What Can I Do To Get These People To Heaven?
Tom Walter’s New Rules Of Engagement
A Conversation with Tom Walter Chief Culture Officer, Tasty Catering
If you want a shining example of a Leader With Courage who is ensuring the company’s core values drive everything in terms of operations and employee relationships, look no further than Tasty Catering’s Tom Walter.
As the company’s Chief Culture Officer, Tom, along with his staff, have transformed Tasty Catering into a highly ethical, high-performing, award-winning organization that blends freedom and responsibility within a culture of discipline. In doing so, Tom is empowering people at every level of the business to embrace Tasty Catering’s core values, vision and mission – and they’re seeing how they fit into that picture of success too. In addition to his role, Tom is also the author of “It’s My Company Too! How Entangled Companies Move Beyond Employee Engagement for Remarkable Results”
Leading With Courage Academy: Tom, knowing how incredibly crucial your core values are at Tasty Catering in driving everything you do, I thought you might share those seven core values with us.
TOM: Of course. Our core values at Tasty Catering are as follows:
1. Always moral, ethical and legal
2. Treat all with respect
3. Quality in everything we do
4. High service standards
5. Competitiveness: strong determination to be the best
6. An enduring culture of individual discipline
7. Freedom and responsibility within the culture of individual discipline
This set of seven core values for our company is what I am most concerned about in terms of my legacy. It is my strongest hope that they will remain intact for generations of leadership to come.
Given all that you've done, the investments you've made in building a terrific culture at your company and all the awards you’ve earned, do you have any other concerns about maintaining your legacy? How do you pass this on?
The point of legacy isn’t lost on me. That’s why for four years, I’ve had an understudy. This gentleman came to my son Tim, the CFO and said, “Tim, I’m bored where I am. There’s no challenge and I need that.”
Tim asked him what job he had in mind. He said, “If I could have any job, it would be Tom’s. We need to have a good transition in place.”
Tim agreed and we talked about it. He said he needed at least four years of my time to become a CEO. Those four years ended January 1st of 2019 and he became CEO. Now I'm going to spend a year or two quietly advising him.
So yes, I'm concerned with him, but frankly, I'm concerned with every junior leader. As we walked around today, I saw two things that I'm going to go back to a member of the leadership team and talk to them about because they were things we had not agreed to do. It's about following up in the name of values by saying, “You agreed to do this Monday and it's Thursday and it isn't done. Why isn't it done? That's not treating me with respect nor the company.” So, again, I have this constant concern about the legacy of the values.
That’s a great example of what I believe makes Tasty Catering different from most other caterers. I think you talked about it and I wrote it down because I totally agree with it. The products are the same. The food you're using is the same. Even the staff, the raw labor is the same. But it's the values they bring and the values you instill in them. I was walking around with you and struck by how you not only greet everyone by their first name but you also know something about each of them and their families. You’re proud of what each of them has done.
That's part of our culture. That's the only thing that makes a difference. So many companies don't understand that.
You know, I was speaking not long ago to a maximum capacity room and the topic was company culture. A co-speaker was Jenny Briggs from New Belgium Brewing Company, which gives employees bicycles when they start so they can be better for the Earth. Two professional coaches were speaking as well. It was our third year speaking as a team at this conference and we created a following that was unbelievable as we talked about culture changes we did over the years.
Everyone in the room was thirsty to learn about culture because they were going from the culture of command and control single ownership to employee owned. How do you do that? The first chapter in our book features SRC holdings, Jack Stack's company. Jack wrote “The Great Game of Business,” a phenomenal management book. What Jack did was incredible – he went into a factory in Springfield, Missouri, in a rural town and turned it into a superstar company. How did he do that? It's the culture. The implementer of this change was / is the Great Game of Business.
The principles in “The Great Game of Business” have been adopted by many ESOP and non-ESOP companies, but you’ve embraced them quite like none I’ve ever seen before. Maybe it’s because one of your brothers is a Great Game of Business coach. But I don’t think so. I think you figured out it’s just a great way to reinforce your values tangibly. Can you give some examples of how you live the concepts?
