Focus on research
With his conservative plan, Ridge says that initially he did not want to put the WD-40 brand at risk by placing it on new products. The next phases of growth have come from the reinvestment of increased profits into research and development that has produced new products and packaging that leverage both the WD-40 brand and the larger distribution system.
From 2004 to 2006, Ridge has increased annual R&D spending from $1.5 million to almost $4 million to develop new products.
Ridge is relying on the strength of the learning culture to make certain the company is ready for the R&D phase. He has improved the opportunities for employees to continue their education and their willingness to take risks and innovate.
“I continually work to develop an infrastructure that will drive the continuous learning process and a culture that drives the business by developing people,” says Ridge.
To facilitate continuous education, Ridge has structured monthly lunch-and-learn sessions and introduced his a leadership academy to develop new talent. He further supports his philosophy of learning through his own Web site portal , “The Learning Moment,” a collection of resources and stories that reinforce his ideas on leadership.
Taking a page from his initial success in behavior change through sharing ideas, Ridge has encouraged innovation by building a project marketing team called Team Tomorrow, which is charged with increasing revenue from the newly developed products by $100 million over a three-year period that commenced in 2005.
When he’s not developing new products, he’s finding increased market share by offering new packaging and uses for the old, reliable WD-40 formula. The firm recently began marketing the lubricant in a “travel size” called the WD-40 No-Mess Pen.
The end result of Ridge’s efforts has been a total transformation of the company. Since taking the CEO position in 1997, Ridge and his team have moved the company’s annual sales from $100 million — with 70 percent coming from domestic sales of WD-40 — to $263 million in 2005. They are projecting sales of $285 million in 2006 — with 56 percent of that coming from WD-40 sales outside of the United States.
The job hasn’t been easy, but Ridge never tried to do it alone. The transformation came about from a commitment to not only change but also to learn.
“I believe that you have to show people how to get an A, not just mark their papers,” says Ridge. “It can be a little bit of tough love. You have to define for people what getting an A means, like delivering the product on time 98 percent of the time, then you have to show them how to achieve that. You continue to define the difference between an A and an A+, benchmark the outcomes and hold them accountable. Put a process in place that allows people to measure, learn and react.
“I think in order to be successful, you have to be candid, you have to win trust and you have to be a man of your word who treats people right.”
HOW TO REACH: WD-40, www.wd40.com