Fred Klipsch is keenly aware of the power his words carry when he speaks to his employees at Klipsch Group Inc.
“The one thing you can count on is, every time you talk to your employees and you tell them something, they are going to remember,” says Klipsch, the company’s chairman and CEO. “When the facts all become clear, they know whether they got the straight scoop or not.”
When the national economy went into the tank in 2008, Klipsch knew changes needed to be made. He also knew that he had to be very forthcoming with employees about what they were facing at the company, which he says has net sales well in excess of $175 million.
“Whenever there is any change that occurs anywhere in the organization, we lay it up on the table and explain it,” Klipsch says. “We don’t hide it. We keep it as open as we can. It has to be a proactive, consistent, almost 24-7 intent to keep your employees informed with what’s going on.”
Klipsch’s business of selling high-performance speakers began to nosedive in October 2008. The company’s core business is for residential consumers, and with new home construction down sharply, Klipsch knew his product would take a hit.
He needed to make a quick read of the market, figure out where to focus the company’s sales efforts and then get his team on board with the changes.
“Every company’s challenge is to be sure their vision of who they are and what they do is current and correct,” Klipsch says. “The vision of a company in a growing economy like ours was in 2008 is one thing. The vision of a company that needs to survive a serious recession gets less strategic and far more tactical in nature.”
Klipsch knew he had to adjust. By developing a clear vision and communicating it to his team, he was able to stay focused on what needed to be done to survive.
