’s holistic consulting approach of supporting leaders, delivering results for years. Dealer leaders – if your truss plants are underperforming, give Todd a call for his custom playbook tailored to your business. If you have the right playbook and your truss plant leader is still underperforming, give us a call here at Misura Group. Remember, giving me the Green Bay Packers’ playbook is not going to make me an NFL QB, much less Aaron Rodgers. It might be time to embrace the reality that your draft pick was a mistake.
Hire Smarter – Tony Misura
February 14, 2020
We are excited to share our 7th episode of Hire Smarter! Our goal is to educate leaders with best practices in hiring and to help professionals make better career decisions.
How many professionals understand how taking risks is directly tied to personal growth, career progression and compensation?
How many hiring authorities project a candidate’s level of intellect, resiliency, learning speed, trust-building skills, passion and drive by the amount of risk they have taken in their career?
Many professionals and hiring authorities struggle to make the connection.
It’s common for professionals who worked for the same company for 10 -15 years that have reached GM or VP levels to call Misura Group and claim, “I am ready to become the industry’s next President.” It’s not impossible… but it is highly unlikely. The last 10-15 years of your career at the same company have given you the benefit of slowing learning the nuances of the business model, plus 10 years of networking with customers and building the trust of people who all come together to support your goals. Learning fast under pressure and rebuilding a network of trusted people internally and externally are skills that rust quickly.
No one hires a President and says we have a perfect company, don’t change a thing. Presidents are expected to deliver impact quickly; they don’t have 10 years. They must operate at a speed that is 2-3-4-5x faster than you have just spent the past 10 years over your career. Professionals who want to be a president take career risks, working at multiple companies to absorb their best practices. They are constantly driving impact at every position, constantly challenging themselves in new environments and cultures, and improving both the depth and breadth of their skills and expertise. At the first sign of slowing growth, they move on to the next challenge.
Along with being one of my best friends, Allan Breidenbach is the President of Wick Buildings, pre-engineered steel buildings we know as agricultural barns, commercial use and grand toy sheds and garages. Leading about 200 people, designing, distributing and also installing about one-third of their projects allows Allan to leverage his broad industry expertise. Allan’s journey is a great example of taking risks, embracing challenges and continuously growing along the way.
Hire Smarter! -Tony
January 31, 2020
Welcome to our 6th episode of Hire Smarter! Our goal is to educate leaders with best practices in hiring and to help professionals make the best career decisions based on their personal and professional goals.
Have you made hiring mistakes allowing emotions to cloud the assessment and selection stage of your process? Letting the emotional human elements blur your objective reasoning is a common mistake we all have made as hiring leaders. What has been your toughest test to remain objective and cognitive in predicting who will be successful?
Michele Burger from the Misura Group team joins me in this episode as we discuss with Lindsey Fox what it takes to be a successful female professional in the industry.
We placed Lindsey with Nationwide Industries as Product & Marketing Manager. Nationwide is a $70m innovative fence and railing hardware manufacturer that has the #1 market share in the space. Here is where it gets interesting – Lindsey was 5 months pregnant with her first child when we started the recruiting and vetting process, and 7 months pregnant when she was hired. She is an excellent professional who shares her best practices for navigating career advancements, motherhood and taking on Impostor Syndrome, that feeling of self-doubt and inadequacy that comes with being human.
This generation of the workforce is asking one question of any leader who is interviewing them: How does your company action its values?
In this case, Chris Kliefoth, CEO of Nationwide Industries, sent a clear message when he hired Lindsey – we respect and support family values, and we value people based on their merit.
Hire Smarter! – Tony
Thanks for listening!
January 20, 2020
The press release dated January 13, 2020 announced Builders FirstSource has launched a search to replace Chad Crow as CEO. https://www.hbsdealer.com/news/builders-firstsource-ceo-will-retire-in-2020/
Chad has done well. As of March of 2019, the Fortune 500 had BFS listed at #394 of the top 500 companies in the world. It’s pretty cool to see a dealer from our industry segment flanked by legacy companies like Hershey at #391 and Weyerhaeuser at #406 on the Fortune 500 listing.
Before taking the helm, Chad had the benefit of being mentored by Floyd Sherman, an empire builder. Working alongside him as CFO, then COO, was excellent preparation for being the CEO. With Floyd now at 79 years old, I’m not sure the next CEO will be offered the same opportunity. It would seem plausible COOs Scott Robins and Dave Rush would be internal candidates for the position, following the Floyd-to-Chad succession pattern. Misura Group placed Scott at Hope lumber in 2004 as a market Vice President; he has done well persistently developing his leadership skills and would seem to be well poised for the next step.
What is the right Score Card for Builders FirstSource CEO candidates?
Leaders that have mastered teaching, training and developing people, their people grow faster than the business demands. The excess of talent creates a more competitive environment with the best talent raising the level of performance expectations. The increase in the competition drives the profit line to new heights, an area of opportunity for BFS in the future.
Across their served market, the range of complexity of the general contractor customer base is wide with vastly different needs. Effectively serving those needs under one common business model is difficult. The competitive offering from specialists is growing, posing threats to the high profit margin product segments. Will the next leader be effective at creating new solutions to rising challenges, and be capable of not losing customer focus under intense financial performance pressure?
Continuous improvement culture
What is the candidate’s proven history of success leveraging Hoshin Kanri? Hoshin Kanri, or “strategic deployment,” is a core executive tool developed in Japan and used by the Toyota Leadership College, its tenets commonly discussed among Fortune 500 CEOs. Many of you spent countless hours in Q4 2019 attending the year-end strategic planning meetings. It’s common for that strategic plan to be written down and never looked at again until next December. A clear sign of the executive leader’s ineffective deployment. Leading people to be consumed by the day to day tactical fray of keeping the trains on time. Not supporting your best people to have the time, space and resources needed to gain ground on significant strategic challenges. Hoshin Kanri is a proven solution. For Fortune 500 CEOs, being deeply trained in Hoshin Kanri was equivalent to the rest of us mortals moving from arithmetic to algebra; it’s new and hard but simple in concept and a hurdle we cleared like a freshman in high school. A clear “must-have” in my book for the next BFS CEO is to have achieved success with key strategic goals through an effective deployment process – Hoshin Kanri.
As with every recruiting project, making sure everyone is aware of the possible pitfalls is critical.
NASDAQ listed, Wall Street traded, yet people and customer-centric should be the mantra. Easier said than done. The next leader should have great examples of successfully leading through a similar volatile environment while not sacrificing core values for financial achievements.
Tallest Midget Syndrome. The building product dealer space does not have many publicly-held companies, BFS and BMC Holdings. The tendency to over-value leaders from the building industry who are publicly held in the production builder or manufacturer segment under the “they know the industry” concept can be a risk. Limiting the talent pool to building products companies that are NASDAQ or NYSE traded shrinks the potential talent pool hence creating Tallest Midget Syndrome.
To the BFS Board of Directors – the people and families of BFS deserve the best and are counting on you. Serve them first, and the broader shareholders will be pleased with the results.
Hire Smarter – Tony
January 17, 2020
We are excited to share our 5th episode of Hire Smarter, where our mission is simple: educate leaders how to improve their best practices for hiring talent and helping professionals make better career decisions.
This is the second installment of a two-part series with Hans Vonderhofen, President of Split Rail Fence & Supply, an installed fencing business with annual sales over $20m, focused on serving residential single-family general contractors in the greater Denver area.
Turnarounds: What makes a great turnaround leader? Hans has a proven history of success with multiple business turnarounds in the installed building products segment, serving the production builder customer base. Often faced with tough competition and the complexity of 30 install crews working offsite every day, all while inheriting high turnover challenges at the onset of the project.
Hans wastes no time with the message, “It’s about having the right people.” His warning, leading with price without having the right people and process, is a common mistake for many leaders and owners. Listen closely to his steps concentrating on collecting the data from the employees working to identify the root cause for the turnover. It’s rather straight forward: compensation, benefits and quality of life. The leader and owner must collect the facts to understand their employment market.
Hans shares his hiring insight:
What attracts talent to installation crews?
What is the path to a self-empowerment culture?
How do you use psychological profiles to hire installers?
A top “Hire Smarter” best practice is what we refer to in the office as the leader’s history of “getting dirty” in the business. This is our twist on The Toyota Way top core value of Genchi Genbutsu, “go and see” leadership, and Gemba, “the place where value is created.” Hans knows what reasonable productivity expectations are for installations because he has done it. Working in the field developed his operational awareness, knowing how each process change will affect the P&L. No magic here – simply working in the field with install crews put him in the right place to collect the data.
Leaders – look at the weakest performing areas of your P&L and ask yourself how much time you have spent doing the specific job you are asking of the team. Practice “getting dirty” in that segment of the business and you might be surprised how quickly the performance improves.
Your feedback is essential as we look to improve and grow – please don’t hesitate to share any thoughts and comments you have on our podcast.
Hire Smarter! – Tony
January 13, 2020
Helping individuals grow and watching them succeed is why we do what we do. We look forward to building more meaningful relationships in 2020.
Hire Smarter! – Tony
January 3, 2020
The Misura Group team is excited to share the next installment of Hire Smarter – a podcast focused on sharing our network of successful professionals in the building materials industry, educating leaders on how to improve their best practices for hiring talent, and helping professionals make better career decisions.
This two-part series features Hans Vonderhofen, President of Split Rail Fence & Supply, an installed fencing business with annual sales over $20m, focused on serving residential single-family general contractors in the greater Denver area. In this episode, Hans shares how he builds trust with his teams and the importance of complete transparency as a leader. Listen closely to gain Hire Smarter best practices for successful business turnarounds and financial growth.
We are proud to have helped Hans reach his career goals by placing him in this role in August 2019. Bringing together great leaders with great companies and helping professionals reach their goals is at the core of our mission as an organization. Hans is an exceptional leader and we look forward to witnessing his continued success. Stay tuned for part two of our conversation in Episode 05!
Your feedback is essential as we look to improve and grow – please don’t hesitate to share any thoughts and comments you have on our podcast.
Hire Smarter! – Tony
Look out for future episodes HERE
December 20, 2019
I am excited to share our third podcast episode featuring Walter Foxworth, Chairman of Foxworth-Galbraith Lumber. Walter joins me in our podcast goal: sharing our network of successful professionals in the industry, by educating building industry leaders on how to improve their best practices for hiring talent while also helping professionals make better career decisions.
In October, Mireya Zapata and the Lumbermen’s Association of Texas (LAT) held the inaugural Texas Unity Dinner honoring Walter Foxworth, Chairman of Foxworth-Galbraith Lumber in Dallas, TX. Foxworth-Galbraith has 35 locations, 1200 team members and over $400m in sales. They are an LBM dealer serving the residential single and multifamily housing segment, covering Texas, Oklahoma, New Mexico, Arizona and Colorado.
At 84 years old, Walter has worked through six major economic market corrections and has been a highly successful business builder. In our conversation, we look to define the secrets of his personal and professional success.
How does a University of Texas master physicist end up in the lumber and building products business?
What is his passion and purpose that drives his energy to stay engaged with the business?
What is the best way for leaders to be involved in shaping federal, state and local laws that directly affect your business?
Walter has been very kind to me over the years and I have never walked away without learning something from every engagement. I hope you enjoy the conversation and his graceful wisdom as much as I did.
Hire Smarter – Tony
Thanks for listening!
December 16, 2019
As the holiday season approaches, it’s a great time to be thankful for our support network of personal and professional friends.
As we are watching college football bowl games, remember these lessons from Dabo Swinney.
Lessons in life often flow easiest around the areas where we play and have fun. I love college football for a list of reasons. Specifically, I enjoy learning from the best NCAA coaches as they face the constant challenges around recruiting, developing and promoting people. The competition is fierce in the NCAA Division 1 Football Bowl Subdivision, 10 conferences and 130 teams. Coaches know the team with the best talent wins while managing a constant 20% turnover rate to eligibility, not counting injuries.
The pressure to recruit, develop players and win is intense, and Dabo Swinney, the Head Coach of Clemson, has taken on mental illness head-on. Dabo’s genuine interest in his players and their health and happiness is not to be questioned. His approach breaking down the macho bravado and stigma not allowing mental illness to be the “boogie man in the closet” is a great example of innovative, great leadership. He has made mental health central to their culture. I have dropped off all 3 of my children on a vast college campus, leaving behind a wide-eyed 18-yr-old to fend for themselves. As any parent will attest, the feeling is somewhere between the best and worst emotions colliding with the realization your safety net of your child’s well-being is no longer effective. At that point in a parent’s incredible vulnerability, what impact do your think Dabo’s mental health and well being focused culture has on recruiting the nation’s best players? Dabo’s 2 national championships in the last 3 years might be a sign of its success.
Leaders interested in developing a competitive edge recruiting talent, study Dabo’s top 5 mental health practices:
1) Make mental health part of your common cultural language. Ask the tough questions: How are you managing life stress? What can we do to support you at a higher level?
2) Start with empathy. Mistrust, and at times in heavier doses, becoming paranoia, are commonly intertwined when we humans are in a vulnerable state. Leaders – start with being vulnerable, telling a story about yourself in irrational anxiety or a depressed state.
3) Lead by example: It’s ok to ask for help. The best way to shift the culture is to ask them to help you with your own behavioral ups and downs.
4) Don’t mistake physical size, strength, reptilian exterior, or masculinity for emotional resiliency.
5) Be supportive of team and social events. A sense of belonging is powerful, reflected by friendships at work.
Have fun! I have a bottle of wine for the first company that installs a kid’s slide in their business.
Top performers are typically the most insecure overachievers who have channeled their vulnerability into their professional trade. Workaholism is no different than alcoholism or drug addiction in the damage it can cause. It is as common to be physically exhausted from bouts of anxiety and depression as it is unfocused energy. At now 51 yrs old, in my view, energy is not to be wasted. Focused anxiety and depression can be your personal plutonium reactor, a perpetual energy source when practiced.
Make mental health your competitive edge!
Hire smarter! Go Badgers! – Tony
December 6, 2019
The Misura Group Team is excited to share the latest episode of our Hire Smarter podcast. Our goal is simple: share our network of successful professionals in the industry. We do this by educating building industry leaders on how to improve their best practices for hiring talent while also helping professionals make better career decisions.
In our 2nd episode, I sat down with Bradley Hartmann, the founder of Red Angle, a Spanish Language Skills and Sales Training consulting firm for the building industry. He is also the author of Behind Your Back, an excellent sales and negotiation training book that is the platform for his Behind Your Back Podcast.
There are people you admire for their intellect, achievement, empathy and innovative traits – from my view, Bradley hits on all those marks. In our conversation, we cover how he was born into the industry, honing his skills at Pulte, and his entrepreneurial endeavors as a language, cultural and sales consultant.
Have you implemented a diversity and inclusion strategy for your hiring challenges? We begin our conversation by sharing our passion for Latino/Hispanic cultures. Diving into the roots of our Hispanic interest lends more insight and understanding as to why we instantly found respect for each other. If you listen closely, you can pull another Hire Smarter best practice of focusing on minority cultures in your area that are often overlooked and rich with talent.
What is the best way to inspire self-improvement? This question might be the most common challenge for every leader. Listen closely as Bradley generously shares his highly unique methods. The magic of his sales training approach is rooted in his clear understanding of the human psychology of behaviorism. To be is human is to want to grow, understanding that individuals demand the freedom to choose where, when, how and at what pace that growth occurs. Listen to how he has adapted his sales training by leveraging the human spirit on its often irrational and erratic level, elevating the engagement, retention and implementation rate of learning.
Leaders – are your profits suffering from a sales team that is lacking negotiating skills? Sales professionals – is your income limited by your negotiating tactics? How sophisticated are your customers’ negotiating skills? Bradley and I touch on these questions also. We hope you find some answers in this episode, or better yet – ensure you are asking the right questions of how to accelerate your strategic growth plan for 2020.
The best way for us to improve is by hearing your thoughts and comments on our podcast. Please don’t hesitate to reach out.
Hire Smarter! – Tony
Look out for future episodes HERE
December 2, 2019
“IF you can keep your head when all about youAre losing theirs and blaming it on you….”