While we were walking around, I pointed out a large whiteboard that shows a detailed weekly P&L that’s on display for all to see. There’s one person responsible for each line on it. For example, Fred (not his real name) is responsible for / owns fuel costs. It’s a major line item given our business. When Fred became responsible for it, he started tracking the cost of fueling each of the company’s vehicles. He noticed that gas was least expensive on Tuesdays and so the company began to only refuel on Tuesdays. Over the course of a year, Tasty saved $35,000 as a result of Fred’s initiative, which could allow us to hire another employee. This probably wouldn’t have ever happened if we hadn’t assigned ownership for fuel costs to someone.
Another example is the large board in the packing/staging area with each of the napkins, cups, spoons, forks, plates, clamshells, coffee stirrers, etc. we can use in an order. Beneath each is their cost. The employees packing orders created it as a way for them and others to be sensitive to the costs involved. When I offered you a cup of coffee and you asked for a stirrer, I couldn’t find one. So I got you a napkin pack, which consists of a napkin, knife and fork. You immediately looked at the large board and commented on how I’d just given you an $0.18 coffee stirrer.
What was your epiphany? There had to be a moment where you said to yourself, “I really have to focus on culture to succeed and Tasty Catering is going to be culture-driven.”
When people came to my desk – young people in their early 20s – and said, “Either you change or we're leaving.” Change what? I couldn’t understand what they meant. “We don't want command and control anymore. We don't like your leadership attitude and we want to change.”
I didn’t know any other way to lead. That’s when they cited the book, “Good To Great” by Jim Collins. They said, “We want an employee-generated culture.” Everybody in the company, at that time, had read it. We even created a book club atmosphere with specific discussion questions around that book.
This prompted everybody in the company to start thinking about what core values they wanted. Then we gave them a list of about a hundred core values in Spanish and English. They listed all the core values and started to share them by writing them on a whiteboard in the conference room. They wouldn't let my brothers or I participate. They said this was for the employees and we didn’t have a place at the table.
They had come up with the first few core values of being ethical and legal as well as treating all with respect. The one idea that bound them together and that prompted me to action came from one of our young leaders, one of the most brilliant human beings I've ever met. She said, “We’ve decided you’ll be the Chief Culture Officer.” I admittedly didn’t know what that was.
She quoted organizational behavior to me: “Antecedents lead to behaviors which lead to consequences.” She said, “We've given you the antecedents, now you're in charge of behaviors. Make sure we follow the core values because then we don't have to worry about the consequences. They're going to be great. Right?”
I asked if someone else could be the Chief Culture Officer. She refused and said, “Do you know how powerful it will be if the top person in the organization is in charge of the values and the culture?”
She was prophetic and absolutely correct.
There are four hallmarks of an effective leader and one of those is you’re a Champion of the Company Culture and Values. And you don't compromise on them. You're also the Champion of Innovation, which goes hand in hand with what I see here.
People associate leadership and culture with all the things you say, but in reality, I know that non-verbal is a very important part of communication – even more so than the spoken word. It’s the way you look. The way you act. I decided at that point, whether I go to the grocery store or church, no matter what I do, I will never violate those seven core values. I will always be aligned with them. Because to violate one of them just one time leads to someone saying, “Hey, the leader makes mistakes so I can make a mistake too.”
Have you ever violated those values?
I was the first one. An employee forgot to charge for a liquor bar on one of our jobs, which I didn’t realize until I read an after-action report on my iPad. We lost $4,000 on that job. So I came in in the morning and ripped into this person in front of all the employees. I was raising my voice and suddenly, I realized everything had stopped in the office. There was complete silence and everyone was paying attention to me. That employee then turned around to me and said, “Is this Core Value #2: Treat all with respect”?
