The need for speed
Lukianov’s passion for swift response was partly influenced by
his previous work experience. It’s not that his prior companies
were unresponsive to the needs of the marketplace, the culture
just didn’t go far enough to create a true competitive advantage.
In his first CEO role, Lukianov says he finally had the chance to
create a more complete culture, and given the circumstances,
speed was the best cure for the company’s problems.
Surgeons buy NuVasive’s products, and Lukianov says that
instinctively, surgeons want everything yesterday, so building a
culture that would appeal to them was vital. Also, the pace of innovation at larger, more bureaucratic organizations can be
slow. Greater speed in the design, implementation and sales of
new products would enable Lukianov to drive productivity and
greater output with a smaller staff and capture market share
quickly. The business case for speed was clear, but to implement
a culture built on swift response, Lukianov says CEOs need to
start by letting the staff know why speed is important.
“To create an environment predicated on high standards and
excellence, you have to let everyone know why it’s important, so
they become emotionally invested in the outcome,” Lukianov
says. “Investing in a culture really isn’t important if the plan is to
build up the company and then flip it, because in that case, management is really not all that concerned about what happens to
the people. There’s an emotional investment that leaders make
when they build a culture, and you can’t really make the investment unless you’re committed for the long haul.”
Although Lukianov has named his cultural initiative “Absolute
Responsiveness,” and he uses the cheetah as the culture’s symbol, he’s gone beyond rhetoric and T-shirts by putting some teeth
into his cultural vision. Lukianov refers to NuVasive employees
as shareowners, and almost every employee has a stake in the
outcome.
“I just can’t imagine attracting the kind of people you need to
drive 50-percent-plus growth rates unless they have a stake in the
outcome,” Lukianov says. “I don’t think the equity has to be a lot,
but it can be very effective if it’s done systematically.”
He opened a distribution center in Memphis adjacent to FedEx,
so surgeons are assured of receiving their product orders
overnight — his stated goal is to never miss a surgery. He also
reviews dashboards each month that track the company’s
responsiveness on all its deliverables, and he uses a balanced
scorecard for measuring performance and holding people
accountable to his high achievement standards.
Each dashboard measures the company’s progress in specific
functional areas, from the 40 products currently under development and their anticipated release dates, to the degree of sales
force penetration for each product the company sells in every
market. So far Lukianov’s plan is working because the company
has been granted 48 U.S. patents and has another 134 pending,
most of them coming under his leadership, and revenue is growing more than 50 percent.
“We measure four key areas on the scorecard including financial results, adherence to internal processes, customer knowledge, and personal growth and development,” Lukianov says.
“There’s a progress review, and every employee is graded each
quarter, but what really makes our scorecard different is that it
not only measures achievement of short-term financial goals but
progress toward the company’s long-term objectives. We have a
goal of reaching $500 million in revenue and to be GAAP profitable, and every person in the organization can tell you how we’re
going to get there and what their part is in reaching the goal. In many
organizations, senior management is well-versed on the long-term
objectives, but it’s critical for everyone to understand their role.”
