Not long ago, I did two interviews on the same day and heard starkly different views on the best way to be a big dealer. The first was with U.S. LBM, the startup on track to post $325 million in sales its first full year. The second was with ABC Supply, No. 2 on the ProSales 100 and aiming to get bigger.
U.S. LBM subscribes to a holding company philosophy: small headquarters staff, scant centralization, and a big emphasis on locally named, locally run operating companies, each with a local president. One key philosophy is that every operating unit employee should know the unit's president and be able to see him regularly.
Contrast that with the view I heard the same day at ABC Building Supply, arguably the most successful of America's LBM giants. CEO David Luck rejects the notion that company employees need to see their president regularly in order for the business to succeed. What matters more is setting core values and agreeing on a vision all can share, he says. ABC did that recently by reconfirming the vision and values of its late founder, Ken Hendricks.
Which philosophy should you embrace? That depends.
U.S. LBM's style fits that of many construction supply executives who believe in management by walking around. Such folks typically like to see for themselves what's going on, and they rely on the personal touch–or command authority–to influence others.
But such a style has its limits. I met a dealer in Kansas who doubted his business could expand because the most likely operation he would acquire was more than 40 miles away–too far to oversee properly, he felt. Other dealers might be willing to drive further, and some execs even buy small planes to help keep an eye on their operations, but the basic problem remains: if the company's success depends on you, then it cannot stretch further than you can reach.
ABC's style might seem more corporate and less human, but note that the company's mission and vision also have their roots in a single person: Hendricks. When he traveled, Hendricks constantly stressed certain values and a common purpose. Now those values have provided the bedrock upon which his successors have written a vision statement, a declaration of core values, and a corporate mission.
Lots of construction supply company owners have built successful, modestly sized businesses by dint of their hard work and smart thinking, but then failed to create an environment in which the company can exist without them. Unless that owner can infect staff with the same spirit, drive, and philosophies that motivated him, his legacy will last only until the "for sale" sign goes up.
In the end, then, it's all about you–about your ability to inspire as well as to manage. When you do that, when others get the message and carry it forward, then ultimately it's not about you at all. At that point, the operation you run can become something bigger than you ever could achieve on your own.
Craig Webb, editor