After an acquisition that didn’t go well,
Doug Grane and his brother abandoned that growth strategy and instead decided to grow Central States
Trucking organically. And their goal in 2003
was ambitious — to double the sales of their
family business by 2007.
Buying businesses might be a quicker and
easier way to grow, but Grane has
steered the company into the fast-growth lane by an aggressive sales
effort to customers. And that strategy
succeeded — Central States posted
2006 revenue of nearly $36 million
and this year, Grane expects to hit
the $42 million mark — double the
company’s 2003 sales.
Smart Business spoke with Grane
about the importance of recognizing
who you can’t do business with, why
one state-of-the-company address
isn’t enough and the value of thinking like an underdog.
Q: What is the most challenging
aspect of fast growth?
Some companies may have an
inclination to overpromise and
underdeliver. Our emphasis was to
tell the customers what we could
do, keep our promises, be on time,
work with them on solutions and
get better every single day.
We couldn’t become complacent. Just because we had success
the month before didn’t mean we
were guaranteed success the next month. I
can’t tell you how many phone calls that we
get from companies that want to do business
with us. But we’re very candid with them. We
say we’re really not a good fit at this time.
So as much as you might want to accept
new business, part of the key to growing
over the long term is to partner with the people that you want to partner with and for the
right reasons.
Q: What are the most critical elements in
sustaining successful rapid growth?
It’s your people; it’s making sure that your
people know and understand what you
expect of them. Be clear with people in
terms of their reviews; communicate the
values of the company tirelessly.
Let them know what your culture stands
for. For Central States, it’s safety, simplicity, speed and solutions. I tried to come up
with words that everyone would remember. Every once in awhile, I’ll quiz an
employee on what the four values are, and
they do pretty good. Our values mean
something to them.
Q: How do you keep your employees
focused on growth?
I give a state-of-the-company address to
everyone in the company. I give them feedback on where we were for the past year as
compared to our goals, what we focused on
in the past year and what we want to focus
on for the upcoming year.
Everyone in the company understands
what our vision for growth is and how we’re
going to get there. It’s not just a once-a-year
state of the company. I also do it mid-year, so
in the middle of summer, I let them know
what our plan was at the start of the year. I
give them some feedback in the middle of the
year because 12 months is a long time for people to keep everyone focused and on track.
It’s a chance for me to get all of our
employees focused on what our goals are
for the year and how we’re best going to be
able to take care of our customers and meet
their needs.
Q: What are the dangers of fast growth?
We know that one of the biggest pitfalls for
a company that is growing rapidly is
resting on its laurels and becoming
complacent. In one of the state-of-the-company presentations a couple of
years back, the theme was ‘Think Like
an Underdog,’ and this was the theme
for our 25th anniversary year.
How do you get a company that’s
doing well not to rest on its laurels and
not say, ‘We’ve been around for 25
years, we’ll be around another 25
years?’ I said, ‘You know what? The
marketplace right now is Darwinian —
it’s survival of the fittest; it’s adapt or get
left behind. I said, ‘Even though we’re 25
years old, think like we’re in business for
the first year.’
So how do you communicate that edge?
How you live that on a daily basis is you
remind them not to take anything for
granted. We’ve still got to earn the profits
for the company.
Q: How do you keep growth from overwhelming your ability to keep up?
The key thing for a mid-sized family business is we’re looking for the long-term relationships. Maybe sometimes with a public
company, you’ll read how they’ll jack up
quarterly earnings, or you’ll get a CEO who
will pursue a very short-term strategy to
jack up the stock price.
Even though you’re in the fast lane, you
want to focus on being of long-term value
to your customers. If you ever feel at any
given time that this rapid growth isn’t
working, have a cooling-off period; there’s
nothing wrong with that. You owe it to your
customers that you already have to take
care of them.
If you’re growing too fast where you’re not
taking care of your current customers — the
top line can go up and down. It doesn’t have
to be growing by double digits every year.
HOW TO REACH: Central States Trucking Co., www.cstruck.com