Successes and Challenges of a CEO Using Requisite Organization

Speaker A My name is Thad Simons. I'm the President and CEO of Novus International. Novus is in St. Louis, Missouri, USA, and we are an animal health and nutrition company. So we provide products that go into animal feeds all around the world. We have about 600 employees, and two thirds of them are outside of the US. And we have sales of approaching a billion dollars, and two thirds of those sales are outside of the US. So we're very global. Our name is international. That's an important part of who we are and what we do. My personal experience with Requisite, I came into the company as a general counsel, really the only lawyer in the company, and really very focused on setting up the company's needs in terms of the legal structure, what was required to get the business going in all the parts of the world. After, I guess, about two years, joe Privet, who was our CEO and really the founder of the company, had been looking into how to organize. And really, the first year, he was really trying to understand what were the things that were needed for Novus to move forward and to grow as a company. He became aware of Requisite organization, and we started working with Nancy Lee, really in the second year of the company. But in all this time period, I was really just the company lawyer, pretty much on my own. Actually. We have here an artwork that shows a series of TPS. And there's one of my colleagues who was the head of operations, head of manufacturing. There was one TP that was far off to the side by itself, and he said that was my TP. Because the lawyer always seemed to be far away from all the things in the business. I still have that artwork in our new office building now, and it's in my conference room to always remind me that there is a certain isolation, and certainly the role of CEO is even more isolated than the role of general counsel. But anyway, in terms of getting back into the reckless organization, it was very interesting because after two years, Joe came to me and said, well, we need to start putting more emphasis in this area of organizational design. We need to have an HR function being established. Sabrina Hamilton was with us from the first day she started, really as an HR benefits manager, and how we were going to grow an organization that was already international and building it upon what came to be known as the Novus management system, really pulling these principles of Elliot. And I said, Joe, I'm not really a good choice for this. I've never had any management training. I've never done anything in HR. I run through secretaries every six months. I turn them over because they can't deal with my workload and style. So how in the world can I be heading up HR? Oh, he said, there are lots of legal issues in HR. You can handle it. Don't worry. Fortunately, I had Sabrina there because Sabrina and I had a good working relationship already, and she had a lot of experience and knowledge in terms of really the fundamentals of HR. Really the part of HR. The benefits, the things that had to be done. So she trained me. So I've been trained by Sabrina personally over the many years about what it means to be successful in HR. So I attribute everything that I do well to her, and everything I do bad because I don't listen to her. So we understand that very well. And then after a couple of more years, joe was concerned that we weren't growing as fast as we should in our new business, our business development area. And so he approached me about heading up business development. Well, I said, Joe, no, I've never done marketing. I didn't go to business school. I went to law school. I don't know what a business plan really is. I need to go study finance or something. No, how can I do this? Other legal issues in business development and acquisitions contracts. You can do it. Just get it done. At this point, I accepted. I've never turned down too many challenges of those kinds, because the thing I like best about my job anytime is learning new things. So this is really in terms of how an organization, I think as well, is always either growing or is declining, dying. So those are the two ways in which organizations like people have to always be learning new things and growing. If we think in terms of how we started developing the Novus management system. My first personal experience of this was when we had our first anniversary picnic for the employees, and we were all outside having fun and games. It was a great, beautiful spring day, june in, I guess, early summer day in St. Louis, and here was this lady that shows up unannounced. We didn't know who she was, and when I was on Joe's staff, I didn't know she was coming. And here she is, Nancy Lee. And everyone said, a consultant coming in, a management consultant. How many people get fired? This is basically the question. How many people will be fired if you have a management consultant coming into the company? And Nancy, poor thing, had laryngitis, so she was even not able to communicate very well that day with the people that she was meeting for the first. So but of course, this is not Nancy's style. She wasn't here to fire anybody. She doesn't do that. She's here to ask questions, and the questions are the questions that make you think. And so as we went through that process of working with her, and then Ken Wright also came in, because Joe was very concerned in terms of some of the personalities. We had very strong personalities, and we had to have strong personalities. If you're starting up. As a small company like this, you need to have strong personalities that are willing to take the risk of moving on and moving out. But sometimes those strong personalities also had some issues of moving things forward. So working with Ken as sort of an internal coach and working with Nancy in terms of organizational design and looking then with the managers of how we were going to build an organization for growth and that was the whole purpose. We were doing a lot of work at the same time on the novice vision. So what would be the novice vision? And that vision statement that we came to back in 92 is still the vision statement and the core values that have carried through to today. So our basic Nova's Vision is helping to feed the world. So everything we do is really with regards to helping our customers, helping them to be successful because they're really in the food industry. And today we tie those same concepts into principles of sustainability. These are new words that are being used today, but these are words that tie very much back into those same original vision and core values. Well, a part of that was using Requisite organization. That is, that part of developing the employees, that part of seeking excellence from the employees. That part of having an organization where they can feel like that their work is making a contribution to the organization's overall goal and vision. And we did that over time. It took a lot of work with the different managers to go through their organization, to really to set up the roles in a way that was going to allow them to be successful, to achieve those goals. In learning to work with Requisite, there is a whole program that Elliot developed over years. And when it's first presented to you, it's like, this is the complete organizational structure management system. You need to adopt this wholesale immediately across the whole organization. And there was some resistance, I think, among all of us to really do that. There was a part that has to do with organizational design, really what's the work that needs to be done and at what level does it need to be done. I think everyone kind of understood that fairly well. We also understood that the system that we had brought over from Monsanto was too complex and too well. There was one of these hate point systems. So basically by then I was really heading up HR and I said, people come to me for promotions, I'm counting points that I have no idea what it means. And maybe that was a beauty. Because I wasn't trained in HR, I wasn't persuaded that was necessarily a good way of doing it, because I could just see that it wasn't working, what we were doing before. And that being ahead of HR, I could see that it wasn't really being very effective to achieve our goals and getting people really understanding what they needed to accomplish. And we had already a system of goal setting, we already had a system of annual appraisals. We had all those things in place from Monsanto but they weren't necessarily very effective. And so that was one thing we had to see how we can make that more effective. But when it came to the other side which was actually the people side so what's the level of this person and what's their mental capability and what is their career growth? This became kind of a different story and that even to today is an area that we have more trouble in actually saying this is something that we can going to put a label on people that the manager is going to be the one who could say permanently this person is going to be like that. And I think this is where it's always been a question that people have because we have this kind of a fundamental sense that we want people to all be treated. Everyone is equal before God in the law. All right, that's true and we're not taking that away. But we know everyone is not equal in an organization because there have decisions have to be made. Primarily everyone's not equal because there have to be somewhere, a decision has to be made. And what we had to learn over the years is that if we're doing it well we're pushing down that decision making. We're not bringing it up. We're not always doing it well. And so that sometimes is the struggle we've had to deal with over time. And we're also if we're doing it well we're actually empowering people more to be able to work at a level that they really are comfortable with and they'll be successful and trying to expect them to do things where they'll not be successful and they'll be frustrated and their colleagues will be disappointed in their results.