Nothing gets your attention like a catchy title. A recent Forbes magazine article: “I Took Over The Company From Crooks” sure got mine. I read the entire piece, which is short and very directly written by Todd Wille, the man who took over ailing Unify Corporation, teetering on the edge of collapse in 2000, hardly taking a breath. This is so good, so timely and so important, I just had to share it with Daily Fix readers.
If you don’t get to any other articles in your stack of waiting-to-be-read material, please read this one. You might even save it or print it out. It’s that good.
The story: Todd Wille, was a former controller and CFO of Unify Corporation, from 1995-1998. Unify is an application development, database and migration products supplier based in Sacramento, California. Wille received an SOS phone call from Unify board member and present-day chairman, Steve Whiteman one day. It seems the former CEO “had committed securities fraud and overstated earnings and was likely to be tried for insider trading and securities fraud”.
Mr. Wille was asked to return to Unify to take control of the situation. He decided to take the challenge: “Let’s get going and save this company.” What he stepped into, was tougher than he had ever imagined or expected. Todd Wille relates his two defining moments and the “four key strategic decisions” he made in response to them.
* Defining Moment #1: on the day Todd Wille walked into Unify’s offices, 19 Federal agents gave him some very bad news. Company revenue was about $3.5 million per quarter but with a cash burn of $6.5 million per quarter, Unify was going to run out of money in 90 days. Not only that: the Feds informed Wille that 39 shareholders had filed a class-action lawsuit against the company. Unify stock that had once been listed on the Nasdaq and valued at its high at $42 a share had dropped to $1.
Wille considered filing for bankruptcy to give him time to reorganize, but a bankruptcy attorney told him he would need a $400,000 retainer. Out of the question since Wille was days away from making a $300,000 payroll. Memorable quote: “We’re too poor to go bankrupt.”
* Key Strategic Decision #1: appointed the head of customer service to the position of VP of Sales. Why? Customers had known him for years; they had confidence in him and trusted him. Wille encouraged his new VP to call every customer every week to hear their problems, frustrations and concerns; to ask for their patience and to reassure them that the company was going to be saved.
* Key Strategic Decision #2: focus the product development team to build new products based on customers’ true needs and wants, rather than continuing to support old products. In order to do that, Wille told his team to “Ask the customers what they needed, and then go and build it.”
* Key Strategic Decision #3: Wille went out on the road to meet key customers himself. In London, he met with 60 key accounts one day.
* That London meeting led to Defining Moment #2. The CEO of an accounting software firm told Wille in front of the group “that he was uncomfortable signing a $100,000 contract for the following year because he wasn’t sure we would be in business”. Wille’s response after collecting himself: “You know what? You’re right to feel the way you do. But if you don’t sign your contract, I will be out of business, and your worry will become reality. Then your company will need to find another supplier for database development tools, and it will unfortunately be a long, complicated and potentially expensive process.” That CEO’s response: “You know what, Todd? That makes a lot of sense. Let’s make sure that doesn’t happen.”
Many of Unify’s customers came to that same conclusion, ensuring a high percentage of contracts were signed, bringing in much-needed cash flow.
* Key Strategic Decision #4: Wille knew his employees were hurting. He held weekly meetings with the entire company and vowed to tell the truth, no matter how painful it was. Heart-to-heart meetings with the entire staff were sometimes very difficult. Especially when Wille had to initially tell them they were almost out of money. That 35 of them had to be let go one day. That he didn’t know for certain the company would make it. The dividend: only one staffer left the company over 18 months. Acts of selflessness became commonplace.
It seems leveling with customers as well as employees pays off.
This all happened nine years ago but it is more relevant now than ever. In the past 3 years, Unify has:
* Acquired three companies tripling the company in size.
* Added a “stellar suite” of software tools and solutions, broadening the customer base in the process.
* Been re-listed on the Nasdaq again, trading on that key tech exchange.
* Unify’s customers are among “the world’s most admired businesses”.
Why I love this story: grit, determination, hard work, unfailing honesty inside and outside of a company, and sound decision making can inspire people when the chips are down. This again points to the most important aspects of any business: taking care of your employees and customers first with honest, continuous communication. Second, by truly listening to their needs and allowing them to vent while also seeking to deliver what they truly need.
This is what leadership is all about. This is what building trust is all about. I wonder how many companies might follow Todd Wille’s example as a blueprint to pull their companies out of trouble these days. . .
Todd Wille was named 2008’s best turnaround executive by the American Business Association.
