Chapter 13
Dream, Believe, Dare, Do

We keep moving forward, opening new doors, and doing new things, because we’re curious and curiosity keeps leading us down new paths.

Walt Disney

By now you know that Walt Disney made a practice of envisioning the untried and impossible; that he understood that success comes from the entire team and is enhanced by solid partnerships; that he refused to follow the paths of others; and that he was a master at creating detailed plans that not only ensured results but inspired the entire team to act: Dream, Believe, Dare, Do. The result: “the happiest place on earth” where guests return year after year to relive the magic that Disney created.

Thankfully, Walt’s legendary success credo is inspiring companies from New York to California, in industries light years away from the majesty of Disneyland and Walt Disney World. It is here behind the scenes of our seven featured organizations that “show business” emerges as a way of life and is not exclusively reserved for the most powerful entertainment organization in the entire world. Like Walt Disney before them, The Cheesecake Factory, Downtown School, Ernst & Young, Four Seasons Hotels & Resorts, Griffin Hospital, John Robert’s Spa, and Men’s Wearhouse have raised the bar from simply meeting customer needs to a demonstrated passion for fulfilling the dreams of those they serve as true guests.

As if in a dream, when we watched the curtains go up on these seven organizations, we nearly forgot that there was another world out there where old economy theories of management are still very much alive and thriving. Yet, in our travels, we are continually reminded that the level of excellence attained by these seven is only within reach of those who are brave enough to relinquish power and become servants to their employees, their teams, and their customers. Most of all, these iconic leaders are smart enough to exercise their “magic” each and every day by empowering others, from the board-room to the front line, to live their dreams; create new avenues to the future guided by their values; dare to make a difference; and, most of all, never to be satisfied with the status quo. Remember the inspiring words of Walt Disney: “All our dreams can come true, if we have the courage to pursue them.”

The Cheesecake Factory

Dream

David Overton must have had an inner voice that said to him, “If you build it, they will come.” In 1974, he left the music scene of San Francisco to fulfill the dream of building a showcase for what his mother had created: the “ice cream of cheesecakes.” All he knew about cheesecake, per se, was that his mother, Evelyn, made the best cheesecake west of New York (and now one could argue, anywhere) and that everyone seemed to love it. He remembered folding pink bakery boxes with his sister Renee to earn their allowances of a penny a box. (Fact: The boxes are still hand-folded!) David also remembered being in elementary school and bringing only one cheesecake to a bake sale, where his principal was literally standing on the steps waiting to buy it.⁸¹ And to this day, people are still waiting with pager in hand for more than just a slice of the over 35 flavors of cheesecake. Yet, guests never really have to wait for The Cheesecake Factory experience to begin: as soon as they walk through the grand entrance into the glistening palace-like banquet room and absorb the magic of the rich Egyptian columns, hand-painted murals, and gently swaying palm trees, they have entered a fairy-tale world and left the real world behind.

David didn’t let the fact that he had no restaurant experience stop him from starting a little restaurant in Beverly Hills in 1978. He was a businessman with a keen sense of what people liked, and they certainly liked cheesecake. But, what else could he offer them besides cheesecake? For David, this was more like figuring out what to fix for guests for dinner on Saturday night than it was for opening up a restaurant. As Linda Candioty, retired vice-president recalled, “David was sitting on a very old saggy couch in a teeny office surrounded by cookbooks, mountains of magazines, and things he had torn out. He had stacks of things everywhere. He dreamed of making things better. He didn’t want to bring out something that wasn’t unique and innovative.”⁸² If you’ve ever tried the Thai Lettuce Wraps on the menu, you’ll know what she means.

Before the little restaurant opened in the world-famous city synonymous with wealth and celebrity, an ounce of fear entered David’s mind. He had never set his sights on opening with the fanfare of the Disneyland band or having the who’s who of Hollywood enter on the red carpet as if approaching Mann’s Chinese Theatre. In fact, he really didn’t want to be open at lunchtime at all. “I put a small sign in the window, ‘Open at 2 p.m.,’” David told us. “At 1:30 p.m., a line had already formed in front of the restaurant, and by 2 p.m., the line reached well beyond our property to the next store. I told Linda to go out and entertain these people. She was a wonderful cheerleader.” And, for the “money’s no object” Beverly Hills clientele, you’d better be prepared to “razzle-dazzle ‘em. David once said, “New Yorkers can be very straightforward in their demands, but Beverly Hills is a tougher group to really please. In a sense, we were trained by the best customers in the country.”

David seemed perfectly content to let Linda take center stage. His role as consummate producer and director of a one-of-a-kind culinary institution was and still is reward enough. And, fortunately, both of his parents lived to see his extraordinary success.

Believe

Every generation seems to blame the one before it for something, and in families everywhere, this certainly rings true. It’s an uncommon and refreshing exception when adult children publicly credit both of their parents for helping formulate their fundamental beliefs and values. David Overton is such a person. “My father was total perseverance,” said David. “He could go and call on a restaurant account six or seven times and never take no for an answer. With my mother, I think I got just the straightforward quality, the sort of desire, the commitment.”

David started the little 78-seat restaurant with all the right ingredients, and they were not found in the kitchen. Rather, it was the Overtons’ leadership, strong work ethic, and desire to do something nice for others that generated the long-standing recipe for success at The Cheesecake Factory. To this day, David is still inspired by the memories of his mother in action. At one point in time, much to David’s dismay, Evelyn made a decision to close down her fully functioning bakery and move to another location, which was not immediately ideal for producing huge orders. As David recalled, “When we opened the new bakery, nothing was going right. The machinery wasn’t working, but my mother was determined and stayed up for something like 36 hours, just to get an order out. If she hadn’t done that, we might have lost the account. She had employees who followed her lead and worked nonstop until the baking was done. We didn’t lose the account because of my mother’s sheer will. So, I guess I got a lot of that from her.” We don’t guess, we know.

Dare

What kind of person decides to try out a new restaurant idea without any restaurant experience (David Overton never even worked in one.) under the microscope of Hollywood and doesn’t get egg on his face? One who sees risk as “innovation,” David told us. “Sure, there was this 5 o’clock moment when we were doing the Beverly Hills deal. I knew that if I did nothing, it would not have gone forward. And I asked myself if I really wanted to do this. Of course, I pushed forward. At that moment, I could understand how some people would feel overcome by failure.” But David’s excitement and desire to build a distinctive corporate culture laid the groundwork for The Cheesecake Factory’s incredible record—from individual stores’ generating in excess of $3 million annually to the company’s surpassing the $1 billion revenue mark in 2005.

With a solid foundation and a proven model that baffled the restaurant industry, David was ready to expand his horizons. In the mid-1980s, the Marina del Ray and Redondo Beach locations took David in a new direction with the opening of his first full-service bars. David and Linda worked for hours trying out new drink ideas and giving them names such as Typhoon Punch and Flying Gorilla.

Then one day, a friend of David’s enticed him to open in Washington, D.C., and bring the “quesadillos and guacamole”—two words that, back then, required explanation for those in and around “the D.C. beltway.” David was ready, but he knew this would be a real test. Things would be different in D.C. with a 13,000 square foot, bi-level, glass-enclosed design and a clientele with a reputation for receiving preferential treatment. On opening day in January 1991, a major snowstorm hit the northeastern United States. D.C. was almost totally shut down. Some people called to find out if the restaurant would be open in such inclement weather; others called to find out if The Cheesecake Factory was just a bakery. “I had 33 servers and we needed about 90. I couldn’t find any more people who were willing to quit their jobs over the holiday to come and work for this unknown company. Once we opened and people saw how popular we were, we said ‘Whew!’ and were able to hire more servers. I still think those 33 servers are the best servers I’ve ever seen in our company,” said Peter D’Amelio, now president of restaurant operations.⁸³

By day three, the word was out. East Coast residents are very “cheesecake savvy,” but now a new West Coast cheesecake had arrived and was out to de-throne New York’s favorite. By the end of the night, there were only a few pieces left, and the closest supply of this fabulous new cheesecake was 3,000 miles away. As Max Byfuglin, president of The Cheesecake Factory Bakery told us, “We got the call that said, ‘We are out of almost everything. We don’t even have any more of the Original (Evelyn’s original cheesecake recipe).’” Normally, a truck would deliver the cheesecakes directly from the bakery in California to the display cases in D.C., but faster delivery was needed. “We figured out that we could get eight cakes packed in specially designed boxes with Styrofoam into one Federal Express box with dry ice. That day we sent over 100 boxes via Federal Express to D.C. The cost was about $150 a box to ship them, but we could not not have cheesecakes!” Max exclaimed.

The craving for cheesecake was contagious in D.C. and has continuously brought waves of locals and tourists to the growing list of Cheesecake Factory locations from coast to coast. And with the success of the D.C. location, the company went public in 1992: an unbelievable feat for a restaurant chain with no more than a handful of locations.

Despite its unparalleled success, many food critics have expressed their displeasure with the whole “Cheesecake” phenomenon. They have little regard for David’s innovative bent for producing untried and eclectic cuisine. But then again, he was never one to buckle under pressure or criticism. When CNN and USA Today provided a forum for critics who announced the fat and calorie content of certain Cheesecake Factory items, retired vice president, Linda Candioty, called and told them, “We want our customers to get every calorie they are paying for.” After that, according to Max Byfuglin, “Sales went up.”

The fact that the menu has evolved from a simple two-sided piece into a 200-menu-item book may be attributed to David’s great passion for the exploration of food and finding new things that people just can’t seem to get enough of. Fortunately, at Cheesecake Factory, they can’t really complain about the portions, which are large enough to share or save for another day or two. According to David, the concept promotes “sharing and tasting different things.” And with such a vast array of menu choices, customers could order something different every day for well over half a year! No one else in the industry can claim this level of fare, or stand as an anchor with the likes of Nordstrom’s and Macy’s in upscale suburban malls of America.

Do

Over the years, David Overton discovered that his likes closely match those of his customers. He never worries that people won’t like the food. Anyone who can’t find something they like on The Cheesecake Factory menu must be from another planet. Remaining true to its motto, the restaurant offers “something for everyone.” Nevertheless, every Cheesecake Factory item must pass the Overton test. Others may have a hand in creating and tasting, but in the end the final approval for menu items is up to its founder and chief perfectionist. As Peter D’Amelio said, “We deal with the two most volatile things in the world, people and food, and they both need constant attention.” They get this and more at The Cheesecake Factory.

