20 COACHES CORNER
SPRING 2018
Coaches’ Corner:
THE ONE THING THAT HELPED AN ENTREPRENEUR SELL HIS BUSINESS FOR A PREMIUM
BY: DOUG WICK, GAZELLES INTERNATIONAL CERTIFIED COACH; FOUNDER, POSITIONING SYSTEMS
WHEN PHIL Lieber, then president of P & L Technology, began working with me as a coach in December 2015, his Omaha-based IT support firm was bringing in $ 6.8 million in revenue and turning a profit. It had grown to 46 employees since he opened it in 2004. That success had helped the company make the Inc. 5000 six years in a row.
However, the company was having challenges with execution. Resolving customer calls was taking too long. Even as it added employees, its team couldn ' t keep up.
That was slowing the firm’ s growth. Customers who waited too long for their technology problems to be resolved were not likely to become the raving fans who would recommend it to other customers.“ We were bordering on having some client defections,” recalls Lieber.
However, that situation did not continue for long. By the time Lieber sold P & L to a larger technology firm in July of 2016, he was able to command a multiple of 8x earnings before interest, taxes, depreciation and amortization( EBITDA).
What turned things around so quickly was an intense focus on execution. Lieber had been using the Scaling Up system for growing a company— then known as the Rockefeller Habits— since the company opened, but he had reached the point where he needed new ideas on how to apply it even more effectively.
To do that, we went back to the company’ s strategy. Working within the One Page Strategic Plan, we set an annual goal focused on accountability: Do What
You Say You Are Going to Do. Phil and his leadership team determined the critical number to measure the achievement of this objective would be average resolution time for each ticket.
To make sure P & L Technology maintained customer satisfaction while resolving calls more quickly, it relied on the NPS Score, a measure of how likely customers are to recommend your company to people they know. And to avoid burning out employees, P & L used the eNPS score, which tracks how likely team members are to recommend your company to friends as an employment opportunity.
Turning things around while meeting these requirements required a strong commitment. When we started out, the number of calls that the company was too backlogged to return that week was more than 500.
To get everyone on the same page, the company simplified the key performance indicators( KPIs) for each employee. It set one KPI that everyone understood: if a customer contacted them, they had to communicate with that customer that day— and any day the ticket was still open. Employees were expected to keep working until that goal was accomplished each day. As Phil put it,“ If you get 500 tickets a day that come into our call center and 10 percent of them don’ t get addressed, that’ s still 50 tickets that are a problem.”
To establish accountability, each call center rep’ s results in meeting this communication goal were posted on a big screen on the wall and shared in a daily huddle. This renewed emphasis on tracking meant that employees had nowhere to hide if they were not following up.“ This forced them to get the right tickets to the right people to get them closed,” explained Lieber.
The new approach was very effective. By the end of the first quarter, Lieber and his team reduced the unanswered tickets to fewer than 100; by the end of the second quarter, they’ d reduced it to fewer than 50 a day.
Relationships with customers improved, too.“ Our customer satisfaction levels were extremely high,” says Lieber.
Although employees were working harder, many reported they would recommend P & L Technology to their friends, and the firm’ s eNPS score put it in the top scoring category for all employers nationwide. That was remarkable for a firm in the call center industry, where turnover is very high.
As a result of the company’ s new efforts, the call center’ s gross margins rose from 43 percent to 57 percent. Meanwhile, with happier customers, the company was able to raise its prices. The result was that P & L Technology became very attractive to a larger technology firm and sold in July of 2016.
Lieber is now focused on another business he is passionate about, P & L Capital, which helps businesses finance their technology. As you might imagine, he’ s using the Scaling Up system there, too. As he’ s discovered, learning more about how to apply the system can really pay off— very quickly.
Doug Wick is a Gazelles International Certified Coach and founder of the coaching firm Positioning Systems. You can contact him at dwick @ positioningsystems. com. Doug received the Thinkers50 Lifetime Achievement Award.