Building a Culture of Training
Phil Barker kept vigil in his father’s hospital room.
It was early 2012, and Barker felt drained. He was working 70-hour weeks and had nothing to show for it; his business was in shambles.
And now his father was dealing with a near-death illness.
There’s a point in every business owner’s career when “that light comes on,” Barker says. His just happened to come in one of his darkest hours.
“I sat there with my dad next to me—he was sick, we weren’t sure if he was going to make it—and I was just thinking, ‘What would happen if it were me right there?’” Barker says. “I was scared to even think of it.”
Barker has a family—a wife and kids—and he has an entire 25-employee auto service company depending on his leadership. And that company, he says now, was too dependent on him at that time.
The company lacked true vision, goals, and a pathway for reaching them. Every day, the four-location Magpie Oil Change and Maintenance Center in eastern Michigan was simply in survival mode.
“You sit there, and you know all these things you need to do and give employees: training, vision, praise, support,” he says. “But it felt impossible to do it. I didn’t have the time in the day, and there wasn’t any money for it. How do you invest back into your business when there’s no money?”
Just 10 years ago, everything at Magpie seemed easy, or simple at least.
At that time, Barker had been with the business for nearly 15 years, the latter seven as operations manager overseeing all four locations. And, he says, he had the business humming.
In 2005, though, that all started to change.
“There was a brother and a sister who owned the company 50-50,” he says. “And they were desperately lacking direction for the business. The sister wanted to go north, and the brother wanted to go south.
“Eventually, they hired a consultant, and his conclusion was simple: One of them needed to buy the other out, or they needed to sell it all together. There was no way it would work with both of them at the helm.”
That’s when they turned to Barker, an industry lifer and the person in charge of all day-to-day operations. It took some time, but by mid-2006, they had hashed out a deal, and Barker took full control of the company.
At first, everything seemed like a smooth transition, Barker says. He slid into the owner’s role and promoted the manager below him to cover his previous position. That manager was the most experienced option, and at the time, Barker felt he was the right fit.
The business stayed steady for the first year. Then, the recession hit.
“We’re just outside Detroit,” Barker explains, “and I’m not sure I really have to explain how that affected businesses around here.”
Although not carefully tracked at the time, Barker says car count took a huge hit. The company, which had a maintenance-focused business model, took a sudden nosedive.
And as money became tighter, Barker noticed more and more lapses in the business’s operations. Ability to sell work, efficiency of technicians, organization in the shop—none of it was at levels that could keep the shops afloat when car count was dropping.
“When you have multiple locations, the most crucial position you have is your operations manager, and I just didn’t feel we had the right people in place,” he says.
After a year’s worth of evaluation, Barker felt he needed to restructure his leadership team, which meant making a change at operations manager.
“There were clear-cut reasons, and I still feel it was the right decision,” Barker says. “Well, because no one knew what was really going on, it sent a ripple effect through the whole company.”
Bottom line: Some of the moves didn’t go over well. He promoted two managers to fill that space. Both had the right skillsets and plenty of potential, but both were younger and inexperienced compared to their predecessor. During the transition, Barker began picking up some of the slack himself.
Morale plummeted, Barker says, and so did sales. To keep their heads above water, Barker cut training expenses, he slashed the company’s entire marketing budget, and he often didn’t pay himself. By 2012, not only was his business falling apart, but he was close to losing his house.
Barker says he spent too much of his day focused on operations—something an operations managers, not an owner, should be handling. It left him little time for actually running the company and putting in initiatives to grow and improve.
Barker needed to help his managers reach their potential. The only way to do that, he felt, would be through training. Yet, with his financial limitations, he was left with few options—he could either take out a line of credit, or put together a training program himself.
As with any hire, there were clear reasons Barker put his managers in the positions they were in. They had the right skillsets, personalities and experience. They just needed more direction.
Training was something that was lacking throughout the company, but there was a glaring need among his managers. As operations manager, Barker went to seminars and night courses for years, taking every form of industry-related education he could. His thirst for knowledge, and the opportunity he was given by previous ownership to quench that thirst, was one of the main reasons he succeeded as a manager, he says. It was also something he failed to provide for his leadership staff once he became owner.
His two operations managers—Jared Smith and Matt Kaake—each oversee two Magpie locations. Each of the four locations has a separate, designated store manager. None of those six managers were receiving any form of training from Barker.
That was the first thing that needed to change. Barker went about devising a management-development program for his team.
He began by specifically assigning his two operations managers to aspects of the company’s training: Smith would focus on sales and the front counter; Kaake on repair work and operations.
Then he signed Smith and Kaake up for a six-month sales training course with Elite Worldwide Inc., picking up the tab via credit card. The goal was twofold: to improve their skillsets and knowledge, making them the company’s “experts” in that realm, and also to have them relay what they learned to the rest of the team.
“It was amazing to see the way it instantly energized them,” Barker says, noting the stark change in attitude and motivation after attending the program’s first three-day seminar.
Barker then began creating his own program, one that’s simple yet thorough.
Every other week, Barker reserves a back room at a local restaurant (which is free as long as they buy lunch), and he and his six managers do a three- to four-hour session.
Barker breaks each session into three segments. The first is about “accountability,” where they review the company’s progress toward recent goals. The second segment is reserved for whatever training topic they are going over that day.
Some days, this is from information Barker gained at past seminars (he’s a self-described “pack rat,” and says he has boxes of workbooks and handouts from education events in his office); other times Smith highlights his current work in the Elite program; Kaake will give technical and repair information as well.
The third segment is where “we set about taking action on what we learned,” Barker says. They set goals based on the day’s training, decide on a pathway and procedure to reach those goals, and then set deadlines for achieving them.
The most noticeable change—and probably the quickest, too, Barker says—was the attitudes of his managers.
“When you see your company or your owner investing in you and your education and career, it gives you that sense of value,” he says. “You’re not just going to improve your skillset, you’re also going to improve your morale and self worth.”
After just a handful of meetings, he says his managers began taking more initiative and focusing on how everyone in the company paid attention to the “little details” of day-to-day work.
Business, too, is remarkably better. Revenues and profitability have increased, as the training sessions (and Barker’s recent work with an industry business coach) have led to a number of operational changes. The shops topped $2 million in sales in 2012 and are on pace for a record year in 2013.
As for the “cost” of the training, Smith’s entire program was roughly $5,000, Barker says. And looking at the weekly improvements in revenue and profitability, Barker says he felt the shop already made the money back before he even had to start with the credit card payments for it.
No company, regardless of size, is going to succeed without buy-in throughout the entire staff, Barker says. That’s what he feels his training program has achieved.
“People see how their careers and their lives are affected by the decisions we make and the changes we’ve made,” he says. “It’s a fun place to work again, and that’s something I couldn’t say for a long time.”
Barker says the shop’s overall financial health is still below where he’d like it to be, but it’s finally heading in the right direction.
“We needed that vision to where we were heading—have the business be like a slow-moving barge headed for that goal, but with being able to pass obstacles like a speed boat,” he says.
“We’re on that course now.”