– IF by Rudyard Kipling
The Pittsburgh Steelers are an incredible example of selecting great leaders. The Steelers have had 3 Head Coaches in the past 50 years. From 1969 to the present: Chuck Knoll, Bill Cowher and Mike Tomlin. Remember, the NFL average tenure is roughly 4 years, meaning the average team has had 12 coaches over the same period. Exactly how successful have they been? The Steelers are tied for #1 in the NFL with 6 Super Bowl wins and rank #2 in Super Bowl appearances at 8. All 3 coaches have contributed to their Super Bowl achievements.
Recently we had the chance to watch Mike Tomlin in action in what might have been the most intense, emotionally-charged situation in the NFL in recent history. I’m guessing that many have viewed the video of the Steelers vs. Browns brawl on Nov 14. The highlight reel of Myles Garrett, the defensive end of the Browns, using a helmet like a sledgehammer to hit Mark Rudolph, the Steelers quarterback, on top of his helmetless head, seems to run on an endless loop on every TV channel.
While most viewers focused on the players, I studied the leaders – specifically Mike Tomlin. If you watch closely in this next video, you can see the emotional intensity and underlying rage in his eyes, yet he remains calm and in control. In the video below, he communicates clearly, keeping his hand gestures to a minimum, often with his hands in his pockets to maintain a physically constrained body position.
What we are witnessing is his lifetime-practiced art of being calm, cool and collected under intense pressure. It’s common to believe that your emotional state controls your body position and movement. If you are enraged and protecting your family, you might throw a punch and assault someone; if your favorite song is playing, you are more likely to sing, dance and feel happy. It’s helpful to understand when facing intense, emotionally-charged situations that it’s easier to start by controlling your body position and movement, knowing your emotional state will follow. In this video of the post-game press conference, we can see Mike controlling his body movements in action.
He begins acting like it’s just another press conference. Notice Mike’s posture: hands are calmly placed forward, resting on the podium. He is relaxed, his eye contact is direct and straight forward, no one in the room doubts who is in control. He starts by quoting facts, listing common injuries and that Mayfield, quarterback for the Browns, played well, extending plays.
The press asks, “Mike, what were your thoughts of what happened at the end?”
Mike: “I will keep my thoughts to myself. You guys saw what happened at the end.”
Journalist: “You have no comment on it?”
Mike: “That’s exactly what I said, I have no comment.”
Journalist: “Have you ever seen anything like that at the end of the game?”
Mike: “No more questions regarding that, because I am saying nothing.”
Mike is confident, knowing that saying nothing is best. He stands his ground through all 3 questions from the press. An inexperienced leader would have allowed themselves to be sucked into the high emotional state, pleading the case for their team and only making the situation worse. Respecting his emotional state and a high probability of having an emotional, biased view, he wisely buys himself time by saying nothing. A journalist responds with a general question: “How concerned are you about your offense?” Notice his body posture and tone – he shrugs his shoulders and speaks like it’s just another post-game conference.
Mike: “You know I am concerned, but you know, we did not get it done tonight. And that’s my level of concern. It does not carry over to the upcoming weeks and things of that nature. We will evaluate this and assess who is available to us and plot a course to move forward.”
Young leaders – have patience. Very few, if anyone, is born this calm and cool under pressure. It is a skill that requires focused practice; watch the body movements and nonverbal cues of your favorite leaders or movie actors. Take a notepad and log their nonverbals related to specific emotions or behaviors and in different environments with different personality types.
– Breadth of command
– Calm in the face of chaos
Physical movement is highly effective in controlling your emotional state. Non-verbal skills have a dramatic impact on how your message is received. Our primal brains have been trained to survive by detecting fear and mistrust along with selecting who we should allow to lead us. Humans respond quickly to the psychology of the delivery; it is your decision whether you make it your advantage.
Hire Smarter – Tony
November 22, 2019
The Misura Group Team is excited to launch our first Hire Smarter podcast. Our goal is simple: share our network of successful professionals in the industry and educating building industry leaders how to improve their best practices for hiring talent, while also helping professionals make better career building decisions.
In our first episode, I met up with Russ Kathrein at the LBM Strategies Conference in Austin, TX. LBM Strategies is a terrific conference for lumber and building material dealers selling to general contractors, a well-attended conference by some of the most recognized companies in the lumber and building materials industry. Russ Kathrein is the CEO of Alexander Lumber ($100m in sales, 10 locations, and 2 truss plants) and was presenting on Best Practices Developing the Next Generation of Leaders.
What key steps do you take to build your career to become a President or CEO? Russ’ journey offers young upcoming professionals some great insight. He consistently evaluated the company and leader he was working for and made career decisions, stretching and growing. The pattern of taking measured career risk is a Hire Smarter key trait when identifying talent.
Is your company struggling to recruit talent? Listen closely as we talk about mentorship and development as a key Hire Smarter best practice. We address the most significant obstacles leaders face while mentoring 20-somethings and the best steps to develop great mentoring leaders.
I look forward to hearing your thoughts and comments on our podcast.
Hire Smarter! – Tony
Look out for future episodes here
November 4, 2019
A great “thank you” to Matt Ogden, Steve Swinney, and Dave Flitman. Also to NLBMDA and HBSDealer for putting on a great conference.
The goal of our panel was to give insights from 3 of the top industry leaders. Each of the leader’s business models are unique. Our hope was that other industry leaders could capture tools they could then take back and implement in their own business. Matt Ogden, Founder and Managing Principal of Building Industry Partners, who was part of the startup US LBM and went on to build Homewood Lumber and US Fence. Steve Swinney, CEO and Founder of Kodiak Building Partners and Dave Flitman, CEO of BMC.
For my opening remarks I asked everyone to eliminate the word “retention”. Often it’s used when looking at the past result of performance. The trouble with perpetual problems is they attract the same language that does nothing to solve the problem. Instead, replace “retention” and start asking questions.
Are we hiring smart?
Are we developing and promoting people?
Are we growing healthy attractive cultures?
By focusing on the action steps and making it part of our daily language everyone will take great strides in solving their people problems.
Dave Flitman on how to maintain the culture in a company with 9,000 people
Dave shares how BMC follows 5 key tenets that set the tone for the entire company culture across 19 states and over 40 different metro markets.
Steve Swinney on collaborative culture
Steve explains how Kodiak Buliding Partners maintains their culture by being locally driven, entrepreneurial, and honoring the legacy of all of the companies that join the Kodiak family.
“The number 1 driver of success for Building Industry Partners (BIP) is the people – an A+ leader attracts and retains A+ talent.”
– Matt Ogden, Building Industry Partners
“Hiring, developing, and promoting people – that is the action element that is going to solve the problem.”
– Tony Misura, Misura Group
The personality and character of the CEO defines the culture of the company. Each of these leaders brings a unique value and business model to attract talent. How does your personality and character impact your company culture? Looking in the mirror might be the best place for leaders to start who want to improve their people problems.
Hire Smarter – Tony
|· Market Sales Manager with full P&L responsibility for a $20m specialty building materials distributor and manufacturer with install
· Inherited a team with 20% declining sales, implemented a culture of accountability and metrics measurement leading to growth of 15% in the first year
· Inherited a location with failing machinery leading to production delays, worked with other plants and local competitors to expedite production and prioritized customer experience by meeting with all clients to ensure retention
· Utilized 4DX methodology to drive daily, weekly, and monthly sales objectives leading to 30% 2-year growth
To learn more about this professional, contact Michele Burger
September 3, 2019
If you focus on collecting the relevant facts, the appropriate action becomes obvious.
Following are the top 3 criteria we cover right away when evaluating General Manager talent.
#1 Experience is not equal to Proven History of Success. Be aware of the experience trap. Professionals holding the position over several years is not a leading indicator of success. Financials don’t lie.
What was the P&L you inherited and what did you grow it to?
#2 It’s about the People. The level of leadership revolves around the quality of people they can attract, develop and promote. Young smart people want to be mentored – some leaders are good mentors, some are not.
How many people have you recruited, developed and promoted?
How many were in their 20’s when you recruited them?
#3 Nothing else matters. Look for repetitions of #1 and #2.
Hire Smarter – Tony
Work Rules! by Laszlo Bock
Laszlo was the senior HR Leader for Google, responsible for growing the company from 6,000 to 60,000 people, while maintaining the ridiculous high standards. How high? It’s 25 times easier to get into Harvard than Google. Google hired 0.25% of the people who applied – by comparison Harvard admits 6.1% of its applicants.
Battling Regression to Mean as the business scaled up was critical to their strategy.
The “Why” is proven by their 4.76x stock appreciation, $168 per share when he started and over $800 when he left.
The “How” is compelling and the book goes into great detail, providing an insightful read.
July 29, 2019
A General Manager recently called in a panic stating: “I have been demoted and expect I will be fired by the end of the month. I have a wife and 3 children; will you help me?” The greatest reward this position has granted me is the ability to help people. Candidly, that passion still burns bright and remains one of my great pleasures. Please remember, for those that know me, understand I am speaking from the heart, particularly when delivering the tough message. There is no reason for anyone to suffer, particularly if it’s self-inflicted.
This GM was leading a single location out of 6, serving residential new construction in a metro market that is top 5 in US housing starts, with the other locations serving 2nd tier suburbs and surrounding rural markets. Product mix: 40% lumber and plywood, 60% general building materials. Delivery trucks, outside sales team, lumberyard – a typical industry business model.
In 2015 the owner/operator offered the GM a promotion from the Inside Sales Manager/Operations Manager to General Manager of the location. Hungry, wanting to grow and provide for his young family, the 33-year-old accepted the role. He inherited a location with sales of $8M and a profit line that was losing $500,000 annually. The location had 35 employees, and when I asked about the turnover, the response was “the previous manager hung on to everyone regardless of performance.” The young, aggressive, 33-year-old newly-appointed GM goes to work. He circles the team of 35 people and announces, “I am excited to support your growth, but everyone must understand BFS, BMC, 84 Lumber and list of 7 other competitors are fighting every day to take our customers. We are moving forward with only top performers and I hope that’s you.” Solid opening address. I asked him why not share the financial status of the business? “Well, the owner does not want anyone knowing the profits. I had to fight to get him to share them with me as the GM. There was no way he would allow our $500,000 loss to be public.” A common mistake of independent owners.
2015-2016: Setting clear expectations for every person on the team, in the first year he grew the sales from $8-$16M while improving the profit from a $500,000 loss to $20,000 pre-tax profit. Along the way, he reduced the headcount from 35 people to 16 people. Good first year.
2016-2017: He grew the sales to $22M and $500,000 pre-tax profit. OK, what is his plan to start making money, and when does he plan to implement it?
2019: Year-to-date sales for Quarter 1 and 2 are $6.5M and profits are $60,000. Oops!
Asking him to explain the sales revenue drop, “Well, we decided to commit 45% of our total sales to DR Horton. The owner was excited and thought it was a good idea at the time. However, this last round of pricing, we lost the DR Horton account and $9.9M in sales.”
The GM explained that when he took the position, winning was defined as increasing sales and generating a 5% pre-tax profit. He went on to explain he was confident he could keep the DR Horton business by out-servicing his competition. Asking him, “Given the competitive options, why would customers choose to buy from your business?” His response was a classic under-developed GM answer: “Service, On Time and In Full (OTIF) and relationships we develop with our customers.” Tony: If that was working, why was your profit only 2% and why did you get fired? GM: “Well, I should have hired more sales talent to capture more sales and dilute the DR Horton customer concentration.” Tony: “Hire more salespeople and continue to sell despite making not far from a break-even profit line?” GM: “ I hear you. I put my heart and soul into this position, fixing the operations, developing solid people and personally spending 2 days a week in the field with my sales team. But in the end, I still failed. Now what do I do?”
I wish I could say this scenario was rare, yet our industry wonders why we don’t attract and keep young talent. A solid up and coming 33-year-old leader was set up to fail before he took over the position. As for mentorship, proper guidance and development, what little was provided was terrible. A good operator would have surveyed the current and targeted customer base, determining answers to the following questions: Given the competitive options, why do customers buy from us? A good operator would know who the competition is, what they do well and where their weaknesses are while developing a unique and competitive offering, designed to be profitable.
Service and OTIF have not been a competitive advantage for independents since 2006, particularly in a top 5 metro market. Consolidation of the top national production builders has crushed that fluff out of the supply chain. The location had the DR Horton account simply because they were the cheapest for a moment in time, likely due to a Blue Moon buy on lumber in a rising lumber market. Good operators don’t build businesses on a lucky buy. A good operator would have known that being the low-cost provider fighting in a top 5 market, for a top 3 volume builder, against BFS sales of $7B, 84 Lumber sales of $3.8B and BMC sales of $3.6B is foolish for any OTIF/service-only value offering, $50M independent. Out of the gate, they are giving up 2-4 points of margin on the buy-side to their giant competitors. It’s nearly impossible to win sustainable, profitable share with the low-cost provider strategy as an independent.
Is it the sales team’s fault? Salespeople have virtually no impact whether people by Apple’s iPhones, iPads and air pods, their products are simply better than the competitive offering. Good Building Materials leaders look at their business offerings the same way. It’s common for leaders to lay the blame on the salespeople as a smokescreen when it’s the operator’s poor strategic awareness that is at fault.
General Managers/Location Managers:
As I guided the GM in this example, getting fired was 50% his fault. He, like many, is much too driven to allow a foolish owner/operator to derail his personal growth. He is too smart to be incurious in developing his strategic thinking abilities. While it’s true, being a tactically-driven operations manager creates obstacles thinking strategically, it’s a weak excuse. His homework was to study Michael Porter, a Harvard Professor and a world-renown strategy teacher.
A great presentation through which I have guided many leaders:
Understanding Porter, an excellent book and must-read for any leader:
A great article:
Check your ego at the door, forget about your strengths, know your weaknesses intimately and take action closing the gaps. Seek the highest level of training, development and mentorship to focus on your gaps. If you’re not finding it, call me and I will align you with a career path and leader who will invest their time in you.
Are you brave enough to ask the Bill Gates questions of yourself? Do you enjoy being an operator? How good are you at it? Or should someone else do it? Your P&L financials are the ultimate report card. The isolation of being an independent owner/operator lends to the hamster wheel effect – if I run faster, get up earlier and work harder, I know the business will get better. Our expertise is helping leaders get off the hamster wheel and embrace the shortcomings of the business model, build from the strengths and surround themselves with the talent needed to be successful.
July 22, 2019
The competitive environments of recruiting talent are intense and continue to grow as the supply and demand factors continue to escalate. Leading a recruiting firm focused on delivering top talented professionals and committed to continuous improvement, brought me to study this question: How many top performers are there in the building products industry?
The first quickly dispelled notion is that it’s the building products industry that has the problem. Humans have a great ability to rationalize a problem by providing cover from looking in the mirror and embracing the facts. Building Products companies with strong leaders are for more effective attracting and retaining. Rather the dispersion of talent is human science that is consistent not only in the building products industry, but any time you have a group of humans competing.
Does human competition drive a disparity of results regardless of whether the endeavor is capitalism or the arts?
Here are some facts to ponder:
- 66% of the researchers are below average in the number of articles published
- 84% of Emmy-nominated actors are below average in the total number of nominations
- 68% of US Representatives are below average in the number of terms they have served
- 71% of NBA players are below average in the number of points scored
Studying the dispersion of high-performing humans, you can find similar disparity percentages in authors, composers and professionals in the business world that fall into the same pattern. How wide is the disparity of results? Based on performance outcomes, how many people fall into each category?
Fortunately, Laszlo Bock, Human Resources Chief at Google, studied this same question and published his findings in the book Work Rules! – Insights from Inside Google https://www.workrules.net/. He was responsible for increasing the Google employee count from 6,000 to 60,000 people from 2006-2016. Properly framing the task of hiring 50,000 people, Google’s performance expectations required they interview over 428 people for each person hired, for every 700 people hired they required a review of 3,000,000 resumes. Science and being fact-based is a core value at Google; they carefully studied these human performance questions and came to some clear conclusions:
– Power Law/Pareto Distribution: 80% of the productivity comes from 20% of the people
– 60% of the population generates 10% of the combined productivity
Based on these facts, smart leaders are asking: How to do I avoid 60% of the population in my hiring process?
- Adopt the proven history of success hiring method. Simply ask has this professional been successful in exactly, specifically and precisely the role we are hiring for? If they have been successful multiple times, and have adapted to multiple cultures, it minimizes risks such as they rode someone else’s coattails or took advantage of the rising macroeconomic tide.
- Understand great recruiting requires great sales skill. Great salespeople are generally poor critical thinkers; vetting is a critical thinking process.
