Tucked over Alan Hoover’s home mirror is an index card with the words
“You Gotta Believe” written on it.
The phrase, made famous by the late
baseball pitcher Tug McGraw, inspires
Hoover, president and CEO of Kahiki
Foods Inc., an Asian frozen foods manufacturer and distributor.
In 1999, Hoover joined the then-$2.6 million company as senior vice president of
sales and marketing, working with founder
Michael Tsao to expand the company’s
brand.
The company moved to a much
larger facility in the summer of 2005.
There were cost overruns with the
move, and Kahiki was short on
cash. Then, almost 60 days after the
move, Tsao passed away, and
Hoover was named president and
CEO in November 2005.
Today, Kahiki Foods has 210
employees, and the company posted 2005 revenue of $23 million,
with sales up more than 62 percent
since 2003.
Smart Business spoke with
Hoover about how he grows his
company.
Q: How can other executives
grow their company the way
you’ve grown yours?
We had big dreams. We didn’t
have any plans to stay small.
Our goal was to grow and
become a much bigger company. Those were really the founding things that we really started
out with.
One of the things that started
us along that line was embracing lean
manufacturing. Every two weeks, the senior and middle managers would meet, and
we started with the book ‘Lean Thinking.’
Then we went to the book ‘The Toyota
Way.’ We made visits to other plants that
had embraced lean manufacturing principles. Over the course, we did also bring in
a consulting group to help us in that journey.
We put out scoreboards at each process
to see exactly what’s going on. If you walk
into a baseball game in the third inning,
you might see the scoreboard … so you
know a little bit about what’s going on. I
wanted to be able to do the same type of
thing in our facility at each key process.
It really provided us some rather dramatic results. We dramatically reduced
our inventory, freeing up lots of cash for
the business. We gained incredible discipline out in our manufacturing operations, really just streamlined so many of
the operations and made things easier for
people to add value.
We wanted to eliminate all the wasteful
things that we were doing in the facility.
Q: How can companies stay on top of
trends?
You have to talk to your customers,
see what’s going on in their business
and really understand where they’re
headed. You’re looking at what the consumers are buying and where they are
going to shop.
Distill it down and (say), ‘This is
where we think things are headed. Let’s
create the future for ourselves by
understanding where these trends are
taking the consumers and our customers. Let’s be ready to go.’
There’s a (phrase) in ‘The Toyota Way’
that we use a lot. It’s called ‘genchi genbutsu’ — going out and standing in the
circle. When you stand there long
enough, you start seeing things from a
different perspective and getting new
ideas.
Q: What advice would you give
other CEOs trying to grow their companies?
You’ve got to love what you’re
doing and be passionate about it.
It really starts with you.
There’s another Japanese word
we’ve incorporated here called
‘hansei.’ It means reflection. We
want to make it safe for people to
reflect and (say), ‘I really messed
up. I made a mistake, but here’s
what I want to share with the group
on what I’ve learned from it. Here’s
why I made that decision, and
here’s how I would do it differently
now.’ They’re not going to lose their
job over that.
I encourage people to overcommunicate because we have to deal in
three languages here every day:
English, Spanish and Mandarin. When
I do a meeting with our hourly team
members, I’ve got interpreters on
both sides of me. We also use lots of
graphs and charts. People can see the
trends and things that are going on.
I’ve borrowed a term from Les
Wexner [chairman and CEO of The
Limited Brands Inc.]: ‘Doing the right
things right.’ We preach that all the time.
Don’t compromise on anything in
regards to quality. Treat the customer
with the greatest level of respect, and do
everything you can to make that customer a fanatic of your company.
If you do the right things right, and you
do that consistently, you’re going to be
successful. It’s not rocket science; it’s
basic fundamentals.
HOW TO REACH: Kahiki Foods Inc., (614) 322-3180 or
www.kahiki.com