Andrew Berlin remarks on how talent, determination, and teamwork create amazing and surprising outcomes – in both business and baseball.
A Journey: Four Stages of Team Building
I want to share with you some thoughts on building teams. Businesses have customers, and suppliers, and warehouse space, and databases. That's all very good and important. But it's the people that add the magic ingredient.
Over the past few of years, Berlin Packaging has gotten much bigger. We've gained new employees from acquisitions and through organic growth.
We've approached all these new faces with an aim to get the most out of the new team. When a new team comes together, there are four stages a team goes through. These stages are Forming, Storming, Norming, and Performing.
THE FIRST STAGE IS FORMING.
In this case, people are getting to know each other, everyone is polite and avoiding conflict, and people stick to what they know best and operate independently. Think about the first time you met your spouse's parents; this is a great example of the behaviors we see in the Forming stage.
SOME TEAMS MOVE ON TO THE STORMING STAGE.
Here team members are starting to brainstorm and debate goals and tactics. There is some friction, but it's healthy friction.
SOME TEAMS THEN MOVE TO THE THIRD STAGE, NORMING.
Here the team has set protocols for how to work together towards a common goal. They've set norms and expectations for each other.
THE FINAL STAGE IS CALLED PERFORMING.
The team is working smoothly without inappropriate conflict. Team members have become interdependent. It's a well-oiled machine. Results are terrific.
Not all teams get to this last stage. This only comes about when true trust and skill exist.
And this is not a one-way process. At Berlin, we're always moving within and across this continuum. As we add people or change the make-up of our teams, we need to make sure we appreciate the step we’re in and build again towards High Performing teams.
I believe that if you don't take each other for granted and invest in building and maintaining a great team, then we'll all have more fun at work and make more money as well.
There are many things people are afraid of.
- Acro-phobia is the fear of heights
- Agora-phobia is the fear of crowded spaces
- Astro-phobia is the fear of thunder and lightning
Each of these fears can hold us back. For example, a fear of flying (which is known as aero-phobia) would prevent you from visiting some of the amazing far-away lands across the globe, or even easily seeing your family if they lived far away.
To reach your full potential, you need to conquer your fears. One of the biggest fears I see – and one that can impact your professional growth and the growth of your company – is the fear of failure. This fear is especially diabolical since the fear itself prevents the sufferer from even trying new things.
Some of the indicators that you have a fear of failure include:
- You tend to tell people beforehand that you don't expect to succeed in order to lower their expectations.
- You get distracted or procrastinate and "run out of time" to complete preparation for tasks.
- You worry about how smart or capable you are.
- And once you fail at something, you have trouble imagining what you could have done differently to succeed.
In business, we need to confront this fear. For employees to deliver results, they need to – among other things – provide productivity, profitability, and innovation. All three of these are difficult if not impossible if you are sabotaging yourself with a fear of failure.
Some practical fixes for overcoming failure-oriented anxiety:
- Baby-steps approach. Just like acclimatizing your body to an allergy, you can take small steps and build your confidence with small victories. In all things, there are aspects that are well in your control. So, focus on these first.
- Root-cause approach. This is what therapy does. It tries to locate the real reasons for the fear. Deep in your psyche there is a feeling or an event or a memory that is holding you back. A root-cause approach will have you "own the fear". This means that you embrace the fact that failure leads to fear and shame. Finding people with whom you can speak openly about this leads to a healthy resolution instead of sabotage.
- Big bang approach. Sometimes you just need to jump in headfirst. Before Chuck Yeager became the first pilot to break the sound barrier, he did all kinds of prep and testing. But when it came to the actual event, there was no way to know if he'd be safe. Chuck surely was afraid, but he bounded headlong into that fear.
I don't know what you're afraid of or what the fear of failure is preventing you from achieving. But I do know that fear can hold us back from many things. Conquer your fears. Even if you do fail in a situation, failure will make you stronger. Learn from your failures. Embrace them.
I am glad to be here.
The Blue Angels are the U.S. Navy's precision flying squadron. If you've ever had a chance to see them perform at an air show, it's truly amazing. They perform amazing feats in the sky, often flying in close formation. Sometimes their wing tips are 18 inches apart.
The level of teamwork they have is outstanding. One mistake could lead to a catastrophic accident.
It's the teamwork that the Blue Angels have that I find inspiring. I want to speak to a couple elements of how they build spirit.