Yet even if you have the “perfect palate” of David Overton, the restaurant business is still a manufacturing plant. The challenge is to reproduce menu items on the spot each and every time, by hand, not by machine. And David believes that every repeat guest knows what his or her favorite item should taste like. David explains to his employees, “If they tell you it’s not the same as the last time, don’t tell them you think it is the same. They know better than you.” David is the number one role model in the organization for listening to the customers and doing whatever it takes to please them.

It’s a toss-up who are more finicky—the diners or their servers. David had a keen sense of the market early on, and was determined to recruit the best people in the industry and hold on to them. Nowadays, The Cheesecake Factory has such prestige that people flock to the doors to get an interview. The company’s comprehensive training programs for managers are enticing to job candidates. Managers, general managers, and executive kitchen managers can earn over $100,000 a year, double the industry average, and work for a company that adds icing to the compensation cake almost every year. For example, the CakeStake program rewards salaried employees with stock options amounting to between 8 and 12 percent of their base pay—if the company achieves 95 percent of its profitability goal. This is all part of “cheese-caking” per David Overton. In his most serious tone, David told us, “It’s not easy to take a $12 million complex business and hand it over to a 27-year-old. (Some will go on to manage a business that generates about $942 per square foot, more than four times the typical casual-dining field performance.) We need to have a program that is rock solid.” But sweetened compensation packages and training programs are not the only reasons people want to work for The Cheesecake Factory. It’s the long-standing corporate culture that David and his parents have instilled; it’s pride in the company’s unique focus on quality and service; and it’s the opportunity to be part of a legendary organization that is the envy of industry giants.

David tirelessly works to perfect his culture—his people, his operations, his food—while at the same time he continues to scale new horizons so more throngs of diners can experience the wonder of it all. In his own words, “The minute we ever forget why the guest is standing out there in line, we’re in trouble.” And the great Walt Disney never forgot this either.

Downtown School

Dream

“Imagine a place where children can curl up in a rocker or stretch out on the floor to read and discover the world … a place were children learn in a nurturing and challenging environment … a place where each child’s uniqueness enriches the learning community … a place where talents and abilities are developed and individual personalities shine … where children work together and learn from each other … where children use the whole downtown as their classroom … a school where parents work around the corner and stop in for lunch to share in the day’s activities. This is the Downtown School.” Here is the original Downtown School “dream” as cited in the Community Report of the Des Moines Business/Education [B/E] Alliance. On August 23, 1993, that “dream” became real when a new type of neighborhood school opened its doors: a school located close to where parents work rather than where they live.

The dream at Downtown School is more than just well-crafted words on paper. It’s the way the teachers, the parents, and the students live each and every day. For over a decade, retired principal and B/E Alliance executive director, Jan Drees, has been the torchbearer who assembled an entire network of people who have come to believe that Downtown School’s approach is clearly the best way of educating children. As retired board member, Mary Lou Daley, said, “It begins at the top. Jan is fabulous. She gets it. Her enthusiasm, her eagerness, and her knowledge of this kind of curriculum spreads to her teachers.”⁸⁵

The realization of this dream did not happen overnight. It took three years of research and long hours of hard work to create Downtown School’s child-centered educational model. But the research continues. Renee Harmon, Downtown School assistant principal, said, “Our education model is very eclectic. It takes whatever research has proven to be best for children and we implement that. We are constantly looking at what we are doing, looking at what research is discovering, and changing what we do to fit that.”⁸⁶

Believe

The Downtown School Mission reads

The Downtown School, in collaboration with parents and the business community, will provide a research-based learning environment that ensures each child’s success.

Our common goal is to enable children to mature into responsible and respectful citizens capable of independent problem solving, team-work, and leadership. We are committed to a world-class educational opportunity for the benefit of all students of the Downtown School, their parents, and the community.

When asked to evaluate the culture of an organization, we seek to determine if the behaviors are consistent with the mission. Let’s test the critical elements of the Downtown School’s mission.

“Collaboration with parents and the business community.” In Chapter 6, we described the creation of the Downtown School and the critical roles of both the Des Moines Business Alliance and the Des Moines School District. Collaboration with parents has been nothing short of miraculous. Because of the proximity to the workplace, flexible time, and the dedication of both teachers and parents, parent-teacher conference participation is over 99 percent. Downtown School also boasts an extremely active Parent Teacher Association (PTA). Meetings are often held during the lunch hour in a downtown business conference room. We had the good fortune to attend a PTA meeting during our research for this book. The conference room was about 85 percent full, although the president apologized for the low turnout, stating that typically the room is filled to capacity. We also observed some parents entering the school to have lunch with their children, and others who were on site to watch their children give presentations. During the first two years of operation, the Downtown School logged 3,492 parent visits. This figure does not include visits before or after school. Parent visits continue at an average of three visits per family per month or about 10,000 a year.

“To enable children to mature into responsible and respectful citizens capable of independent problem solving, teamwork, and leadership.” To test this aspect of the mission, all one has to do is walk into any Downtown School classroom. Mary Lou Daley explains, “It is very difficult to find the teacher, but she’s there. She is so intertwined, perhaps on the floor or bending over a table. There is no teacher’s desk. What is happening is that the children are always working on projects in groups together, and there’s a wonderful hum in the room. No matter what age group you see, they are all very productive. It is not pin-drop quiet because this is the time the teacher is reading and everyone must not talk. I used to tell my class (Mary Lou spent 14 years as a traditional classroom teacher.) ‘You can only interrupt Mrs. Daley during reading group, if the building is on fire, or if you are going to throw up.’” The “hum” of the learning and cooperative environment at the Downtown School compared to the “pin-drop” quiet traditional classroom that Mary Lou described reminded us of what Art Linkletter once said on “Larry King Live.” Years ago, Art created and hosted the television show “Kids Say the Darndest Things,” on which he would interview young children. When Larry asked Art how he dreamed up the idea for the show, Art said the seed had been planted many years before when his son started school. Art had asked his son how he liked his first day of first grade. The rest of the conversation reportedly went as follows: His son said, “I’m not going back!” Art asked him, “Why not?” His son replied, “Teacher asked me to read, and I can’t read. Teacher asked me to write, and I can’t write. I can talk, but every time I talked to the boy next to me, teacher told me to be quiet.”

Are there any problem solvers at the Downtown School? We met a five-year-old student named Nathan, who was just beginning his second year. In response to our question about the meaning of “logical thinking,” Nathan replied, “Logical thinking is like, for instance, if I used a little thin string on this chair to try to lift it up and a pulley, logical thinking is like this string won’t work. It’ll break under the weight of this chair.” These were his exact words! Sure, Nathan is a bright little boy, but he is not the exception at the Downtown School. Every five-year-old is making presentations, solving problems, and can both apply and articulate the meaning of logical thinking.

“Committed to a world-class educational opportunity for the benefit of all students of the Downtown School, their parents, and the community.” Does the Downtown School provide a world-class educational experience? Apparently a lot of people think so. Nearly 900 students are on the waiting list for admission to the Downtown School. During the first two years of its operation, 2,038 educators, school board members, and business people visited the school. The visitor log includes representatives from 22 states and 10 countries. “Only through innovators like you will the rest of us begin to change,” commented one visiting elementary school principal. An educator from Kyrgyzstan remarked, “Even without the ability to communicate verbally, because we do not share a common language, we did understand the philosophy and design of the school by actually seeing the classes and children.” Sounds pretty world-class to us.

Dare

For most principals, swimming against the vast current of traditional education in American would result in being swallowed up by the undertow. Jan Drees simply changed the tide, a monumental act of courage for which the parents of her students should be eternally grateful. The educational system in the United States has been failing our children for the past quarter century or more. But it’s like the elephant in the room—everybody talks about it, but nobody does anything about it. Jan and the Des Moines Business Alliance decided it was high time to remove the elephant. As a team, they decided to “blow up” the traditional model of education and start from scratch at the Downtown School.

Was this a risk? Nearly every principal in America would answer “Yes” to that question. But, if our schools are in such bad shape, shouldn’t everyone rally around such a project? On January 13, 2006, ABC news correspondent John Stossel hosted a “20/20” television special entitled, “Stupid in America: How We Cheat Our Kids.” As John remarked, “If you’re like most American parents, you might think, ‘These things don’t happen at my kid’s school.’ A recent Gallup Poll survey showed that 76 percent of Americans were completely or somewhat satisfied with their kids’ public school.”

Not only were Jan and the Des Moines Business Alliance bucking the conventional wisdom of the majority of U.S. parents, but they also were up against a huge and powerful tidal wave in the form of the teacher’s union and school district administrators. In most school districts, the K-12 public educational system is a monopoly; parents have no choice as to the school their children may attend. Add to this problem the contractual headaches induced by the omniscient teacher’s union, and you have the perfect formula for non-innovative teaching. In Stossel’s “20/20” report, Joel Klein, Chancellor of the New York City public school system reported, “It’s just about impossible to fire a bad teacher. The new union contract offers some relief, but it’s still about 200 pages of bureaucracy. We tolerate mediocrity because people get paid the same, whether they’re outstanding, average, or way below average.” Stossel proceeded, “Klein said he employs dozens of teachers who he’s afraid to let near the kids, so he has them sit in what are called ‘rubber rooms.’ This year, he will spend $20 million dollars to ‘warehouse’ teachers in five ‘rubber rooms.’ It’s an alternative to firing them. In the last four years, only two teachers out of 80,000 were fired for incompetence.”

It has been over 10 years since the creation of the Downtown School, and by all accounts, it has been an overwhelming success. Just imagine what would have happened if the Downtown School philosophy had failed. All of the naysayers would have rallied together to dish out the blame, and the name “Jan Drees” would have topped off the list. Was this the same type of career “dare” Walt took when he decided to make Snow White? The naysayers in Walt’s day said that no one would sit through a 90-minute cartoon. Boy, were they wrong!

