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The Wall
Published October 1998
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BUY A REPRINTSays McManus, "With Bill, I felt I didn't have any hope of getting my life back."
Heroes Die Young
But the McManuses' blinding pain had the effect of making their hearing more acute. At a conference in May 1997, when the couple heard entrepreneurial counselor Lanny Goodman describe another way to think about growing their company, they were on the edge of their seats. Though whipped and desperate, they were still seeking solutions, and Goodman suggested a perspective-altering premise: think about yourself and your personal needs first, and your company's demands second. Goodman even promised a kind of miracle: think about yourself first, he said, and you will actually serve your company better, too. Quit trying to be a hero, he said. No one cares.
Two months later, in July, the McManuses went to Albuquerque, where Goodman met with them privately in his office for two days and listened--until, late on day two, he began offering prescriptions.
He said, "I want you to announce to the company, 'We're cutting back to 50 hours a week.' And I want you to tell your controller, 'We will now be paying ourselves a higher salary.'"
"How can you say that?" they cried.
He said it again.
They were shocked. What cut the deepest? The idea of working so much less--or paying themselves so much more? Neither concept fit their image of what owners did--or abstained from--in the name of building a company. They just couldn't imagine it.
But Goodman could. As he listened to John and Gloria McManus make their confession, he knew something had to change radically.
Their confession went something like this: "For nearly eight years now," the husband and wife explained, "we've worked 80 hours a week. Sometimes 20 hours a day." They were a little embarrassed, hesitant. They stopped and started. "We haven't taken a real vacation since 1989," they said. Slowly, the details came out. "We can't sleep, we're so tired. We wake up at 3 in the morning thinking about work. It's what we think about in the shower. We started this business to enjoy some of life's fruits that were rotting on the vine, and here we are, working 80 hours."
"It was obvious," Goodman recalls, "these were sweet, kind, loving people--and it shows in their catalog and in their customer service." However, he says, it was equally apparent they had paid a hefty personal price. "So many entrepreneurs end up working for their companies instead of having the company work for them. And John and Gloria were no exception."
Gloria, whose hazel eyes are usually lit up with a smile, fought back tears as she confided in Goodman that summer day. She talked about simple needs--wanting to feel healthy again, maybe play a game of tennis now and then. Reflecting on the long hours she had put in at the company, sometimes even staying overnight, she noted, "Growing up on a farm in Canada prepared me well for this. We grew our own food, and I learned to get by on nothing." But her parents, still on the farm, weren't so young anymore, and she desperately wanted to be closer. "I can't even get away to visit them."
Things had worked out to be so different from what she and John had imagined. "In the company's first year," recalled Gloria, "when it seemed we'd be successful, I had dreams for the future." Along the way, those dreams got deferred--along with any semblance of a life outside the company.
John McManus was hurting as much as his wife was, and even more so, because he'd tried so hard to stay strong for both of them. With shock and disbelief, he described how his dream business had morphed into a nightmare. "Running this company," he said slowly, "has become such a grind." And it had happened so quietly. "You're so consumed with the start-up experience, you don't think about business or life plans," says McManus. "In the back of your mind you're thinking about why you're leaving your current job, and you don't go beyond that for a while."
If the McManuses' predicament didn't surprise Goodman, he was moved by the heroic proportions of their sacrifice. By the time they sought out Goodman's guidance, they had grown their catalog to nearly $8 million, fast enough to have made the Inc. 500 two years in a row. (They went on to make the list a third time, later that year.) More to the point, they'd accomplished their speedy growth with no previous catalog-industry experience, and with no management help.
"There are few entrepreneurs whose companies are at $8 million who are still working 80 hours a week," observes Goodman wryly. But that was just the half of it. "What I discovered in the course of those two days is that they were working 80 hours and they were paying themselves one-third the market rate." In other words, they were working the equivalent of four jobs and paying themselves for one. "You're actually distorting your financials," Goodman told them. "Your profits are inflated."