First, the Blue Angels have a high degree of planning and preparation for everything they do. The maneuvers for every air show are mapped out versus a center point on the ground. Each pilot knows what they will do, when they will do it, and where they will do it – all structured around the center point.
Second, after every Blue Angels flight, they debrief what went well and what needs to be improved. The last statement everyone makes is "Glad to be here." I love how upbeat and affirming this is. They say "glad to be here" no matter what they've just discussed (be it success or failure). They are truly happy to have had a chance to participate. And given the danger they are exposed to, they are happy to just be alive.
I think we can take a lot from this; this attitude can apply to any one of us. On some days, Glad To Be Here can just mean you are glad to have a job, or even just to be alive. And even then, we sometimes get so caught up in our day-to-day tactical activities that we forget how fortunate we are to have the opportunities we have.
I think optimism and gratitude are very powerful things.
The Beauty of Net Promoter
My goal isn't to satisfy customers; I want to thrill them. A great way to measure how you're doing is through Net Promoter.
Net Promoter is a way to measure customer engagement and loyalty. It is a score that is the result of asking one question to your customers and prospective customers: On a scale of 0 to 10, how likely are you to recommend Berlin Packaging (or any other company) to a friend or colleague?
The Net Promoter is calculated as:
- The percent of respondents that score you a 9 or a 10 (these are the “Promoters”)
- The percent of respondents that score you a 0 to 6 (these are the “Detractors”)
- (For the score calculation, you ignore the respondents that score you a 7 or 8.)
Essentially, after Promoters cancel out any Detractors, how many Promoters are left over to evangelize about your company?
Net Promoter is a powerful concept. Research has showed there is a direct correlation, across industries, between companies with a higher Net Promoter and companies that are more successful financially. Their revenue grows faster, for example.
Beyond this, Net Promoter is a useful methodology because:
- It's very easy and simple to execute in the marketplace. Berlin manages it internally and the cost is zero.
- It's a very short survey to complete, which increases response rates.
- It is quantitative and can be baked into management systems.
We've taken these ideas and embraced them at Berlin Packaging. I think we are unique in the packaging space in our focus on customer thrill. I see our approach to the customer experience as a true competitive advantage. We spend more time thinking about, improving, and delivering against the customer experience than any other company in our sector. And we have great results.
- An independent study done last year showed that we led the packaging industry in customer thrill.
- Our Net Promoter is way up from 2010, the first year we measured it.
- Our Net Promoter is approaching the levels we see at JetBlue or American Express… companies that are known for their great service.
I've applied Net Promoter also to the South Bend Cubs. We looked at every touchpoint a visitor to the ballpark has – from driving to the field and parking to listening to the music and eating our food. We try to inject thrill into every part of a visit to a game.
We're doing all this because it’s good for business. We know that thrilled customers are going to give us more of their wallet, stay with us longer, and promote us to prospects and, thus, making our acquisition efforts easier.
For more information check out Berlin Packaging's white paper:
Do you have 3 minutes?
Maybe you don't because you're so busy with urgent work. But I think I have something that might help you, so if you give me 3 minutes, I will give you back more than that in return.
Many of us feel busier than ever. And it's also true that time management is hard – you're always thinking about what to work on and how to keep all the balls in the air. And there's always new things flowing into the funnel. And you probably have some bold goals you’re trying to accomplish.
And that's what I want to address – how we can achieve our bold goals while working smartly.
I read a fascinating book called The Fifth Discipline: The Art and Practice of the Learning Organization. The book itself is over 500 pages long, so let me highlight my two key takeaways.
First, look at what works well and repeat it. Second, and maybe even more importantly – look at mistakes, understand why they happened, and commit to not repeat those same mistakes again.
Just imagine all the things that didn't go right last year or even in the last quarter. Things where we say – if we could do it again, we'd do it differently. What if these same mistakes didn't happen that year? Or the next?
I see at least two great outcomes:
- Faster growth. We'd be able to retain business more easily and we'd create happier customers that give us more of their business.
- Freeing up time. Think of all the time spent cleaning up mistakes. All the time soothing customers, reworking projects, dealing with quality problems… you get the idea. If we did it right the first time, you would free up a tremendous amount of time.
Simply stopping past mistakes is a great thing to focus on. This will actually reduce workload while also helping to grow the business.
We live in VUCA times.