We believe that the courage exhibited by Jan Drees in challenging the traditional education system was the same kind of courage that Walt exhibited over half a century ago. It took more than 60 years for other film companies to begin producing animated feature films. Hopefully, it won’t be another 60 years before the rest of our nation’s school districts dare to follow the Downtown School’s example of “blowing up” the old system and creating a world-class educational opportunity for all students. They need only to remember: “If you do what you have always done, you will get what you always have gotten: stupid in America.”

Do

As we have previously noted, the three-year research and planning process to identify the best-of-the-best educational processes was vital to the overall success of the Downtown School. To us, the most impressive aspect of the Downtown School was the project approach to discovery learning, one that has made this school the envy of all those who feel constricted by their own antiquated systems. Jan explains, “All students are expected to successfully complete research projects which include selecting a topic, gathering information from books, site visits, and interviews. Each student is expected to plan, organize, and present his or her information to peers and parents.”⁸⁷ Five-year-old Nathan told us about one of his class’s projects: “We went to visit a bank and got a bank loan. Our class got the loan. We made up this little jewelry shop in the mall and sold jewelry.” When we asked him what they did with the money, he responded, “We paid part of it back to the bank and still had some extra. We bought books for the new classrooms.”

We asked teacher, Renee Harmon, “What do you do with a child that has little, if any, interest in the selected project?” She answered by sharing this riveting story with us: “One of the projects selected was trucks and transportation. One student had absolutely no interest in this project. He was very bright and extremely creative but wasn’t real thrilled about the whole topic and didn’t see what he could learn from it. Since this student was just starting to get interested in the Internet, he was encouraged to do some online research on truck designs. He was also very interested in the environment, so he researched the gas mileage for different types of trucks. He also conducted a sample to determine the most popular color of truck in downtown Des Moines. He discussed and presented his findings to his fellow classmates.” The benefit of this project approach can be summed up by world-renowned educator, William Glasser: “We learn 10 percent of what we read, 20 percent of what we hear, 30 percent of what we see, 50 percent of what we see and hear, 70 percent of what we discuss, 80 percent of what we experience, and 95 percent of what we teach others.”

You may be asking, “Why include an elementary school in a business book?” There are several reasons why we chose Downtown School as one of our seven featured organizations. First, Jan Drees and her team provide a prime example of innovation and leadership exhibited by the creation of an environment where students are self-motivated, and where mutual respect and trust abound.

Furthermore, Downtown School is really much more than just a school. Jan and her team are builders of a workforce that will one day be instrumental in upholding our nation’s claim as a leader in the global economy. Recently, ABC’s “20/20” reported, “At age 10, American students take an international test and score well above the international average. But by age 15, when students from 40 countries are tested, the Americans place 25th. The longer kids stay in American schools, the worse they do in international competition. They do worse than kids from poorer countries that spend much less money on education, ranking behind not only Belgium but also Poland, the Czech, and South Korea.” The business community at large can no longer sit back and allow our schools to fail. Business leaders must learn from the Des Moines B/E Alliance and do something about our educational crisis in America.

Unfortunately, not only has the Des Moines School District failed to insist upon spreading the Downtown School philosophy throughout its domain, it may completely destroy this unique learning environment. As this revised edition of The Disney Way goes to print, Jan Drees is retiring from her role as principal of Downtown School.

Jack Welch, retired CEO of General Electric, once stated that one of the hallmarks of a good leader is training a replacement who would be ready to take over at a moment’s notice. When we asked Jan if her assistant principal would soon be stepping into the role of principal, she lamented that there were five other candidates who the District was considering, none of whom had any experience in the Downtown School teaching practices. In this case, the problem with the District’s adherence to their HR hiring guidelines is that although the other candidates may be able to learn and apply a new set of methodologies, they are not likely to have the degree of passion for the school’s vision and values that the assistant principal has had for lo these many years.

Wake-up Des Moines: if those five “principals in waiting” are not true believers in the philosophy that made the Downtown School exceptional, please do not allow them to wreak havoc with this incredible learning environment. Art Wittmack, Des Moines Business Alliance president, continues to be an exceptional advocate for educational reform. He told us that he was not aware that “politics” were involved in the decision-making process. However, he did admit, “What Jan has provided us with is a stable platform from which others can work. If what we have created is dependent upon Jan Drees for success, then we have not been successful. It requires a creative leader, one who understands the goals. We need to reproduce what has been successful in the Downtown School in the entire district, and that can’t be done by one person. There’s no question that Jan Drees is a one of a kind and without Jan’s pioneering work, we wouldn’t be where we are. It took that pioneering spirit and that genius which Jan has. But when you go through organizational development, it takes different personalities—from the entrepreneur to the place where you can deal with the HR issues of a larger establishment. We are in one of those struggles right now. I am optimistic that this will be a positive outcome.”

We applaud Art and the Business Alliance for their passion regarding educational reform. However, it has been over 10 years since the creation of the Downtown School and not one school in the district has adopted its philosophy. If the Business Alliance is to transform the educational system in Des Moines, they must muster up the same type of leadership and courage that they had 10 years ago when they initially challenged the traditional classroom learning environment.

Certainly, in any business you need a “stable platform” to manage the operations of the organization. But as we have learned from all of our featured organizations, a quality leader is one who believes that the real “magic”—creating an environment of mutual respect and trust—transcends policies and procedures. These exceptional leaders are more than administrators—they are communicators of the highest order who can bring the organization’s vision to life; listen to the needs, desires, and dreams of their customers; and lead by example. Yes, Jan Drees is a “one of a kind,” but if the Downtown School is going to survive and serve as the template for the Des Moines School District at large, an exceptional, unique, and passionate leader must once again step up to plate.

We asked Renee Harmon if the Downtown School learning environment is right for all children. She responded, “I have yet to meet a student it hasn’t been right for.” However, it is important to remember that Jan and her team took the best-of-the-best and created their own unique learning environment. Those who dare to follow the example of the Downtown School must be fearless innovators, not imitators! Those who choose this course will work harder than they ever knew they could. There is no instant pudding, but the results will be evident in all the Nathans of the world.

Ernst & Young

Dream

Most of our featured organizations started their enterprises with a dream: George “I guarantee it” Zimmer of Men’s Wearhouse, Jan Drees of Downtown School, John DiJulius of John Robert’s Spa, Isadore Sharp of Four Seasons Hotels & Resorts, and David Overton of The Cheesecake Factory. Only Ernst & Young and Griffin Hospital had well-established cultures before a new leader with a new dream decided that change was in order. Griffin Hospital didn’t have an option; it was either change or die.

In the year 2000, Ernst & Young was a well-established, successful global organization with roughly $10 billion in revenues and nearly 90,000 employees. It would be several years before the Enron scandal would be blamed for the seemingly overnight fall of Arthur Andersen LLP, E & Y’s largest competitor. So why change?

Professional service firms are known for putting their young recruits and less senior people through “hell.” It’s just like pledging a fraternity or a sorority; you take the hazing knowing that some day you’ll be able to dish it out. David Maister has studied, taught, and written about professional service firms for more than 20 years. When asked why professional service firms don’t change, Maister replied, “Let me give you an analogy from my own life. I am a fat smoker. I don’t need another speech to tell me that I should stop smoking and lose weight. Clear lungs, longer life—I accept that it’s a fabulous strategy. But please, no more speeches.” People in professional service firms, as well as other businesses, have heard all the speeches before. They know the importance of providing exceptional customer service, developing people, being a team player, etc., etc. Maister advises that, “Whether it is giving up smoking or giving great customer service, any kind of improvement requires short-term sacrifice and short-term pain in the name of a better long-term future. The problem in professional services is that because the environment is so bountiful, you can get everything wrong and still have a nice income.”⁸⁸ In reality, very few businesses are willing to endure short-term pain in hopes of achieving long-term gain, especially when profits are solid.

As we stated in Chapter 7, Jim Turley and his team rolled out a “People First” philosophy early in 2001. They were ready to endure pain to change the century-old culture of Ernst & Young. The E & Y “People First” philosophy is “to be the firm that contributes most to the success of its people and its clients by creating value and confidence.”

As chairman and CEO, Jim Turley leads the organization’s commitment to putting people first. This is accomplished by creating a supportive culture; making people paramount in all decisions; providing development opportunities for all employees; fostering an inclusive work environment; and building strong and enduring relationships with its people. Jim realizes that culture change is a two-way street. To make the change real at Ernst, each and every employee must also set personal goals, take ownership of his or her own careers, and live the firm’s values every day.

Of course, the work is still stressful, the hours long, and the clients demanding, but there is good stress and bad stress. Everyday task-related pressure is typically much easier to cope with than stress that comes directly from one’s superior. And pressure on young staff is perhaps nowhere more apparent than in the Big Four environment. “We need to make sure that our partners understand how their management styles impact our people,” says Jim Freer, vice chair of people in the United States.⁸⁹

Ernst & Young recently created the position “director of partner matters” and placed Mike Ritter, a highly respected senior partner, in the role. “Mike Ritter will wake up every day thinking about partner stress and what we can do to impact it positively,” says Freer.

“People First” is no longer a program at E & Y—it has become a way of life that is imbedded into the very DNA of its culture. Every new employee at Ernst & Young knows that the “People First” philosophy is important and will still be important when they become partners. Making people paramount in all decisions is as much a part of life at Ernst & Young as is running a trial balance for an audit.

Believe

At Ernst & Young, shared values guide actions and behaviors. Not only do these shared values influence the way employees interact with their coworkers, they also guide the way employees serve their clients and engage with other stakeholders. The Ernst & Young Global Code of Contact provides a solid ethical framework for business conduct. Employees are expected to base their decisions and their actions, both as individuals and as members of the global team, on the Code. In fact, full compliance and commitment to the Code is mandatory, and employees must sign a declaration to this effect. This credo underscores who they are and what they stand for:

People who demonstrate integrity, respect, and teaming

People with energy, enthusiasm, and the courage to lead

People who build relationships based on doing the right thing

Dare

Changing a culture that had survived for 100 years was quite a risk for Jim Turley, but perhaps not as big a risk as announcing to the world that at E & Y, people come first. According to Jim Freer, “We’ve always recognized that people are our most important asset. It’s their talent and skills that make us who we are.” Bill worked for Ernst before the new philosophy was instituted. At that time, there was no such thing as a “bad client.” If the engagement was not profitable, teams looked for ways to increase the scope and, hopefully, the profitability. They did not seek out clients who were in illegal or unethical businesses, but clients who could pay their bills were considered “good clients.” In 2001, Jim Turley let it be known that the rules of engagement were going to change at E & Y.