Questions:
* Are you inspired by the Unify story and Todd Wille’s leadership? Have you experienced a dramatic turn-around like this in your own professional life, or are you aware of a similar story?
* Besides the key decisions Todd Wille made, what else would you have done?
* Would you be willing to share this story with your colleagues who might be going through a rough patch in their companies?
I’d love to hear from you.
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My first comment: the Ceo and the board were brave enough not to hide the dust under the carpet.
How many people in that position would have admitted they have a huge problem and they need someone to fix it? Lately, we saw several case in which, board took the bad track and tried to leave the building without notice.
And then, clear strategic vision and hard work made the rest.
Bravo to Todd Wille and his staff–going from worst to first. However, let’s not forget the contribution of Steve Whiteman who knew where to go to find the right talent for a near impossible situation. Everyday we meet people like Todd Wille, who we may not need now, but may in the future. Reminds me to double down on my networking.
How right you are, Gianandrea. You hit on a very important point: when a company is in a lot of trouble, it’s the best policy to be honest, truthful and up front about it. People will find out about it anyway, so why not own up before gossip and inuendo arise? When that happens, there are often half truths and outright fabrications, as well. I admire Todd Wille for owning the truth and then asking for confidence and business from his customers–in person–and through his VP of Sales and staff. That takes guts, and as you said, Gianandrea: “And then, clear strategic vision and hard work made the rest.” Thanks for weighing in with a great insight.
You’re so right, Paul. When companies get into the kind of jam Unify Corporation found itself in, it’s crucial to find the right person with the right mindset and leadership skills to give them a fighting chance of survival. Mr. Whiteman astutely called on Todd Wille, and backed the right horse for the job.
This should inspire every ailing business–and we know there are plenty of them out there–to know that they too have a chance at survival. It takes recognizing the scope of their problems, owning them, finding the right leader(s) to fix them, and then developing a sound strategy and finally, doing the hard work to succeed.
Thanks, Paul; and yes, what a great opportunity this economy hands business professionals to network.
If I were him I would have spoke directly to customers in thier own language. I think a great way to win back/keep trust is by using loyalty and rewards programs. Customers care more about what they get then always a reputation or random change in events. I use Marden Kane for my customer relations and I would reccommend anyone else to them, especially if you are in this guy’s position. http://www.mardenkane.com
Thanks for adding your thoughts to my post, Sara. I agree that loyalty and rewards programs are great tools for many businesses to use. However, in my experience, I do not believe it means much of anything to customers to “get something” if they don’t have underlying trust or respect for a business. And the only way you can gain that is by being honest, up front with the customer on the phone and in person–I don’t think emails cut it in this instance–and then work hard to gain back their trust by saying what you mean and meaning what you say. There are no short cuts to this process. It takes time to win back trust that has eroded; especially due to unethical behavior. You can’t “buy good will” by giving the customer freebies. You have to earn it in every interaction you have with them.
Thanks for weighing in, Sara. I appreciate it.
This is a very nice story, but very risky, all in all i think this company was lucky.
Making new products for customer needs is what turned this company around.
Mabye we will see more of this company in the future and it’s success!
That is truely a great story.
I really like to hear of great leadership in action and yes, of course, the entire company deserves praise for saving the business.
The key message that I will take back to my consulting practice is that they asked the customers what they actually needed as opposed to what they ‘thought’ they needed. A very important distinction.
Great article, thank you!
Hi Graham,
Good insight. I think you’re right. On the face of it, a trying to save a sinking company and launching new products at the same time might be a recipe for disaster. However, recall that the sales people were asking customers what they needed and wanted along the way. . .so maybe this was a more calculated risk. Remember the old saying also: “No risk, no reward”. Bottom line: I think there are elements to Unify’s approach when struggling to survive, that might be beneficial to all of us.
Thanks for weighing in, Graham. I appreciate it.
Brad,
As I said to Graham, I think there are plenty of good ideas here and a solid blueprint for turning companies around in this story. That’s why I really wanted to share it with DF readers.
I love what you said here: “the entire company deserves praise for saving the business.” You’ve hit the nail on the head. Todd Wille deserves credit for turning things around, but he could hardly do so without the help of his entire company. Let’s remember that almost everyone was willing to work through a very painful period, stick together and reach out to the customer to turn it around. Management cannot do this alone. Another reason why executives need to really focus on internal communications and their employees as their #1 resource, isn’t it?
