Build a plan
Once he established with his people those fundamental things that he wanted to accomplish, Huff spent the next two months building a plan from the bottom up and trying to understand what worked and what didn’t at the company. He also had to get his team members to agree to either stop doing the things that weren’t working or fix them.
The key to this process was being completely transparent with everyone involved.
He spent the first couple of weeks visiting all of the company’s key partners around the world. He had already told people how he was going to approach the job at hand, so he wanted them to see him in action.
“I wanted people to see that I was looking them in the eye and making that commitment to them because I think it was clear to everyone in the company that there had to be some dramatic changes that occurred,” Huff says. “It was clear. I think calling that out straight away and again being transparent with people mattered a lot.”
He was also transparent with his shareholders and employees.
“I really believe that transparency matters,” he says. “Not just to employees but to shareholders. My first call, I was honest with people and said, ‘Look, there’s a lot of things that need to be changed here, and here’s how we’re going to approach it. We’re going to tell you what we believe is good about this business, what we believe is bad about this business and what we think the prospects are.’”
What was most important to him was that these two constituent groups weren’t sitting around second-guessing him and the management team, so he did podcasts every two weeks so they knew what progress had been made and what Huff was finding.
“I didn’t want the rumor mill to shape opinion,” he says. “People may not ultimately like what the result is, but I wanted them to never doubt that we were being honest with them and open with them.”
He also looked at what EarthLink did well and not so well.
“Being transparent, first and foremost, is critically important, and then I think focusing on what your core strengths are as a business and building off of those as opposed to trying to build off of something that you’re not as strong on — getting that great foundation is great,” he says. “I think the second thing is making sure that whatever you’re rebuilding, you’re rebuilding it with the idea that you’re going to create value for the people that have invested in you. Any other model is not a business. I truly believe that you need to be focused on building business models that create investor returns.”
He says, “If I put $1,000 into this business, explain to me in two minutes how much you think I’ll get back and how you would conduct business to give me a return on that money.”
It often stumps people.
“I certainly wouldn’t say nobody thinks about it, but there are a surprising number, especially of smaller companies, that the business was built around a passion as opposed to a business model, and that’s probably the difference. You need equal doses of both,” he says. “If you’re not building something that provides a return for the people who are giving you money to build the business and investing their careers in the business, you probably ought to rethink the model.”
So EarthLink had to rethink its strategy in a couple of areas. He decided to pull out of a wireless mobile joint venture because it didn’t have a core wireless network and would have to complete with people who had full networks. He also saw that EarthLink was spending tens of millions of dollars on initiatives to build out municipal WiFi networks, but there wasn’t a model to create any shareholder value, so he had to go to those municipalities and tell them that he wouldn’t be working with them anymore.
“Again, it’s this idea of knowing what your core strengths are and building off of those and being close enough to reality to know where you don’t have core strengths,” he says. “You can really want to grow wings and fly around a building, but the likelihood of you being able to do it is slim, so moving your business in that direction is probably not a good idea. I think being connected with the reality of the environment is critically important. You can’t sell yourself an idea. It’s got to be grounded in reality. It can’t be based on you just convincing yourself that it’s a great idea in spite of the weaknesses in the strategy, and, again, just being as open and honest with people as you communicate the strategy as you can possibly be.”