Not long after the “People First” philosophy was rolled out, Jim was speaking to a group of managers and senior managers. He asked them, “Please be totally honest. How many of you work for clients you do not like?” Seeing a large number of hands raised in response, he then asked, “Leave your hand up if the client is highly profitable.” Most of the hands went down. Jim then asked those who had initially raised their hands to raise them again. Finally, Jim said, “Leave your hand up if this client you dislike is good for your personal growth and development.” Once again, to Jim’s surprise, most of the hands went down.

Over the years, David Maister (former professor at Harvard Business School, now a consultant to professional services firms) has conducted similar studies with his own clients. David first gives his audience three categories to classify how they feel about their work: Category One is, “I love this stuff.” Category Two is, “I can tolerate it, but that’s why they call it work.” Category Three is, “How the hell did I end up doing this junk?” According to David, the results are consistent all over the world: 20 percent say they love their work; 60 to 70 percent say they can tolerate their work; and 10 to 20 percent say what they do is junk. David then gives his audience three categories to classify how they feel about their clients: Category One is, “I really like these people. I enjoy serving them.” Category Two is, “I can tolerate them. I give them good service, but there is no real difference between today’s client and tomorrow’s client.” Category Three is, “These people are idiots that work in a boring industry.” David reports that the results of this question are similar to the first. About 20 percent love their clients; 60 to 70 percent can tolerate them; and 10 to 20 percent cannot stand them. When David asks his audience if they think clients can sense these feelings, the answer is always a resounding “Yes!”

After coming to a similar conclusion, Jim Turley wondered, “Why should we keep doing business with clients we don’t like, who are not very profitable, and do not provide an opportunity for our people to grow? At the end of the day, we don’t want to be thought of as being in the audit, tax, or corporate finance business. We want to be thought of as being in the business of developing résumés, skills, and careers for all the people that come through the firm.”⁹⁰

Once again, like the rest of the leaders of our featured organizations, Jim dared to challenge conventional wisdom. He wasn’t trying to create the typical professional services firm. Such firms, according to David Maister, reflect an attitude of, “We won’t screw up, but we are nothing special.” Instead, Jim Turley turned Ernst & Young into a special kind of firm where they really do put people first.

Do

Making the new “People First” culture a reality at Ernst & Young required hard work, dedication, and commitment at all levels. This transformation involved rolling out several high-profile initiatives: the Gallup Q12 process, essentially an attitude survey; PeoplePoint, which provides a way to give upward feedback to partners, principals, and directors; the People Advisory Forum, which provides management with direct, regular contact with nonpartners; and the CNW (Center for the New Workforce), which supports the development of women leaders as well as other workforce issues. These are just some of the elements that continue to grow and nurture the culture.

Ernst & Young’s extensive investment in its people is also demonstrated by a vast assortment of formal and informal training programs that allow people to, as Jim Turley stated, “develop their résumés, skills, and careers.” In 2006, Ernst & Young was again named to the Training Top 100, a ranking by Training magazine. E & Y consistently makes the list, but this time took the number three spot among significant competition from a field of over 500 entries.

“We are delighted to be recognized by Training magazine as one of the top 10 companies on the Training Top 100 list for a fifth straight year,” said Mike Hamilton, Ernst & Young’s Americas chief learning and development officer. “The global Ernst & Young organization is committed to a culture of putting our people first. Part of this commitment is providing our professionals with continual training and learning opportunities that help them develop and grow, leading to increased fulfillment in their work and the highest quality service to our clients.”

“The professional services industry has seen many changes over the past several years. Ernst & Young has developed, refined, and deployed many new learning programs and events on a global scale to help its people meet these new challenges and reach their goals. Additionally, it has employed innovative workplace initiatives, leading development and learning practices, and cutting-edge technology to improve people’s performance,” Hamilton added.

Much of the groundwork for the new culture began in the late 1990s under the leadership of Phil Laskawy, retired chairman and CEO. In 1997, Ernst & Young formalized its flexible work arrangement (FWA) program, which empowers employees to decide how, where, and when they get their work done. According to E & Y, approximately 2,300, or nearly 10 percent of its U.S–based workers, take advantage of the program. The Flexible Work Arrangement is especially appreciated by women at E & Y who are serious about furthering their careers. Women professionals currently account for the majority of FWA participants, although men are increasingly taking advantage of the program every year. Today, 20 percent of the participants are men, up from 17 percent last year and 13 percent two years ago. This program allows thousands of professional women and men to balance their career goals with their personal lives.

As Phil Laskawy told us, “When I was in school, all the smartest kids were girls. When I got into business, I wondered what happened to them.”⁹¹ Vice chair of client services, John Ferraro, knows that giving women the chance to succeed makes good business sense. “Our commitment to women’s development and advancement is integral to Ernst & Young’s success. In 1996, E & Y launched a focused effort to grow its women leaders, both personally and professionally. Since then, the promotion rate of women at the partner level has more than doubled to 25 percent and women now comprise 13 percent of all leadership positions at our firm.”⁹² From offering childcare to concierge services, it’s clear that Ernst & Young is dedicated to helping employees manage both their professional and personal lives.

A true testimony to its values, Ernst & Young is concerned about the perceptions of its alumni. “We look at employment as life-long. Not being with the firm anymore does not mean that you are not a part of the family,” Phil Laskawy told us. The strong alumni network is evidenced by the fact that 25 percent of its experienced hires are “boomerangs,” or those who left the firm and then returned at some point in the future. And, of course, leader behavior is a key factor in those decisions people make to return to the Ernst “family.” As is true of Isadore Sharp of Four Seasons, the leaders at Ernst & Young truly understand their role of setting the right tone for the organization: one of trust and respect.

But is it working? In 2000, Ernst & Young had revenues of $9.5 billion and 88,625 employees, ranking fifth among the then Big Five. Today, Ernst & Young ranks second in revenues among the Big Four, with $16.9 billion in revenues and over 106,000 employees; its largest competitor’s revenues and staff decreased over 5 percent for the same period. For eight consecutive years, Ernst & Young has been consistently named to Fortune magazine’s “100 Best Companies to Work For.” Changing an organizational culture is a daunting task requiring much more than strategic leadership, but Ernst & Young set out to do it and succeeded.

Four Seasons Hotels & Resorts

Dream

Doug Ludwig, recently retired CFO of Four Seasons, first met founder and CEO Isadore Sharp more than 20 years ago when young Doug was an accounting intern working on a class project. Doug told us, “Issy’s dream back then was as clear, precise, and thoughtful as it is now.”⁹³ Back then, Isadore was just getting started testing the theory that one could build a world-class, five-star hotel empire on a simple ethic, The Golden Rule. Now, of course, that theory is fact.

Doug joined the Four Seasons accounting department in 1984, after seven years at a Big Four public accounting firm. He remembers how nervous he was being called into Isadore’s office on his very first day—the experience certainly made a lasting impression on him. “Wondering what I had done wrong already,” Doug recounted, “I was amazed to find out that Isadore just wanted to welcome me to Four Seasons and to share his vision with me.” When we asked Doug if Isadore remembered the class project, he replied, “At first, I didn’t think so because he didn’t mention it, but all of a sudden I glanced down and there was that college report of seven years ago. When you are in the university, you think this is really important stuff; but after seven years of experience, I wasn’t quite sure. Nothing was said about the report until I was getting up to leave. Isadore said ‘Just a second, I want to talk to you about a few things in this report.’ I didn’t know it at the time, but Isadore makes it a point to spend time with every new corporate employee on their first day.”

Communicating the dream to each and every new employee on his or her first day is just as important to Isadore today as it was back in 1984. Isadore’s compassion and humility fit perfectly with the globally acknowledged Golden Rule philosophy on which his company is based.

There is an old adage in public relations that the only bad publicity is none at all. According to Elizabeth Pizzinato, director of corporate public relations at Four Seasons, “The main PR objective of most companies is to get their name in print or on the nightly news. More is better. That’s not the case at Four Seasons. Here, in everything we do, it is quality over quantity. What we do with journalists is what we do with guests: we build relationships.”⁹⁴

Whether it is the front of the house where there is constant contact with the guest or the back of the house for the corporate business side of Four Seasons, the shared vision of management is always the same: Take care of your people, and they will take care of the guest. Kathleen (“Katie”) Taylor, president of worldwide business operations, explained, “There is an unending focus on the issues of our people. They are the constant focus of our energy. It is hard work, and it takes real energy and real commitment. Every one of our GMs and their staffs gets up in the morning obsessed with serving their employees and their guests.”⁹⁵

Believe

It is no surprise that the goals, beliefs, and principles of Four Seasons are all people-centered:

Our greatest asset, and the key to our success, is our people. We believe that each of us needs a sense of dignity, pride, and satisfaction in what we do. Because satisfying our guests depends on the united efforts of many, we are most effective when we work together cooperatively, respecting each other’s contribution and importance.

Isadore told us that these statements are only words—what counts are behaviors based on heart-felt values.⁹⁶ One notable role model at Four Seasons who lives The Golden Rule is president of worldwide hotel operations, Wolf Hengst. Wolf joined the company in 1978 as the opening general manager of Four Seasons Hotel Washington, D.C. As Wolf jokingly told us, “I’m at an age and position in my career that I can say what I want. What’s the worst that can happen to me, early retirement? When I interviewed over 25 years ago, there were only seven hotels. I said then, ‘If the philosophy and what I had heard in the interviews does not change, this will be a truly unique company.’ It has never changed, not in all these years, not even in one year can I say there has been a change in philosophy. The company has changed in its size; the company has changed in its organizational structure; but the basic belief and philosophy at the core of the company and the culture has never changed.”⁹⁷

Respect and trust are truly the foundation for delivering five-star service at Four Seasons, but do these virtues also apply to the corporation’s business dealings? we wondered. “Once we sign a business contract,” Isadore affirmed, “we file it away and never take it out again. If there is an issue, we do what is right.” Katie Taylor, former general counsel at Four Seasons, gave us a lawyer’s perspective of this practice. “If you have to go back to the contract, there is something wrong with the relationship,” Kate told us. “In common law cultures, relationships of a business nature are anchored by contracts. But we operated lots of hotels without contracts. We once waited a full six months for a signed contract, but it didn’t stop us from opening. Another hotel management agreement went on for several years without a signed contract. Everyone realized it when we were going to refinance the property and looked for the contract.”

