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Turning a Setback into Success

It was easier to teach

good people our

business methods

than to hire industry

veterans and hope

they were a good,

cultural fit.

By Todd Palmer

CONTRIBUTOR

Todd Palmer is the president of Diversified

Industrial Staffing, a national skilled labor

recruiting firm, based in Troy, Michigan. 

Contact ::

[email protected]

ABOUT YOUR BUSINESS

26 PRODUCTION MACHINING :: DECEMBER 2016

T his is my cautionary tale for all small business owners

and entrepreneurs. It’s about massive failure/setback,

which ultimately resulted in success beyond my dreams.

Ten years ago, in September 2006, I fired my entire

company in one day and started my business over.

As the captain of my company, I had let things get way out

of hand. The company had gotten $600,000 in debt, revenue

was declining because of lack of a strong sales force and

process, and our company culture had become rotten to its

core—to the point where I no longer trusted my staff, the

staff I had hired. To accelerate my sense of urgency to make

swift changes, we had less than 60 days left of cash.

By removing all of the salary expenses, the company

immediately began to

have positive cash flow

and became instantly

profitable.

Once the office was

cleared of the final

employee, I first had to

deal with me, the CEO

and owner. The mess was

mine, since I created it. I

was embarrassed, I was

cloaked in failure because of poor staff management and

business ignorance. I was depressed that I allowed this to

occur. And somewhere deep inside was a voice of resolve

and resilience that would not allow me to quit.

Two weeks before the business shake-up, I had engaged

a business coach to teach me what I did not know. He

provided invaluable advice—to listen to my inner resolve

and to get the negative thoughts out of my head.

Retaining a coach was the first key step in moving the

business toward a model of success. My coach was a

sounding board for big decisions, taught me key tactical

business methodologies and processes such as Key

Performance Indicators (KPIs) and the value of daily staff

huddles to get a pulse on the business. With his help, we

created weekly profit and loss reports and a weekly cash flow

report. No longer would I be steering my business blindly.

Three months after I terminated my staff, the business

workload was overwhelming for me, and I started to hire a

new team. Instead of hiring people with relevant, industry-

specific experience, I decided to hire people based on their

DNA and teach them our business. It was easier to teach

good people our business methods than to hire industry

veterans and hope they were a good, cultural fit.

A key thing I was teaching my new salespeople was the

power of the word “no.” As I redefined the business, I made

a list of things I did not like about my business and decided

that a rebooted version of the company would no longer

do those things. For example, I decided that we would be

margin focused, not revenue focused.

We also decided to embrace the Jim Collins Hedgehog

concept, making us niche focused. By being niche focused,

we had to say no to opportunities that did not fit within our

niche. That was incredibility difficult at times. The ultimate

value in being so clear on what our key competency was that

new employees did not have any confusion as to who we

were, and who we were not, as an organization.

In 2008, we had made many strides and the company was

in a much healthier position regarding processes, metrics

and culture. Something was still missing—the soul. As the

leader, I still did not know why we were in business, other

than to serve clients and make money. Then in April 2008, I

saw a new author, Simon Sinek, speak about why a company

is doing business. Our company was missing that “why.” By

2010, after many hours of conversations and pondering, the

purpose of our business hit me—our “why” is to improve

lives. If we do that for our candidates and clients, the lives of

the people who work in our company are improved.

By seeking the wisdom and experience of a coach, by

putting the key business processes into practice on a weekly

and daily basis, by hiring good people that fit our culture,

by focusing on the bottom line and by having our “why,”

our company has seen success over the last 10 years: We are

debt free and have paid all of our vendors in full, our staff is

stable and consistent, and we made the “Inc.” 5,000 list as

one of America’s fastest growing companies six times. As

CEO, I could not be more proud of the work the team has

done. And I am grateful that I am able to live the “why” of

improving lives every day.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.