Leadership Archives

How a Board Can Boost Your Business (Post 2 of 4)

Why would the CEO of a private company proactively seek the guidance of a voluntary board of advisors? With no stockholders, there is no legal/fiduciary oversight responsibility for a board to uphold. Even so, I’m a firm believer in the benefit of working with a board of advisors.

If you’ve read my book, Building a Winning Business, you know I believe leaders should listen, seek to understand and solicit input from employees on a regular basis. But no matter how open the work environment, few – if any – employees are going to offer their candid perspective on how I’m doing (can you say “awkward”?!). Nor would it be appropriate for employees to advise me or my business partners on personnel decisions for example. An independent board of advisors is the perfect solution to the CEO thought-partner dilemma.

Intertech’s board of advisors is comprised of business leaders, who’ve lead successful companies. For the current and past members, their backgrounds and work experiences are varied and include experience with start-ups, turn-arounds, and, most important to me, growing highly profitable firms. I choose members based ultimately on my personal regard for their business acumen and integrity.

Two of our members also brought an added bonus due to their strong experience in sales and finance/accounting (which I consider to be my weakest areas). Ironically, those board members have been most instrumental in helping me make some tough personnel decisions (Tom’s Takeaway: don’t select board members based on narrow experience criteria. Rather, find top-notch business professionals that you respect and admire.)

For the record, a board of advisors is quite different from a board of directors. Specifically, advisory board members do not have the authority to oust private-company CEOs like me, such as board of directors can do with CEOs of public companies. But that doesn’t mean they don’t have clout! Any advisory board member worth his or her proverbial salt will walk if they sense their relevant experience and advice is not being carefully considered and frequently followed.

That’s not a problem with Intertech’s board of advisors. I genuinely value the perspective of our board members. These are people who have vast experience and generously share their wisdom with me four times a year during meetings. Members agree to serve on our advisory board for three years. Our advisory members are compensated per meeting and receive options in our company, which gives them a stake in our future success.

Still not convinced you need a board of advisors? Next time I’ll share a few examples that might just change your mind.

My Interview on “Why Dad remains top mentor choice” in The Business Journal

As one of The Business Journal’s Fast 50 (the Fast 50 are the fastest-growing private companies in the Twin Cities, based on revenue growth over the past three years), I was interviewed on the impact of my dad on the business. If you’re a subscriber to the Business Journal, you can access Why Dad remains top mentor choice online. If not, the brief interview is below.

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Intertech Inc.

Headquarters: Eagan

Business: IT training and consulting services

Answering: Tom Salonek, CEO

Dad: Theodore Salonek, farmer

What is your father’s best business advice?

Tell the truth and you’ll only have one story to remember.

How has your father inspired you?

“If you do nothing, you won’t make any mistakes,” were his first words to me as a teenager after learning that I accidently had sheared the axel on his truck. There was no shaming reprimand, just a straightforward focus on solutions. What a great lesson for anyone who manages fallible human beings!

How has your dad supported you?

He was encouraging and quick to tell me he was proud of what I and the firm had become.

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How a Board Can Boost Your Business (Post 1 of 4)

While CEOs of publicly held companies ultimately are responsible to a board of directors, those of us running private companies do not share this mandate. A recent article in the April issue of Harvard Business Review, “What CEOs Really Think of Their Boards” by Jeffrey Sonnenfeld, Melanie Kusin and Elise Walton, reinforced the importance of soliciting a board’s perspective even for privately held companies such as Intertech.

The authors asked dozens of well-regarded CEOs the following questions: “What keeps boards from being as effective as they could be? Are they really the cartooned millstone around the CEO’s neck, or do they help shape the enterprise in positive ways? What can boards do to become a greater strategic asset?”

The answers are distilled into five recommendations:

Boards should be careful not to rein in boldness too tightly.
They should do their homework on the company and the industry at large.
They should recognize that character and credentials, not celebrity, are what’s needed for a high-functioning board.
Directors should overcome any conflict aversion and bring energetic, constructive debate to the boardroom—contrary to conventional wisdom, CEOs don’t want rubber-stamp approval of their plans.
Directors should work to make the inherently fraught succession process less awkward, taking care not to overlook talent in the internal pipeline.

Ok, current and future board members, you have your marching orders!

But what should a CEO keep in mind when working with a board? And how can private companies benefit from the wisdom of an experienced board? In my next few posts I’ll explore this topic and share best practices from my past decade of work with Intertech’s stellar board of advisors.