A sense of family is apparent not only with the “old guard” like Wolf, but also with trainees and newer employees. “I have been here only a few years, but it seems like a lot longer, and I mean that in a positive way. I really feel like I’ve been part of this company for a long time. I think from your very first day at Four Seasons, you actually get to know what the company is all about,” remarked Elizabeth Pizzinato.

The real test of a people-centered culture comes in bad times, like economic downturns, terrorist attacks, or changes in a local economy. Maintaining business health at such times for most service firms means unavoidable layoffs. That is not the case at Four Seasons. Wolf explained, “We come out of troubled times stronger. We must continue to do all the things to give employees the motivation to stay with us. We create an environment that makes them believe that they will be here with us for the long term. That is not as easy as it sounds because you also have obligations to other business owners and partners who don’t always look at things the same way. It’s a hard job to stand up and say to those partners ‘We cannot change this. You have to understand that in order for us to have long-term success, we can’t just drop everything and pick it up in a year or two. It just doesn’t work.’ Yes, you do less. No, you don’t eliminate.” In many companies, upper management or the accounting department challenges expenses and seeks ways to cut costs, especially during tough times. That is not the case at Four Seasons. As Doug Ludwig described, “Even after 9/11, we did everything that was smart to do to save, but we were careful about not compromising the guest experience or the employee experience. The two are very closely linked, and the last thing you want to do is cut corners in the employee cafeteria or locker rooms.”

Time and time again, we heard enthusiastic examples of the same story, the success of Four Seasons’ shared vision and values. Comments such as, “From the first interview, I knew I wanted to work for this company”; “I have great pride in working for the company”; and “Everyone knows how much they have contributed” all speak to the root of Four Seasons’ goals, beliefs, and principles. Indeed, they are more than just words; they come straight from the heart.

Dare

We don’t think Issy Sharp really believed that running a business based on The Golden Rule was a risk. Sure, he realized the theory needed testing, but we believe that once feedback on his Golden Rule philosophy starting pouring in from his employees, Isadore dared to move forward.

In the last several decades at Four Seasons, there were many times when Isadore could have abandoned his philosophy or compromised his values. At one point in the company’s growth, he told his management group that all plans for expansion would be put “on hold.” He thought the company was growing too fast and that quality might be compromised. From then on, Isadore and his team built one hotel at a time, making each one the very best it could be. Today, it would be a risk to change the culture at Four Seasons. Doug Ludwig told us, “We have 30,000 people all around the world who tell us this is the only way to work.”

Do

As is true in any organization, hiring the best people is vital to long-term success. Certainly at Four Seasons, hiring the best people is a top priority. Every new employee goes through at least five interviews, the last being with the general manager of a particular location. According to Katie Taylor, “It’s not so the GM can say ‘Yes, I like this person’ or ‘No, I don’t.’ All candidates, even dishwashers, are interviewed by the GM. It shows the potential dishwasher that his [or her] job is really important. He may go home and tell his mother or his friends, ‘Wow, I met the GM today,’ and on his first day at work he knows the GM, and the GM knows him.”

This early exposure to the general manager is very important for any Four Seasons employee. Both the general manager and senior management stay very involved in the daily lives and the responsibilities of their employees. For example, the GM frequently checks rooms after a housekeeper cleans, not to see how clean they are, but to let the housekeeper know that he or she has a very important job. Whether it is the housekeeper, the bookkeeper, or the bellman—all Four Seasons employees know they are part of a team that works together to create exceptional guest service. To be sure, nothing happens by accident at Four Seasons. The systems, the procedures, the methods, and “art” of leading people are all in place and continually reinforce a culture of excellence in service.

Another key to the delivery of outstanding service is the long tenure of management at Four Seasons. The average tenure is over 20 years while the average age is less than 50. This low turnover rate translates into a continuity of the culture. Staff members do not have to consciously think about The Golden Rule every day: they just live it! The strength of this cultural foundation fosters employee trust and commitment within and between all levels of the organization. Employees don’t spend time worrying about what their coworkers might do. They just know and trust in the beliefs, values, and leadership of Four Seasons. In the words of Wolf Hengst: “We all sing together from the same hymn book. I sometimes have to pinch myself when I think about how fortunate I have been. It all boils down to this: you’ve got to take care of the employee, take care of the guest, love what you’re doing, and you have to want to serve. The culture won’t change as long as we understand this. If anyone ever loses sight of what the Four Seasons is all about, then we will have a problem.”

Griffin Hospital

Dream

When you walk through the halls of Griffin Hospital, it’s impossible to imagine that not long ago, 30 percent of the residents in Derby, Connecticut, said they would “avoid” their community hospital if at all possible. Now, Griffin is the pride of the entire healthcare industry, living its mission to “provide personalized, humanistic, consumer-driven health care in a healing environment; to empower individuals to be actively involved in decisions affecting their care and well-being through access to information and education; and to provide leadership to improve the health of the community we serve.”

While some hospitals have claimed a “Disney transformation,” not one of them can boast being named number 4 on Fortune magazine’s 2006 list of “100 Best Companies to Work For”—the highest ranking ever achieved by a hospital. Griffin can also boast of being the only hospital in America named to this prestigious list for seven consecutive years. In most hospitals, administrators balk at “pixie dust,” claiming, “This isn’t Disneyland, it’s a hospital.” These types would never have the guts that Griffin displayed in asking a critical question of its own staff members: “If you or a family member were admitted to a hospital, describe what you would want the hospital experience to be like.” Griffin took those responses to heart and under Patrick Charmel’s leadership, a transformation began.

One thing Patrick had on his side during the transformation of Griffin was the longevity of his senior leadership team. Over half of them had worked together for more than 27 years and were essentially “born at Griffin.” (Vice president Bill Powanda was actually born at Griffin, and his executive office was once part of the original maternity ward. Bill says proudly, “I have been right here all my life.”)⁹⁸ A key factor that fueled the transformation was the fact that four executive staff members had recent, not-so-comforting hospital experiences for serious personal or family medical problems at three different hospitals. Although none of them reported being disappointed with their medical care, all of them had felt a void in the area of personalized attention from hospital staff. Sharing these experiences was more than a catharsis for these leaders: it was the solidifying of a dream to ensure that Griffin patients never have to wonder whether they can ask a question about their care and get a straight answer; whether they have the freedom to view their medical charts; or whether their families will be respected by hospital staff. This determined and empowered executive team was a source of great strength and inspiration for the entire staff during the days of Griffin’s transformation. Together they helped facilitate all-day retreats called “Griffin Days,” which deepened their passion for creating the dream of making Griffin “the hospital of choice” for every “guest” who enters their sanctum.

Believe

Griffin Hospital’s success in delivering on its promise of superior patient-centered holistic care and customer service is chronicled in its annual reports, like the recent “Creating the Exceptional Patient Experience,” and “Clinical Excellence: Creating Exceptional Outcomes.” Truly one of the hallmarks of Griffin’s success is its unique culture of extraordinary service and teamwork.

Like Disney, Griffin Hospital has always been a place where differentiation is achieved by employees who exercise both good judgment and creativity in their interactions with others—all without a script. “When other hospitals visit Griffin, they give us high praise for the lack of “scripting” in our environment, saying Griffin seemed more sincere than other hospitals that employ scripting for their specific departments. What our guests are seeing is evidence that Griffin’s genuine customer service approach was always part of its culture,” Bill Powanda stated.

The reason scripting isn’t necessary for Griffin’s nursing staff or Disney’s parks staff or Four Seasons Hotels staff is that authenticity comes naturally to these employees and cast members. It’s one thing to use a script on an attraction like The Great Movie Ride at Disney-MGM Studios, where the script is really part of the “show”; it’s quite another thing to use a script when working with the family of a terminally ill patient who expects truthful answers on topics ranging from pain management to hospice care.

Are Griffin’s beliefs being rewarded? You bet. Griffin Hospital has been conducting community perception surveys on a regular basis since 1982. Results of the most recent survey completed in November 2005 show that the quality of care at Griffin is on a par with Yale New Haven Hospital and above the other six competitor hospitals. Griffin’s emergency room was rated highest of all hospitals in the region, and, overall, Griffin was rated the most improved hospital by a three to one margin.

Dare

If you think culture change is difficult to achieve in the typical American organization, you’d be right. To create a winning culture, the vision and values of the organization must be brought to life and demonstrated every day. Hospitals, however, are “change allergic,” according to David Freeman’s 1999 Inc. magazine article on Griffin. And the unfortunate truth is that, today, one can readily spot evidence of resistance to becoming “guest friendly” in the vast majority of hospitals across the country. It doesn’t take long to find those halls of linoleum, bright fluorescent lights, cluttered hallways, and clusters of nurses whispering—all in the name of “good health care.”

In Chapter 4, we described Patrick Charmel’s success in transforming Griffin Hospital into a wellness paradise, which began in the hospital’s maternity ward. Together, Patrick and long-time fellow associate Marge Deegan, vice president of ambulatory services, set out on what would become one of the most “creative” journeys of their lives. They traveled together as the “pregnant” mom and concerned “husband” for the purpose of experiencing hospital birthing facilities directly through the eyes of the customer. No facility totally matched their dream of a place to serve as the stage for one of almost every family’s main events—becoming parents. Most hospitals give families the opposite feeling, to which many of the leadership team, including Patrick himself, could attest.

