An Excerpt from the Book:
“I always placed a high value on employees,
with an emphasis on ethics and humility”
In 1984, Ron acquired a majority interest in Leonard’s Metal, a 36-year-old family-run metal shop specializing in commercial aircraft components and subassemblies. Over the next 30 years, he led a team that transformed Leonard’s from a $5-million manufacturer to a $420-million publicly-traded enterprise – “LMI Aerospace”- with twenty plants and offices offering engineering services as well as complex machining and manufacturing solutions.
In the 1970’s, as a young CPA with a focus on tax law, I had advised multiple companies and developed an ability to see what was really going on just from the financials. Like any good analyst, I could quickly tell whether a company was healthy or not, and pinpoint specific problem areas.
I was under the assumption that I was learning their business. I was not. Unless it is your company, you don’t really have a full understanding of what is at stake, and what goes into all of the decisions.
One of those companies that I advised was Associated Transports, whose core product was delivery of new automobiles from Ford manufacturing plants directly to dealerships. In the mid-1970’s, my role shifted from advisor to management, and it was here that I really learned how to run a company.
My mentor was Joe Burstein: Joe taught me the nuts and bolts of acquisitions, and how to develop the proper strategies and analysis to determine if the target company was a good fit, and whether the acquisition made sense. I also learned how logistics could play into profitability: optimization of routes was directly tied into the bottom line. But that’s a CPA talking. It’s easy to look at the routes, but then forget the people behind those routes; that’s not the kind of owner I wanted to be. I soon realized that although the metrics tell a valuable story, it was more important to get out of the office and engage the employees.
But I ran into a barrier: Associated Transports was a union shop, which immediately positioned the owners against the staff in an adversarial relationship: it kept me from connecting with the staff in a genuine and open way. I have always placed a high value on employees, with an emphasis on strong and sincere ethics and personal humility.
I have seen many cases of CEO’s who are very good technically, but who have difficulty connecting with their employees – they sometimes appear distant and aloof. There are also those CEO’s who are good at sales and marketing – good communicators with clients – but ironically have that same lack of connection to their staff. Although somewhat shy and reserved initially, I was able to come out of my shell with the purchase of LMI, and I made human resources my focus.
There is no magic formula on how to do this: you have to want to do it, and then develop a process which drives accountability. I walked the talk: I didn’t take a large salary compared to the senior staff, who were themselves well paid compared to industry standards.
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