- Uncover your hiring biases. The book Thinking Fast and Slow by Daniel Kahneman is the foundation of our internal process for eliminating vetting biases.
- Increase the flow of top talent in your hiring process. Increased top talent flow gives you the power of selection and negotiation.
The amount of broad sweeping social pressure fighting this proven science is coming from multiple fronts. The topics of universal income and other social leanings stem from the belief that we are all equal, and productivity will be either random or even regardless. Low performers lack the resilience to embrace the facts, and if allowed, will continue to hide in organizational structures. Weak leaders avoid defining the individual value, thinking it will erode their position when addressing compensation, making the choice to lose that talent to a competitor who is more transparent in their business measurements and rewards. If the top 20% of talent is producing 2x, 3x, 4x, 5x more profit than the average person on the team why would they stay anywhere there is a lack of performance transparency and merit-based compensation is not commensurate?
Hire smarter – Tony
June 3, 2019
We recently took on a project to help an $80m millwork business with 180 employees find an exceptional HR executive leader. The private equity owners purchased the business and replaced the legacy operator with a new President in 2016. The sales at the time of purchase were $96m with 4% EBITDA, declining to $80m with 2% EBITDA by 2018, forcing them to replace the President in 2018. The private equity owners and the new President did not care to repeat their past mistakes; they requested our evaluation of the business model to help them develop the right questions to be successful in the turnaround. Candidly, private equity owners are some of our favorite clients – they have a high desire to win, embrace the facts and quickly adapt to new information.
The company they bought was stuck in what we call the “1974 Syndrome”. It was operated by a legacy founder and owner with an egocentric leadership style, with low performance expectations and discretionary bonuses. The cultural theme of “we take care of our people” with no metrics measurement in place can be interpreted as “guaranteed jobs for everyone.” The average age of level 2 and 3 leadership was 58 yrs. old and the companywide average tenure was approaching 19 yrs., which included a 25% turnover rate of the manufacturing crew. After cleaning out the back office, they donated the office equipment to the local museum including typewriters, copy machines, an old switchboard phone system, and several Apple II and Commodore 64 computers. The real treasure was the crate of Life Magazines from the 1970s.
The evaluation results:
- Underestimated the depth of the cultural problem
- Hired the wrong leader; the past President did not have a proven history of success solving entrenched cultural problems
- Undervalued the need for human resources support backing the President
The past President’s failures:
- Focused on evolving people who were between 35 and 55 yrs. old with an average tenure of 19 yrs.
- Did not hold top leaders accountable to new performance standards
- Did not follow the 20% “fresh blood” rule
What is the 20% fresh blood rule?
It is a critical step in driving change, 20% of the workforce must be new to the company and between 20-29 yrs. old. Hire hungry people. Leaders often make the mistake of thinking a few key new hires will make the impact desired, only to have the entrenched culture crush their spirits, forcing them into the fold or driving them out of the company. The subculture synergy needed will never develop a foothold with anything less than 20% fresh, hungry people. The old guard needs to feel pressure from the younger talent; their higher level of energy, hunger and synergy must be more powerful than the status quo.
It’s common for leaders to be overly optimistic about their abilities to drive change with the tenured employees of the organization. The historical behavioral patterns were rewarded for decades and have locked them into a state of inertia. To them, survival is doing everything possible to protect the homogeneous, indolent culture. Everyone agreed, for the President to be successful the organization needed 20% of the workforce to consist of new employees that are 20-29 yrs. old. Currently, with 180 people, the company needed to hire 36 new people to support the performance merit-based culture they envisioned. The goal was to create a competitive environment, identifying and rewarding high potentials – but the plan had to start with the ability to hire a lot of new talent. The owners agreed; the short-term higher payroll expense was well worth the investment to move the culture forward.
Who was the silver bullet?
The task of hiring 36 people was not something the benefits, payroll and safety focused HR team was capable of handling. It became quite clear the support the President needed was the right HR executive leader to deliver this critical part of the plan.
Scorecard for the HR leader:
- Must have led a company out of the 1974 Syndrome to success
- Must have built an effective, metrics-driven recruiting team
- Must have led a Best Place to Work objective
- Must have created and implemented a development program for high potentials
Everyone agreed, the administration, payroll, benefits and safety would be handled by the HR Manager, freeing up the VP of HR to focus on building a recruiting team and leading the cultural evolution.
Should the VP of HR come from the building materials distribution industry?
Our team was immediately concerned about the “Tallest Midget Syndrome”: a common recruiting mistake caused by limiting the search parameters, a specific industry segment or geography are the two most common limiting factors. In other words, setting up search parameters where the quality of a candidate might appear to be excellent due to the poor quality of the comparable candidates.
Our best tactic to guard against Tallest Midget Syndrome is recruiting two pools of talent, one within the tight parameters and one outside of the parameters. This gives our clients the power of comparison. Since the building materials distribution industry has been 10 yrs. behind the Best Place Work initiatives and cutting-edge recruiting practices, we were confident our talent pool would be much stronger with this dual search approach.
For the past 20 yrs. recruiting in our industry, a couple of things never made sense to me: there is a CEO, CFO, COO, CIO, CMO… but never a Chief Human Resources Officer? The VP of Sales might make $250,000 – $350,000; the VP of Operations and VP of Manufacturing over $200,000; but HR leaders’ compensation has stayed in the $90,000 – $120,000 range for most companies ranging from $50m to $300m in sales.
HR leaders are finally getting recognized for their economic impact on the business. The HR leaders guiding companies with 200-500 employees outside the building materials distribution industry, who are excellent at recruiting talent and proven successful at competing for the Best Place to Work award, have base compensations starting at $150,000, with clear metric-based incentives that bring them to $200,000 – $250,000. Leaders in other industries have clearly learned that the company with the right talent and culture generates the highest profits.
A quick survey of the HR leaders’ compensation at building materials distributors that are roughly the same size with 200-500 employees:
The low end was $80,000 with no bonus up to $115,000 with 25% bonus; this made up for 80% of the companies surveyed. There are several companies that have embraced the greater-US trend and are paying a base of $150,000 – $180,000 with a $50,000 – $70,000 bonus.
Owners/leaders – if you are happy with your profits, then change nothing and celebrate being a great business builder. If not, consider recognizing the innate abilities and thinking styles needed to be successful at recruiting and driving a culture change. How different are those abilities and thinking styles from the traditional administrative duties of most HR positions? Hire the right HR talent and free up HR leaders from the trap of administrative responsibilities; allow them to focus their efforts on the greatest challenges in your company – likely recruiting talent and cultural evolution.
HR leaders – if you are happy with your compensation, then change nothing and celebrate personal and professional alignment. If not, consider upgrading your recruiting skills, specifically your marketing and sales skills. Develop an expert-level understanding of Best Place to Work leadership and implementation. If your company will not support you in these efforts, reach out to our experienced team for a professional assessment and to confidentially help you locate a better-aligned career opportunity.
Hire smarter – Tony
May 28, 2019
We were recently working to find the right General Manager for an LBM company that had a $20m location in the Southwest, serving general contractors in single-family new construction. The company started a satellite location, serving a market that was 90 miles away from the major metro market our client focused on serving. As a satellite location/market, the owner wanted a strong leader who could operate with full autonomy since the executive team needed to focus on their major metro business. This satellite location is in an underserved market, running with only an operations manager and dispatcher leading the team and needed a dedicated General Manager to grow. The owner and I believed with the right leadership, the location should drive $30m in sales and a 10% EBITDA in the first 2-3 years as a low-case financial benchmark.
As the owner honed his focus on the right candidate from the talent pool, he requested input on what the compensation package should be. He was struggling as this location is a standalone business, whereas their other locations operate together as a market. We asked our client to consider the following questions to determine the right compensation:
- What are the compensation levels for the 7 candidates in the talent pool who have a proven history of success growing a location from $20m – $30m in sales, in a highly autonomous and entrepreneurial business model?
- What is the competitive advantage of this location’s business model to gain and hold share on its own?
- What level of influence will the right leader have over the profit of the location?
- What is the key-person risk of the right General Manager? Retention planning is best done before you hire any professional.
- What is the return on investment modeled out at varied tiers as the business grows?
- What are the appropriate benchmarks for the General Manager to hit, making certain inventory, A/R and people are managed in a healthy way?
Our client found great comfort in the balance and forward-thinking elements of this process. The candidate we placed was excited to have an entrepreneurial opportunity to build a business and be rewarded for success.
The final step in this process, we reported the base and bonus compensation programs for 15 independent LBM businesses with a situation similar to our independent client company: $30m sales and 10% EBITDA.
The survey results:
The low-end: base salary of $100,000 and bonus of $75,000, $175,000 total. The high-end: base salary of $140,000 and bonus of $210,000, $350,000 total.
Top independent LBM companies’ base and bonus compensation ranged from $175,000 – $350,000. A difference of $175,000 between the independents.
BMC: $135,000 base and $35,000 bonus, $170,000 total. (Bonus calculated by a region, not the P&L of the location.)
Builders FirstSource: $100,000 base and $35,000 regional compensation, $135,000 total. (Bonus calculated by a region, not the P&L of the location.)
84 Lumber: $70,000 base and $180,000 bonus, $250,000 total. (Half of the bonus calculated on gross margin goals, paid monthly and half on profit, A/R, inventory and safety.)
US LBM: $140,000 and 25%, $175,000 total. (Bonus calculated as a percent of base salary.)
The large national LBM dealers base and bonus compensation ranged from $135,000 to $250,000.
There is a difference of $215,000 from the low end of the national LBM dealers to the high end of the independent LBM dealers.
The compensation differences make complete sense: business models, the market and the type of talent needed are all highly variable. Focus on collecting the relevant facts and the actions needed will become self-evident.
The driving factors:
- What is the competitive edge of the business model on its own, without the General Manager to attract talent and customers?
- What resources in leadership, structure and training are the company providing?
- What are the levels of entrepreneurial talent and autonomous experience expected from the General Manager?
- What are the gaps in the business model the General Manager is expected to fill?
- What is the competition offering this talent?
- What does the talent want that the competition is not offering?
“While the right design is essential, it is only half the battle. It is equally important to put the right people in each of those positions.” – Ray Dalio, Principles: Life and Work
Owners/leaders: If you are pleased with the return on investment and profits on the bottom line, do not change anything. Well done being a great business builder! If not, focus your financial investment on getting the exact talent and skills needed. Remember, it all starts with the right leader. Don’t hesitate to reach out to the Misura Group team to learn more about our process and 1-year guarantee on excellent industry leaders.
“In life, you don’t get what you want. You get what you think you deserve.” – Teddy Roosevelt
General Managers: Know your industry value! You will be spending 30,000 hours over the next 10 years of your life on work-related activities regardless. Make sure you know what you are worth and that you are valued for it. Reach out to our experienced Misura Group team to help you find great companies that value your talents.
Hire Smarter – Tony
May 13, 2019
Builders Millwork (BMI) is a $20M company headquartered in the heart of the Dairyland – Mondovi, WI. I first met Jerry Jehn, the owner, in 2008 walking into his office greeted by a life-size Wisconsin Bucky Badger Football player Fathead leaping off the wall. BMI is a great company with great people, providing architectural door and hardware products to general contractors focused on multi-family new construction projects in the upper Midwest. BMI’s model has supported a 15% growth rate YOY for the past 10 years. The shocking aspect of their business model, they have no sales team. Can you imagine your competitive edge being so great you have no need for a sales team? Well the BMI team not only imagined it, they did it.
How do you build a business model without a sales team?
Multi-family, commercial projects have been plagued by the Hardware Room for decades. The Hardware Room is a single room secured and designated to hold all door locks, hinges, closures and entry hardware needed for the project. One key is handed to the job superintendent to guard. It’s proven to be an efficient path to having lost products, hardware applied on the wrong openings and general time and money suck for everyone: general contractors, installing sub-contractors and the supplier. Jerry and the BMI team developed a solution – presorting the doors, millwork and hardware per unit. A 200-unit assisted living project will receive 200 materials packages, each marked and sorted by unit and phase. Hardware is palletized. This allows for easy and immediate distribution throughout the building and eliminates the need for hardware rooms and empty units for staging product. If units are ready, all materials can be delivered directly to the respective unit. Less time is spent handling the product and mitigating the risk of damaged or lost material. The BMI On-Site Optimization Program, the trademarked name for this process, has become the oxygen their customers need to survive.
Impact: Inventory shrink solved. Installers save on labor and stress. General contractors close projects on time. BMI does not have the headache of proving what was delivered and who is responsible for the loss.
Greater impact: Subcontracted installers demand BMI as the preferred supplier on their projects. Subcontractors have become the BMI sales team.
Jerry: “The BMI Value Proposition is our employees and their Midwest roots. Coming from a largely agricultural, hardworking heritage, our employees realize the value of hard work and are rewarded accordingly. We create an entrepreneurial culture where all employees participate in improving the company. Their opinions matter. Let the employees that are doing the work come up with the solutions. They share in the success and more importantly, take pride in being a part of the success. They take ownership.”
BMI is a team, no lone ranger swaggering sales persona driving their sales volume. No salesperson capable of moving their accounts to a competitor after a disagreement. The competitive edge was created by solving a major on-site construction problem, positioning them to operate without a sales team. What are the elements of your offering that are different from your competitors and in high demand? Clue: it’s not “on time and in full (OTIF)” or “customer service”.
Jerry is humble; make no mistake the quality of the team is a reflection of people the leader attracts. The competitive edge of the business model starts with a strategic thinking leader. You can measure the strategic abilities of any leader by their expenses on outside sales compensation and entertainment. High commission sales expenses and Canadian and Alaskan fishing trips might be a sign your competitive edge is over-reliant on your sales team and not the competitive edge of the business model.
Here are my top 6 strategic vetting questions:
1) When have you developed a market competitive edge? (proven history of success is must, looking for multiple examples of when it was done)
2) What did you inherit and what was the result? (must be reported in hard P&L numbers)
3) What is the process for developing a market competitive edge? (the answer must be focused on collecting facts directly from the customer base and defining the problem to be solved)
4) What is your problem-solving process? (looking for collaborative, team-based answers – instant fail grade if the leader says “I” or “my team” as it’s a clear sign of narcissism)
5) What are the common obstacles and how do you navigate them? (people not embracing the facts – poor ranking and prioritization)
6) What have been your biggest mistakes? (not having any examples is a clear sign of an egocentric leader – instant fail)
If your hiring process does not have multiple leaders in the final stages that score high on these questions, you are likely not accessing the hidden top-tier industry talent. Don’t settle, reach out to our experienced team and interview the talent you are missing.
Hire Smarter – Tony
May 6, 2019
We are dedicated to impacting people’s personal and professional goals; combined with helping great companies connect with great people. Following are a few of the great professionals and companies who engaged with Misura Group recently.
Regional Sales Manager
“Tony has run multiple searches for our business for top-level market leaders. We think about Tony and the team and the success they provided in two different ways. First, they were successful in finding a great many highly qualified candidates that fit our profile and ultimately helped us work through the process to find great fits for these positions. Second, Tony has become an integral part of our market insight, strategy development, and team building. I would recommend Tony and the Misura Group team to anyone looking to improve their team, culture, and strategy.” Jon Vaughan, President at Brand Vaughan Lumber
Truss General Manager
Truss and Panel Design Manager
“I have known Tony for a few years and he is a very special guy when it comes to recognizing top talent and quality people in our industry. We hired Tony to search for a general manager for our truss plant. He and the team put some great talent in front of us to choose from and we were able to hire an outstanding individual. The Misura Group is an awesome team and does outstanding work.” Clinton Grothues, General Manager at MG Building Materials
Chief People Officer
Senior Project Manager
“Tony is really good at finding out what your culture is as a leader and as a company, and making sure that he finds people that are a cultural fit. He’s not just looking at a transaction, he’s looking for where you want to be strategically then helping identify what kind of people to bring in to accomplish that goal.” Russ Kathrein, CEO at Alexander Lumber
Access Control Technician
Helping individuals grow and watching them succeed is why we do what we do. We look forward to building more meaningful relationships as the year unfolds.
With every breath keep growing – Tony
Meet the minds of our Marketing team! Laura and Nali work behind-the-scenes to make sure our clients and candidates (and the whole Misura Group team) reach their goals.