Without uncovering a model to “imitate,” Patrick vowed to “innovate.” He would bring his team together and produce a “magical” patient-centered, not physician-centered, environment. “In health care,” said Marge Deegan, “we develop mindsets that become the barriers to innovation. We had a credible leader in charge of the process. Patrick was always the one who pushed the envelope. He is so professional, and never let on how difficult it was to bring on the new concepts.”⁹⁹

And many new concepts in the area of facilities at Griffin were about to take shape. On Patrick’s watch, however, new “attractions” at Griffin needed to pass one critical test: how well they could support the credo of patient-centered care he dared to adopt. He listened intently to the focus groups he had commissioned to identify what was needed to create the “ideal” birth experience. The expectations of focus group participants were like a newlywed’s “Christmas Wish List” with hefty price tags attached to every item. Most executives in Patrick’s position would have asked for a more realistic proposal. In fact, many company leaders prioritize “customer wishes” annually, choosing only a few of the least expensive items or “low-hanging fruit” that are easy to achieve. And, if you were an executive in an organization like Griffin, which was at one time struggling financially and nearly bankrupt, you might opt for cosmetic changes and forget the rest. But, the emboldened Patrick did something that shocked his team members. Just like Santa Claus, he brought the gifts that everyone wanted: a noninstitutional, home-like setting with garden-fresh flowers, family room-style lounges, soft hallway lighting, skylights, custom-built double beds, and a Jacuzzi—and that was just the beginning.

Since the opening of the Childbirth Center at Griffin Hospital in 1987, Griffin has been renewing its status as an innovator in the healthcare industry. It was now the place to go—at least for expectant parents who didn’t need to be convinced to sign up for a dose of Griffin’s pampering while living through the various stages of pregnancy and childbirth. But selling this patient-centered approach to Griffin’s doctors was a whole different experience for Patrick and his management team. Thankfully, it didn’t take long for old-line doctors to move out and for a new crop of altruistic doctors to join the Griffin team.

When the decision was made to take the patient-centered care concept hospital-wide, the rest of the hospital’s doctors knew they couldn’t pass it off as simply a maternity “thing.” Patient empowerment, open medical records, and formal care conferences can be very threatening to physicians who are accustomed to having ultimate control.

Medial director Dr. Kenneth Schwartz told us, “I’ve yet to see a negative outcome from patients reading charts, and a number of positive things have happened. About a year ago, I had a patient come in, having passed out. He was a little out of it for the first day he was here. He was a very intelligent guy, a local retired minister. A couple of days later, I came in and made rounds on him, and he said, ‘I want to thank you for allowing me to look at my chart.’ He said, ‘I really wanted to talk to you about this. I think the history recorded is a little inaccurate because I was a little woosy when I first came in.’ Then he clarified the details, which was actually very helpful. That’s a typical positive response that you get out of the system.”¹⁰⁰

Patrick Charmel and his team created a new approach to patient care that shattered the myths and beliefs that have long been hospital tradition in America.

Do

Many hospitals have brought in consulting teams who share the “secrets” of Disney’s on-stage and back-stage areas. But, most of them are not practicing the Planetree model: the philosophy based on the belief that if patients have access to information and education regarding their illness and hospitalization, they can become active participants in getting well. But it is much more than just information sharing. The hospital provides a healing and nurturing environment with warm and supportive caregivers. “Lots of hospitals try to sort of steal the Planetree concept,” Dr. Schwartz explained. “They might have sculpture, water, a piano playing in the lobby. You can pretty-up any hospital. But, the philosophy is the tough part of it, because that’s the part that requires support. That’s where the competitive advantage is.”

As we previously described, that doctor-driven hierarchy is still very much alive in some of the most prominent and powerful medical centers in the country. The good news, however, is that due to its widely publicized success, Griffin Hospital is now under the microscope. Over 500 U.S. hospitals have paid $3,000 for the privilege of touring and learning from this once modest and obscure facility in a small Connecticut community. They will meet a team of people who are clearly a “family” who strive together, in good times and bad, to achieve their mission of excellence. Peering behind the picture-perfect Griffin “stage” that has become legendary, there are countless untold stories of the Griffin family taking care of one another as they do their patients. As Barbara Stumpo, VP of patient care services, related, “We had a guy who worked in critical care, and he was only here a short period of time. He was diagnosed with metastatic cancer, and he was a young guy who had a little child at home. He was trying to get through chemo, and would come in and work a couple hours probably to get a break from his home setting. The administration here at Griffin really supported him. Every one of them donated vacation time to his paycheck—the docs, the nurses, the entire administration. He had a full paycheck until after he passed away. People are what make this place so special. It’s the sincerity, the compassion, the respect.”¹⁰¹

Hospitals throughout the United States are in desperate need of what Patrick Charmel has modeled for Griffin—the Dream, Believe, Dare, Do credo. Management consultants from Ernst & Young (another one of our featured organizations) describe the changing healthcare paradigm that could serve to force many in the industry to adopt the Planetree approach and reinvent themselves: “The trillion-dollar American healthcare market is on the brink of the biggest transformation yet. The primary force behind this change is not technology or managed care but the growing mass of educated and empowered consumers. ‘Healthcare consumerism’ will alter how healthcare organizations will operate, how they compete, and, perhaps, why they exist.”

After embracing the patient-centered Planetree model, Griffin took ownership of the Planetree organization in 1998. The Planetree national headquarters is on Griffin’s campus in Derby, Connecticut, and is a subsidiary of Griffin Health Services Corporation. Today, the Planetree Network has grown to over 100 member hospitals in the United States, Canada, and the Netherlands, whose staffs are trained, coached, and nurtured by Planetree president, Susan Frampton, and her competent team of professionals.

According to Griffin vice president, Bill Powanda, hospitals who adopt the Planetree philosophy do so for one or more of the following reasons:

Pure altruism—a belief that this is the right way to treat patients

Strategic initiative—a way to differentiate themselves, particularly if they are in very competitive markets

Brand promise—assurance of being backed by Planetree, which provides support through its network membership

Those fortunate organizations that have CEO support to bring Planetree into their facilities will live and learn a new vocabulary that reinforces how people behave; they’ll be saying, “That’s very Planetree,” or “That’s not very Planetree” as a critique and confirmation of what is patient-focused and what isn’t. As Susan Frampton told us, “In each Planetree hospital, there is something different when you walk through the doors … the warmth, the whole atmosphere. It’s understanding the patient’s perspective, knowing that you’re creating memories that last a lifetime.”¹⁰²

Planetree provides hospital employees with a level of freedom that allows them to “go the extra mile” for their patients. Christine Cooper, director of radiology, cardiology, and neurology at Griffin Hospital, exhibits Planetree behaviors in arenas that most people would say are beyond her control. On one very busy day in the radiology department, she was aware that patients were getting restless with having to wait a long time to be tested. The radiology department at that time was using an outside company for their mobile MRI service and expected them to deliver Planetree-style service. One irate patient decided he could no longer wait for his name to be called and stormed out of the building. Later that day, he called back to report that he was never coming back because the service was so “lousy.” Chris took matters into her own hands. Not only did she convince the MRI company to issue $100 gift certificates to four patients for their aggravation, but she also took time out of her busy schedule to send personal letters to each one of these individuals. Chris believes that her partners in delivering patient services must be held to the same high standards as her hospital lives by … now, that’s very “Planetree.”

The Planetree approach has produced dramatic results for Griffin Hospital. Griffin uses an independent, private marketing research company call center to conduct patient satisfaction surveys. The center completes 100 telephone surveys monthly (about 15 percent of discharges) with results reported by the fifteenth day of the succeeding month. The center captures narrative comments from patients that Griffin’s leadership team finds extremely valuable in identifying and solving problems. The overall patient satisfaction rating has averaged 97 to 98 percent for the past five years. Griffin Hospital’s patient satisfaction ratings are among the highest in the country.

The Agency for Healthcare Research and Quality (AHRQ) recently announced that the results of its CAHPS Hospital Survey (H-CAHPS), a standardized survey of hospital experiences, will soon be available online. This means that the general public may view Griffin’s patient experience/satisfaction ratings and compare them to other hospitals and national norms/averages. In a pilot survey conducted for AHRQ, Griffin ranked the highest of all Connecticut hospitals, and Connecticut ranked the highest of the four pilot states. As Griffin’s Bill Powanda stated, “Soon there will be a great deal of pressure on hospital management to become patient-focused. The challenge will be even greater for tertiary care university medical centers where the focus has never been on the patient experience or patient satisfaction, but rather on medical research, medical education, and clinical outcomes. Most are not good at ‘Creating the Exceptional Patient Experience.’”

With Patrick Charmel’s impressive leadership track record, Griffin Hospital is sure to continue to be an industry leader in personalized health care. Last year, Patrick was appointed to a three-year term on the National Advisory Council for Healthcare Research and Quality. Recently, the Yale School of Public Health honored Patrick as the John D. Thompson Distinguished Visiting Fellow of 2006. Those Yale students, many of whom will be the next generation of health care administrators, are the lucky ones who will learn from one great leader how he guided his team through some turbulent waters and ended up building one of the top “100 Best Companies to Work For” in America.

John Robert’s Spa

Dream

On their first date, John and Stacy dreamed of owning a hair salon. John DiJulius says, “When I met Stacy, she was already a phenomenal hairdresser. At 19, she had a waiting list.”¹⁰³ On that very first night, they discussed how Stacy would open a salon and bring to life some of the many great ideas John had for running a business. As John recalls, their first business plan was drawn up on “a bunch of cocktail napkins.” Having worked for UPS during college, John quickly discovered that he could make more money as a UPS driver than as a corporate trainee with a marketing degree. As John told us, “I went to work full time as a driver, hoping that I could put enough money away to someday open my own business.”

