CEO's Notebook

CEOs give advice on improving communications at your company, reducing the cost of customer complaints, keeping your technical staff from leaving, moving your company, and more.

How can we improve communication at our company?
Hint: it takes a lot longer than a minute. That's what Ken Blanchard, author of the One Minute Manager series and other business books, and his wife, Marjorie Blanchard, have discovered at their 150-employee company. At Blanchard Training & Development Inc., in Escondido, Calif., each worker gets together with his or her manager once every two weeks for a one-on-one meeting of roughly half an hour. At that meeting the employee sets the agenda, so employees can count on having a time to be heard. That, Marjorie Blanchard believes, makes it easier for them to adapt readily to change. "You build a communication infrastructure that I think helps people deal with their personal concerns about change and also get the information they need," she explains. However, Marjorie Blanchard notes that some managers at first resisted adding new meetings to their schedules. So the company tracks how often the one-on-one meetings occur, and one year even offered a bonus to those who held them as scheduled. "That probably took us over the final hump" of getting managers to adopt the system, she says. --Martha E. Mangelsdorf

---

Benchmark
Does anyone still wear a power tie?

Surely, you've noticed that you see fewer suits at work or at business get-togethers these days--and more chinos. Business dress is becoming increasingly relaxed, especially at young companies. A survey of the 1997 Inc. 500 revealed that casual or "business casual" dress is standard at more than one-third of the nation's fastest-growing privately held companies. Roger Mody, CEO of the Inc. 500 company Signal Corp., a $55-million information-technology-services provider in Fairfax, Va., has seen his customers' attire become increasingly insouciant in recent years, so he's allowed his employees to dress more casually, too. "People are far more productive when they're casually attired," he says now. "They're more comfortable and more creative." Within five or seven years, Mody predicts, it will be an anomaly not to dress casually--"which I'm sure the suit industry is sick about." ---Christopher Caggiano

---

Can we reduce the cost of handling customers' complaints?
Ed Hurston of Wonderwood Corp. says he used to spend an average of $50,000 annually addressing customers' complaints. Then he started asking grumblers this simple question: "How would you like us to handle the situation?" "It's unbelievable what happened when we put it in their hands," says Hurston, the president of the $12-million wood-products manufacturer. "They always tell us something that costs far less than what we'd do." Here's an example: After Wonderwood spent $2,000 replacing an entire picket fence twice for an unhappy customer, the customer still wasn't satisfied. When he was finally asked how he'd like the situation handled, he suggested a $100 solution. Hurston estimates that the company, based in Deland, Fla., now spends less than $2,000 a year addressing customers' complaints. --Stephanie Gruner

---

How can we interest potential employees in our company?
Why not invite them to a charitable event that your company puts on? Once a month, Kay Hirai, president of Studio 904, a Seattle hair salon, takes her staff to an elementary school in a low-income neighborhood to cut the children's hair. To help staff the school visits, Hirai solicits volunteers from local cosmetology schools. She says the pro bono work also serves as a low-key recruiting tool to interest the cosmetology students in her $600,000 company. "They get to see our culture, and we see their skills and personalities," Hirai says. --- Christopher Caggiano

---

Headhunters call our technical staff constantly. What can we do?
Offer a piece of the action. To keep the programming staff he's assembled, Raoul Socher of Network Software Associates, in Arlington, Va., pays his software developers royalties on the products they help produce. The catch? Programmers are eligible for the quarterly royalties, which are based on the company's gross margin on each product, only as long as they stay at the 40-person software-development company.

Give them time off. Daniel Maude, CEO of Beacon Application Services Corp., a $10-million software-services company in Framingham, Mass., shortened the workweek for his software consultants. Beacon's consultants work primarily at distant customer sites, and they were flying out on Sunday and returning Friday after work. "That really left them with only one day off," says Maude. Now those employees leave Monday morning and return Thursday night, still working the same hours--roughly. "If you want to keep someone 5 to 10 years, you can't work them 60 hours a week," argues Maude. --Christopher Caggiano

---

Hotter Tip
You call that a hot tip? Kenneth Hazen, CEO of Continental Traffic Service Inc., says he has a strategy that tops a Hot Tip Inc. ran in May about software company Siebel Systems. Like the management at Siebel, Hazen decorates the entrance to his Memphis-based company with material saluting his customers. Hazen's transportation and logistics service, which projects 1997 revenues of $7.5 million, buys a share of stock from each of its publicly traded customers and hangs the framed certificates in its main hallway. But Continental's decor does more than please visiting customers: another benefit is the annual and quarterly reports stockholders get. Hazen and his sales force regularly pore through them to learn about customers' plans. --Stephanie Gruner

---

Off the Record
What entrepreneurs are telling Inc. about moving

" We've moved our company so many times that we consider relocation one of our core competencies." -- President, Ohio-based $21-million medical-services company

" It's worse than moving from your house. You don't realize how much junk you have. Our recent move was stressful but fun. We let the staff be part of it. We did make mistakes. The work flow is smoother now, but we'll have to redesign the ladies' bathroom." -- President, Tennessee direct-mail-processing company with more than $2 million in sales

" Time to market is everything for us. We worked up until Thursday evening. Stopped. Packed. Moved. Then resumed work as usual on Saturday." -- Owner, Internet-related start-up outside Washington, D.C.

---

How can I persuade top-notch people to join my advisory board?
Make your first pick a local business veteran who is willing to tap other executives. That approach allowed $5-million Computer Free America Inc., in Springfield, Ohio, to assemble a more seasoned group of advisers than the computer company's founders otherwise could have found. CEO Tony Cooper began by asking his accounting firm for names---a tack that led him to Eddie Leventhal, a director of a local small-business-development center who also had extensive management experience with a manufacturing business. "Eddie was respected in the area and well connected," says Cooper. Once on board, Leventhal recruited two other advisers to offer the company guidance on financial and strategic issues. One was a controller with 20 years' experience. Another was an accountant who'd experienced both success and failure while running a local chain of ice-cream shops. The board helped analyze Computer Free America's business units and encouraged Cooper in his negotiations with a potential buyer for one unit. --Susan Greco