I had to take a deep breath and apologize sincerely. It wasn’t because of what she did anyway. I then asked if she had violated the Core Value #3: Quality in everything we do?
She had also violated Core Value #5: Competitiveness: strong determination to be the best, as well as Core Value #7: Freedom and responsibility within the culture of individual discipline, which in her case was the order. She freely admitted it, to her credit. She then stood up at lunch and apologized to the entire company and that was it. But everybody in the company knew I was the first one to violate those core values and I was the last one that I know of to be called out publicly. I was even called out about two months ago.
Then it's about your reaction when they call you out on it. If they're watching and you get defensive, it's over. You're done. I don't know that you get many second chances. Something that came to mind that I've written about before is a quote: We judge others on their actions. We judge ourselves on our intentions.
When you find someone isn't coachable or isn't willing to change, especially after you bring in someone from the outside and they have all the hallmarks of being a model employee, what happens next? You see they won't change and don't want to be coached. How long do they remain in the organization?
They don’t remain long. It’s the one thing we can't coach. Your behaviors either blend or they don't. You can’t teach a 30-year-old to make up for 29 years in a matter of months and say, “Change your behavior.” Either you follow the values and believe in them or you don't. So we make it part of the hiring process, ensuring in our screening and onboarding that the candidates (and then eventual hires) know how they're going to be held accountable. Because a lot of employees go into companies where they don't see how they're going to be held accountable. They know about performance. But what about the behaviors that lead to the performance? So we show them our seven core values. This is our culture statement. Read them, take them home and let us know if you have any questions – but this is how we're going to hold you accountable.
We give them examples. If you're gossipy, we're going to say that violates the Core Value #1:always moral, ethical, and legal.. And the third cohort of our ethics statement is that you cannot injure anybody psychologically, emotionally, physically or financially. So you are doing psychological and emotional harm to somebody by talking about them.
Core Value #2 is treat all with respect. If you gossip, you're not treating them with respect. We even do role plays to show how you can learn to confront and use the Value to open up a conversation about something you don't think is right.
You can actually use a core value to approach subjects like this much better. But if it's consistent behavior, you'll be written up. After three write-ups, it’s an automatic termination.
I admire you for that. A key attribute of leadership is being able to draw a line in the sand and stick with it. So many others would settle but what are the repercussions of that? Everyone notices it and thinks, “Well, I guess it's okay. I can get a second chance or a third chance.”
Exactly. It’s like the first day of any class – how far can we push the teacher? That said, we consistently ask ourselves if we have judged someone poorly. We’re big enough to say…maybe we did. Did we treat them with respect? Did we do harm to them emotionally or ethically?
The night before I got married, my father said, “Son, when you get married tomorrow, your God is going to judge you based on whether you helped your wife get to heaven.” And when I had children, I said to my wife, “Why don't we make our vision getting our children to heaven and our mission to be, what does it take to get them to heaven?” I applied this principle to Tasty Catering as Chief Culture Officer: What can I do to get these people to heaven? What can I do to have them reach the eternal reward? What can I do not to have them go home and have to take drugs or alcohol to get through the day because they were treated miserably at work?
I saw this at SC Johnson a lot. I've worked in its family office and knew Sam Johnson pretty well. He admitted to being an alcoholic towards the end of his life. He cared for the people. They were his family in a very defined and unique culture. But even when you do so much for the employees, you'll get the occasional one who says it's not enough. How do you deal with that? Why do you keep doing it if you get this constant pushback? Sam simply said, “You’ve got to do what’s right.”
Sometimes I get frustrated with that and bite back. But when you came in, you passed by Maricarmen Rios, our Kitchen Supervisor. We call her the soul of this company because she saved the company during the recession. It was her idea that turned around the financial performance here and she was only 27 years old with no formal education past the first year of high school in Mexico.