Opening a hair salon, however, was not the sort of business John had in mind when he first met Stacy. Sure, he thought it would be a nice little business for Stacy, but John’s plan all along was to save his money for a “real” business. Stacy recalls buying their first salon, “John saw an ad in the paper for a small salon. He was always looking for opportunities. He called them up and before I knew it, he had put an offer in. I was freaking out. I was 22 years old and thought, ‘Oh My God! We don’t have any money.’ We took out a loan using my Nana’s GE stocks for collateral. I don’t know how John talked her into it, but he did. She must have had her hearing aid turned way down that day.”¹⁰⁴

Their first employees were friends of Stacy’s who were also hairdressers. With four employees and a base of over 1,000 clients, John thought the salon was off to a great start. But John and Stacy soon discovered that these employees simply did not deliver the “secret service” (now the credo for John Robert’s Spa and others who practice the customer service methods in John’s book, Secret Service) principles John and Stacy were attempting to instill at the new salon. Stacy told us that one day, one of the hairdressers was running late and told her client she didn’t have time to blow-dry her hair. Stacy overheard the comment and announced that she would take care of drying the lady’s hair. Once the lady had left, the hairdresser came over to Stacy and shouted, “Don’t you ever take one of my clients again!” Stacy lamented, “This is exactly how a lot of people in this industry act. They feel very threatened, but the client unfortunately is the one who suffers. The client did nothing wrong. She came in on time and expected great service.” After this incident, the lady switched her allegiance from the self-centered hairdresser (who, by the way, is long gone from John Robert’s) to Stacy, to whom she remains loyal to this day.

After the first six weeks of business, John Robert’s’ original hairdressers quickly disappeared; they were either fired or they left. As John remembers them, “They wanted nothing to do with our dream. They wanted to do things their way.” John and Stacy wanted no more stereotypical hairdressers at their shop. Other salons put up with staff who might not show up for work, might come in late, might have a hangover, might leave the shop between clients, and would never think of helping their coworkers. People who treated their careers in such a cavalier fashion would never fit into John and Stacy’s dream.

John and Stacy wanted to create a unique environment where they could provide and serve as a model for legendary customer service. To achieve such a feat, they must stay the course. As John told us, “If that meant going out of business, so be it. I’d rather go broke than compromise our standards.” Stacy said she thought the world was going to come to an end, “I was young, Nana’s stocks were up for collateral, and I thought I would be disowned by my family and have the Italian curse put on me.”

But, fears cannot deter those who are passionate about their dreams. Like all of our featured organizations, John and Stacy decided to buck traditional wisdom. Instead of hiring experienced hairdressers from established salons, they would hire cosmetology school graduates and train them to be “mini-Stacys.” John says, “Before Stacy was an owner, she was a great employee. She was always concerned about the salon and about the client.” Delivering first-class service is never the easy way to run a business, but John and Stacy knew it was the only way to achieve the long-term success they dreamed of.

Has the experiment worked? Since 1993, the business has grown from a simple 900-square-foot salon into a collection of three salons and spas that have been custom designed exclusively for relaxation and restoration of the body, mind, and spirit. Features and services include a spa with four treatment rooms; a vichy shower; a steam shower; a manicure/pedicure sanctuary; a tranquil spa lounge; a men’s salon; a sports-themed room complete with a pool table; a color lab for mixing personalized color formulations; 20 styling stations; an experience area where guests are greeted upon entering and encouraged to test products as well as browse through team portfolios; and, finally, a café that serves up tasty, healthy smoothies and a variety of other refreshments. What started with four hairdressers who could barely spell “secret service” is now a team of 140 who bring John and Stacy’s credo to life. From the brink of losing Nana’s stocks (and the fear of being forever “cursed”) to generating over $4 million dollars in annual sales, John Robert’s has redefined the salon experience and is truly a model for any industry.

Believe

As is true at Ernst & Young, John Robert’s employees get top billing. John explains, “What that means is that if you are going to work at John Robert’s, your team members need to be a high priority—as high, if not higher than our guests.” This is reflected in the John Robert’s mission, “For every long-term employee to regard their decision to work at John Robert’s as one of the best decisions of their life.” Eric Hammond, director of operations, explained, “We have a great team philosophy. When I first came to work here, I tried to figure out how it came to be. It starts with the leaders and just trickles down. We don’t do a ton of stuff that encourages team play. It’s just the foundation that John Robert’s is built on.”¹⁰⁵

John and Stacy believe that it’s everyone’s job, including their own, to live the John Robert’s mission. One day a client witnessed Stacy sweeping the floor and asked her, “Can’t you hire someone to do that?” Stacy, John, and their management team lead by example, based on their brand of “secret service.” Most new hires at John Robert’s seem to quickly adopt the teaming and service standards that are now tightly woven into the very fabric of the company. As Eric explained, “When someone comes in who really isn’t a team player, they stick out like a sour thumb. In those rare instances, we make every effort to coach the employee and bring them into the fold.” In the early years of John Robert’s, Eric was training a new employee who didn’t understand the benefits of teaming. After discussing her performance at several management meetings, Eric was on the verge of recommending her termination. But when he realized it was really his responsibility to coach and train new employees, Eric vowed to do everything he could to help her “turn the corner.” And as Eric now proudly admits, “She’s my ‘go to girl.’ She’s the first one I turn to whenever I need help. She’s the one I ask to coach any new employee that may be having problems with teaming. She even jokes about almost getting fired during her first few weeks on the job.”

Today, it would be nearly impossible to begin a career at John Robert’s without understanding the company’s core values. And with a minimum of four interviews over time, each candidate has the opportunity to evaluate if and how those values mesh with his or her own. Only about 1 in 25 who apply will be hired. In John’s words, “We want to make sure they are not just running up and down the street looking for the best deal. We don’t hire from other salons.” During the initial interview, candidates receive a list of the John Robert’s nonnegotiables.

Service. Unless candidates are clients of John Robert’s, they most likely do not understand what John Robert’s service is all about. During their first interview, they’ll hear a few powerful stories of exceptional customer service at John Robert’s: a spa attendant who did some quick grocery shopping for an elderly client while she was receiving a spa treatment; an employee who picked up her client at home during bad weather; and many other examples of how John Robert’s staff go the “extra mile” to make the client experience “magical.”

These “magical moment” situations may not happen every day; however, the expected “secret service” for each and every client is “magical” by most salon standards. The client cycle begins with the Pre Experience, which occurs before the client enters the salon and involves a polite telephone conversation with an appointment taker who never rushes the conversation and who uses your name at least four times. (This not only makes the client feel good, but the repetition helps the employee memorize the client’s name.) The next phase is called the Start of the Experience. Walking into John Robert’s is like walking into no other salon. You are immediately greeted by a hostess who announces your arrival to the operator. The hostess neatly places your coat on a hanger, brings you a refreshment of your choosing, and addresses you by your name throughout the conversation. While the operator analyzes your needs and expectations, you receive a stress-relieving massage before your hair is meticulously shampooed and conditioned. Male clients also receive a mini-facial. Now you are ready for the Service phase. During this phase, your hair is cut and styled, your arms and hands are massaged, your jewelry is cleaned, and you are given an explanation of the products used with no pressure to buy. Woman clients will have their makeup touched up in the Post Service phase. Additional services and promotions are also explained to all clients during this phase. In the Conclusion of Service phase, clients have the opportunity to purchase products and schedule their next visits. During the Post Experience, clients receive a friendly phone call within 24 hours; a thank-you card within 48 hours; quarterly newsletters on a regular basis; and a card on their birthdays.

Education. John told us that the industry average for salon training is three hours per year per employee. John Robert’s requires employees to receive over 200 hours of training each year. One morning each week, all John Robert’s employees participate in training classes; and two days each year, employees are required to participate in special days of training (with pay).

Attendance. As John tells his employees, “In this industry, hairdressers are notorious for being late. At John Robert’s, if you are 14 minutes early, you are a minute late.” John does not want his hairdressers running into the shop minutes before their first appointments.

Transportation. All employees are expected to have reliable transportation to work.

Community Service. In John’s words, “It’s an oxymoron, but volunteering is mandatory at John Robert’s. If that does not excite you and get your blood flowing, then maybe you are not the right fit. It doesn’t mean you’re wrong, but we like to attract people who try to practice world-class behaviors in the four areas of our lives: Guest Service, Teamwork, Community Service, and Family.”

Attitude. It’s almost impossible to get fired at John Robert’s for making an honest mistake. John claims that, “If you spill bleach on a women’s fur jacket while coloring her hair, and it costs us $5,000 to replace it, you won’t get fired. But, if you make a career out of being grumpy and you bring that attitude to work with you, you’ll be out of here fast.”

Pay. At the very first interview, the pay structure is explained to each prospective employee.

John told us that about half of those who interview at John Roberts find out the culture is not right for them. Some say, “Hey dude, all I want to do is cut some hair.” Others say, “I thought you said this was going to be difficult … this is everything I have ever dreamed of.”

John and Stacy truly believe that the “magical” client experience begins with a “magical” employee experience. John says it best: “Take my buildings, equipment, all my money, my land, but leave me my people and in one year, I will be back on top again.”

Dare

Both John and Stacy came from modest backgrounds. Back in 1993, the financial risk alone was almost enough to deter them from realizing their dream of opening a salon. Stacy was overwhelmed thinking about their lack of funds, the potential of amassing debt, being a new mother and, on top of all this stress, running a salon. But after the initial shock wave had passed, John Robert’s began to stabilize. The new employees had a client following, and John still had a dependable paycheck coming in from UPS. For a while, life was good. Six short weeks later, the chairs were all empty and the only employees left were Stacy and Cathy (John’s sister). John started coming in after work to help save the company.

At that point, the safe move would have been to hire another group of hairdressers and hope for the best. But John had another plan. He came home one night and announced that he was going to quit his job at UPS and go to beauty school! This one-time college baseball player and well-paid truck driver was going to become a hairdresser. Stacy remembers, “When John first came into the business, I was not real thrilled. I asked him, ‘What do you mean you’re going to beauty school? You should be going to law school.’” After our original employees walked out, John thought that at the very least, he and Stacy could make a living in their two-chair shop without compromising their service values. Stacy says, “After he got his license (hairdresser’s license), I don’t think he realized how passionate he was about the industry, not the technical part, but the business part. Believe it or not, John is really good at haircutting and still cuts hair. After he came into the business, we really started cooking.”

We do believe that John’s energy, work ethic, and service mentality would be enough to catapult him to the top ranks of countless organizations. But John was born to be an entrepreneur. Like Walt Disney, John dared to follow his dream, and I think we can speak for the more than 30,000 John Robert’s clients—we’re glad he did!

Do

The teaming, the training, the obsession with “secret service,” and the community volunteerism are all keys that have made John Robert’s Spa so successful. And certainly, attention to detail is apparent throughout the organization. First-time visitors to John Robert’s are given a white cape instead of the traditional black cape. Not only do most newcomers feel special with such treatment, but the employees also take care to turn these first-time guests into lifetime guests. The industry average for retaining new clientele is 35 percent; at John Robert’s, it’s nearly 70 percent.