You can view more videos on our YouTube channel here
April 29, 2019
I hope you find value in this Behind Your Back podcast with Bradley Hartmann. Following is a continuation and message I missed on delivering.
My favorite CEO/President interview question is “How many 20-29-year-old professionals have you recruited, developed, mentored and promoted?”
It may come as a surprise that this question is quickly rising to the top of my “toughest interview question” list.
What is equally surprising is the number of leaders in their 40’s that fail this test.
It’s simple. The companies with the greatest number of top talented 20-29-year-olds today will be the companies gaining the most share over the next 5 years. While the companies with the least 20-29-year-olds today will be losing share to the aforementioned companies.
What is the key trait to measure?
Who are the best leaders mentoring and developing 20-29-year-olds?
If you would like to help your organization develop this skill, consider the following points:
Leaders must understand the WHY:
Losing sales is rooted in a leader’s inability to attract and develop talent. Not only is the leader’s career growth directly affected, but there are many who will be demoted or lose their jobs if they choose not to develop this skill.
Understand the vulnerable leader’s mind:
Rooted in fear of the younger generation who are born as cyborgs, armed with lightning-speed technology skills, while also embracing the facts of their own degradation that comes with aging. It’s a tough blow. A key trait in identifying poor mentoring leaders is those who believe their values are morally superior to others. You have a choice – gain the smartest, most progressive, energetic workforce and earn their trust or hang on to your 1987 values with an average employee age of 57 years old with no succession planning or growth.
What is it that Millennials and Generation Z wants?
Learn from your employees. Conduct surveys and embrace the facts around their desired culture: community involvement, meaningful work, marijuana policies within the state law, tattoos, body piercings, paternity leave, collaborative team culture, constant feedback, transparent reporting, flex work schedules, mentorship and defined training programs.
Principles by Ray Dalio and Originals by Adam Grant are both great books for helping leaders sharpen their skills at attracting talent.
With every breath keep growing – Tony
April 22, 2019
According to a Gallup poll, 75% of people quit their jobs because of the direct line leader they report to and 65% of Americans say they would rather change their boss than get a pay raise. The prevalence of poor leadership is something our industry struggles with.
Watch this video to learn more about Competence vs. Confidence and other themes from the book Why Do So Many Incompetent Men Become Leaders? (And How to Fix It) by Tomas Chamorro-Premuzic.
How does your organization measure the difference between Competence and Confidence? What are your favorite interview questions?
With every breath keep growing! – Tony
April 8, 2019
What is Michele’s zen? How does Sarah recharge?
You can check out more videos on the Misura Group YouTube channel here
April 1, 2019
I refuse to hire people who smoke cigarettes onto our Misura Group team. I’m not even slightly apologetic about it. Rationalized by my cognitive mind, “How can I respect a person’s intellectual problem-solving skills if they choose to fill their lungs with smoke and toxic carcinogenic material?” Science has shown that this habit will shorten a person’s life by an average of 15 years. We might also question how that person can be productive when they are taking smoke breaks 2-3 times a day.
Are these rational, data-driven hiring decisions? Or are we dismissing highly-qualified candidates as a result of unrecognized biases? Hiring decisions are among the most complex and critical decisions leaders make. Understanding your biases and psychological miscues is a major step in making successful hiring decisions.
Illusion of Causality
Fact: Net of several social and demographic variables, there is absolutely no correlation between smoking and the ability to be an effective professional. The amount of unproductive time spent by nonsmokers on social media is likely equal to or greater than that spent on smoking breaks. Any leader with a negative bias towards smokers must embrace how irrational this is. Psychologists call this the Illusion of Causality; the development of a belief that there is a causal relationship between two events (characteristics) that are actually unrelated.
Leaders make poor hiring selections by falling in love with candidates for the wrong reasons, unaware of their halo biases. Equally debilitating, leaders eliminate highly qualified candidates based on their irrational biases.
Here are some more stories:
A long-time CEO client would never hire someone who was a golfer; “I hired a golfing salesperson once and it was the worst hire of my career. He spent all of his time golfing.” Are all golfers slackers? This CEO conveniently forgot about all of the top people on his team who golf. Psychologists call this error Duration Neglect; basing future decisions on a distorted or amplified memory of a negative past experience. It’s common human behavior to support our flawed thinking with what psychologists call WYSIATI (What You See Is All There Is). Our ego conveniently creates plausible stories to support our intuitive surface assessment.
We make errors in positive associations as well. Charismatic professionals, attractive people or people who look and act the part during the interviewing process, only to fall short when put to the task, are the “empty suit” hires. Psychologists call this the Halo Effect; the tendency to associate only positive qualities with someone who makes a positive first impression, neglecting any “red flags” or warning signs. We are often deceived by someone who looks like us or our ideal image of ourselves. “Face in the Mirror” is a specific type of Halo Effect reflecting self-love. The ego, of course, wants more people just like you on the team because you are perfect.
Private equity company owners have “Face in the Mirror” candidates they are drawn to, those with great financial skills who present well to the board and shareholders. The MBA plaque from a top school guarantees they will be great, right? Unfortunately, the operator fails as they are unable to engage with the blue-collar operational grit of the business or gain the trust of the people and customers.
“Our comforting conviction that the world makes sense rests on a secure foundation; our almost unlimited ability to ignore our ignorance.”
– Daniel Kahneman
What are the roots of our biases?
Biases come in three forms: conscious, subconscious and unconscious. Embracing that science has proven 95% of the human mental function takes place in the subconscious and unconscious is the first step to understanding the monstrosity of this problem. To be human is to be driven by an emotional mix of self-love (ego) and repressed pain, fear and guilt.
After some unpleasant reflection and psychoanalysis of my own smoking biases, it’s my grandmother who is at the root. In 1976 I was 8 years old. My grandmother lived across the street, and my parents were in a bowling league every Friday night – meaning we had a babysitter every Friday of the 30-week season. Arguing with the babysitter is a competitive sport when you are 8 years old. Suffice it to say that anytime I wanted to rebel, I walked across the street to hang with my grandmother. She was a registered nurse who smoked like a chimney. She lived for Friday Night (scaring/disturbing) CBS movies on TV, these combined with an endless supply of chocolate-covered peanuts were the reward for putting up with her ashtray kisses and smoke-filled family room. Digging deeper into my bias, my Mom suffered from serious PTSD, the result of an abusive childhood. Her father was the abuser, but my grandmother was clearly complicit, failing in a mother’s most crucial role, protecting her children. I still hold my grandmother accountable. To this day, the smell of cigarettes conjures up immediate dark and sinister images. Remember, pulling this out of my subconscious was neither an easy nor pleasant experience. We humans work hard to avoid difficult and unpleasant experiences.
How many hundreds of unknown biases do we harbor deep within our subconscious and unconscious?
5 Rules for making Great Hiring Decisions:
1) Increase your awareness of your personal biases
Humans are vulnerable to emotion, euphoria and the darkness in our life experiences. This is the place to start searching for the most entrenched irrational biases. People seem to be more entrenched and blind to biases rooted in pain, fear and guilt. Understanding our pain, fear and guilt is the only way to increase our cognitive power.
“The test of learning psychology is whether your understanding of situations you encounter has changed, not whether you have learned a new fact.”
– Daniel Kahneman
2) Choose cognitive reasoning over intuition
Your intuition might be effective when it comes to hitting a baseball or taking a jump shot but only after 10,000 focused repetitions. Leave your intuition where it belongs, on the field or on the court. The team deserves a more cognitive approach when selecting talent. Developing proper scorecards is critical to any hiring process, followed by scripted questions that will provide clear insight into the strengths and weakness of any professional. Take time and focus on collecting the facts, not drawing conclusions. If you focus on collecting the facts the conclusions will be obvious.
Speak in algorithms, so the language of the team is focused on collecting the facts and completing the math. Math does not lie. Teach professionals that their university and college professors lied to them, they really can be boiled down to a dollar value, and knowing that value is the first step to controlling your career path. The hiring process is about the leader and candidate trying to figure out this problem:
Resources x Strategy x Candidate/ Time = Return On Investment
4) Vetting as a team
It’s a team event and critical to our process. Perspectives become more well-rounded, provided there is not a dominant leader running shotgun over the process. Each person must be rewarded for calling out each other’s biases. The privilege of working with coworkers over a long time is knowing the individual and team patterns. What is the proven history of success? What are the behavioral patterns in their double vetting? Our team fully believes in double vetting.
5) 360° reference checking
Fact: people often lie on reference checks. The cause is some combination of the litigious environment and the need to be liked. This is a tough obstacle for companies and corporate recruiters to overcome as their intentions are not shrouded, making a truly unbiased reference highly rare. One of the most valued aspects of our vast network and now 30-year history in the industry is the ability to call a president and talk about an opportunity he might be interested in, and in the barrage of interview questions asking, “so in your career who are your proudest mentees?” What this is really driving for is a reference on a GM that reported to him 5 years ago. If the president selects this GM, from the over 20 has he led, that is an objective reference – worth its weight in gold. It is tough for hiring companies to feign their intentions and minimize exposure to the candidate when reference checking. In this competitive environment losing candidates to other companies once it’s known they are “on the market” is a significant risk. Not to mention jeopardizing a professional’s current career position and need for confidentiality.
The backbone of our vetting process is found in the pages of Thinking, Fast and Slow, written by Daniel Kahneman. He won a Nobel Memorial Prize in Economic Sciences for his work. The book has become a must-read for any C-level or President we place. The book, both hardcover and cliff notes version, never leaves my desk. It’s riddled with notes and highlighter marks.
Remember – reading is easy, it’s putting the concepts into action consistently while under pressure that is the real separator.
With every breath keep growing – Tony
March 4, 2019
Check out this video to learn how to de-risk your hiring process.
It is common for leaders to believe that being secretive or noncommittal with the company people is a smart practice.
Company growth plans, individual growth opportunities and company financials are all common areas in which leaders choose to be tight-lipped.
The reasons range from the belief of protecting a competitive edge, fear of embracing the facts, to fear of the facts being companywide knowledge. Words like strategy and savvy are used to rationalize these efforts.
What they don’t understand is that it’s a lack of information that drives people away from companies. People are looking for clarity and are wise to smell the freshly-spread manure as a leader dances through questions without being direct. The first thought in a candidate’s mind is, “the company that does not share financial performance must have something to hide, either they are on the fringe of bankruptcy or the owner is getting so rich he should be embarrassed.” Or “the leader who cannot give me a clear answer on achievements needed to be promoted must mean there is no promotion opportunity.” None are typically accurate scenarios but the absence of facts, like a vacuum, pulls in the worst-case scenarios and, in a candidate’s or employee’s mind, they become beliefs. Now the relationship has a foundation of half-truths or lies.
Please let me know how helpful or non-helpful this video is as we look to improve our content.
You can subscribe to our YouTube channel here.
With every breath keep growing! – Tony
January 11, 2019
“Never compromise your principles, unless of course your principles are Adolf Hitler, in which case you would be well advised to compromise them as much as you can.” – Justice Scalia
Could a lesson delivered by my millennial children be your greatest competitive edge recruiting talent? I just returned from a wonderful family vacation and am compelled to share. As there are many who can attest, having adult children has its own set of rewards, but the true test of embracing diversity is being isolated with your socialist democratic adult children for a week. Great conversations late into the night with the appropriate infusion of spirits opens the gates to impassioned discussions on politics and economics. I hope I am not unique in that the father, son/daughter nature of our relationship allows the gloves to come off rather quickly, with everyone compelled to share their impassioned views.
Topic: Capitalism and Free Enterprise vs. Socialism
In the opposing corner: My oldest son, Cody 28 yrs. old, website developer for a Minneapolis marketing company. Delta Airlines is one his accounts. If you have a problem with their website, it’s Cody’s role to fix it. My daughter-in-law, Jenny 28 yrs. old, Master’s Degree in Public Health. Logan, my 26-yr-old son electrical engineering student, and Maddie my 22-yr-old daughter pursuing her Master’s in Speech Pathology. Political stance: entrenched Socialist Democrats. Holding true to their peers, a Harvard study found 51% of millennials do not support capitalism. https://www.forbes.com/sites/victorlipman/2018/06/01/many-millennials-reject-capitalism-what-does-this-suggest-for-management/#5a47cae76dbd
Myself, 50 yrs. old. Centrist Republican, business owner. I fought hard for Capitalism and Free Enterprise. Conjuring up my best Milton Friedman (’76 Nobel Award for Economics, 1980-88 key advisor to Reagan) impression, “The only cases in which the masses have escaped grinding poverty; the only cases in history are where they had capitalism and largely free trade. What other society allows individuals to pursue their self-interest? Is it really true that political self-interest is nobler somehow than economic self-interest?”
But it was this interview on CNBC last month from Paul Tudor Jones that delivered the last blow in our debate. https://www.youtube.com/watch?v=kUfzebxwrxA
Paul founded Tudor Investment Corp, which had a long record of double-digit annualized returns. A self-made hedge fund manager, with a $4.5B net worth, has started an investment fund called Just Capital – an investment portfolio that picks companies based on the surveys of the American public on how they value companies. The #1 factor is worker pay and overall treatment of their people.
Tudor goes on to explain the belief that companies can be a force for the greater good and play a crucial role in addressing the social challenges in our country is critical to capitalism’s survival. Paul makes it very clear to Andrew Ross Sorkin, co-anchor CNBC Squawk Box, over-focusing on earnings is a problem.
51% of millennials 18-29 yrs. of age are opposed to Capitalism
If we don’t change, Capitalism will not survive
20 yrs. from now you will be practicing in Havana unless we change the way Capitalism works
If companies are viewed as lifeless entities that do nothing but make profits, we will not have a sustainable social structure
Be wise, these changes have already happened. Consider the number of Dow Jones companies ranking high on Just Capital’s employees-first metrics: Microsoft, Intel, Proctor and Gamble, Apple, 3M, Nike, Caterpillar. These companies know their success is determined by their ability to attract and hire top talented millennials.
Learning and adapting with the next generation, particularly your children, is not always easy – but what other option is there? Threading the needle between value differences of your workforce is challenging. Making decisions based only on legacy, or how you see the world in a vacuum, can be dangerous. What steps are you taking to collect facts from outside that vacuum? As Cody, now in his 2nd year with the company and has earned 4 weeks of vacation, informed me: “Dad, everyone knows 4 weeks is the standard in the industry.”
What happens when competition for talent becomes so intense as a business leader you no longer have the privilege to consider your own political self-interest? Simple – choose your economic self-interest above your political ideals. The smart leaders throw aside their 2009 values, including their compensation and benefit plans, and adapt to the new generation. When competing for top talent what you think is or is not nobler does not matter. The only thing that matters is what top talent wants and what the competition is offering.
With every breath keep growing! – Tony
December 14, 2018
Recently, the Greg Brooks/Misura Group HR Roundtable leaders had some questions surrounding compensation plans for Outside Sales Reps (OSRs). The following was my response, I hope you find this helpful.
The most common mistake we see leaders make is developing plans based on what they “think” and not on what is fact. Make a commitment to collecting the new and current facts surrounding your business and your competitive market for both customers and talent. If you are diligent in collecting the facts and ranking them by relevance, the appropriate action becomes quite clear.
Here are my top 5 questions for developing a sales compensation plan:
1. What is the competitive edge of the products or services?
2. What is the value proposition the sales professional is personally delivering?
3. What is the competitive “Compensation Currency” the hiring company is offering?
4. What is the amount of sales volume/gross profit dollars the business model can deliver?
5. What percentage of gross profit dollars are paid to the sales professional?
1. What is the competitive edge of the products or services?
Apple, Budweiser and Leaf Guard do not need to pay their salespeople above market. Why:
- Apple has Facetime, end-to-end encryption and a long list of proprietary high-demand products the public wants. Their strategic product position is excellent. Their toughest sales question: Do you want that in black or white?
- Budweiser – who sells more beer, the sales professional or the Clydesdales on NFL Sundays? Their brand dominance is impressive, only order taker sales talent is needed.
- Leaf Guard, it’s an exclusive distributed product with patent protection that allows “old guys” like me to have clean gutters without the risk of breaking their leg. High demand for products or services means a low level of sales compensation is needed.
What is the level of demand for your products or services when compared to your competition?
- Your gross margin percentage might be a leading indicator.
- Complete, accurate and on time are low barriers to the competition and typically are not enough to command customer loyalty and high margins.