VUCA stands for:
- Volatile – so dynamic with fast changes
- Uncertain – having a lack of predictability
- Complex – multiple forces
- Ambiguous – having a hazy reality
The global economy is a great example of VUCA. Countries are tied together so a depression in Europe hits us here. We've seen so many fits and starts to the economic recovery that I have whiplash. You can see VUCA every day in the stock market, in the unrest in Ukraine, or even in the debate about privacy and how Big Data is changing how we live.
The term VUCA was first coined by the US Army War College during the collapse of the Soviet Union. But we can also see VUCA happening on a more micro scale. Think of how the brand Method reinvented the household care category. Or how Mio – you know, the liquid concentrate you add to your water – tried to rethink beverages.
- All of this is relevant as we try to grow. Indeed, every company is trying to stand out in these VUCA times and Berlin Packaging is no exception. Here are some ideas we are using to stay pointed in the right direction:
- We want to cut through all the clutter. We have a crystal clear mission, and that's to increase the bottom lines of our customers. We're in the business of selling profit growth, and packaging is the currency we use.
- We also want to have a clear strategy and superior business model. We have this in our Hybrid Packaging Supplier approach. By bringing together the best elements of manufacturers, distributors, and income-adding consultants – we are setting ourselves apart. We're making investments to strengthen our service and services, which will extend our lead even more.
- We work to build a terrific work environment. This is what our Berlin Values T-Chart is all about. You can read about this in another of my blog posts. With every employee engaged and pulling together, we can accomplish so much.
- We work to execute maniacally. VUCA times require deliberate action; you must "lean in" to accomplish your goals.
VUCA isn't necessarily a bad thing. It signifies a time of innovation and a high velocity of change. Now for companies that are slow and flat-footed, it's a problem. But for companies that are fleet of foot, it's a great opportunity.
I am obsessed with operational excellence.
I am obsessed with operational excellence. At Berlin Packaging, we've made amazing progress building operational muscle over the years. The fact we've achieved 99+% on-time delivery every month for over ten years is one testament to our focus.
At the core of all of this are four principles.
First, to ensure operational excellence, we must focus on Employee Experience. This means our employees need to have the proper tools, training, information systems, and work environment. Imagine you are a carpenter; you need to have the right tools, training, and workshop to make great furniture. That's what this principle is about.
Second, we must focus on the Customer Experience. We want service that thrills.
Third, we need to embrace Quality and Process Improvement. Our processes need to be efficient, and we must always have an eye for continuous improvement.
Fourth and finally, operational excellence is borne from superior Asset Management. Our financial assets at Berlin are our Inventory and our Accounts Receivable. We need to be as smart as possible in managing these assets.
These four keys are all important, and we strive to be successful in all areas at the same time. But when we need to make tradeoffs, we apply these principles in the priority order I listed. What I mean is:
- Employee Experience must be right to satisfy a customer. Your environment trumps everything.
- Efficient practices that do not satisfy a customer are useless. So customers trump nice processes.
- And saving money at the expense of satisfying a customer or at the expense of providing proper tools or training is short sighted.
Every company has its own starting point, but I've found these four operational keys essential in strengthening Berlin Packaging.
I want to share a history lesson.
The Constitution of the Unites States is the supreme law of the land. It establishes many foundational elements including the branches of government, the roles of the federal government vs. state governments, and a set of individual rights including the first ten amendments, which are called the Bill of Rights. It's an amazing document that is perfectly relevant today, which is remarkable since it was fully ratified in 1789. If you haven't read the Constitution, I highly recommend it.
At Berlin Packaging, we have our own form of a constitution. Our Berlin Values T-Chart lays out the desired behavior of two constituents. The first is what the company owes the employee, and the second is what the employee owes the company. In a clear way, the T-Chart explains the mutual obligations the company has with its employees.
There are a few things I love about the T-Chart. First, it's focused on such fundamental topics. The company owes employees six things:
- Coaching & training
- A chance to grow
- Job security
I see these six things as fundamental goals of an excellent employer. To create employee engagement and thrill, these six items are key. In fact, if you think about why you left a prior employer, I'll bet it was due to a failure in one of these six items.
And the employee, in return, provides another six things:
- Strong work ethic
Again, these are foundational issues and we want to have a team that delights in providing them in exchange for the other side of the T-Chart.
Second, I like how flexible the T-Chart is. We haven't rigidly defined each of these words. This allows the T-Chart to morph itself to apply to so many people and situations. It's impossible to contemplate all the scenarios and individual situations that may arise, and how different people bring different needs and strengths. So it's great that the T-Chart doesn't prescribe narrow lanes.