Happy Father’s Day

Tom with his mom and dad

A couple of years ago, I wrote “Lessons from My Father” for Octane, The Entrepreneur’s Organization Magazine. While some of you may have seen this before, below is a copy…

Lessons from My Father

For many, Father’s Day is a holiday of the worst possible definition: a phony event designed to sell cards and neck ties.

For me, though, this Father’s Day has special poignancy: It’s the first time I’ll be celebrating as a dad myself, and the first time that I won’t be able to tell my own dad how much he means to me.

My father, Theodore, died last year in a farming accident. It was a terrible shock, to say the least, and it put my life in perspective. In the months since, I find myself remembering all the things he taught me; lessons that I want to teach Theodore, my young son.

In 2001, a local newspaper published an article about how my company, Intertech, was named one of the 500 fastest growing firms in the nation. In the article, I credited some of my success to simple lessons that my dad taught me. Now I realize that my dad taught me so much more, and those lessons have been critical to my company’s ongoing success.

“Tell the truth and you’ll only have one story to remember” was one of his favorite sayings. After being in business for 20 years, I have repeatedly experienced the merit of my dad’s wisdom. Recently, an important client of ours hired a CIO who turned out to be a dishonest bully. He hoped posturing, changing his story and saying whatever would resonate with me would make me complicit with his deceit. It didn’t. The company fired him, but Intertech is still engaged.

This particular experience taught me that while it’s easy to encourage others to tell the truth, it’s harder to create an environment where truth–telling feels safe. To create an atmosphere of honesty, I’ve learned to support people when they fail. I also encourage my managers to tell those people who make mistakes that they’re OK. I’ll never forget how grateful I was when my dad did that for me.

“If you do nothing, you won’t make any mistakes” were his first words after I accidently sheared the axle on his truck when I was a teenager. After reminding me that only those who do nothing are perfect, he said, “Now let’s go take a look at the truck.” No shaming reprimand; just a straightforward focus on solutions. When mistakes happen in my business, I acknowledge it, learn from it and move on to the next step. At the end of the day, the mistakes are what make us great.

“If someone does something you don’t agree with, tell him directly” was another belief my dad modeled. He wasn’t confrontational, but he did speak his mind if he disagreed or had something corrective to say. When I asked him if this was hard to do, he would just shrug his shoulders and say, “I’m not trying to win a popularity contest.” I was able to apply this lesson when a valued business partner of mine messed up. We talked through the issue and he realized that, while I recognized his mistake, I was more concerned about the future of our company and his role in helping us move forward. I’m happy to say that he’s still with us today.

While popularity wasn’t his goal, my dad was beloved by many. At his funeral, many people recalled stories of how he turned their lives around or did good work. It made me realize that sharing sincere praise is precious. This is something I have institutionalized within my company with a program that encourages employees to nominate each other for demonstrating our company values. Sometimes as leaders we get so busy that we don’t give people the acknowledgement they need to excel. At the end of the day, awareness begets success.

My dad was a modest farmer, but he left a rich legacy of integrity, authenticity and kindness. His wisdom has helped me grow as a business owner and father. I only hope I can be at least half as effective in passing that legacy on to his namesake.

Effective Public Engagement – Look for Convergence, Create Awareness

This is the last post in my series on Fighting a Government Threat. My 8^th lesson, Don’t assume that your counterpart thinks the way you do or is influenced by the same consideration, is underscored in the Harvard Business Review case study on this topic. Author Michael Hartman notes, “Especially when dealing with government entities, it’s important to carefully evaluate what factors are likely to affect their decision making. Will an article in the newspaper sway the governor? Or is he more apt to be persuaded by constituents, such as the company’s employees?”

While you most likely will think about an issue differently, it still is possible to (lesson #9) find points of convergence and show empathy for the goals of the Governor or legislators with whom you have a disagreement.

In the recent B2B tax proposal, the Governor’s good intentions and desire to generate more money to fund them offered little in the way of a solid, viable plan. I was careful to explain that I share the Governor’s love of our state and the many benefits it offers. I hoped that by noting our shared commitment to the state, he would be more open to hearing my thoughts on why I disagreed with his B2B proposal.

Finally, lesson #10: Build a positive relationship with the news media over time. I have spent the better part of the past two decades building relationships with the local business news community. Working with a publicist has helped, but at the end of the day I have agreed to participate in almost every request for an interview that has come my way.

Building relationships with the press takes time, but this credibility pays huge dividends when you want to speak out on an important issue. If reporters and editors already know you are a credible businessperson from past interactions, they are more likely to seek you out for quotes and consider your OpEd submissions for publication.