It’s the little things at John Robert’s that people remember—from the scalp massage to the mini-facials to the jewelry cleaning to the between-visit bang trimmings—that translate into big returns. To the casual observer or penny-pinching accountant, greeters may seem like a needless extravagance. But John told us that their greeters are carefully trained to cross-sell services and introduce new products. The sale of one or two services a day will cover the salary of the greeter, but more importantly, the first 5 to 10 seconds in a salon sets the stage for the entire client experience. As Eric Hammond tells it, “You can get a haircut down the street for much less. You are coming to John Robert’s for an experience.”

And that experience is why John Robert’s clients are loyal. They could easily book their next salon appointments at one of the other 30 salons within three miles of John Robert’s largest facility and spend about half what they spend at John Robert’s, but they choose not to. When they can feel pampered like superstars, why would they go anywhere else? And, in times of trials and tribulation, as was definitely the case on the afternoon of September 11, 2001, clients came to their special refuge from the storm. Many clients didn’t even have an appointment that day. They just wanted to be where they felt safe and secure and, most of all, to be treated like family. This place is John Robert’s.

Men’s Wearhouse

Dream

When we first met George Zimmer, who was decked out in a sweater and jeans, sporting the “permanent” grey beard, and spewing out lines like “Mammals have the ability to detect authenticity in other mammals” in a gravelly voice, we could picture him as a distinguished professor of philosophy. But, when you see him with his employees on the dance floor at one of his annual Christmas parties, you might see him as an elder classman trying to resist dancing the night away. Admittedly, says George, “I’m an institution unto myself.”¹⁰⁶ He is totally authentic. He’s the kind of guy who engages you in his dream, no matter what he’s doing. He was even able to engage his own father in his dream.

The story goes that when George Zimmer graduated with a degree in economics from Washington University in St. Louis, he joined his dad’s apparel-manufacturing company based in Dallas. His first assignment was as a purchasing agent in Hong Kong. After returning to the United States, he sold clothes out of the back of a Buick Electra. One day, a customer wanted to return some unsold goods and vowed to purchase a large amount of another item as compensation. Zimmer’s father, Robert, thought the request was unreasonable, but George felt it was important to their business to grant it. “George always took strong positions on things he felt deeply about,” said Robert. Knowing that George’s dream of starting the first Men’s Wearhouse would require a $300,000 investment, this supportive father dutifully came to the plate with the needed cash. Today, Robert proudly sits on Men’s Wearhouse board of directors. Brother Jimmy, a suit buyer and company advisor, as well as Richie Goldman, a good friend, philosopher, and image-maker, also became early partners who bought into the dream.

George was determined to create a shopping experience that was a whole lot of fun, not stuffy and “buttoned-down” as in the typical stores, shopping centers, and malls. George once told a group of executives that most men view suit shopping with the same enthusiasm as getting a root canal. From that first Houston-based store, George reinvented the suit-shopping experience and fashioned the company into North America’s leading retailer of tailored men’s clothing. And, after 30 years, the store at 6100 Westheimer in Houston, Texas, is still thriving!

When entrepreneurs are still in the dream stage of a new venture, necessity is the “mother of invention.” Young Zimmer and his partners couldn’t even afford a cash register in the early days, so they made use of a cigar box for several weeks. It came in handy on the very first day when the sales reached $3,000.

What has made George’s dream come alive over the years—not only for himself, but for millions of others who hear his basso delivery of the simple but powerful phrase, “I guarantee it”—is the passion for his customers and for his employees. He exudes that personal commitment to “servant-leadership,” leaders as servants, as business guru Robert Greenleaf penned in The Servant as Leader over three decades ago. Men’s Wearhouse employees also become servant leaders, and they hold one another accountable to that end. They know that people enter their doors often with very little knowledge of buying suits, and yet they treat each customer as a unique individual who, like a friend, just stopped by for some good advice from someone who facilitates, not forces, a decision. George Zimmer’s special brand of authentic “servant leadership” has always been critical to the success of Men’s Wearhouse team, and it is now embedded into the company’s total culture. “In business,” as George Zimmer told us, “the degree to which you feel your boss and your colleagues are authentic is going to play a great part in how enthusiastically your employees strive to achieve the goals of the business.”

Believe

It is one thing to say that believing in human potential is worthy of inclusion in a list of business values; it’s quite another to live it. George believes that, “In order to be successful, you have to create an environment in which people are able to reach more of their potential more of the time.”

The only way to achieve this is to care about your employees through consistent, and as George told us, “authentic” behaviors. “I wish every employee would have the opportunity to witness the agony that goes into making the decisions that affect their lives, primarily in George’s office,” says Eric Lane, recently retired president and COO.¹⁰⁷ According to Eric, there is a tremendous effort on the part of the entire senior management team to support the stores, a radical shift from the typical retail establishment. “In most organizations,” Eric told us, “if you are a burned-out merchant, they put you ‘out to pasture,’ and that means in the stores.” In contrast, Men’s Wearhouse stores are the lifeblood of the company. As Shlomo Maor, associate vice president of training told us, “At one time I was a store manager, the highest position that we hired at that time. Then, I moved from there to district manager, and after that to regional manager. I found that I couldn’t impact people every day, that they were too far away. Then I realized that I could do it by developing a training program. So I started ‘Suits University’ at one of our stores in Atlanta on a Sunday morning. I came in from 9 to 12 in the morning and worked with people who came to learn, all on a volunteer basis. What motivates me isn’t money. What motivates me is when people tell me that a piece they learned in ‘Suits U’ helped them. I teach them all that they must work together and impact the sales of others. That’s how you become successful.”¹⁰⁸ That’s servant leadership in action.

And certainly, the management believes in supporting and nurturing its employees. Management also believes that if employees support and nurture each other, those employees will, in turn, treat their customers accordingly. When it comes to customers, George Zimmer is like a mind reader who seems to be able to comprehend their psyches. As Eric Lane explained, “I can’t tell you how many times I’ve been in George’s office when we are walking through, for hours on end, a customer experience; when they come in the store, what should we say, how will they respond. It’s all choreographed at the highest level.”

Dare

Daring to go down a path untraveled...that was Walt Disney, and that is also George Zimmer. Why does Men’s Wearhouse have lower turnover than nearly every other retail establishment? Perhaps it’s that they view “having fun” as a definite must for avoiding boredom and stagnation, and they champion employees who create new rules. In the ranks of most other retail chains, either of those things could get you fired in an instant. But, George is legendary for his “Hippie culture” style, as Shlomo Maor puts it.

How many companies have a pool table where employees and vendors are encouraged to unwind from the pressures of their jobs? Even when the company was busting at the seams with growth in early 2000, “George sent out an edict saying ‘the pool table stays,’” reports Doug Ewert, executive vice president of merchandizing. And how many retail companies buy Nerf balls, ping-pong paddles, putters, and golf balls for their employees, and yes, their customers, to play with? The expectation is that if employees are filled with positive “energy,” that will translate into happy and loyal customers.

The level of trust may be best evidenced by the company’s treatment of job applicants. Unlike most retailers, Men’s Wearhouse does not require pre-employment drug screening or conduct criminal background checks on candidates. The whole hiring process might seem a bit crazy to some, but at Men’s Wearhouse, there is an anticipation of a long-term relationship. This is anything but standard retail practice. Training methods at the company also fall right in line with their approach to nurturing employees. “I think this is one of the best investments a company can make, investing in their people and naturally allowing the way they’re treated to trickle down from their people, toward their customers, which ultimately takes care of the bottom line of the business,” asserts Shlomo Maor.

When employees feel cherished, they are often more willing to take risks without fear of repercussion. Pushing the limits at every level is expected behavior at Men’s Wearhouse. As Eric Lane told us, “If everything in a store is selling, you know people aren’t pushing the limits. They have tremendous autonomy to try things out, and they may fail.” And when people fail at Men’s Wearhouse, there is forgiveness, just as there is in a healthy marriage. They fix it and move on.

When it comes to pushing the limits, George Zimmer is the supreme role model at Men’s Wearhouse. Recently, George invited Deepak Chopra to join the company’s board of directors. The Chopra philosophy is grounded in holistic medicine that is intended to foster physical, emotional, and spiritual wellness. Zimmer believes that Chopra is a natural fit with his company mantra of people development, team-building, and community service.

Do

Richard Goldman, image maker at Men’s Wearhouse once said, “Early on, George and I realized that whether you’re a sales associate from Boise, Idaho, or the president of the company, we all come from families. So, we felt that if we could create an atmosphere that sort of felt like family, we’d be successful. For some people, the ‘business family’ takes the place of their family; for others, it enhances their existing families. We knew that to make sure your customers are treated right, we had to treat the people who work for the company right”—athough with over 500 stores and nearly 8,000 employees, George Zimmer isn’t as much of a hands-on leader these days. He makes every effort, however, to see each employee in person once a year, and he continues to provide the resources and experiences for them to grow and strive for “self-actualization” (the final sentiment of Men’s Wearhouse mission statement).

For company managers and wardrobe consultants alike, one of the most anticipated experiences of the year is summer training. In every company region, a few people from each store don their shorts and tee shirts and head for a resort where 24 hours of enrichment takes place, Men’s Wearhouse– style. The intensive session is a combination of short training sessions, with games and activities such as beach volleyball, dancing, and poker. “It’s like Groundhog Day (the movie) for those of us who lead these sessions,” comments Doug Ewert. “You start all over again four or five days in a row in a region for six weeks. We will not cut these motivating training sessions … that will be the last stuff to go.”¹⁰⁹

It’s no wonder that Men’s Wearhouse has some of the finest retail sales-people in the world. Entitled “What We Do,” the following is written in company-recruiting bulletins: “We are always looking for great people to fill our openings for Wardrobe Consultants in all of our markets. If you would enjoy working as an integrated member of a team, focused on helping people dress well and feel good about themselves, this position is a good fit for you.” As George Zimmer has often said, “We are really in the people business, we just happen to have clothing on our racks.” And, this is a man who clearly understands his business.