- What is it that your competition is not doing, or not doing well, that is the area to focus your competitive edge?
- If you have a “me too” product or service offering you have to pay more in compensation or offer more “Compensation Currency” to attract top-level sales talent. The success of the business requires the sales professional to carry more weight.
2. What is the value proposition the sales professional is personally delivering?
- Truss and wall panel sales professionals make more money because their math, blueprint and construction knowledge is in high-demand and short-supply. Whatever the skill, it must be quantitative and reflected in higher gross margin dollars.
- The best new-business developing sales professional in the county is worth more compensation than the account-maintainer sales professional. Again, supply and demand, driven by return on investment, are the factors.
- If an OSR is claiming their “relationship-selling focused model” is working, it must be reflected in their gross margin dollars. (Warning: the good ol’ boys “relationship” selling model is not sustainable today.)
3. What is the competitive “Compensation Currency” the hiring company is offering?
What are you offering the sales team that they want, that the competition is not providing?
- It’s often not what you “think” they want. Many leaders miss the boat here – collect the facts. Survey your current sales talent and post-interview the sales talent that turns you down to understand how your offering compares with the competition.
- It might be centralized estimating, work-life balance schedules, bird-dogging assistants to track orders and walk job sites, technology that increases their volume per hour worked, trips to Hawaii, training and development, a sales manager to hand over new business leads, or career path growth. You can offer less compensation if you have the right mix of these types of offerings.
4. What is the amount of sales volume/gross profit dollars the business model can deliver per sales professional?
Most OSRs are already working the maximum number of hours, from their view. The question is how many gross margin dollars can be generated with each hour worked with ABC Company vs XYZ Company?
- Taking steps to increase the amount of gross margin dollars a salesperson can generate in your business will decrease your compensation offerings and increase your talent level.
- More effective purchasing programs can have a major impact.
- Business development, estimating and logistics processes can create opportunities.
5. What percentage of gross profit dollars are paid to the sales professional?
Most solid OSRs are highly money-motivated. The rubber meets the road at gross margin dollars sold divided by compensation paid.
Beyond these 5 points, OSRs are humans and will only conform to the incentives and structures laid out in front of them. Activity-based costing (ABC) analysis, leading every OSR to annually turn over the bottom 20% of their accounts to junior sales talent, keeps their business development skills sharp and improves the health of the overall business model. ABC is effective in helping the senior OSRs improve their compensation per hour worked. If you don’t want a sales team that won’t leave the nest waiting to be fed – quit treating them like baby birds. Compensation is not a silver bullet solution for poor leadership or a non-competitive culture. Owners and Presidents must ultimately take responsibility for the sales performance as they are accountable for the pace and culture.
If you are interested in more compensation ideas specific to your situation, please reach out.
With every breath keep growing! -Tony
November 19, 2018
“Fortune Favors the Bold” – Bohemian Rhapsody
On one of my best days in 2018, I was boarding my flight when I looked up and saw Kevin McHale sitting in seat 2A. Without even thinking I blurted out, “Kevin! Wow, hello!” like he was my best high school buddy, reaching my hand across the person in 2B all but elbowing them. I love those moments – when at 50 years old I’m suddenly transformed into my 14-year-old self. From my perspective, Kevin was THE power forward in 1982, playing for the Boston Celtics team that had just won the ‘81 NBA championship. I remember studying his moves: baby hook, turnaround jumper, but it was the drop step from the low post that he perfected.
On that day, Kevin graciously shook my hand and I took my seat in 19B. Being the ever-persistent fan, I walked with Kevin from the gate to the baggage claim area. I thanked him for teaching me the drop step, which had allowed me to start as power forward for the St Patrick’s 8th-grade team. Our team went 35 and 3 that year, letting Kevin know he had played a key role in that was very cool.
In 1982, at 14 years old, all I knew was that I wanted to improve my basketball game. The best self-directed step seemed to be watching and adopting the techniques of the best NBA player who played my position. Little did I realize that this was my first attempt at using a Gap Analysis Continuous Improvement Process.
Here are the steps to that process:
Envision your goal. For example, to become the top sales professional or top general manager in the industry.
Find a role model. Study the industry’s top professionals to find your Kevin McHale and make a list of everything he or she does. Notice I said the industry’s top professionals, not your company’s. Aside from the relatively restricted range of talent that you will find within one company, you will also limit your exposure to new ideas and approaches. An individual company’s practices are subject to historical biases and outdated customs that are likely begging for a fresh perspective.
Create a list of questions. These should be aimed at learning about this top professional’s path, both his successes and failures. Be comprehensive with your questions, we will sort and prioritize later. Be confident, professionals at the top of their game will be open and willing to help.
Your list of questions should be thorough:
- What steps do you take developing your sense of purpose?
- How do you spend your free time?
- How do you handle stress?
- How do you recharge your batteries?
- How do you maintain your level of energy?
- What methods do you use to stay positive?
- Who do you go to when you need objective feedback and increased self-awareness?
- What is your diet?
- What is your workout regimen?
- How do you manage your work/life balance?
- How do you set goals?
- What are the 3 biggest mistakes you’ve made in your career?
- What is your process for managing your ego?
- What are your favorite creative sources?
- How much time do you dedicate to personal development per week and what do you do?
- What is your process for staying organized?
- How did you develop your financial discipline?
- What spurs your curiosity?
Now, take that list of questions and give it to 5 people who know you well and care about you enough to be brutally honest. What are the gaps between you and your Kevin McHale? Break the list into the following 4 categories: low effort-low impact, low effort-high impact, high effort-low impact, high effort-high impact.
Carefully write down the high effort-low impact and low effort-low impact items and throw them away.
If you are fortunate enough to have low effort-high impact items on the list, pursue them.
High effort-high impact areas are where the rubber meets the road. As humans, we are inherently emotional beings prone to undervalue the high impact-high effort items in order to protect our egos. This is the same reason I choose to shoot free throws every time I’m at the gym. As an 87% free throw shooter in high school, my ego loves the free throw line – off-handed ball handling and shooting… not so much.
What is the one thing from the high effort-high impact list that will bring about the greatest evolution and advancement toward your goal? Concentrate your efforts on this “One Thing”. Set a reasonable timeline to learn, practice and implement these changes. Stay focused until you can apply the new methods consistently when under pressure.
What is the value of a professional coach?
- To help you recognize the high impact-high efforts areas.
- To help you understand that what your brain perceives as Mt. Everest is emotional fiction, the reality is a countryside rolling hill.
- To force you to work on the highest impact area of your game, which typically requires the greatest emotional resiliency.
My daughter Madalena will be graduating from UW Madison this spring. Looking back and comparing pictures of her as an incoming freshman to a graduating senior I am in awe… such phenomenal growth. Why in the hell should accelerated growth be exclusive to the young?
With every breath keep growing! – Tony
November 5, 2018
“I never saw your future only your possibilities” – Billy, counselor at The Refuge
Coaching youth sports for over 20 years created some of my favorite life memories. Youthful souls, hungry to learn and full of energy. I view my role as coach with this simple objective: learning how to compete, win and lose well is foundational to a successful life. The accelerated learning loop of athletics might be its greatest asset. Attempt, fail, assess, adjust, try again. That loop can happen dozens of times in one game. Learning to compete requires mental resiliency, the common trait among top career professionals.
Years back when my sons were in grade school, a new director took over the town baseball program. Their first action was changing the names of the teams from the Cubs, Pirates and Tigers to the Raspberries, Blueberries and Strawberries. Yes, this is a true story, you can’t make this up. Their next move, we were no longer to keep score and statistics. The purpose was to avoid exposing kids to failure and act like some protective bubble from the reality of life. The change was initiated out of fear for the children’s’ feelings and emotional state. Irrational and ridiculous, right? When the kid strikes out at the plate, it’s impossible for their peers and parents to unsee what just happened. In life, when has any good come from hiding a failed attempt? The essence of a great athletic experience that comes from embracing outcomes with encouragement and proper guidance, was destroyed. The response was overwhelmingly negative, and the director was replaced, thankfully, the following year.
At various industry speaking events, I focus on helping operators improve their recruiting efforts. I am shocked at the large numbers of companies that refuse to share financials, profit and loss statements, with employees. When asking them “Why?” the responses range from “confidentiality” to “the people’s inability to handle it” or “it’s just not our traditional way”. These responses are rooted in an irrational fear of some sort, you can see it in their eyes. A more honest answer might be, operators either feel guilty because of the high profits they are making and low compensations they are paying their employees or embarrassment of the low profits the company is generating as it negatively reflects their poor leadership. Not sharing financials is called the “Mushroom Management” approach, avoiding the facts and not allowing the crucial conversations to take place. Consistently the results are disengaged people and high turnover rates, mixed with mediocre talent, delivering low profits.
“We live two lives; the one we learn with and the one we live with.”
Naming a sports team the Raspberries and not keeping score or stats is equally as ridiculous as not being transparent with your financials. Being human means we often do not act not in our best interest, but rather in the interest of serving our ego and emotional state. Our subconscious mind’s favorite tool in this ploy psychologists call “duration neglect”, in which we craft stories about the experiences of our past to support our emotional state. Simply put, we lie to ourselves. And worse, we make future decisions based on those lies. Don’t kid yourself, duration neglect is a pervasive human trait. Resist the natural response of applying the concept to someone else and take the tough look in the mirror. Collecting facts and tracking how activity impacts financials is the best duration neglect defense. Financials don’t lie, making them the ultimate report card.
Employees can hold their own fault and responsibility fulfilling a role supporting the Mushroom Management model. As it requires a codependency of employees willing to lie about how great the company and its leaders are, in return the leaders don’t hold them accountable. If you are in a position where you cannot define your impact and value in hard numbers daily, you are likely in some form of Mushroom Company, or Mushroom Position. National Sales positions are famous for lacking clarity between their daily actions and market share and profit gains. Key buying decisions are made in the local market, what is your impact on the company beyond the next golf best ball tourney? A person’s unhealthy fear of change and exploring a better career path is a vote of confidence for the Mushroom business model and being treated this way. If you find yourself in this business model take action. Create your own measurements, tie them to a financial result. Request 360 feedback from peers and leadership. Develop your own mini-MBA, reading and studying books a minimum of 4 hours per week. Personal development done well should increase your income by 20% per year minimum and increase your efficiency by more than the 4 hours per week you are carving out to study. Call our team, we can help get you started.
Leadership – it comes down to trust and impact. Either you trust the people that make up your company, or you don’t. The actions of a prevailing trust culture are easy to identify – everyone in the company understands how their daily efforts impact the P&L and want to be measured and rewarded based on that clear outline. Open conversations regarding the professional’s current skills and talent, including both successes and failures, are welcomed. Leadership, in turn, requires constant feedback, increasing their self-awareness acting to grow and improve to close their leadership gaps. Great professionals take advantage and look forward to their failures, knowing their approach will drive significant personal growth on the other side.
The choice is simple: allow everyone to keep score and individual statistics through financial transparency, or keep telling lies. Regardless of whether or not your head is buried in the sand, there are winners and losers. I guess, you could always change your name to the Raspberries.
October 15, 2018
Adam Grant is a professor at Wharton University of Pennsylvania. Professor Grant tasked his MBA students to determine which Fortune 500 company had the best culture. Armed with Wharton credentials and resources the students launched into the project, flying around and visiting company to company collecting their culture and performance data. When the Wharton MBA student debates ended, Bridgewater Associates, Ray Dalio founder and Chairman, is a $150B, HQ in Connecticut, and the top-performing hedge fund. What made Bridgewater the best culture? Baseball Cards! Baseball Cards? Yes, Baseball Cards.
Every person in the company has a personal Baseball Card with agreed performance measures and values that are updated 24/7, by subordinates, peers and leadership. Starting with Ray Dalio himself. A recent entry on Ray, the Chairman of the Board’s card, “Ray – you scheduled a meeting and planned for 30 minutes, but you came unprepared and rambled your way through. The meeting lasted 90 minutes and was a major waste of my time. You earned a 1 for organizational skills and preparation. Try harder next time.” Pete, Manager in IT.
Leaders struggling to provide the level of development and feedback the millennial generation is demanding – Baseball Cards might be your solution. Providing everyone with a voice and creating a high level of transparency is empowering, engaging and leaves no room for disgruntled and underperforming team members. Weak leaders beware: this culture is not made for the underperforming leaders who prefer fiefdoms where everyone lies about the greatness of their leader and in return, the leader covers for underperforming people.
This book is a fantastic read. I have found the explanation of the structure and implementation to be excellent in simple language. As a team, we are 3 months into adopting the systems with great results. I walked a few Presidents and CEOs through the book with solid early results. Best of luck on your journey creating meaningful relationships through radical transparency.
With every breath keep growing – Tony
October 2, 2018
Last week I was walking into a classy hotel in Minneapolis for the Greg Brooks Executive Round Table. While thinking about topics to be covered, I met Roy; the doorman, valet and luggage porter. I was impressed with his energy, enthusiasm and communication skills. Unlikely to be a college student, being it was a Tuesday morning and he was working, I was intrigued as to his story. He revealed that he is now 28 years old, had graduated from high school in 2008 and assessed that taking on a large college debt at that time didn’t make sense. He had watched an older sister go to college only to be burdened by a heavy debt load for a degree that was not benefiting her current career. His girlfriend now graduating from college, Roy is hoping to get married and buy a home soon; considering what direction to take his career, he looked to me for advice.
His current compensation as a bellhop is $20,000 in hourly wages, he receives another $25,000-30,000 per year in tips, bringing his total income to $45,000- $50,000. His present need for greater financial security demands a career that will enable him to grow and advance. His position at the hotel, while stable, offers no career growth opportunity. He mentioned the steamfitter and electrical trades as respectable options. The irony was shocking to me. I was preparing to help some 50 presidents solve their recruiting challenges – they all walked by Roy, likely tipped him as he carried their bags or valeted their cars, never even considering that he could be the solution to their problems. An eager, smart and hungry 28-year-old with a proven history of success delivering best-in-class customer service and an income that is over 50% commission-based. Hiring Roy as a junior outside salesperson and watching him command and conquer is where I would place my bet.
Focus your mindset; be recruiting 24/7
Why is Roy the bellhop not being recruited? Are leaders entrenched in the “must have sawdust in their veins” theory? Or are they just not accustomed to actively recruiting themselves? The first step is shifting your mindset, by looking for talent everywhere.
Shift your network
Leaders are often not directly engaged in solving their hiring problems as their networks are typically not well-suited to fit their recruiting needs. Your primary network consists of your family, friends and customers. None of these pools are adequate when it comes to meeting your talent needs. The traditional practice of having the HR department handle recruiting by advertising is the old solution. We all fall into ruts, attempting to solve new problems with old solutions is the paradigm that needs a shift. Where do truck drivers and warehouse workers spend their time? Eating breakfast and lunch at the local truck stop. If I wanted to hire the best truck drivers, I would go to local truck stops and offer the waitstaff $100 gift cards for every driver they referred to me or hire a crew to wash windshields and hand out business cards. You could have your yard manager certified to train CDL drivers. Sitting on the board at a technical college or leading certification processes for your focus area are proven best practices. Stop waiting for candidates to apply online – reach out, beyond your standard network, and draw them to you. The recruiter who is action-oriented, thinks outside the box and gets up-close and personal, will out-recruit his competition every time.
Shift your thinking and create new solutions
Some operators walk into a restaurant and think about the supply chain logistics of the tomatoes in their caprese salad, some think about customer turnover at the tables and the revenue capacity of the business. The best recruiting leaders think about how similar the kitchen operations are to warehouse or yard operations. They assess the wait staff, looking for that individual with an engaging personality and the right level of curiosity and desire to serve their company. How well suited is a Starbucks employee for an inside sales role? A barista awarded Best in Class for service, with a history of success and arriving to work by 5:30 am, deserves more than a good tip. These qualities would be #1 and #2 on my scorecard for a counter sales role.
It’s about mentorship and career path growth
Think about Roy. What is it that Roy wants that his current employer is unable to provide? Career options and growth without college debt, as well as mentorship and personal development. Our industry lines up perfectly to provide what younger talent desires. We have never been an industry that requires a bachelor’s degree to enter, rather enthusiasm, curiosity and a willingness to be trained on the job are preferred traits. Shift your personal recruiting process to search out the Roys. As a leader, your greatest competitive edge for recruiting talent is your commitment to their personal development. Focus on providing mentorship and career growth opportunities and you will solve your toughest recruiting challenges.
