Leadership Lessons—This Makes Good Cents!

Has this ever happened to you? Your technicians come into your office and tell you that your prices are just too high and that you had better cut back on pricing if you are going to be competitive in the market. You also hear them discussing, behind your back, that you are ‘filthy rich’ and don’t care about their future as long as you make your money and keep gouging people.

The next day they come in and tell you they need a raise.

On the weekend you find out they went to some sporting event and paid $8 for a 16 oz. beer. Got four or five beers and tell you they can’t believe how expensive cigarettes are these days!

Or am I the only one that has ever experienced this?

As a leader you often have to “cut through the noise. You also have to help people see reality. For instance, you can’t cut prices and give employees a raise. It just doesn’t work that way.

As soon as you tell them that you can cut prices … then ask how much of a pay cut they want and tell them you’ll do the same … you’ll find you really upset them. The key then, as a leader, is to find a way to get your employees to better understand the costs of running or owning a business.

Go to the bank and get 100 pennies.

First you must ask your people what they think you make for every dollar you bring in. It is important to get an answer from them. If it is your own business explain to them, too, that you have risked everything you have. Also explain that you (most likely) had to leverage your house to be able to get the load to buy/start your business.

Next, put those 100 pennies on the table and explain that you want them to better understand what it costs to be in business. This might help you prevent them from becoming a competitor. If you can use an actual P & L with percentages it becomes much more dynamic.

  • Take pennies for your cost of goods—use your percentage of revenue. This may be your cost of glass and other job-direct costs.
  • Take certain amount of pennies away and explain that this is for the true labor costs—including pay, benefits, insurance and workman’s compensation.
  • Take another portion of pennies away for phone, repairs, etc.
  • Take a few more pennies away for rent.
  • Take more away if you are providing any insurance coverage.
  • Keep going … take even more pennies away and explain what you spend on advertising.
  • Money that covers office supplies, credit card fees, computers and computer supplies comes next.

You won’t have much money left—usually less than what they think you should be taking out of the business.

  • The final cut is what you have to pay in taxes. Take those pennies away and explain to them this is what you are able to take out of the business.

I’ve seen another version of this that is even more powerful. My franchisee drew a chart showing the percentage that was taken out next to what the right number should be. For instance, he would look at his P & L and explain that 31 percent was the cost of goods. The true number should be 26 percent (or whatever your number is).

When it got to wages he would do the opposite and explain that if the team could reduce some percentages of waste or inefficiencies—there would be more money for wages.

Simple? Absolutely! Effective? Yes, if you do it correctly. This is the importance of using a real P & L.

Owning a business is hard enough in life. It becomes easier if you know the team you lead is supporting you every step of the way and they know you are supporting them as well.

Try it … you’ll like it!

Leadership Lessons—From the City with Sirens!

I haven’t spent much time in Baltimore but was excited to go there for Auto Glass Week™. I’ve never seen so many fire trucks in my life, complete with sirens and lights flashing. Maybe they were all headed to the Convention Center because of the “smoking” leadership lessons.

Whenever I go to Auto Glass Week I am excited about the people I’ll see and the lessons I’ll learn in just a few days. I remember the speech from Mike Eruzione, captain of the “USA … USA … USA” hockey team when a bunch of college kids beat the Russians in the Olympics on the way to the gold medal. (Yes, I still remember where I was when they won that game) Next, I remember Captain Phillips. The real Captain Phillips, who Tom Hanks played in the Academy Award nominated film.

This year the keynote for the first day was Marine Sgt. Dakota Meyer—now a Medal of Honor recipient. As a Marine Corporal, on September 8, 2009, he went back into heavy Taliban fire … five times … and saved 36 fellow soldiers. (Side note: He was 21 years old at the time. How many times have you said something to the effect, “I’m not hiring any young people … they just don’t work that hard and aren’t dependable.” Sure.)

Some of the key leadership lessons I learned from him:

—Life is about two things: opportunity about accountability.
—In just four months of working together, their group of four soldiers started caring about each other—to the point that they would give their lives for each other.
—America is not standing together. We are Republicans and Democrats. We are Christians, Muslims, every religion. We are in trouble if we won’t stand together. We need to start.
—We are more scared of the system than being who we are. We are afraid to say the Pledge of Allegiance or to pray to our God because the system says we can’t do that anymore. No one is going to tell him that he can’t do either one.
—People can do anything they want—if they believe it. But you have to believe it.

