Caterpillar Dealer Unearths
Employee Engagement
What this company gained from
investing in its people.
Three million dollars. That's what Doug Fabick figures Fabick CAT made last year on a $500,000 investment, which, says Fabick, "Is a pretty damn good return." In fact, that's a 600% return on investment - enough to make even Berkshire Hathaway stockholders jealous and to inspire CFOs to ask pertinent questions about Fabick CAT's investment strategy. But that half million dollars didn't go into new equipment, buildings, or technology. In fact, there's almost nothing tangible to show for it. Instead, Fabick CAT invested $500,000 on its people. And people are how Fabick CAT made $3 million back.
Fabick CAT sells, rents, and repairs Caterpillar construction equipment. The company serves construction businesses and contractors in 61 counties in southern Missouri and 36 counties in southern Illinois, as well as pipeline construction contractors around the world. Founded by John Fabick in 1917, Fabick CAT now has more than 600 employees in 12 locations - each considered a company in its own right - with headquarters in Fenton, Missouri. Fabick CAT is still a family-owned business, and Doug Fabick, its president, is the fourth-generation Fabick to lead the company.
In 1999, Doug Fabick took over from his father, who told him to "make his splash" and build his team. Fabick realized he had a challenge - Fabick CAT wasn't even in the top 25% of America's 50-plus CAT dealerships. It wasn't a comfortable place for the competitive Fabick, and clearly, something had to change. But change is not a beloved concept in the heavy equipment industry.
"Change is the constant of the world. Change is good; change is inevitable. But change scares people to death," says Fabick. "CAT dealerships are twenty years behind the times. Technology doesn't do much for us - you can't send a big old yellow CAT over the Internet - so we don't change unless we have to."
Fabick decided that it was time to change, though he wasn't sure what change, exactly, to make. So he analyzed the company, thoroughly researching every standard business indicator. Nothing turned up. Then he started analyzing businesses run by his friends at other CAT dealerships. He asked for their organizational charts, figuring that because CAT dealerships all do and sell the same things, the charts would clearly show one system that worked best. But there wasn't one. Some CAT dealers did well, while others didn't, but there was no indication as to why. So he called the dealers and asked them point-blank. He got nowhere.
"They couldn't tell me how they got to be so successful because they didn't know," Fabick says. "So when I hung up the phone, I could only think [that the reason] they do well is because that guy does it well. That's why he's got these two departments doing great and some other guy doesn't, because the other guy doesn't have that experience. Or something."
Fabick began to wonder if other dealers even understood why they were so successful. He kept studying, moving his people around, trying to figure out how to make his company CAT's best dealership.
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Reprinted from The Gallup Management Journal |
 Note from Kevin
Greetings!
Knowing that many of you receiving this month's article have already read it, I still felt compelled to use it based on how important the message really is. So, for those of you who haven't read it, I encourage you to take it seriously, and for those of you who have, make a point of sharing it with anyone who has the responsibility of engaging employees.
The primary question I would like each of you to consider is whether or not you and your organization consider people a liability or an asset. Yes, many of you are talking people, but how many of you truly consider them to be the most important and sustainable advantage you will have in the future? Making this mental "switch" is critical when you consider the fact that people are no longer the "soft" issue in business.
Doug Fabick of Fabick Caterpillar found this out first hand as he examined his own operation and the operations of other Cat dealers across the country. Imagine coming to the realization that what separates the best from the rest is a result of having the right people in the right positions and getting them what they need to be fully engaged.
The process of selecting the right people, getting those right people in the right positions, and then giving them what they need should NOT be an accident! Each of you has the tools you need to make this process a proactive, every day action in your businesses. Knowing that every organization is at a different point in the process, I am going to challenge you with a few simple yet powerful questions:
• What do you want for your organization?
• How do you perceive the condition of your organization right now?
• What alternatives do you have to move your organization in the direction you want?
• What will you DO to achieve it?
Life is good...
KW |