Third, I like how the T-Chart has stood the test of time. Since we launched the T-Chart over 20 years ago, it has stood with us. But just like the US Constitution, which has seen many amendments over the years, the T-Chart can be amended and enhanced.
Ultimately, the T-Chart is the backbone of how our company operates.
When the New Year arrives, everyone is quick to make new resolutions.
But most of these resolutions quickly fall by the wayside. Instead, I like to regularly look at what's happening around me and stay vigilant every day.
My point of view is anchored on some core tenets that I've built over my career. These include:
- Not all business models are created equal.
- The right people make all the difference.
- Thrill is better than satisfaction.
- The proof is in the pudding. Talk is cheap; the more we are able to prove our performance, the better.
I seek to live by these ideas and make myself a better person and leader. My goals are to…
…identify and avoid the mistakes I make. I think this is a growth strategy unto itself, because each mistake is a drag to progress.
…set the bar even higher. Whether it's related to leadership, innovation, or executional precision – I want to deliver even greater things tomorrow. Doing the status quo is my anti-strategy!
…invest for success. I'm prepared to spend more resources – time, money, passion – to build a greater enterprise.
…not wait for permission. I want to control my own destiny. In business, it's tempting to point to the overall economy as a factor governing performance. Sure, it's nice having tailwinds, but companies can forge their own futures with determination and moxie.
These are my resolutions on January 1 and every other day of the year. I am always eager to learn and improve.
Qualities of a Leader
I became CEO of Berlin Packaging in 1989. Since then, I've evolved as a leader. I've learned from some great mentors, I've learned from my mistakes, I’ve taken classes, and I've read a lot of great books on the topic.
To me, there are four pillars to leadership: integrity, articulated vision, work ethic, and voracious learning.
Integrity. You want to adhere to a set of moral and ethical principles. You want to be seen as honest and consistent. You want to be trustworthy.
Articulated vision. You want to have a clear story of where you want to go and why. This is the vision. But having the vision is not enough; you also need to communicate that vision to those around you. You need to make it memorable.
Work ethic. You want to walk the talk. Leadership is not about sitting in an ivory tower – it's about making things happen. Rolling up your sleeves and sweating the details are necessary traits of a leader. You help make your vision come to life.
Lastly is voracious learning. This means that you have a hunger to make yourself and your organization better.
So I think a great leader has these four qualities. You don't have to take all this from me. There are thousands of books out there on leadership. But one of the best is a book by Warren Bennis called On Becoming a Leader. All the same themes run through his book.
What I want to underscore is that being a leader really has nothing to do with where on the org chart you are. I've seen plenty of companies with people at the top of the organization where NOT leaders, they were merely the people that had risen highest in the team.
Leaders can exist anywhere. You can take ownership of your job and show leadership in delivering excellence. You can exhibit the principles of integrity, vision, work ethic, and voracious learning.
I saw a couple fascinating statistics recently.
First, Fortune Magazine publishes a list every year of the 500 largest public companies. They started publishing the list in 1955. When comparing the 1955 list to the 2014 list, only 61 of the original companies are still on the list. This means that only 12% of the great companies from 1955 are still strong today. American Motors, Collins Radio, Detroit Steel, and Zenith Electronics – all of these companies used to be titans in their industries, and now they're gone.
Second, a Boston Consulting Group survey showed that innovation is a top-three priority for 77% of companies. Yet other studies show that most innovations fail.
Taken together, these facts show that while innovation is difficult, but it's also essential. Any company that wants to stay on top must embrace creative destruction. This means that companies need to constantly be thinking about taking apart, reassembling, and improving key aspects of their operations. I remember having a Zenith television when I was a boy. It was great. As a company, Zenith invented the remote control. The Zenith brand still exists today, but it's owned by LG Electronics. Zenith was an innovator that didn't innovate enough or on the right things.
When people think about innovation, they may think first about new products. Yes, innovation is about product news. At Berlin, we're always looking for exciting product news that we can take to our customers. But let me go broader than product innovation. Ask yourself: Are you open to new ideas and suggestions? Do you question the status quo – the way things are done today? Do you proactively uncover new ways to do things? Do you look to other industries for inspiration? Do you embrace and champion change in your team?
These are all ways to think about innovation. Innovation is about improving our processes, our business model, and the tasks we perform every day.