August 29, 2018
Congratulations to our recent placement, Lindsey Fox, now Marketing Manager at Nationwide Industries. It was a pleasure working with Lindsey, we are excited to see the impact she will have as she creates thoughtful, customer-focused marketing programs for our client.
Here is what she had to say about her experience working with Misura Group:
“Working with Misura Group was my first experience with a recruiter and it felt like the stars aligned from day one. Everyone always had time to speak and answer my questions, and I felt like I had a close professional mentor through the entire process. The thing that surprised me the most was the level of detail involved in each step; from the initial conversation to checking my references and finally working with me on an offer.
I appreciated Misura Group’s level of knowledge about the industry, the employer and the type of individual needed to fill the role. Tony showed great sense of character and integrity by taking the time up front to understand my goals, personal and professional, before we dove into details of the position to make sure the opportunity was the right fit.
There are many reasons this opportunity interested me. I was able to bring expertise from my marketing background while expanding upon additional skill sets to make me a more well rounded professional. I’m also able to put my thumbprint on a growing company and work with more brilliant minds within the building products industry. Lastly, the culture of teamwork, motivation, fast-paced environment and entrepreneurial spirit helped make a difficult decision easier.
I recommend working with the right recruiter, in my case Misura Group, if you are interested in considering a new position. Don’t shy away from recruiters reaching out to you, the job of your dreams might be waiting for you in the wings.”
August 6, 2018
Don Magruder, CEO of Romac Lumber & Supply, will be moderating an executive panel discussion on hiring, training and retaining employees of the future at the Florida Building Materials Association Convention August 22-24 in Orlando, FL.
This panel will discuss the past as well as future demands of the market as they relate to growth and then explore ideas on how to create employees of the future.
Don will be joined by the following panelists:
Mark Callender, VP/COO of Great Southern Wood Preserving, Inc.
In this role as VP/ COO, Mark has a clear view of all the company’s activities and operational results, and he has an extensive responsibility for carrying out the company’s policies, goals and objectives. Mark has 37 years of experience in this industry – most of that with GSW.
Mitch Lewis, President/CEO of BlueLinx
Mitch Lewis began his career practicing law, specializing in mergers and acquisitions. Prior to accepting his current role at BlueLinx, Mitch also served as President and Chief Executive Officer of Euramax Holdings, Inc. and President of Amerimax Building Products, Inc. For more than 26 years, Mitch has been a leading executive in the supply industry.
Russ Hallenbeck, CEO of Tibbetts Lumber Co., LLC
Russ is a Director and CEO of Tibbets Lumber and Cox Lumber Ltd. in the Cayman Islands, taking that post in December 2014. Russ began his career in 1987 with the former Cox Lumber Co. until 2006 when the company was sold to The Home Depot. Russ also served as Area Vice President of Florida for ProBuild from 2010 to 2012.
Jacqueline Schaffer Shaw, VP/General Counsel of Schaffer Associates
As VP Client Development, Jacqueline oversees all new and current client relationships and directs all corporate communications and marketing, including print, public relations, and social media. As General Counsel, she provides legal counsel to the firm with a special focus on employment issues.
Tony Misura, President of Misura Group
Tony has been serving people in the lumber and building materials industry since 1987. He started Misura Group in 2007 after buying the Building Industry Division of Focus Executive Search, the recruiting firm he had been at since 1999. There, he learned the dynamics of the recruiting business from leaders of an established firm and learned how to create a national network of top executives.
Don’t miss this “Standing Room Only” event.
You can view the full agenda and registration details here.
July 16, 2018
“Some feel the rain. Others just get wet.” ~ Bob Marley
The average compensation for Division I (FBS) collegiate head football coaches is $1.64M, for athletic directors it’s $646K, for state governors it’s $70-$190K. Political commentary aside, in the best-case scenario the governor’s salary is 11.5% of their university’s head football coach. Simply there are more people who have skills and are willing to be the governor than the Division I head football coach.
It’s reported the average college undergraduate has $37,172 in student loans. And yet the most popular undergraduate degree is Humanities and Social Sciences, which ranks among the lowest in career field job placement and starting compensation. Why is Humanities and Social Sciences the most common undergrad degree? The students’ high interest level combined with a relatively low academic rigor is a good guess. Why is their compensation and job placement relatively low? Simply there are more undergrads than there is demand for their skills.
It is remarkable the number of professionals who don’t understand the economics of compensation. Employees who blindly move through their careers believing that compensation involves some mystical equation. Leaders who believe they have control over market compensation and are shocked when they lose key talent.
Compensation is a function of supply and demand economics, with an X factor.
The Top 5 factors that drive compensation:
The number of people willing to do the job – Staffing a Starbucks will always be easier than a lumberyard. Coffee is cool. The food service and education industries have the advantage of an alluring appeal, the building products industry by comparison does not have this privilege. The food and education industries generally have lower compensation rates than the building products industry due to this factor.
The number of people capable to do the job – The level of discipline and cognitive horsepower needed to be a neurosurgeon creates a low supply.
The level of risk tolerance – The window cleaner who handles 50-story buildings is compensated more than the window cleaner who doesn’t own a ladder.
The level of demand for the service/skill – Pharmacists once had a lucrative career path, but now the online and mail-order pharmacy business models are shifting the demand. It’s wise to understand the demand for your skills as well as the economic trends affecting the industry you are serving.
The X Factor… How strong is your network? Hiring Leaders, the depth of your talent pool is limited by the quality and quantity of your network reach. Professionals, the flow of your career opportunities is limited by the reach of your network. Confidentiality and risk will always be significant obstacles for both parties to connect without leveraging a 3rd party recruiting resource. Limited time factors only further complicate this difficult situation. The result: It’s common for a professional’s network to be focused on serving their customers, which is not very effective in serving a hiring process or career search.
The truss, custom millwork and installed segments of the industry are hot. When run well, these business models commonly generate 50-200% more profit than lumberyards. The shrinking contractor labor force, combined with an older-demographic customer base that is shifting from Do-It-Yourself to Do-It-For-Me, creates great profit margin opportunities increasing the demand for service. Trusses, custom millwork, installed services all reduce construction time, on-site risk of injury and the level of on-site carpentry knowledge, all of which increase the demand. General managers, Sales managers and Sales talent in these segments have increasingly complex responsibilities, requiring a broader skill set. Simply, the number of people willing and capable to do the job are less than the number of lumber generalists, leading to a short supply of capable talent. Lumber people – before you send the hate mail, ask yourself: Which do you screw up more often, the lumber pack or the truss bid?
Why are industry leaders commonly compensating truss, custom millwork and installed sales leaders the same as lumber generalists?
It could be a few reasons:
Singular focus of keeping compensation costs low as the objective, rather than the ratio of productivity and profits to compensation.
If talent is not wise to the broader market and unwilling to relocate, does competitive market compensation matter?
It might be a factor of status quo, the less disparity the better. Maybe our industry needs more Humanities and Social Science undergrad leaders – we know they would have learned the lessons from George Orwell’s Animal Farm.
June 25, 2018
What defines your Stanley Cup?
A key step in recruiting and retention is creating the “Internal Company Vision”. Many companies have external customer-facing vision statements, this is different. The purpose is to provide clarity to the direction and goals of the company for your current and potential future employees as the audience. Since the target group you are speaking to is not the customer base, objectives and depth of detail are much different.
Following are the 5 key steps in creating your Internal Company Vision:
Keep it simple. A 12-year-old must understand what winning looks like, and how it would affect their lives. I love the image of the Stanley Cup. 31 teams in the NHL, over 700 players, yet every individual can describe in vivid detail how their life would change if they won the Stanley Cup. What defines your Stanley Cup?
Leadership Enthusiasm. As you read the vision it must generate huge passion, enthusiasm and energy from you. Great leaders understand the best methods to project infectious energy.
Team Inclusive. Teams and people are mixed between serving WIIFM (What’s in it for me) and the power to give to those in need. A great vision that combines the financial and human spirit perspective is critical.
The power of written words. Most leaders are extroverts and they over-rely on verbal communication. From the people’s perspective if it’s not written down it does not exist.
Language Creates. People who typically want to define excellence, often only need to be pointed in the right direction. Let your internal vision message provide the common language to become the daily chaperone of your culture. Borrowing from great companies, Alexander Lumber (Aurora IL), uses “Own the Last Mile” for their drivers, at Brand-Vaughn (Tucker GA), “The Strength Lies Within” – both are powerful messages.
Internal Company Vision Example
Young’s Creek Lumber
By January 1, 2020, the Young’s Creek Lumber sales goal is $100 million (25% increase). Combined gross margins will stay over 30%, and operating expense will be stay below 20%. Young’s Creek Lumber will have 3 locations in the Washington–Oregon Pacific Northwest Region, with each location generating over 7% pre-tax profit. By this date, Young’s Creek Lumber will operate on a cash basis with no long-term debt. We will be committed to financial transparency. Each employee will understand what part of the P&L they own, and how their impact will be measured quarterly on the P&L.
The sales revenue will be 50% semi-custom new construction general contractor accounts, 30% will come from renovation and remodel general contractors and 20% will be super-regional production builder accounts.
Products and services will consist of 20% installed services, 20% truss and components, 60% lumber and millwork distribution. We will build strong relationships with Home Builders Associations, with our general managers chairing 2 committees and our entire sales team actively engaged in events. Sales will come mostly through word-of-mouth because of our exceptional quality and service. Young’s Creek Lumber will avoid pressure-based sales, focusing more on actual testimonials from satisfied clients who have increased their profits and sold more homes by leveraging our company value proposition. Our marketing materials will be simple, professional, and feature the signature Young’s Creek Lumber navy blue and gold colors.
Young’s Creek Lumber will compete for the Oregon Best Place to Work Award. Our goal is to embrace what our current employees and the top talent in the market desire from their workplace. Our commitment will allow us to attract employees with the unique ownership and professionalism capable of serving the team first. While our employees will come from diverse backgrounds, ages and education, they will grow as people because of their experience working with Young’s Creek Lumber. Our managers will truly be leaders, helping employees to grow, reaching their personal and professional goals and holding them accountable for results through regular meetings. Our managers will be committed to rigorous reviews and 100 hours of outside professional leadership training. Employee engagement, growth and impact will be the key measurements guiding our employee-first mission. All employees will wear navy and gold long and short-sleeved polo shirts with blue jeans, khakis or approved shorts uniforms. All uniforms will have our company mantra “the Strength lies Within” printed on the sleeves establishing the expectations we have for each other. All attire will be available for purchase on the Young’s Creek Lumber website.
We will be organized and systematized, with all employees keeping appointments and schedules up to date and on the calendar. We will be committed to timeliness and following through. Our drivers will “own the last mile”, this will be their mantra commitment to success, as we track complete, accurate and on-time deliveries. We will have very specific, well-implemented systems that employees can use, creating efficient paths for onboarding and training. Our trucks will always be clean inside and out, with all equipment and materials in their place and ready for action. Our offices of operation will be clean and orderly, yet friendly and inviting. Customers and visitors will always be greeted warmly by knowledgeable and professional staff.
Young’s Creek Lumber will be committed to supporting the Oregon Foster Care and Adoption organization, AdoptUSKids.org. As a company we will volunteer in teams for fundraisers, bikeathons and 10k runs. The company will have performance goals triggering 1-3% of the company’s profits donated to the AdoptUSKids initiatives.
Above all, Young’s Creek Lumber will exemplify our values of Honesty, Service, Thoroughness and Speed in every aspect of our company. We will take pride in our job and always put our people first.
What is more powerful – impact that changes your life or the ability to change other people’s lives?
Clarity + Transparency + Higher Purpose = Empowerment
With every breath keep growing… Tony
May 25, 2018
“THE KEY FOR US, NUMBER ONE, HAS ALWAYS BEEN HIRING VERY SMART PEOPLE.” – BILL GATES
If your company is typical, 80% of your profits come from the top 20% of your people. The P&L tells no lies. How well equipped are you to hire more people that rank in the top 20%?
Here are 5 key traits for you to assess your recruiting process:
1: Sourcing: Flow of quality talent is the first step. If you start with a poor talent pool, there is no recovery and your chances for success are grim. There are two types of talent, those who are in the job market and those who are not. One recruiting secret, the most talented professionals are rarely looking. How effectively is your recruiting process uncovering the talent that is not looking? For top professionals, there is significant risk in exploring new opportunities and changing their career course. Fear of change and the unknown culture of a new company combined with a sense of betrayal of your current employer make this a daunting task for even the most qualified professionals. Breach of loyalty in the most progressive companies can be devastating to one’s career. Most internal recruiting efforts miss out on sourcing this high level of talent.
2: Confidentiality: Strict adherence to a confidential process is critical to protecting your talent and customers. If there is an incumbent in place, the importance of confidentiality is even more sensitive to hiring companies. It is extremely difficult for the even the best company led recruiting processes to maintain confidentiality, but any recruiting firm worth its salt should be able to outline in detail the steps they take to cover their tracks and mask their recruiting efforts.
3: Scorecard: What does winning look like? Or as I prefer to ask: “If one year from now we are raising our wine glasses to toast a job well done, what has this professional done?” How have they impacted your P&L and what are the essential tools and resources that they have leveraged to achieve this? Your scorecard should include defined measurable outcomes (success) and the list the proven history of success traits required of a candidate to get you there. Spending the time to answer these questions up front will enable you to create a list of essential skills and traits, to understand past successes as well as the cultural dynamics. Finally, a rigorous ranking of these items is the heavy lifting. Number 1 on the list should be twice as important as number 2. Developing the right Scorecard is key.
4: Selling: Why is your company the best place to work? Is it the best place for this professional? It makes sense that companies struggle to sell themselves to their candidates. They lack objectivity and are emotionally attached to the situation. Let’s drop the idea that if you sell a professional somehow it limits your ability to vet them. Try this exercise: 1) Create a “best place to work” ranking of your customers and your vendors. 2) Create a “Best place to work” list of your peer competitors. 3) Make a list of peer companies outside of your area of competitive reach and rank them. I doubt most leaders could list the top 3 peer companies in the next major metro area much less describe what is it like to work at them. Business leaders are focused on their people, their customers and their suppliers and that myopic perspective impairs their ability to objectively assess their company’s unique talent value proposition relative to their peers. Consider thoughtfully how you would sell a professional when they ask, “Given the competitive options, why would a professional want to work here?” Take the time to develop your talent value proposition. As leaders, you should be the best at delivering your 90-second pitch. Rehearse it. Capture it on video.
5: Vetting: Any professional skilled at vetting will tell you that their process begins with exceptional Sourcing (#1). Having a top-notch pool of candidates to draw from allows you to head into a rigorous interview phase with confidence. Now you dig in to differentiate between high performers with a proven history of success, and those riding the coat tails of these professionals, those who coast on the rising tide of the company or market. The most reliable strategy for removing biases and revealing blind spots when vetting is to have multiple interviewers with diverse backgrounds using scripted questions from your meticulously developed Scorecard.
How is your competition getting ahead? Remember, probability of success or failure starts with the quality of your talent pool.
Our team is presenting 5 fully vetted professionals for every project within 3-4 weeks. We have focused strictly on the building products industry for 20 years, and this history has allowed us to develop and leverage our long-term relationships and provide thorough, credible references for our clients.
Reach out to learn how our team can impact your 2018 Goals!
April 9, 2018
Celebrating my favorite mentor
Time passes regardless of our desires. Later this month, Bill Vogt, one of the best human resource leaders in our industry, is planning to retire from Zeeland Lumber and Supply.
Let’s jump back to a time when his walk was a little faster, and his stories might have been little shorter. On that day back in 1992 when Bill Vogt and Jim Cavanaugh met in Edmund Oklahoma, I doubt either of them imagined what was in store for them. Jim was a 39-year-old president of a small 4 location lumber dealer called Hope Lumber and Supply, HQ in Tulsa, Oklahoma. Their sales revenue at the time was less than $50M. Bill was also about 39 years old, with a master’s in public administration from the University of Virginia, looking to leverage his experience. He showed interest in Jim’s vision and was hired. Over the next 15 years together they would build Hope Lumber into a 75-location top performing company, with 1200 employees, covering 10 states and generating $1.2B in annual sales revenue.