Might I suggest you download or purchase the book, “Into the Fire – A Firsthand Account of the Most Extraordinary Battle in the Afghan War” by Dakota Meyer. (I did so and read it on my way back home). Those of us who saw him speak saw this nice, country boy from Kentucky sharing his story. The book tells the real story of what happened and why he is more than qualified for the Medal of Honor. You won’t put the book down as you read this sniper’s account of September 8, 2009.

On Wednesday I wrote notes furiously trying to capture the wisdom of Tony Aquila, CEO of Solera Holdings, parent company of LYNX Services. glassBYTEs.com™ did a nice feature () on his speech. As usual, though, certain phrases and thoughts really got my juices flowing.

Here are just a few quick ones that I hope help you think outside the box like they did me:

—There is an inventor in each of us—you just have to be willing to fail.
—Failure is the key to success.
—The electronic cigarette is almost 10 years old. Next year it will generate $4 billion (yes, with a “B”) in sales.
—Stop fearing the boogie man. Too many people think he really exists.
—The 2014 Benz S-Class 550 (at a cost somewhere between $92 – $139k) has six times the technology of the F-22 Raptor (as a cost somewhere around $138 million).
—Glass will become the intelligent object to bring technology to more use.
—By 2020 Gen Y & N (the newest generation) will control 50 percent of the economy (that didn’t scare me until it dawned on me that 2020 is just a few months over five years away!)
—Start dreaming what is possible – not impossible.

I also attended a seminar held by a couple of friends of mine, Laurence and Charlotte Streidel. They were former Glass Doctor franchisees who made the choice (when Charlotte was on bed rest awaiting the birth of twins) to sell their franchise so Laurence could simply focus on tinting. This has been their main focus now for more than 20 years.

They invented something called “Tint TV.”  They got up in front of a group of fellow tinters, sharing their expertise of how each person in the room could make more money. I love their Tint TV episodes. Here is a couple who Tony Aquila would love as they are not afraid of the boogie man. They just keep doing very cool things and help fellow professionals in their field.

That is the power of attending Auto Glass Week. Ask, listen, learn, share.

I’ll never forget the words of Jean Pero, sales manager for Mygrant Glass, who was honored with the Carl F. Tompkins Award for Excellence in Auto Glass Safety. Jean, absolutely amazed by the award, walked up to the stage and simply said, “It doesn’t seem fair to get an award for doing something you are so passionate about.” With that, she went back to her seat. Jean, I don’t personally know you but you gave me a leadership lesson that I’ll remember for the rest of my life.

My week in the “Siren City” ended with an amazing experience. One that I know Tony Aquila was talking about. On Friday I had a 7 a.m. flight and decided to stay at a hotel nearby the airport. My vice president of operations, Brad Voreis, headed up Thursday night to see a franchisee just north of town. When I suggested we get a cab to the airport Brad suggested we just “Uber it.”

I’m 60. Brad is 30. I took German in high school and know that “uber” means “above or over.” Brad thinks that “uber” means an alternative to a cab. In fact, an amazing alternative to a cab. In Waco, Texas, “uber” meets my definition; in Dallas, where Brad lives, it means his definition … as it does in Baltimore. Brad whips out his phone and types in something. Within four minutes a black SUV, similar to the ones I see the Secret Service use in D.C., arrives. Demba, in gray suit, jumps out … introduces himself … and opens the rear gate for our luggage. Uber has arrived!

Brad types in my hotel address for Demba and shows me the map that tells us we are 14 minutes away. Being curious, I ask Demba how he got hooked up with Uber. He tells me that this was his vehicle that he drives for executives. He signed up with Uber eight months ago and it was the best thing he has done. Brad explains to me that he won’t have to take out his charge card—he will just give Demba a 1 – 5 rating and his tip will automatically be included in Brad’s online billing.

Of course I am in awe. I’m dropped off, while Brad and Demba headed to the airport. There Brad will be dropped off for his rental car and invest less than I spent for a “nasty looking/smelling taxi” that I took to get to the Auto Glass Week hotel. Amazing. All I can think about is what Tony talked about when it came to technology.

When I looked up “Uber” online I found that it was invented in San Francisco in 2009. It is now available in 45 countries—100 cities—and is a business worth $15 billion. I went back to Tony’s speech: “Dream what is possible—not what is impossible.” Uber was possible. Then, I went back one day further to Sgt. Meyer’s speech: “You can do anything you want if you believe it—but you really have to believe it.”

Thanks, everyone, for sharing. You all just made this student in the “Leadership Lessons of Life” program much wiser than before I heard the first siren of the week.