Reflections and lessons learned over the course of 35 years, from the founding of the company to today.
July 13 marked the 35th anniversary of the founding of the company that is today known as Zweig Group, and it’s a good opportunity for me to do a little reflection. That’s a long time for any business to make it. Only a very small percentage of companies last that long. And even though I am completely out of the day-to-day affairs of the company and no longer have any ownership of it, I am still very connected with the business and the people there.
Here are a few of the things I have learned over those 35 years. I can’t get them all in here because of space constraints. There is enough for a future book. But maybe some of these points will help one or more of our readers:
- The people really are almost everything. Find the right people – those who are honest, hardworking, creative, and don’t give up easily – and you can make anything happen. I was and still am constantly recruiting for the business. There is no way we would have been able to make it this long without being able to assemble and keep a great team of people.
- You won’t get great people if you aren’t a great place to work. That means you have to pay decently. We always had good salaries and benefits and have tried to move people up quickly if they are showing they are worth it. Too many small companies don’t seem to understand how important this is. We also always tried to make it fun to work in the company. I think that is really important, too. I won’t diminish the importance of a strong mission to help the clients of the business, either. And we have great clients who are all making this world a better place for each of us.
- You can’t be a control freak. I got better at this one over time, because let’s just say it is not my natural tendency! But no one who is any good wants to work in a job where they have absolutely no discretion over what they do and how they do it. You have to be willing to give people responsibility and let them run with it.
- Ownership and leadership transition planning works. It just takes a ton of communication and a lot of time. Don’t hold your cards close to your vest. Tell everyone (including those you plan to move up into your own role) what your plan is. Give people the coaching, mentoring, training, and experiences they need to be prepared to assume the roles they are moving into. Then get out of their way. “Getting out of their way“ is much easier said than done for entrepreneurial firm founders, but it’s absolutely necessary. I would probably still have an office in the company if my successor didn’t gently usher me out, and it was the best thing for the company, for him, and for me.
- Open-book management is an amazing tool. I don’t know why every company doesn’t do it, because it is the best way to get everyone in the company to understand how the business makes or loses money. It can also be extremely motivational, especially if you tie your bonus program into key performance metrics that people can see and understand. Super, super critical!
- Cooperation is everything. There was a six-year period between 2004-2010 when I wasn’t with the company. We sold it to a private equity firm and one of the first things they did was kill our company-wide bonus program and make all the managers compete with each other. They had all kinds of silos in the name of accountability. It was a disaster, and one of the many factors that contributed to the firm’s decline during their ownership. People have to work together. All that matters is that the overall company is growing and profitable. It’s much more than the sum of its parts.
- Consistent marketing is the key to consistent results. That means no matter what, direct mail has to go out, emails have to go out, press releases have to get done, and much, much more. That takes a commitment to spending money on marketing, just like the commitment you make when you sign a long-term office lease, or the commitment to meet payroll every two weeks. And while some of my old partners from the first generation of our company may disagree with me, there was a perfectly linear relationship between marketing spending and our growth rate for 13 years. Thirty percent increase in spending led to a 30 percent increase in sales. In year 14, I was going through a divorce and backed out of the business, and marketing spending didn’t increase. Our revenues flattened out.
- Business planning works. We have always done a plan and involved all people in the company in its creation. Innovation was baked in by the requirement of managers to come up with new offerings to sell and new ways to market what they did. It works. The plan has to be done before the year starts and it has to be simple enough for people to understand what they need to do to help make the company successful.
- Businesses evolve over time. It is a real art for leadership to figure out what needs to change and what needs to stay the same. Some things do need to stay the same. Some things do need to change. I think discerning the difference between the two – especially when you have a company with as much history as ours – may be one of the most critical functions of leadership, period. It’s a constant struggle.
- Growing a business is like raising a child. They don’t come with owners’ manuals. You have to learn as you go. You better have a desire to learn or you won’t do a very good job. But when your business turns out great – to be strong and independent and able to function without you – it’s just like the feeling you have when your child grows up to be strong and independent and successful without you. It’s one of the best feelings in the world!
That’s all I have for now. I hope each of you gets to experience the satisfaction that comes from seeing your business evolve and outlast your daily involvement with it like I have, because that is a thing of beauty!
Mark Zweig is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.