Financials are the ultimate report card. Hope Lumber consistently performed:
Inventory Turns: 10
Corporate Allocation: 1.5%
How did they do it? Here are some excerpts from my conversations with them.
Human Resources Leadership:
Jim: I saw Bill transform from an “in-the-trenches, hands-on, do everything” manager to an Executive HR professional, leading a staff of talented individuals as a team. Not many individuals have the capability, adaptability or expertise to lead, grow and adjust that quickly. Because of Bill’s unique talent, humility and undying commitment to do “right” by both the employees and the company, he was not only able to grow and adapt but THRIVE in this rapidly changing environment. Remember, Hope Lumber completed 20 acquisitions, added 70 locations and over 1000 employees. Bill did an exceptional job, allowing the rest of the team to concentrate on transitioning customers and revenue.
Bill is quick to acknowledge Jim’s support: I will always appreciate how deliberate Jim was with my development. We both understood that if I didn’t understand the details of the business how could I be effective in impacting the company objectives? In turn, I worked hard at earning my place at the strategy table.
Hire Entrepreneurial Talent as Location Managers:
Bill: Jim’s and my thinking were very, very similar. He truly saw and valued strategic human resources input. He was a driver who knew that he didn’t want to be the kind of corporate executive who pulled strings on puppets… he didn’t have time for it. My role was to make sure we were people smart. Standards were set, but he also granted the autonomy necessary to hire highly talented people. Hire talent solutions, support them but also get out of their way. We both agreed, building a culture of excellent talent with loose reins on people was our vision. If you must light fires under people, you likely have some combination of poor leadership and the wrong people on the team.
The Right Compensation Program:
Bill: A good understanding of psychology added to incentive plans is the secret to great compensation programs. Our compensation program at Hope Lumber was almost perfect. It was designed to attract the kind of decisive entrepreneur who would manage our operations as if it were their own company, the only difference being that they didn’t have to come up with the working capital. We collected the first 2% of sales to cover the salaries we paid, paying out 10% of the remaining part of operating profit, adjusted down if they mismanaged their inventory, accounts receivable, or safety benchmarks. We wanted to pay large bonus checks.
Jim: Bill developed industry-leading incentive compensation plans for managers, salesmen, truck drivers, load builders and production workers. Many of those plans are still being used today! He provided the leading edge of the transformation and consistent superior achievement of personal performance.
Culture of Performance and Integrity:
Jim: Hiring and vetting for integrity are key. The loose reins granted to our location managers meant we had to have confidence that their values aligned. Hope Lumber had some of the best location, market and executive leadership in the industry. Many of those professionals are in top leadership roles at BFS, BMC and other companies today. Bill had a tremendous impact on the development of this structure as well as the recruitment of those leaders.
Bill: The incentive program and culture of performance drove out incompetent talent rather efficiently. We believed clear and objective personnel evaluations respected the integrity of the underperformer while giving the opportunity to grow and protected our culture at the same time.
We all have mentors, those people who have generously shared their wealth of knowledge and experience with us. Bill, thank you for giving this once 29-year-old rookie recruiter a shot at serving you 20 years ago. When I tell stories of the shoulders of giants I am standing on, yours are the first ones told. Your friendship will always be valued. Now we can focus on more important goals, like catching big fish in the Gulf.
His walk might be a little slower, the stories a little longer, but don’t underestimate the depth of his knowledge, experience or the breadth of his career achievements. Don’t hesitate to reach out to Bill with your human resource questions – just make sure you have a full cup of coffee, a clean notepad and plenty of time…
View this article in ProSales
March 19, 2018
The toughest aspect of owning and leading an independent business, is being alone. The isolation while making critical decisions, with only your experiences to reference, is limiting. The collective mastermind of our industry leaders – combined with their generosity – might be the greatest untapped resource at your feet.
Last week at the ProSales 100 Conference we had the privilege of hosting 80 pro-dealer leaders for wine and dinner. 80 independent operators in one room. The goal was simple, create a warm environment that enables leaders to establish new relationships across the industry. At the end of the day we all face similar challenges and problems – there is no reason to fight the battle alone. (And there is nothing wrong with having some fun along way!)
Listen to what leaders say about our executive dinners:
It is a privilege to share our circle of trust with the top leaders in our industry. It is an honor to serve them and share in their energy and enthusiasm around our dinner social events.
Don’t hesitate to reach out to register for our Preferred Attendee list. We will provide you with notices and reserve seating for our future Executive Dinners.
With every breath keep growing! – Tony
February 16, 2018
“Awareness is the greatest agent for change” – Eckhart Tolle
As an independent owner/operator your greatest strength lies in your ability to differentiate, to step off the beaten path and live in your largest competitors’ blind spot. Today that blind spot is the People.
Something interesting happened January 10th, 2018. Peter Alexander, President and CEO of the BMC company, was replaced by David Keltner as interim CEO. Remember, Peter came to BMC Select, the second largest full line lumber dealer in the industry, in July 2010 and led the company 6 months after emerging from bankruptcy and reorganization as a private holding. Peter then re-defined BMC Select, focused on people over profits and over the next 5 years built a company capable of buying Stock Building Supply in June 2015. BMC shareholders became owners of 60% of the new company, a result of BMC superior profit margin. Profit differentials aside, the greater challenge became integrating these two companies’ divergent cultures. A rough road at times, but the journey was completed in less than 30 months under Peter’s leadership. Fast forward to January 2018. The act of moving a board member in the interim role and no successor in place as the company conducts a search is not the preferred method of CEO transition, making it difficult to believe this was part of any long-term plan. The average tenure of CEOs among the top 3,000 publicly traded US companies is 9 years. No board wants their CEO to flame out in the first 30 months. Why would the BMC board replace Peter now?
Granted, running dual corporate headquarters in different states seems dysfunctional. The majority of administrative and financial professionals operate from the old Stock Building Supply HQ in Raleigh, while the executive leaders operate from the new HQ in Atlanta; this would seem to be fertile ground for silos to develop. Potentially the tale of the dual headquarters is a reflection that the integration never really happened where it matters most, in the boardroom? Stock Building Supply executives still hold board seats and historically their strategic plan has been clear: focus on operations first, measure metrics and cut costs. A common financial-first agenda potentially should not a be a surprise from a board with only 2 operators and 7 financial-first professionals.
BMC, under Peter Alexander, excelled at developing people and fostering high levels of autonomy in each market, gaining high levels of engagement from its people through being sales-driven and operationally aware. Remember the result of this method was BMC gaining 60% of the equity of the combined BMC/ Stock organization. How does Peter’s strategy mesh with the Stock Building Supply operations-first, efficiency, top down business model? Based on recent events, it doesn’t. Hence the transition to David Keltner.
Conversely, running a $3.6B business serving 43 metro markets across 18 states, in a decentralized structure, puts a colossal demand on talent. The new direction of the BMC board does have its advantages. It lowers the level of talented experience needed in the field and lowers risk as all key decisions come from HQ. The mantra from executive leaders becomes “watch your spreadsheets, focus on operations and efficiency metrics and we will handle the rest”. If you are 24 years old, with a lot of energy and motivation but lack of experience, this could be a great place to start your career. Operations-first, spreadsheet leadership models can work well when developing an inexperienced work force. As demand increases in a rising new home construction market, does the value of experienced professionals decline? As the national production builders’ share of new home starts continues to increase, does the operations-first and spreadsheet business model have advantages? The BMC leaders appear to be betting on it.
If you are an independent dealer owner competing against BMC, 84 Lumber, Builders FirstSource, or any dealer with volume over $1B in annual sales, turning their blind spot into your greatest competitive edge is clear – focus on the top talented people. The greatest competitive advantage of being a small or mid-size independent business is the ability to attract and top-grade talent. As the largest dealer competitors become over focused on financials and the daily stock price, leveraging this advantage steadily becomes much easier to achieve with broader impact. A solid benchmark for your team might be: for every $5M in sales you should have a professional who is in the top 10% best-in-class in the industry. If you are a $100M company, you should have 20 people that are in the top 10% best-in-class in the industry. Developing and hiring 20 top graded professionals with the right resources can be achieved quickly. Think about it, if BMC applied this method on $3.6B in sales they would need 720 people that are in the top 10% best-in-class. Impossible? Maybe. Improbable? Likely! The top-talent people problem for the largest dealers in the industry is potentially the #1 reason they shift their strategy toward centralization and reducing authority in the markets.
Re-create your Human Resources initiatives into your core strategy. Misura Group is helping organizations redefine their recruiting strategy and evaluate the alignment of resources behind their core recruiting objectives through our Strategy + Culture + People workshop. The program’s popularity is forcing us to develop a webinar to meet the increasing demand. Call us to learn how Misura Group can help your Human Resource initiative become your greatest competitive edge.
With every breath keep growing. – Tony
View this article in ProSales
February 2, 2018
“I am always in conversation and sometimes other people are involved.” – Mark Twain
It is human nature to explain our life experiences to ourselves in a way that supports our beliefs and protects our ego. These “stories” are based on fact but colored by our perspective. Everyone has a perspective – they may be different than our own, but this doesn’t mean they are wrong. Perspectives are subjective. As leaders it’s our role to flush out the facts, separate them from the explanations and excuses (stories), and make sure our decisions and actions are based on an objective assessment of the situation.
The following are common stories I have heard from industry owners and leaders:
“The rising lumber market significantly reduced our company profits in 2017”
While it may be a fact that the lumber markets are rising, it is not the “lumber market’s” fault that profits are falling. It is the owner/leader that lacked the foresight to develop a purchasing strategy to coincide with the long-term pricing guarantees, and then allowed the sales team to be lazy in their response to these market changes.
“The housing starts and job growth rates are flat in my market area, reducing our profits” and “The political leadership is hurting business in my area”
Again, it may be a fact that housing starts and job growth are flat, however, healthy businesses run by astute leaders gain share in a retracting market. A rising tide raises all boats, even the leaky ones. Too often the core strategy, or lack thereof, for many owners is reliant on the market or other factors outside their control. Instead, explore the growth areas in your market. Find the soft spots of your competition, innovate, evolve and grow. Your profits are reflective of your unique value proposition, operational discipline and culture. All three of these define your purpose and are within your circle of control.
“The unemployment rate is so low I cannot hire enough people to improve my profits” usually followed by “The turnover rate of millennials is hurting my business”
Yes, unemployment rates are low, but your high turnover rate is more likely reflective of your strategic business plan, strength of leadership and culture. The best leaders develop excellent human resource executives, who turn their human resources department into a core competitive strength. Companies that continue to over-value operations and sales executives and leave human resources in a subordinate role will continue to be disadvantaged and deprived.
Owners and leaders – take control, rise above the common emotional self-preservation conversations in your head. Observe, collect the facts and adjust your stories based on the newly found information. The best cultures actively make this a team event, supporting each other and constantly searching for new perspectives on common topics. The opportunities are there but you have change your perspective to see them.
With every breath keep growing. -Tony
View this article in ProSales
January 15, 2018
What are your goals for 2018?
If you are looking to advance in your career, while also maintaining a healthy work-life balance, ask yourself the following questions:
- Do you have access to the resources you need to reach your personal and professional goals?
- Do you have the time to find opportunities that align with your skills and values?
- Does your network include peers, customers, and competitors within the building products industry?
We are driven to help professionals reach their goals by connecting them with opportunities that align with their core values. Our passion is building relationships in the building products industry, and our network consists of leaders that put people before profits.
Take control of your career path – call us today. – Tony
January 8, 2018
We cherish our partnerships with long-term clients as well as new relationships. Together we can hire the right talent, build stronger teams, and produce better results for your organization.
|Andy Klapperick, Vice President of Operations
Ted Willoughby, Vice President of Sales
|Steve Larson, President|
|John Sewall, CEO||Scott Blackburn, President|
|Bill Vogt, Vice President of Human Resources||Todd London, Senior Vice President of Sales|
|Mark Mosher, General Manager||Adam James, Millwork General Manager|
|Ryan Hubert, General Manager
Jason O’Brien, General Manager
Bronson Royer, Outside Sales
Chris Lee, Sales Manager
|Dan Korgan, Truss General Manager
Tim Saville, Truss Division Sales/Design Manager
|Ken Thompson, Commercial Door and Hardware Manager||Ken Oetjen, Operations Manager|
We look forward to contributing to your success in 2018!
January 5, 2018
We are excited to be a part of the NLBMDA, in good company with organizations that share our passion for the building materials industry. We look forward to becoming more involved and collaborating with and learning from other members.
About the National Lumber and Building Material Dealers Association (NLBMDA)
The NLBMDA represents its members in the national public policy arena, with emphasis on efforts to 1) promote the industry and educate legislators and public policy personnel; and 2) assist legislative, regulatory, standard-setting and other government or private bodies in the development of laws, regulations and policies affecting lumber and building material dealers, its customers and suppliers. Founded in 1917, the association represents over 6,000 member locations operating single or multiple lumber yards and component plants serving homebuilders, subcontractors, general contractors, and consumers in the new construction, repair and remodeling of residential and light commercial. www.dealer.org
View the original press release here.
December 21, 2017
“Misura Group delivered Ted Willoughby, our VP of Western Sales and Andy Klapperick, our VP of Supply Chain Operations in early 2017 – both were essential to increasing the value of Ultralox. Tony was able to quickly assess our needs and leverage his industry network, providing a pool of solid professionals. We continue to use Misura Group.”
– Edward Peterson, Founder of Ultralox
If you want the best outcome, you have to work with the best. We align the skills and abilities of our candidates with the needs of our clients with unmatched speed and quality. – Tony
October 27, 2017
The ProDealer Summit in Phoenix last week was highlighted by Ivy Zelman’s presentation. Ivy is the founder of Zelman and Associates who is focused on US housing market analysis. Ivy, known as “Poison Ivy” by her bosses at Credit Suisse when in 2006 she called the housing bubble in the midst of the robust market we thought would never end. She followed up to call the 2012 bottom, again more accurately and ahead of her peers.
Following are my notes from her presentation:
Age in place: Retired people are staying in their single-family homes past 80 years of age, limiting the supply of homes for millennials. Remodeling is driven by debt/equity ratio in housing. Currently 30% of single family homes have no debt, 5% have greater than 20% equity, 4% are underwater. Combined with the single family home average age of 41 yrs., Ivy is “Bullish in Remodeling”. People have money to spend and homes need the upgrading.
Construction labor market is tight, but not getting worse having leveled.
Land development is at the most active point since the downturn with developers profiting from subdividing C grade raw land. A reflection of the high demand.
The increased flexibility and support from the banking industry providing home mortgage loans is a story not getting out. FHA loans for 3.5% down for borrowers with 620 FICA scores are widely available.
Home mortgage interest tax deduction changes will be limited to homes over $500,000 and home owners with an annual income over $100,000 (which only make up 14% of home owners). Second homes will likely lose the tax deduction. Overall, Ivy believes it will have little if any impact on the housing market.
Demand: Millennials are getting married, having babies and wanting space to grow their families. Surging demand beyond obstacles, new homes are in broadly short supply.
Ivy is projecting housing starts to increase 12% in 2018 and 10% in 2019. As of today, the top 10 publicly traded production builder stock prices are up on average 82% in the past 52 weeks. Wall Street seems to agree with Ivy’s calculations.
When the question was asked whether increasing prices of softwood and panels will be an obstacle, her comment was along the lines of “don’t hesitate to increase your prices they need your materials.” National Production Builder profit margins are 19-22%, the market demand can handle the increase in material expense.
The gasp from the crowd was hard to miss.
Published every other week by Ivy and her team, The Z Report is rooted in proprietary research and opinions and void of advertisements, focusing exclusively on rich content for executives and business leaders that removes all the noise of volatile and unreliable macro data. We encourage you to visit The Z Report webpage to learn more and sign up for a free trial subscription.
Dr. Robert Dietz, the Chief Economist from NAHB, also presented. His review was more conservative projecting 7% increase in single family housing in 2018 and another 7% in 2019. Student college loan debt increasing 220% in the past 10 years, 1.9% GDP projection, and labor constraints were highlights to his position.
These slides in his presentation I found the most interesting. US Wage Growth is 2.5% across all industries, seems like a low hurdle for our industry to draw talent from other sectors.
