Building the Team

Hiring, firing, and training in a new era.

Last week, I wrote about why we set out to visit with Andrew C. Taylor, chairman and chief executive of Enterprise Holdings (“Maybe Someone Else Has Already Figured This Out“). In this post, I want to highlight what we learned during that half-day session in St. Louis in 2011.

Take time to teach

The time that Mr. Taylor, who is now executive chairman of Enterprise, spent with the H.Bloom team was not anomalous. The day before we were there, he had met with senior executives from one of the world’s largest banks. Every day, the team at Enterprise takes the time to teach new employees at Enterprise. Because their leaders do this at a world-class level, business people at other organizations want to learn from them as well. When people in an organization see the organization’s leaders taking the time to teach, they understand that it is important and they learn to do it themselves. This culture of teaching starts at the top.

Develop senior leadership that’s passionate

The senior executives that we met along with Mr. Taylor – Dave Deibert, Aaron Toombs, Tina Diehl, Steven McCarty and Pam Webster – were all passionate about Enterprise as a company. Each one had been with Enterprise for many years, some for decades, and they had moved from place to place as they climbed the ranks. Mr. Taylor talked about the importance of this dynamic: “Develop a small group of senior leaders who are in love with the business and are thinking about it all of the time.” It was clear that this group loved Enterprise, were proud of the talent development programs they had developed and were eager to share what they had learned with us. This type of enthusiasm is nothing but contagious. If you can get your senior leaders excited, they will ignite the passions of their direct reports, and so on.

You can be a nice person and tough

In the three hours that we spent with Mr. Taylor, he came across as a genuinely nice person. But, it was clear that he was no-nonsense about his business. “Do not compromise on talent,” he said. “Provide great training and extraordinary opportunity. But be honest about the hard work. The Management Training Program at Enterprise isn’t for everyone. Even if folks don’t make it to the end, they will have learned a lot that they can take with them to another company.”

You want only to promote the best

At Enterprise, management trainees are in the program for six to 12 months. Then, they have a written skills-evaluation test. After that, they participate in something called “The Grill,” which is an oral test conducted by an area or district manager. If a trainee passes this test, she is ready to interview for a management position when the next one becomes available. This is the first position that is eligible to receive incentive compensation from branch profits.

It’s not about the Ping Pong

There is always a lot of talk about company culture. Often, the talk is focused on the perks a company might offer: onsite dry cleaning, unlimited soda and snacks, a table tennis table. At Enterprise, it is clear that the company’s culture is built on the people. “We promote from within,” Mr. Taylor said. “We provide a career path. People move around to move up; we average 8,700 internal transfers per year. And we celebrate success.” This is sustainable culture. The reason the executives I listed above have been at Enterprise for so long is because they love the company and believe in its mission; it’s not because of a superficial perk.

Building the team is building the business

“Take care of your employees and customers first,” Mr. Taylor said. “Growth and profits will follow.” He knew that as Enterprise grew, he couldn’t be everywhere all of the time. The key to growth would be to train and then empower his employees. Moreover, if he could provide them with a well-defined career path, they would have the incentive to perform in their current roles and the chance to be promoted into a position of greater responsibility and compensation. At Enterprise, the career path looks like this (though at the branch manager level, many additional opportunities open up within the company as well):

1. Management trainee
2. Management assistant
3. Assistant manager
4. Branch manager
5. Area manager
6. Group rental manager
7. Regional vice president
8. General manager

Keep base salaries low but pay for performance

At Enterprise, income is tied to profit performance. Employees know base salaries remain low, but they have the ability to earn more and more money as they move up in the organization. As an example, while general managers may have the same base salary as management trainees, their overall compensation is far greater, which provides the incentive to work hard and rise through the ranks.

Leaders and managers are different

Mr. Taylor talked about how his company worked hard to separate leaders from managers. “Anybody can count the money,” he said. “We need true leaders to run our markets.”

Measure everything and share the results

Enterprise has dashboards to measure performance. Each market has a scorecard that evaluates performance in four areas: growth, profits, customer service and employee development and retention. Each market is then ranked on its overall performance, and everyone sees the results.

Bryan Burkhart is a founder of H.Bloom. You can follow him on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/06/18/nine-lessons-we-learned-from-andy-taylor/?partner=rss&emc=rss