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Several years ago I was asked what were the top three reasons for 500% growth over a six-year period. I simply stated: “the people, the people, the people.”
To explain, I need to give you some background.
Being in the home service business for 23 years before becoming a CEO/owner, I saw many ways to run a business. The air conditioning, plumbing and electric service industry is one of the most fragmented businesses in the U.S. The barriers of entry are fairly low: a truck, a license, some inventory and a person who has technical ability. On any given day in Florida, you could spot hundreds of different companies driving around, going to serve customers.
There are many different ways to run and operate an HVAC, plumbing and electrical service company. This, along with every owner being different, creates unique “personalities” for companies. The average size of these companies is fewer than 10 employees, and they usually have an owner/operator who wears many, many hats.
So why are some companies, in a highly competitive, fragmented industry, able not only to survive, but thrive? Clearly, it boils down to people. However, it's far easier said than done.
There are so many variables to the home service business: delivery of technical talent, procurement and installation of parts, warranty of product, service contracts, sales proposals,
dispatching and logistics, regulations at the local, state and federal levels, etc., etc., etc. These complications introduce many opportunities for failure, especially a failure to deliver great customer service.
When I purchased N&M Heating (now Cool Today) in 2004, my first priority was to attract the best employees through great pay, benefits, training, environment and culture by setting a strong mission with values.
I have observed how contractors try to offer the best services by delivering the lowest cost solutions, and not putting much value in people. I decided not to do that by paying for health insurance, setting up a matching 401k, providing company-paid disability, and other non-traditional contractor benefits in addition to great pay. We knew we had to cover these costs, but clearly, if we deliver our intended value, we knew our company would grow.
Grow, it did. It grew because of the people. It grew because no matter how many ways you could deliver a service, the people who deliver the service drive real value. As a business owner, being selective in your people choices, rewarding them and providing real value to an employee and customer is the only rational decision that should be common in all service companies.
Marketing will make phones ring, but only great people will retain customers. Bad processes and systems will hurt a company, but only good people will figure out how to fix processes.
Training could be considered a real cost in business, but great people will turn it into a real investment in the business. I've seen so many examples in 35 years of how great people will be the only difference maker in a business. So investing in these folks with rewards, recognition and communication by an owner is the only variable to a successful service business.
So how do you do this?
It has to be a focus of the top leader to make sure each member of his team, regardless of level, knows that he understands and cares about him or her, to properly engage employees in larger companies. Here are some tips:
Always stop, shake a hand, say hi, ask how their day is going. Ask about information you may have acquired that might be of pride for them (a compliment letter, good results, a child graduating, etc.).
Make sure you send a personal card when you want to make a special note, like a great job in customer service, a special extra effort, etc.
I send a written thank you note on every single employee's anniversary with a dinner gift card to a nice restaurant. I thank their family as well for their sacrifice for their partner to be in such a time-demanding business.
I have at least two large events a year, bringing the company together offsite. One somewhat formal in early spring, the other for families in fall.
Send a newsletter to entire team monthly. Always respond to online review results with a positive reinforcement.
Make small conversation, and if you find something that is important to them, do a “pay it forward” or a surprise that they won't expect. It's those types of surprises that really make them feel important. (example: I was talking to a technician of mine a month or two ago and heard him listening to Andrea Bocelli in his truck. I gave him and his wife tickets for the concert a month later). He sent me a personal picture and thank you, and said his wife will “never forget it.”
So to conclude, don't ever underestimate the power of your people to make your company stand out in a competitive industry. Computers, systems, tools, trucks and marketing are only part of the solution, but the driver in differentiation of growth are the people, the people, the people!
Jaime DiDomenico is the president and owner of Cool Today, which provides air conditioning, plumbing, and electrical services in the Sarasota and Tampa Bay areas.
CEO Corner is a quarterly column written by members of the Gulf Coast CEO Forum. Learn more about the group at: gulfcoastceoforum.com
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