Move forward together
In the first two years of his plan, Hendrix sold the majority of the
businesses he needed to, which generated $600 million in cash for
Interface. Then, last year, he sold off the fabrics business, which
was more difficult for him because it had grown so much, but that
growth was tied to the office market. Despite how hard it was, the
sale generated $100 million in cash to reduce the debt.
“In looking back, thank goodness we did,” he says. “With the
credit crisis going on today, we’re in a much better place today by
divesting that business.”
While major changes like this could get employees down, you
have to continue to show people why changes are good for them.
For example, by choosing to focus on other markets besides the
office industry, the sales force had to change how and who it sold
to. While the salespeople may not have liked it originally, once they
saw the opportunity in the other segments, they understood how
it would help them.
“Our sales force was 100 percent commission-based in the
United States, and they had a certain standard of living they were
used to when the office market turned down,” Hendrix says. “They
were very accepting of change, saying, ‘There’s a bigger opportunity in the nonoffice piece to go after,’ so it was a perfect storm.”
He also provided incentives along the way to help them come over
to his side quicker by rewarding sales into nonoffice segments more
heavily than those in office areas.
“You have to incent hitting milestones,” he says. “Your pay for
performance has to really pay for the behavior you’re trying to
drive in the organization.”
It was also important for Hendrix to recognize when something
wasn’t working.
“You have to be willing to adjust as you go based on the successes that you’re having,” he says.
For example, as he and his team looked at segmenting their
European business, where they previously had an 80 percent
dependence on the office business, they made some mistakes.
“One thing we learned was it’s not Pan-European,” Hendrix says.
“It’s very specific to each country.”
What worked in the United Kingdom, wasn’t necessarily working
in France or Scandinavia. Similarly, they thought what worked in
France would work in Germany. Interface had to readjust by tailoring the business for each country individually.
Hendrix has seen Interface do a 180 since he took over. Net sales
have since grown to $1.08 billion in 2007, and the loss has been
reduced to just $10.8 million. Hendrix prefers not to think of what
Interface would be like had it not undergone the changes it did, but
now that it’s successful again, he’s excited to think about a strong
future full of more growth.
“From a growth horizon standpoint, we’ve got 10 years that we
can still grow this business without acquiring anything new,”
Hendrix says. “It’s just staying to our strategy of putting carpet tile
on any floor out there.”
HOW TO REACH: Interface Inc., www.interfaceinc.com or (770) 437-6800
