Wrap Up Report: 2014 NMHC Annual Meeting
Taking the helm as chief executive at any company comes with its challenges, no matter whether the hand-off was a white-knight rescue or a strategic succession plan. Every company, for better or worse, comes with a legacy culture and some standard operating processes. The key is figuring out which company values and management practices are keeping the company from realizing its fullest potential and which are platforms for success.
NMHC President Doug Bibby dug into this question of changing corporate culture and course with Ed Pettinella, president and CEO of Home Properties, and Michael Tompkins, executive managing partner for TriBridge Residential, during a session at the 2014 NMHC Annual Meeting. With a background in finance, Pettinella was originally recruited into the Home Properties’ leadership fold to help improve the company’s stock price and deliver better shareholder returns. Tompkins, on the other hand, had been a Julian LeCraw & Co. insider who ended up putting together a team to effectively buy out the family-owned business and then rebuild the company into the entity that is TriBridge today.
Pettinella and Tompkins shared these leadership lessons learned:
- Sell your story like never before. “Not everyone is going to come along and drink the Kool-Aid no matter who you are as CEO,” said Pettinella. He added, “If you’re going to change both course and culture, do your homework. Find the best in class data, talk to people behind the scenes then develop your strategic plan. Then sell it-to your investors, your board, your management team-everyone. You have to champion the cause, ... empower your management to execute that plan, give them accolades and incentivize them.”Tompkins seconded. “Morale at the company was questionable when I came aboard, so we developed processes to get everyone onboard,” he said.
- Listen to your gut. “I’ve learned when you see a change that needs to be made, make it or it will mount up,” said Pettinella. Tompkins reiterated, saying, “If I had it to do over again, I would have responded to some of the negative company influences and impact sooner.”
- Be patient (really patient). “You can’t over estimate the amount of time it takes to make a change,” said Tompkins. “When you’re at the top, you say, ‘Let’s do this,’ and you just think everyone is listening-and they’re not.” Pettinella agreed, pointing to the fact that one of the first changes he implemented after moving into the leadership role at Home Properties was to establish a performance review process. “We had 1,000 people and not a single one had a performance review,” Pettinella said. “To drive a company, you need more structure. ... [But] it took three to four years to change that culture.”
- Get ready for some good surprises. Following the painful process of moving the company’s namesake executive out of a strategic leadership position, Tompkins said that the experience forced the new leadership team to evolve. “Good thing we evolved as we did,” Tompkins said, “because it allowed certain skills to come to the surface. And the evolution that came out of this is that we had relations with Asian investors and started to talk to them about the opportunities for investing in the U.S. ... Asians are the best investors you could ever have. Gratitude runneth over that respect.”
- Your reputation trumps all. After working through a somewhat rocky transition and a company name change or two, Tompkins said he found that a good reputation can see a leader through some of the more trying of times. “I can only say that your reputation is everything,” Tompkins said. “And I don’t care who you are working for-if people feel you are trustworthy and they have confidence in you, they will do business with you.”