How I Made My Millions: Successful Strategies
The two companies never really had a joint vision before so, in order to encourage growth in both organizations, I realized I would have to create a strategic plan that would move both companies forward yet maintain their separate agendas.
As I sought input from our nearly 200 employees and received advice from outside agencies, I realized that the key to a successful plan was to carefully craft objectives and then monitor progress towards them to ensure that our actions were effective.
Listen before you act
First, ask a lot of questions about what is working, what’s not and get everyone’s opinion on why that is. A key part of any CEO’s job is to assess the people they’ve got and then assess the information you are getting. You then need to weigh your options based on what you think has the most credibility and gain a sense of where you are.
Next, look at the marketplace and decide what you can do to gain more of a market share. I believe that you either grow or you die. Identify your competencies. At K’NEX, we define a core competency as something that we don’t want anyone else to have or would take a lot of time and money for someone else to copy. Once your competencies are identified, evaluate the avenues that are open for growth, then the X factor is who you bring into the room for that process.
Some people say that when you get more than six people in a room, things start to breakdown, but I believe more heads are better than one. You need all disciplines represented because if you don’t, someone’s not doing checks and balances of keeping you honest in what you’re trying to accomplish.
At K’NEX & Rodon we involved people from every major discipline in our discussions and we encouraged them to share our findings with their groups on a departmental level.
They came back and said, “We shared this at our team meetings last week, and we got some other things where they thought, yep, we agree with a lot of this, but here are some things we think you can focus on more or we think you missed.” Ultimately we involved about 80% of the company in some way.
Ask yourself the right questions
The big three questions for me are 1. Do we believe what we’re doing is going to maximize our chances at success, and why? 2. Do we have the resources, whether it’s time, people, capital, to pursue what we think are the best options? 3. Do the people have the skill level to do what you need them to do? If not, how are you going to train them or supplement them with other talent?
The quickest way to get buy-in is to identify some easy opportunities that you can execute against quickly to show people the potential. Nothing makes people believers like success. It’s finding some quick wins and then reminding people of them. The reasoning is: if we set these goals, we can go get them, because here are the goals that we’ve already achieved.
It’s constant communication because when you get mired, as people ultimately do in their day-to-day grind of whatever it is they’re focused on, they may feel like they’re not moving the ball forward. I think it’s the CEO’s job to remind them, “Here is what we’ve done so far. Here’s the period of time we’ve done it in. Here’s where we’re headed. We’re not all the way there yet, but let’s understand that we have made progress along the way.”
Gauge whether the plan works
It’s about the bottom line. It’s about meeting the profitability goals. If the strategy is delivering to the bottom-line, then it’s working. Sometimes there’s a balance between delivering to the bottom line and, at least on our toy side, buying market shares. As long as you understand and measure progress towards the goal, you’ve measured it appropriately.
Not everything pays back the month or quarter you invest in it. You just have to acknowledge that going in. If you are beyond the expected payback period, you need to investigate whether it’s the right strategy, the right tactics or even the reasonableness of your expectations.
I think that’s sometimes where companies fall astray. They say, “Well, I don’t see any returns yet; let’s move on to the next thing.” I think you have to be disciplined, patient and ask “When did we think this would pay back? When did we think we would see these gains? Are we there yet? If we’re not, let’s understand that.
Michael Araten joined K'NEX and the Rodon Group in May 2005 to serve as Vice President and General Counsel, became President and COO in January 2006 and assumed his present position, President and CEO K’NEX Brands and the Rodon Group, in January 2009.