Thanks, Brad, for sharing your insights. I’m glad you were able to get some great take-aways from this inspiring story.
It’s hard to have the tough conversations with employees when things are tough but I think that everyone appreciates knowing where they stand. This allowed the employees to know the score and perform as if their job depended on it because it did. Great story.
Hi Brandon,
No, it isn’t easy to have employees discussions about just how bad things are in the business. But using the example in the article, the company ethics scandal that put Unify into a tailspin could hardly be hidden. You know, employees generally know when things are bad. They might not know the extent of things, of course. When executives take courage, tell the truth and ask for support, they’re far more likely to see their troops pull together and work to get the business back on track. As you succinctly put it: “This allowed the employees to know the score and perform as if their job depended on it because it did.”
That’s the thing execs sometimes overlook. Let’s hope this true story inspires more of the same. Thanks, BTW, for weighing in, Brandon.
This is a great lesson for non-profits, as well! Be honest with your donors, your partners, your volunteers. You’ll be more likely to gain stronger relationships and deeper ties. It comes down to owning your problems, taking responsibility for them, and not passing the buck, knuckling under, giving in, or giving up.
http://twitter.com/BlackRiverBRAT
I’ll second that opinion, Kelly. You’re right. This is a great story that every business, non-profit, organization and individual can take in right now. Couldn’t have stated this more succinctly or better than you did, and I thank you.
This is truly a great story!!
This is something really brave.Not all company have the guts to do the same.
Business consultants,
Actually, I suspect that the rare convergence of many factors resulting in a unique economic downturn may have forced more than one company to take unprecedented actions. Sometimes bravery is thrust upon us when the chips are way down. The idea: our company is lost so if we don’t take dramatic steps, we haven’t a chance at all. In extraordinary circumstances, some businesses are able to rise to the challenge and take extraordinary steps. When we hear of great examples like this one, we need to spread it with colleagues and business associates to inspire us to find a way to work out of our problems.
Thanks, Business consultants, for weighing in.
I love the Todd Willie story. His actions, obviously, were made with an understanding Unify’s unique situation. There is some applicability in what he did to all situations, those. Particularly the willingness to act boldly and decisively when the situation warrants it.
Hi Jason,
You’ve raised an important new point here: “His actions, obviously, were made with an understanding Unify’s unique situation.”
Nothing is more valuable than prior industry experience, especially same company experience, is it? In a case like this, Todd Wille had great insights gleaned from years of working at Unify in the recent past. This was very valuable to him and helped him more quickly assess the situation and the steps he could take to address the business’s weakest points. No doubt about that. However, as you also pointed out, Wille also had to have a willingness to tackle these tough problems “boldly and decisively”. Good stuff, Jason. I thank your for weighing in here.
Hello Ted,
This is an inspirational blog on so many fronts that goes beyond leadership.
Todd and his team realized what they needed to do, and executed brilliantly, with urgency, yet with care for both their customers and employees. He employed cooperative intelligence practices by putting himself OUT THERE to achieve survival of his company, by combining his skills as a leader, connector and communicator.
Thanks for sharing!
Ellen Naylor
Thanks, Ellen, for the kind words. You’re right. At a time like this, with such a tough economy, I think it’s important to share stories that inspire us. There’s nothing like a bit of encouragement and a blueprint for success, to make us all pull up our bootstraps and rise to our challenges, in my view.
You’ve brought up a great point, BTW. When a business finds itself in crisis, it’s important for the CEO and/or the president to be very visible. You said: “He employed cooperative intelligence practices by putting himself OUT THERE to achieve survival of his company, by combining his skills as a leader, connector and communicator.” I couldn’t have said it better and wholeheartedly agree. Thanks, Ellen for weighing in. I appreciate it.
Hi Ted,
I was so inspired by your blog and this story that I went to Fortune, Bus Wk and read more, and ended up writing a blog. In these tough times, it’s gratifying to honor and remember there is good management out there!
If you’re interested the blog is http://cooperativeintelligenceblog.com/2009/06/26/todd-willie-turnaround-leader-extraordinaire-a-cooperative-leader/ and I refer to your blog at the end since I think you did a great job!
Gee, Ellen, I’m speechless! Thanks for your kind words! As I’ve been saying, we all need a bit of inspiration during tough times. It gives us a boost when the chips are down. Great idea to write your own blog post on the topic–and I do appreciate the hat tip. Let’s hope this spurs people on to adopting strong leadership ideas whether they have struggling businesses or not.