One tough decision

Written by Brian Scudamore

In the 18 years I’ve been building 1-800-GOT-JUNK?, I’ve had to make some tough decisions — they come with a hypergrowth business. But no decision I’ve made was as difficult as one I made in May.

Cameron Herold joined 1-800-GOT-JUNK? in October 2000. We’d been personal friends for five years before then, and he’d developed an impressive track record in growing businesses and franchising. I thought Cameron could be “the guy” to build us into a billion-dollar, globally admired brand, so I took him on as chief operating officer, putting him in charge of scaling our operations throughout North America.

Cameron was a terrific hire. He and I had a great working relationship, and he had so much passion for the business (even his licence plate read “GOT JUNK”) that many outsiders mistook him for a co-founder. Cameron was committed to achieving $1 billion in annual revenue, and he deserves unbelievable credit for building our sales from $2 million when he joined to $100 million last year.

Still, I had to let him go. He was no longer the right person to lead our operations or execute on my vision. He wasn’t the guy to take us from $100 million to $1 billion.

When Cameron and I sat down and decided to part ways — very amicably, by the way — it was for one simple reason: the way he drove and made decisions was getting in the way. As the company got larger, Cameron’s quick-start, reactive style became less effective. I knew it wasn’t working any longer, and so did he.

That didn’t make letting him go any easier. Not only had Cameron been an integral part of the organization for almost seven years, but there was a 12-year friendship on the line. I was best man at Cameron’s wedding. Besides, how was I going to manage without Cameron? Where would I find someone with the same drive and passion?

Immediately, I called my closest mentors to explain what had happened and to ask for advice. But my mentors saw it as great news. One even said, “Congratulations!”

I learned that this is the way it’s supposed to happen. Jim Collins, author of Good to Great, talks about having the right people in the right seats on the bus. At different stages in the business, you need a different type of person in the driver’s seat. Someone who can drive fast and turn on a dime works in the startup stage of a business; but as your business grows, you can’t make decisions as quickly — there are simply too many people and resources affected by those decisions.

One of my mentors, Rand Stagen, runs the Stagen Leadership Institute in Dallas. He is a big believer in Dr. Ichak Adize’s Corporate Lifecycle model (www.adizes.com). Just as children go through very predictable stages of development, so do growing companies: Courtship, Infancy, Go-Go, Adolescence and Prime. Companies often die a quick death if they can’t break through to the next stage in the cycle. At the $100-million mark, we were right in the middle of Go-Go, in which we displayed many of Go-Go’s characteristics and problems: more is better; reactivity rather than proactivity; focussed on sales, not profit; uncontrolled growth; everything is a priority.

Rand said it best in an e-mail to me just after I announced the news to him: “Cameron being €˜reactive’ is exactly what companies need to enter Go-Go; yet it’s exactly what will hold the same company back from getting out of Go-Go.” This was the key piece of learning for me.

Cameron was very clearly our “$2 million-to-$100 million guy.” Would I have hired him knowing what I know now? Absolutely! I couldn’t have found a better person for the earlier years.

So, what does the next stage of the drive to $1 billion look like? First, it’s about finding the right driver: someone who has been there and done it before. Our business needs the processes, systems, discipline and leadership to get us through Go-Go and into Adolescence. Second, it’s about me understanding my role and unique abilities, and how they fit with a new leader. As we enter that next phase of growth, I have decided to hire a president and COO. I believe it’s critical that I give this person the room to grow while I focus on what I do best: vision and culture. Our roles need to complement each other rather than overlap.

Warren Buffett has an interesting way of looking at tough decisions. He believes that every businessperson’s life is like a punch card of only 10 really key decisions. Warren says he’s punched only seven holes so far. I think I have punched three: 1) making the tough decision to drop out of college; 2) deciding to franchise (and staying focussed on one core business); and 3) deciding to find a president and COO who has “been to a billion” and will help us climb to the next level.

While this latest decision was hard, I believe it was the right decision — not just for 1-800-GOT-JUNK?, but also for Cameron, who I will forever remember as the $2 million-to-$100 million guy and a great friend. What tough decisions do you know you need to make? And what opportunities await you as a result of that decision?

Originally appeared on PROFITguide.com