The Power Of Relationships

Solid relationships provide thewinning formula for successful company.

By Greg Kitzmiller

Mike took the helm of his operation just one year ago. The former CEO was fired after a long and rocky history, with some outstanding years in the 1980s but less productivity since, and questions as to his style of running the business. Mike was a different personality than his former boss and his first year was good, but not spectacular, and the second year was up and down and he considered leaving.

However, Mike’s strategic management was based on three key factors. He believed in his group, he encouraged them and he had each person do those things they knew how to do best. Mike was also a humble person with strong character and beliefs, and he always tried to show his group respect even when he was frustrated with things they had done wrong. He knew he had inherited a talented group and focused on helping them work well individually and together.

In the era of teamwork, a time when Enron has been shuttered in disgrace and disgust and when one of the world’s largest accounting firms is under scrutiny and possible collapse, one wonders if there really is such a person as Mike who runs a business with character and teamwork. Of course there must be. And while this case study is purely fictional as a business the example is taken from a well known current case. How did Mike’s second year turn out?

Drawing a Parallel

Fictional Mike is analogous to MikDavis, the head coach of the Indiana University (IU) men’s basketball team. Mr. Davis became head coach of the team two years ago when former controversial coach Bob Knight, who led the team to three national championships throughout his tenure, was fired.

In his first year as head coach at Indiana, Mr. Davis had one month before the season to prepare his team. They had a decent win-loss record but no championships. However, in Davis’ second year he maintained an improved win-loss record and took his team to the NCAA championship game after beating the No. 1 ranked Duke.

You do not need to be a basketball fan to appreciate this story. In fact it points to strategy and is as applicable to firms as it is to sports.

The foundation of this strategy is built upon principle-based leadership, respect for others, covering the basics and encouraging your em­ployees. And in this case former coach Bob Knight recruited his employees—his team. But as Davis said, "It doesn’t matter whose players they are. They play for Indiana." (Indiana University Basketball press release, 3/25/02)

What would the parallel be in the business world? Let’s suppose Mike is, indeed, the CEO of a nutrition company. The story would end that in his second year Mike’s group would introduce a product that becomes number two in the market—or at least a very strong contender.

Another Example

Believing in people, encouraging people and getting the best out of people are traits that can take a firm a long way. Having employees who care about their employer for all of the right reasons can make them work extra hard.

I recently spoke with a CEO at Expo West, held in Anaheim, CA, in March, whose firm introduced a very good (in my opinion) meatless soy-based product that seems to be unique in the market.

The CEO related a story to me of how he could no longer eat the fattening products he loved due to a heart condition. At this, his key development person asked him what was wrong and when he told her she simply said, "Let me see if I can do something about that."

It took her nearly three years, he said, but she developed this specialty product that is now available on the market and doing quite well. And she developed it out of love for her boss more than out of need to bring a new product to market.

I always try to help firms see all aspects and cover all of the basics. Sometimes it is very easy to work on one strategy but leave other business areas exposed. In other words, you can’t introduce a product that has a major claim, nice packaging and slick advertising but poor quality.

Lastly, teams whether in basketball or in business, should watch out for each other. Does your firm set up teams to question and help each other out? Do these teams back each other up or try to cut each other’s throats?

Covering the ­­­basics, encouraging your team, getting the most from each other and living and leading to earn and show respect; aren’t these qualities that we could all consider in our strategy?NW