Overall US Productivity from all industries from 1993 to present has increased 25%, over the same time period the construction industry is a flat 0% increase. In the past 25 yrs. construction productivity has not changed. The World Wide Web was first tested in 1993, fax machines, pagers, 4% of the population had a giant box cell phones, this was the technical status of 1993 – and the construction industry productivity is the same as 1993. What an immense opportunity! The dealers that develop productivity improvements in construction will have the greatest competitive edge and profits will follow. Might be a solid topic to start your next strategic planning session?
August 28, 2017
It is convenient to blame the talent pool when leaders are struggling to generate quality candidates. As you run your normal traps, internet job posting, leveraging your network, offering finder fees to your people ask the key question; What steps are you taking to access the talent rich, Passive Candidate Pool?
Sourcing Passive Candidates can be difficult as the best professionals are not job searching. Rather they are focused on their day to day challenges at work, while supporting their families and personal well-being. Hiring companies face more complex hurdles when attempting to reach this talented group. Following is a list of natural obstacles companies face when trying to source Passive Candidates:
- You are a competitor, creating an inherent atmosphere of distrust
- Confidentiality breach, risking candidates’ current career position and income
- Your network is designed to know your customers, not your peers. Certainly not your peers outside of your served market area
- Your angle is to sell them on your position, making your actions predictable and biased
- It’s a time and resource drain for leaders
Misura Group approaches professionals to help them reach their personal and professional goals. As a 3rd party, that guarantees confidentiality, with personal coaching expertise and a database focused on the Building Products industry nationally provides us with the resources to be effective with the toughest search projects.
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August 14, 2017
“To be egoless one must withstand repeated attacks of success” – Ryan Holiday
If you think you are safe from the silent darkness of ego, the book’s rich stories of powerful leaders who have fallen at their own hand may shift your perspective. Whether subjecting yourself to the Greek tragedy, or minor displays of ego driven behavior, understand that it comes with being human and affects everyone. Ego is the salve we all crave that soothes the fear and insecurity. Following is an action overview of the book Ego is the Enemy by Ryan Holiday. The book caught my attention after reading that when Pete Carroll asked Bill Belichick what recent great steps he has taken to improve his team, Bill sent him a copy of this book.
Here are the top 10 steps to manage your ego:
1: Be fact driven. Suffocating egos with facts and hard data is effective. Warning: one must develop great intestinal fortitude to become effective at this step. Ignorance is bliss behind rose colored glasses.
2: Pursue regular self-evaluation with detachment. The reason 360 Degree reviews are so effective. With detachment is key.
3: Embrace continuous improvement. The first step in learning is admitting there is much you don’t know, further being concerned that what you think you know, might be wrong.
4: Avoid passion, focus on purpose. Passion is unbridled enthusiasm and a form of mental retardation, deliberately blunting our most cognitive functions. Purpose is like passion with boundaries.
5: What is your purpose? What are you here to do? Answer these questions every day.
6: Create a grand purpose that is larger than you. Now your standards of achievement have become more difficult and easier at the same time. Might be my favorite point of the book.
7: Stay present with decisive action. A person who thinks all the time has nothing to think about except their thoughts losing touch with reality. Idle action allows depression and anxiety to set in, both of which are merely our egos at work.
8: Do not talk or write about your potential success. It saps your energy away from taking action. Silence is the respite for the confident and strong. The only relationship between work and chatter is one destroys the other. “Those who know do not speak, those who speak do not know.” Lao Tzu.
9: How do your Performance Standards rate? Compare yourself or business model to industry peers. Best way to fool yourself is to stay in your bubble.
10: Have a mentor to look up to, peer to compete with and someone you are mentoring. Many do this at work where personal economic rewards are the goal. Challenge yourself to also achieve this in an environment absent of economic motives. Might be the most powerful words I took out of the book. A clear path into the most powerful universal energy.
“If people bring so much courage to this world the world has to kill them to break them, so of course it kills them. The world breaks every one and afterward many are strong at the broken places. But those that will not break it kills. It kills the very good and the very gentle and the very brave impartially. If you are none of these you can be sure it will kill you too but there will be no special hurry.”
― Ernest Hemingway, A Farewell to Arms
To your measured success and resiliency through failure! -Tony
July 21, 2017
“There are no bad soldiers only bad generals” – Napoleon
The book The Generals by Thomas Ricks struck such a chord with me on the topic of leadership and team building, that I feel compelled to share the key points of the book. With the global political crisis looming in September of 1939, General George C. Marshall received a clear directive from FDR. His mission was to build a world class army, and fast. He inherited a feeble ill-equipped army of 190,000 troops. Many of the officers were hold over veterans from WWI waiting to retire. What was the first step he took knowing he had to build a giant Army 40x its current size? He fired 600 officers, keeping only 11 of 43 Generals. He created a preferred leader profile and objectively removed those leaders who were risk averse, plodding, or lacking the energy, passion and skills needed to perform at the top most level.
What was the outcome of this risky leadership move? From 1939 to 1944 the Army grew from 190,000 troops to over 8,000,000. It was an army that made mistakes, but learned and adapted from those mistakes at a pace that left British leaders astonished. The initial firings created opportunity, attracting the best young, flexible and eager to learn leaders who were engaged in growing their military careers. In 1941, Eisenhower was a Colonel, rising to become a 3 Star General and Commander in Chief of the Allied forces in the following year; that is 3 promotional levels in 1 year.
General Marshall’s secret was respecting the strategy of relieving officers as being part of the process of individual development and growth, and is essential to protecting the desired organizational culture. Accountability becomes the energy behind adaptability, when leaders delay terminations, they also diminish the rigor of the organization’s culture. The risk of getting fired is the price leaders pay for having a high level of autonomy and the freedom to be self-directed. General Marshall said, “When a general complains of the morale of his troops, the time has come to look at his own.”
What is the greatest factor in determining the outcome of wars: strategy, tactics, logistics, technology or personnel policy?
The American forces in the Korean War suffered from poor leadership under the egomaniacal General MacArthur who was removed by Truman for cause. He was replaced by General Ridgeway, who was capable and effective, but the military leaders struggled to recruit officers to serve in Korea for fear it might blemish their career paths. Unfortunately, the US Army continued its rapid decline through the 1960s and ’70s. Ricks makes a compelling case that the devastation of the Army’s culture was a result of their policy of 13-month tours for soldiers, and 6-month rotations for officers, combined with little to no enforcement of performance standards. The My Lai disaster and the lack of repercussions for the officers and top leaders conducting the cover up was the defining peak of “Good Ol’ Boys” policy among the Army’s generals. My Lai was so embarrassing, the Army decommissioned the entire Americal Division. You can read of the blind ego of LBJ, and the incurious and foolish General Westmorland, but modern generals agree, the personnel policy of new young soldiers with no experience being led by officers with no experience on 6-month rotations was the prevailing failure. Protecting Officers’ careers became the primary goal, not protecting soldiers, ethics or winning the war.
Does your company suffer from Institutional Mediocrity?
Fast forward to modern times, rarely is a general relieved. The few times it does happen it’s for personal foibles, not for performance in command, and it is done by civilian leaders, not within the ranks of Military leadership. In the Iraq War, a private who loses his rifle receives a heavier penalty than a general with weak command who loses the battle, or even the war. General Mattis is the one of a few Army leaders to relieve a general in the past 20 years. General Mattis was quoted as saying, “Even Jesus Christ had 1 out of 13 not make the cut.” His vision of accountability driving adaptive growth is a glimmer of light.
What is the result of this culture in our time? Brigadier General Mark Arnold commented that when 94% of all Colonels receive a promotion in the same year, “that rings loudly of institutionalizing mediocrity”. The personnel equivalent of Gresham’s Law is that bad leaders drive out good ones. A study in 2010 by the Army Research Institute concluded “that the main reason talented people leave is not the lure of a lucrative civilian career, but because mediocre people stay in and get promoted.”
Thomas Ricks does his homework as Pulitzer Prize winning authors should, referencing personal letters, diaries and testimonials delivering a nuanced perspective of every general since WWII, in a quite candid style. It’s a leadership themed book with much to be mined. Many stories of great generals, Bradley, Abrams, Ridgeway, DePuy can be added to the list alongside Marshall and Eisenhower as models for us to strive towards. Reading how tactical focus not only undermines the ability to think strategically, but seems to erode desire to do so was insightful. However, by far the most shocking revelation are the seemingly endless examples of the power of personnel policy.
What does this mean to the leaders in the Building Products Industry?
For 20 years I have had the privilege of watching and working with many owners, leaders and companies across the US as a national recruiter. Here is what I have learned:
- We can accurately predict which companies will gain market share by the strength of the owner and the top leader of the company.
- We actively list the best owners and leaders to target as our clients.
- We are as diligent listing the weak and incapable owners and leaders whose egos make them helpless, as we know it will be easy to recruit away their best talent.
- Both lists are equally important.
Rigorous 360 reviews and re-assigning or firing poor leaders are essential tools in building great companies. Your people deserve the best leaders providing the best chance of winning in this competitive world today.
View this article in ProSales
July 5, 2017
Talent acquisition is one of the most important factors in the success of a business. Done right, a good hire will make a huge impact on your organization – and likewise if done wrong, the negative impact could be detrimental. You know what you are looking for in a leader – so why work with an external recruiter to find talent? Ask yourself these three questions to see if your current strategy is yielding the best results.
Do you really know your talent pool?
Sure, you can post your open position on a job board and receive multiple applications. But what percentage of the talent pool is actually looking? Of those looking, how many are actually a good fit for your company? Recruiters find the best talent – regardless of whether they are job hunting. We have the ability to not just fill a job, but find the individual who aligns best with all aspects of the position and your company.
Do you have the time and resources to find multiple truly qualified candidates to choose from when hiring leadership?
An open position is costing you money. Can you afford to wait for talent to come to you? A recruiter brings in pre-qualified candidates so you can get right to the selection process. But not all recruiters are created equal. We consistently provide 5-7 qualified candidates within 2-3 weeks so the candidate can begin making an impact on your organization.
Is your current strategy working?
To find the right candidate you need access to a national network of top talent – passive candidates who probably view you as a competitor. You have to remove the barriers of emotions, biases, and complacency. As a third party, we can remain objective and focus on the opportunity. Bottom line, there is an individual that is the best fit for the position and your company – and we will find them.
Do you really know your talent pool? Do you have 5-7 candidates to choose from when hiring for leadership positions? Is your current strategy working? If you answered “no” to any of these questions – contact us today to learn more about how working with Misura Group can make an immediate impact on your organization.
May 30, 2017
Companies typically spend more on hiring in sales than they do anywhere else in the firm – but the right sales hire can bring in a huge return on investment.
In the HBR article “The Best Ways to Hire Salespeople” Frank V. Cespedes and Daniel Weinfurter reinforce some key tactics in hiring Sales professionals:
- Hire for the task
- Focus on behaviors
- Be clear about relevant “experience”
We would rank their 8-point score card in the following order:
Ability to learn:
If you are teaching a sales class, what 3 books will you reach for to prepare?
Outdated books often equal outdated thinkers; those who struggle trying to solve new world problems with old world thinking.
And those who can’t list any books, well… move on!
Prioritization of tasks:
How do you manage your time?
Triaging time is key. Don’t use the word “prioritization” and see how long it takes for them to bring it up.
Develops sales leads:
What is your business development practice?
The best have a practiced system they are continually evolving.
Who is a perfect client for your top competitor?
Knowing your company’s value proposition and how it aligns with your customers’ needs is a solid first step. Knowing the competition is better.
Commits time and effort:
How do you move through the emotional lows of the selling cycle?
Resiliency is an art and science. The best know both.
How do you manage the risks of a multi-tasking profession?
Sales is a common landing zone for those with ADHD. Awareness is the key.
What do your customers need that they are unaware of?
Uncommon and hard to find in an OSR. It can be a struggle finding this in a VP of Sales, much less Sales Managers.
Controlled work approach:
Are they consistent?
What are examples of inconsistencies in your work habits? If they have nothing, they are insecure and lying. To be human is to struggle at times with inconsistency.
Be tough, strategic, and consistent with your interview process!
Are you taking control of your sales? Learn more.
May 18, 2017
Why do leading private equity investment companies like Building Industry Partners trust Misura Group to help them grow? We know the best industry leaders. Building Industry Partners is focused in the U.S. middle-market building products industry.
“We have high expectations, but Misura Group has delivered excellent President talent for our Evergreen Lumber and Split Rail Fence companies.”
– Zach Coopersmith, Managing Partner, Building Industry Partners
Recent 2017 Placements
Organizations that focus on their people first win big. Contact us to discover the excellent talent in our industry.
February 20, 2017
“Fear leads to anger. Anger leads to hate. Hate leads to suffering.” ~ Yoda
Simply stated, our mission is to help professionals navigate planfully through their careers.
Our recent article on non-competes was written with the intent of enlightening professionals to the common miss-steps. The themes and human patterns are there for you to compare with what you see from your perspective, in your world:
- Ego and emotions clouding the judgement of otherwise top critical thinkers and professionals.
- New employees feeling vulnerable to prove their value at great legal risk.
- People paralyzed with fear blindly making legal comments, with some companies leveraging that fear to their benefit.
January 9, 2017
We would like to congratulate Building Industry Partners and Allan Breidenbach, CEO of U.S. Fence, for their recent acquisition of Binford Supply. Binford Supply, is the second addition to support U.S. Fence’s install and distribution growth strategy.
Misura Group placed Allan as the CEO of U.S. Fence last year and we have enjoyed watching him impact the business. If you are a great company searching for a great leader in the building materials industry, contact us and we will help find your next successful executive leader.
January 5, 2017
It has been pleasure partnering with our long-time clients and building new business relationships with some of the industry’s leading companies. We value the trust they have in our firm to bring impact to their organizations.
November 14, 2016
In the ProSales Article “Life After LBM“ Craig Webb did a terrific job of outlining succession planning challenges facing our LBM owners and leaders.
July 23, 2016
Misura Group is honored to collaborate with LBM Journal at their upcoming conference in Charlotte September 6-8. This year’s event will be filled with presentations and open panel discussions allowing for best practice sharing and learning.
- Increasing Your Sales In Today’s Hyper-Competitive Reality
- The “Wow” Factor: Making Your Company a “Best Place to Work”
- Panel Discussion: Real World Strategies to Attract, Hire & Retain Millennials
- Panel Discussion: M&A Strategies: True Tales & Horror Stories
- What Next? Is Your Company Ready for its Next Chapter?
- Beyond Selling Sticks: Grow Your Business by Leveraging Services
- Strategy Z: Overcoming the Tyranny of Price Competition
- Getting Paid: Credit Management Strategies that Work
Conference Promotional Offer
Visit the LBM Strategies 2016 Conference website to learn more about the conference and to register. And now through July 31, apply promo code LBMTM16 and receive a $250 discount on your registration fee.
May 20, 2016
I am excited for the LBM Strategies 2016 Conference and honored to be listed with the excellent collection of industry leaders. As the conference approaches, I’d like to highlight the following event taking place:
Panel Discussion: Real World Strategies to Attract, Hire, and Retain Millennials
- Wendy Whiteash, SVP of Culture, US LBM Holdings
- Caitlin Stoll, Happy People Department Leader, Drexel Building Supply
- Moderated by Tony Misura, President, The Misura Group
Wendy, Caitlin and I will highlight the personal stories of recruiting success hiring the next generation. The stories will deliver insight and dispel the myths around the LBM industry being unattractive to Millennials. Through discussion, we will break down the barriers and misconceptions and sift through the stereotypes to reveal what’s real and what’s not.
January 5, 2016
It has been a pleasure partnering with our long-time clients and building new business relationships with some of our industry’s leading companies. We value the trust they have in our firm to bring impact to their organizations.
Mill Creek Lumber & Supply
Gary Poulos – President
Rick Vancil – Executive VP
Greg Kimbrell – District Mgr.
James Wallace – GM
HPM Building Supply
Adrian Murphy – Sr. Buyer
The Detering Co.
Analisa Pratt – Design & Sales
JP Hart Lumber Company
Duane Sanders – Div. President
Brandon Natale – VP Purch
Marvin Window and Doors
Jason Carmichael – Terr. Mgr.
Mill Creek Carpet and Tile
Gary Cissell – President
Building Industry Partners
Allan Breidenbach –
Great Southern Wood
Jeff Biddy – SYP Buyer
Cornerstone Building Alliance
Rakky Putnam –
Sales & Purchasing
We look forward to contributing to your success in 2016!
The Misura Group Executive Recruiting Team,
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