Tony Reisz wasn’t facing a company on the brink of ruin or severe financial issues. He was facing something much worse: apathy.
“It was our own internal culture and leadership,” says Reisz, the president and CEO of 500-employee Ontario Systems LLC. “What became blatantly obvious to me was the culture and leadership had created a limitation to growth. The culture was the lifestyle business type of culture. ‘We’re comfortable. Why do we need to grow? We have investors, but so what. They’re making money. How much money do you really need to make?’ Leadership had allowed that culture to take place.”
Ontario provides software to collection agencies and hospitals to help them collect their bad debt. The company had some nice products that customers were interested in buying, but sales had hit a plateau. The effort to continue developing new products and technology just wasn’t what it once had been.
“This had been a pretty successful company, 30 years in business, that had reached the medium-sized level but had stagnated from a growth perspective,” Reisz says. “Solid customer base, good product suite but had literally stagnated. I had a huge challenge ahead of me. One was to convince the organization that growth was a good thing and not a bad thing. Two, really reposition the entire company to put it on a growth attitude.”
The economy had begun to spiral into what would become a deep global recession. Reisz knew this presented an opportunity for Ontario as companies would be stepping up their debt collection efforts and would need software to do it.
He just needed to show his people the potential they had and weed out the elements that had caused the company to stagnate. So he decided to begin by showing them a wet diaper.
Demonstrate the problem
OK, so he didn’t really show them a wet diaper. But this metaphor, which came from the studies of Dr. Behnam Tabrizi at Stanford University, seemed like a good place to begin to convince everyone at Ontario that they had a problem.
“It’s very visual, and it certainly is a great representation,” Reisz says. “You have to put somebody in a position where they recognize that they’re not comfortable. You have to change. In order to do that, you have to create that wet diaper so somebody absolutely has to change.”
Reisz got the attention of his staff by making it clear that at that moment, no one’s job was considered safe.
“We made it really clear at the beginning of this that no one in the company had a right to a job,” Reisz says. “We were going to be evaluating them over the next 90 days. Their leadership, their character, their results, their performance. We were going to be reorganizing the business based on the new strategy and based on what we learned from them during that 90-day period of time. That was going to determine where they were going to be placed in the new organization.
“So for them, it was also a tryout. You’d be surprised how easy it was for people who normally were adversaries to find a way to work together, because they had a common goal. They knew they were being evaluated.”
It’s not just about creating fear. You can’t just get up and talk about the need for change without figuring out what needs to change. If you don’t give your people a chance to be part of the effort to make that change happen, you’re not going to accomplish anything.
So Reisz took 50 people from the roughly 600 employees in the company at the time and developed teams to analyze all aspects of company operation.
“I empowered them to diagnose the patient,” Reisz says. “I empowered the teams to come up with the plan. I empowered them to create the actual details of how we were going to accomplish it. I met every week with them to make sure that we were removing obstacles from the way and that they were making progress. What I wasn’t doing was impeding them or micromanaging them about what I thought about the data they were gathering.”
It has to be that way in order for it to work. You can get the ball rolling on change and explain the need for it. But you can’t make it happen on your own.
“I’m responsible and accountable for everything,” Reisz says. “The way that I accomplish it is I delegate very significant portions of that to people who are really on top of it to do that portion of the job. Otherwise, I can’t be successful. If you’re going to be a big company, a growth company, you can’t do it all alone. It’s not possible.”