The Importance of Contingency Plans
Lying in a hospital bed, Maylan Newton realized he had to make a decision: “I could either dwell on it and complain about why this happened to me,” he says, “or I could ask myself, ‘What are the positives here?’” After suffering a minor stroke and flipping over the handlebars of his motorcycle, a broken collarbone and seven broken ribs were the least of his worries: The morphine treating the pain caused a medically induced coma, and Newton lost movement on the left side of his body while spending three nights on a ventilator. At one point, the doctor said he might not make it through the night.
When the CEO of Educational Seminars Institute (ESi) woke up from his coma and recovered from his injuries several months later, he returned to his company to find it had not only survived … but had actually thrived and gained clients. His employees were working in sync, paying the bills and helping shops become more profitable and productive. And it was all thanks to the company’s solid, detailed contingency plan. That’s when Newton realized what “the positives” of his accident were: His traumatic story could help shop owners realize the importance of contingency and succession plans. Thus, he began crafting his next presentation: “It Happens. Will Your Business Survive It?” And now when Newton consults shops, he’s not just focused on the numbers—he’s making sure they can function without the owner.
As told to Travis Bean
It’s no good to plan for tomorrow if you’re not there to enjoy it. Before my accident, when we worked with shops, we were focused on production and profit. Those things are just as important as before, but now I want owners to have a plan so the shop can run without them. A lot of these shop owners don’t take vacations. They don’t even take three-day weekends. My story can help them build a business that functions without them being in it.
It’s about setting expectations. Very few owners tell employees about their philosophies on auto repair: how they want the car repaired and how they want the customer taken care of. You have to tell your staff what you expect of them.
If I hired you as a tech, for example, I’d tell you exactly how many hours per week I expected from you and how I wanted the job done. If you were a service writer, I’d set my expectations for sales and gross profit. That way, they have a measure of whether they’re doing it properly or not, even if you’re gone. Then you have to provide feedback.
During my time in the hospital, I actually told the two ESi coaches who temporarily took over the company, Ray Kunz and Ryan Tunison, that I trusted them like my brothers to do what they felt was right and that we’ll sort it out in the end. Very few owners ever tell their staff they trust them or let them make decisions, whereas I’ve done those things. So when they took the company over, they fully understood my expectations of how the company functioned and how we worked with our clients and how I expected them to be treated and taken care of.
Ray and Ryan just automatically did the things they were good at. Ryan took over the books and billing, and Ray handled all the logistics with trade shows and arranging Bill Haas, ESi coach, to take my speaking slots. That’s actually a good lesson for shop owners: Have somebody who can do the everyday things you do. Not everybody can speak in front of hundreds of people.
In the grand scheme of things, did they do everything I would have? No. But how can you argue with the fact that the company survived, everything got done and we gained clients while I was in the hospital? I don’t really care how they did it, as long as it was done legally and ethically, and they certainly did that because they understood that’s my philosophy. It goes back to the fact that I hired good people, I told them what I expected out of them and I trusted them.
Now, working with a shop post-accident, I’m looking for a staff that can make decisions. Are they decision makers, or are they followers? My belief is we need to have every position filled with a person who’s not afraid to make decisions. I tell my staff that the only wrong decision is one that’s not made. So if they make a decision and it’s not exactly what I would have them do, that doesn’t make it wrong—it makes it different. But if they don’t make a decision at all, the customer always suffers. And we don’t want that.
Decisions are made on two pieces of information: knowledge and experience. If employees use their knowledge of the situation and their experience to make a decision, it’s not wrong. If I have 30 years of experience and they have 10, it’s going to be a different thought. My job is to teach them to think differently.
So when I ask, “How did you make that decision?” and then offer up what I would have done, that may have never entered into the picture. By bringing that up, I’ve actually given them some of my experience. I think that’s what the most successful shops do: The owner isn’t just the owner—he’s the coach to his staff.
I would guess that less than 1 percent of shop owners out there have important notes and information documented so the businesses can function without them. We had a contingency plan in place before my accident. Since the accident, we’ve revised it and added items we realized our company needed during my absence—now it’s up to 52 pages long.
Now it’s full of little things we never even thought of, like answers to security questions if you need to change a password in an account. I had written down all the passwords to important things so Ray and Ryan could come in, write checks, deposit money, and do all the things they needed to do. You need to document any safe combinations, too.
Another important thing: My wife has always been able to sign business checks. She never had to before because I was always around. That kind of info is documented in case somebody comes in and tries to take the company over. Also, very few people have documentation for allowing family members to make medical decisions. It’s called an advance health care directive.
I’m also putting an emphasis on making my clients do the investigative work on whether they need a living trust. I pressure them to make a will. I’m trying to make them understand that if you have those things in place, it helps everybody down the road. You don’t think about these little things until you have to act on them. It’s secret info we like to keep to ourselves, but it needs to be written down somewhere.
What happened to me was difficult. I had the physical pain. I’ve had the residual effects of it. But what my family went through because of a fear of the unknown, of me not running the business, of not knowing if I was going to make it or not—you have to think about all that. So something I’m trying to do now with shops is minimize the aftermath of something happening. Make sure you have all your wills and your trusts properly done, you have a succession plan of who’s next.
And, above all, take care of yourself. You have to understand: Everything that happened to me was my fault. My life decisions led to the stroke. These shop owners work really hard for their customers and their clients and they don’t take vacations, they don’t get the exercise, they don’t eat right, they smoke too much. All because of the stress of what they’re trying to do. Well, their customers really won’t notice if they’re there or not. They’ll just go somewhere else. They need to take care of themselves first. The customers will take care of themselves.
I had two major goals when I started my recovery: Walk my daughter down the aisle on her wedding day and dance with her—which I did in early September—and in January, one year after my accident, I want to be driving again. I want to be back on a motorcycle. The accident was my fault, not the motorcycle’s. I’m the one that has to make the change—and I’m doing it.