Ideas to Read and Pass Along

Kevin & Jackie Freiberg

How Stanley Steemer and Southwest Airlines Create Ownership

Creating Business-literate, Cost-conscious, Revenue-seeking Entrepreneurs

stanleyAt Stanley Steemer, the Dublin, Ohio-based carpet-cleaning giant, new hires are not oriented or trained right away; instead they are celebrated. Founded in 1947, this company began just as wall-to-wall carpeting was starting to roll across America’s floors. Today, the business has grown to more than 230 franchises.

Phil Dean, one of Stanley’s gutsy leaders, is a perceptive straight shooter who understands his recruits’ attitudes and emotions. He knows that the company doesn’t attract rocket scientists.

It’s not that hard to learn how to clean carpets. But that doesn’t mean these folks don’t want to better themselves and their families. We tell them they’re joining an organization that’s dedicated to helping them make their dreams come true.

Building Confidence and Skill

By and large, the company hires males fresh out of high school, whose minds are filled with what Dean calls “the head trash” of adolescent experiences: low grades, the loss of college-bound friends, failure to make the football team, romantic defeats, and their inability to get more than entry-level jobs. Unsurprisingly, they feel like losers. “Our orientation teaches them to clean carpets,” Dean said, “but its central mission is to convince them that they can be winners. We put as much effort into attitude as we do into aptitude.”

Gutsy leaders are secure and smart enough to know that money-saving ideas come from business-literate employees who are fully engaged in discovering new and exciting ways to drive costs down.

At Stanley, each new person is given a “passport,” which lists eight top executives with whom the employee must meet and discuss the company. At the end of each appointment, the executive signs the passport. The system tells the recruits that they are worth the time and attention of top management — and, at the same time, it reminds the executives of Stanley’s commitment to help every employee feel important.

Uncovering The Dream

After their first month, the new hires, in groups of three or four, spend six hours with Dean and his wife in a powerful orientation process. The sessions start with a two-hour, wide-ranging discussion of everyone’s values, goals, and dreams. The Deans strive to create a safe, comfortable environment, where everyone feels secure enough to confide in the group. Next a pile of magazines, glue sticks, scissors, and poster boards are brought out, and the whole group, including the Deans, builds “dream boards;” collages made up of pictures cut from the magazines, which represent each person’s goals, hopes, and even inchoate yearnings. There might be a photo of a rap artist driving a Rolls Royce; a cozy cabin nestled among trees; or a man tutoring a disadvantaged child. The dream boards are sized to fit on the inside door of each employee’s locker, where they will serve as daily reminders that Stanley Steemer encourages dreams. When they finish, the Deans lead a discussion of how the franchise can help make each worker’s dreams come true.

The dream boards offer remarkable psychological insight (you become what you think about) and show profound caring on the part of Stanley Steemer. This technique could be successful for you, too. But a word of warning: Don’t try it unless you care as passionately as the Deans do.

Teaching Dreamers to Think Like Entrepreneurs

The second part of Dean’s orientation process is designed to help these “dreamers” think like entrepreneurs. Crews who clean carpets for Dean can not only give you a job’s exact cost, they can break it down by labor, gas and oil, truck and equipment repairs, chemicals, and insurance. They can tell you how many “redos” they did last quarter and the cost of all their service calls. They also know how many paying jobs a crew could not do because they were occupied with “redos.”

They know all this because Phil Dean takes the time to make crew members business literate. For Dean, business literacy means the frontline will know that if the franchise does 3,200 jobs per month, and chemicals cost $4.78 per job, the company is spending over $180,000 a year in chemicals alone. With this information, being precise when doling out chemicals takes on new meaning. At $3.90 per job, the dispatchers know that gas and oil for the fleet costs as much as $12,000 during peak months. Maybe that explains why they are so passionate about clustering each crew’s jobs, instead of having them drive back and forth across town. Dean is following the lead of proponents of open-book management when he says he wants each person on his team to understand precisely why his or her job is so valuable to the business.

Business Literacy Drives Costs Down

Gutsy leaders are secure and smart enough to know that money-saving ideas come from business-literate employees who are fully engaged in discovering new and exciting ways to drive costs down. And they are often successful. In one part of the organization, it may be $10,000; in another, it might be $50,000 or $100,000. At the end of the year, hundreds of small savings can have a huge impact.

For example, when flight attendant Rhonda Holley was collecting empty cups from the cabin, she noticed that Southwest’s logo was printed on the plastic trash bag. Two things struck her: first, customers knew which airline they were on; and second, the trash bags were thrown away immediately. She wrote Colleen Barrett to ask how much it cost to print logos on the trash bags. Colleen’s response thanked her for caring about the company, and added, “You’ve just saved us $300,000 a year. We’re not going to be printing logos on the trash bags anymore.”

swa planeSouthwest pilots know that upon landing, if they can use reverse thrust to slow their planes down to 80 knots before getting on the brakes, they can cut Southwest’s brake maintenance in half saving the company millions of dollars.

Steemer and Southwest understand the power of teaching employees to see themselves as the people who make the business grow. Both companies have demystified the language of business by teaching people how to make sense of the numbers. Associates who understand how economic value is created—how revenues and expenses translate into profit, are better equipped to create financial security for themselves and the organization.

Following the lead of Stanley Steemer and Southwest Airlines, help your associates psychologically make the transition from having a worker-identity to an owner-identity. Invite your team to point out unnecessary waste and redundancies. Reward them, in public if possible, whether you take their advice or not.