But to Maricarmen, every woman who works for us is like her sister or her daughter. By the way, we let all the children of our employees work for us. So, in the summertime, if you’ve turned 15 years old, and your parent(s) work at Tasty Catering, you get the first right to a part-time job. What better thing for a parent than to see their child punch a clock and do a company picnic someplace? It’s led to the parents being better because the children realize that their parent is somebody. They get to sit down and have lunch with their parents. They see their parents work hard and the identity of these kids by the time they're 17 and 18 is that they're confident, outgoing and powerful.
We have three generations of families working here and that strengthens the culture. This company is about people. It just so happens we do catering.
Tom, when I first contacted you, I assumed you were an ESOP because you talk so much like one with your close-knit culture where every employee feels like they have a real stake in the company’s success. Yet, you made a choice not to go that route. I’m curious – what is it about an ESOP that is not as attractive as the path you're going?
That’s a brilliant question. I have an excellent appreciation for ESOPs and why companies implement them. But in our case, we're talking about a wide range of people that have everything from graduate degrees to people who are illiterate. Some cannot read nor can they write. When it comes to ownership, some of our employees have trouble understanding who's going to participate in this or that and how much money they’re going to bank. We have a problem with 401(k)s because some people can bank a lot of money and some people don't work with a nickel saved away because they don't understand that. For those reasons, I didn’t want to get into an ESOP. I couldn’t have it apply in all practicality to only the leadership team, plus maybe a select few more. That would have the potential to create a bad hierarchy among our employees. As I say, an ESOP can work wonderfully in many environments. We’re just not set up for that.
In a culture of ownership, some people want to be owners but don't want to be involved in making decisions. We have about six people here in actual leadership positions. So I focus more on the culture of leadership tasks with them so we can discover what differentiates them from everybody else.
All of that said, ESOPs may not be for every organization, but I wholeheartedly believe the best practices of ESOPs do work for every organization. ESOP companies are more responsive to the needs of succession planning and leadership development – and those are two significant areas where most companies fall short. They aren't investing in leadership development or succession planning. To which I say – how are you going to survive?
When I think about metrics of leadership, I tell our people that we're not paying you for your mind and your body. We're paying you for your soul. So instead of looking at financial returns, we look at their behaviors as leaders. That's where employee engagement comes in. I like that as a leading indicator of what's going on.
As you look at our list of nine blind spots that can minimize or even derail a leader’s impact (click here for the list), which ones really stand out to you?
Coming In With The Answer is a big one. A personal problem I have is that I find the problems before other people do and find the answers before other people do. I've aimed to ask people questions that are going to lead to them to the same issues that I see.
The other thing that I see is Sticking With Under-performers Too Long. It’s devastating to do that because everybody in the company is wondering, “Why don't you get rid of that person?” Well, we fire him. There's usually no remorse at all. It's about time. About two weeks ago, I asked a group of people, “How many of you have stuck with an under-performer too long?” They all raised their hands. Then I asked, “How many of you, when you finally found the courage to terminate, regretted it?”
All the hands went down. Because you can't change a human being. God created them. Who are you to judge God? If God created them in a way that doesn't fit us, that's fine. Nothing wrong with them. We're wrong for hiring them. I can train you in some things, but I can't rehab you. Your mother and father raised you. Those are behaviors you grew up with.
Tom, what is it that you’d like to hear the master of ceremonies say about you at your retirement party?
I think that's a phenomenal question that leaders should be asked earlier. I think it’s “Tom earned our trust and he loved us. Tom cared for us. We mattered.” That's what I want people to remember. I cared about them. I was a leader who realized that if it weren't for people, I wouldn't be where I am today.
If your organization has an ESOP (or even if it doesn't) and you’d like to discover how your employees can build higher trust relationships that will help you retain your “A players”, talk to Leading With Courage Academy today. Our assessments, workshops and coaching programs are sure to have a phenomenal impact on your desire to have employees who are more present, energized and focused – on their goals and those in the big picture of the company. Call us at 312.827.2643 or email Hello@LWCAcademy.com.