Some companies stay small in order to do big things.
As a small-business owner, I was ecstatic when Luke Carlson, owner of Discover Strength, sent me Bo Burlingham’s Small Giants: Companies That Choose to Be Great Instead of Big (Portfolio 2007). The subject of the book makes it a perfect launch pad for Part Three in this series on leadership in the fitness industry.
Most industries offer two choices: (1) get big and conquer the world and (2) stay small and strive to be very good at what you do. The second is the path I’ve chosen, which is why I was fascinated to read Burlingham’s accounts of companies in various industries that are thriving even as they compete against empires like Walmart, Target, Starbucks, the food chains and, in our industry, the big-box clubs.
Burlingham studied 14 companies that resisted the temptation to grow for growth’s sake and instead focused their efforts on their customers, employees and communities. Burlingham says these companies have “mojo”—energy or charisma—that makes customers want to do business with them and makes employees want to work for them. Mojo ultimately drives success and profits.
Burlingham’s book spotlights companies that
- had an opportunity to expand, grow or go public—and chose not to;
- are recognized within their industry as being the best at what they do;
- are acknowledged for their community contributions;
- have been consistently profitable for 15–20 years;
- are still small enough that their entry-level employees have a relationship with top management, such as the CEO; and
- have mojo: People want to buy from them, sell to them and work for them.
A Strong Lesson From a Nutrition Bar
One of the case studies is Clif Bar, a company familiar to the fitness industry. Gary Erickson, founder of Clif Bar & Company, walked away from signing a $120 million deal with the food-manufacturing giant Quaker Oats. The ingredients in Clif Bar products are primarily organic, and it’s easy to imagine that if Erickson had sold out, his visions and values for a high-quality, healthy, responsible product could have been set aside to drive profits.
Erickson continues to work with the company as its Chief Visionary Officer. The values he has helped the company maintain include environmental sustainability, company culture and community outreach. Some examples: Clif Bar’s employees own 20% of the company; and its work facilities include a gym, a rock-climbing wall, a yoga studio and massage rooms.
Employees receive 2.5 hours of paid workout time each week; if they do their workouts at the onsite fitness center, they have access to a full-time yogi and five personal trainers. Another perk: Employees can bring their dogs to work. Outside magazine voted Clif Bar one of the top places to work 5 years in a row. Clif Bar also supports the 5,500-plus volunteer hours its employees give to community-service projects each year. You can see that Erickson’s company is focusing on the quality of its products, nurturing the working environment for its team and giving back to the community—instead of chasing rapid growth and maximum profits.
Why Bigger Isn’t Necessarily Better
Burlingham found that corporate America is driven by the imperative to grow larger each year and to focus on revenue growth and expansion—in other words, to ask, “How do we get bigger?” and “How do we take more of the pie?” Reaching those goals can lead to unethical or undesirable business practices; some of the ways that companies decrease their expenses and improve their profits are by using less-expensive ingredients; implementing cheaper or faster processes; and outsourcing, downsizing or relocating—and thus taking jobs out of the community.
In the food industry, for example, the profit motive is behind the inhumane treatment of animals. This motive has also rewarded the use of manufacturing systems or protocols that produce unhealthful, “food-like” products.
Burlingham’s case studies show that companies don’t have to follow the approaches mentioned above to be successful and profitable. Instead, they can succeed by concentrating on
- quality products and services,
- job satisfaction and team morale, and
- company culture and contributions to the community.
His Small Giants are exemplars of integrity; they focus on doing their best while still making a profit.
Key Small-Giants Lessons for Fitness Leaders
As a small-business owner, I drew these lessons from Burlingham’s book:
Your studio or fitness facility is only as strong as its leader. Leaders and owners must fully understand who they are—their mission, goals, action steps and values for the business—and must be able to inspire their teams to embrace that vision. If you want your team to be passionate, energized, enthusiastic, and motivated to strive for excellence, then as the company’s leader you must model those attributes. The leaders showcased in Small Giants are in love with their companies, teams and customers and with what they do. They maintain their passion for their industries year after year.
You must be rooted. You need to create strong relationships in your community. Give back. Host fitness fundraisers for local charities, and offer free educational health workshops for your community. Write articles for your local newspapers and magazines. Join your local Chamber of Commerce. Rally your team to volunteer and get involved in your community.
Getting to know your clients is key. It’s crucial to foster and develop friendships. How? Host parties and group events, so clients and staff get to know each other. Create a culture through social media. If you create an experience that people can’t get anywhere else, they won’t go anywhere else.
Your fitness business is only as strong as your team. According to Birmingham’s case studies, the customer actually comes second. To have a world-class organization, you first need to have employees who are passionate about taking care of your clients. How you treat your team is how your team will treat your clients.
Teams should take ownership of the business, even if they aren’t owners. Small-giants team members are asked regularly for their opinions and thoughts, and their ideas are taken seriously. Creativity and out-of-the-box thinking are emphasized. Owners are transparent about finances, so team members fully understand the pulse of the business and how they can directly help their company succeed.
Lest you think the companies studied in Small Giants are primarily high-minded organizations that are all about producing a feel-good vibe, Burlingham drives home the point that a strong business model and an effective operational system are essential. Profits give you the freedom to compensate your team well, to provide your customers with value-added service and to update your equipment/facilities as needed. A struggling small business is in no one’s best interest. Volume and growth are not everything, but being financially successful and profitable are key to long-term viability.
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