Leading Your Company To Success

After 16 years as a salesman and regional account manager for an office technology company, Paul Lewan was out of a job. The company he was working for eliminated branch operations. However, Lewan agreed to purchase much of the company's excess inventory at a dis-counted price. In 1972, he founded his own company, Lewan & Associates, to sell the office technology products he had acquired. Originally, desktop calculator sales drove the start-up business. Copier sales and eventually computer network sales were later added. The Denver integrator now posts over $100 million in gross sales. The entrepreneurial spirit that drove Lewan & Associates in its formative years still permeates the company. Maintaining this spirit is the key to the continued success of Lewan & Associates - and all VARs and systems integrators, says Lewan.

Lewan & Associates has grown to 450 employees including 125 sales representatives. The company handles about 125,000 accounts with 50,000 considered to be a core base. While 1997 gross sales topped $75 million, Lewan & Associates is projecting that figure to double within the next five years. The privately-held company has sales offices throughout Colorado and Wyoming. Despite alliances with vendors for some national accounts, Lewan & Associates remains a regional integrator.

As a company grows, a bureaucratic mentality can often replace the entrepreneurial spirit on which the company was founded. Paul Lewan, president and CEO, called upon his brother, Dr. Lloyd Lewan, to serve as the chief strategist for the company. Dr. Lloyd Lewan, chairman of the board, came from an academic environment and is a nationally-recognized speaker on workplace issues. For 14 years he has been charged with reinforcing the entrepreneurial spirit at Lewan & Associates and teaching leadership skills to upper-level employees.

What Is Leadership?
Companies today are usually guided by one of two different syles - management and leadership. Management is concerned primarily with staffing, planning and organizing. This leads to bureaucracy. Leadership brings out the entrepreneurial spirit in all employees by em-powering them. Separating the two styles is not always easy because both use much of the same terminology, such as "customer service." "The one way to separate the two styles is to see how a company actually treats its customers," comments Lloyd.

The management style is demonstrated clearly in some government agencies. When waiting in line to renew a drivers license, one doesn't get the feeling that customer service is a priority. "Managers are too concerned with managing to care about the customer," states Lloyd. "If customers have to wait for more than two minutes at our company, they will go to my competition."

In contrast to a management style, Lewan & Associates teaches its people to be leaders. This means taking charge of customer issues. Lloyd often finds himself talking to a top salesperson in a hallway of the company. The impromptu meeting is often interrupted by the salesperson giving Lloyd a timeout sign. It is the salesperson's indication that there is something more important than talking to Lloyd. "This happens all the time at our company. The salesperson can dump me in a second if a customer needs to be taken care of," states Lloyd.

Separating A Manager From A Leader
There are some leaders who have good management skills, according to Lloyd Lewan. However, it is somewhat more difficult to find a manager with good leadership skills. To be successful, VARs must identify whether they are managers or leaders. They then must hire people to complement their particular skill. This is generally easier for leaders. "Most good leaders have great respect for the principles of management. If a leader is not capable of being a manager, he/she will hire someone who is good at it," says Lloyd. "Managers do not often bring in great leaders. Managers are almost threatened by leaders."

Managers, and the bureaucracies they breed, are not bad, according to Lloyd. However, he says VARs start as entrepreneurs and must continue to hold on to that spirit. Entrepreneurs are leaders. They take a hands-on approach to solving business issues.

While chairman of the board seems like a prestigious title, Lloyd often finds himself at customer sites. Recently, a church in the Denver area had a problem with a printer that it purchased from Lewan & Associates. The salesperson told Lloyd about the problem and both parties traveled to the church for the service call. "The customer was mad and I felt I should go on-site and apologize. That would not happen as easily in a bureaucracy," says Lloyd. Not expecting to see a company executive on a routine service call, Lloyd says the church official's jaw dropped. Lloyd gets the same customer reaction at every site he visits. He recently spent one day participating on 20 service calls with a technician.

Hiring Good Leaders
One of the skills taught to top management personnel at Lewan & Associates is how to profile potential employees. The company tries to hire employees with an entrepreneurial predisposition. The initial interview process can provide a good indication to the mind-set of a prospective employee.

The interviewer probes candidates for signs of a bureaucratic mentality. If career track, title and office size are important to prospective employees, then Lewan & Associates will probably not be interested in their services. Lloyd Lewan considers the aforementioned traits to be signs of an employee with a bureaucratic mentality. "I explain to prospective employees that we have talent paths and not career paths," comments Lloyd. Lewan & Associates guarantees its employees opportunity and asks for their best effort. A bureaucracy offers hierarchy and titles and wants loyalty in return. Says Lloyd, "Bureaucrats are not bad, but they are much different than entrepreneurs."

The manner in which a job is listed in a newspaper will also attract two different kinds of prospective employees. Consider the two following listings: 1) Entry-level marketing position, $25,000 salary, company car and annual bonus. 2) Make up to $200,000 a year selling computer technology, commission only. "For the first ad, people would line up around the block. You would be lucky if anybody responded to the second ad. People who show up for the second ad are willing to put their own talent on the line for an opportunity to do well," says Lloyd. "I want to hire the person that shows up for the second ad."

Attributes Of Leadership
Passing on leadership skills to employees is one of the top priorities at Lewan & Associates. There are ten upper-level management employees who meet with Lloyd Lewan once each month to discuss the art of leadership. The meetings focus on three skills which Lloyd believes define leadership.

• Vision - A leader has to be a believer, but also realistic. "Employees can sense when you are not passionate about an issue. You cannot be a leader unless you also believe in your vision," says Lloyd. "However, vision without reality is a waste of time. Without a realistic vision, leadership can be dangerous."
• Focus - A leader cannot be distracted from what is important to the company. "The key to focusing people is to give them context," comments Lloyd. "You can't dismiss a problem. You have to put context around the problem to show the problem to be solvable. After you provide context, you can refocus employees."
• Influence - A leader's personal behavior signals a motive to employees. Leaders have to consistently treat employees and customers with respect and dignity. "You have to separate behavior from worth," says Lloyd. "You can fire an employee or criticize performance, but you shouldn't ever call an employee an S.O.B. Attacking a person's worth is not a trait of a leader."

Letting The Leaders Lead
Most VARs start as entrepreneurs, taking a hands-on approach to every aspect of their business. This paternal mind-set changes as a company grows. "Most VARs move from paternal to bureaucratic instead of paternal to professional," explains Lloyd Lewan. "You have to keep the best of the entrepreneurial spirit, but be better organized and more professional." Paul Lewan was astute enough to realize that his small company was growing beyond his control and he needed a long-term strategy. In 1984, Lloyd Lewan joined the company as chairman of the board and chief strategist. The first step to becoming a more professional company was to create new leadership at Lewan & Associates. Once leaders were identified, some authority was transferred from Paul to the new leaders. "Paul had to have his fingers on everything, which is typical of most entrepreneurs. As the company grew, Paul had to delegate," states Lloyd. The leaders now head departments within the company.

Adjust Your Attitude
While companies tend to become more bureaucratized as they grow, Lloyd Lewan claims this does not have to be the case. It is not the size of the company, but the spirit of the company that is important.

For example, a customer may call a big bureaucracy and find that it is nearly impossible to resolve a problem. By contrast, Lewan & Associates has a statewide communication center to process customer calls. All customer calls are placed locally, but are then routed to the headquarters in Denver. Lloyd once overheard a representative talking to a customer who wanted to speak to a sales manager. The representative paged a manager as Lloyd watched the process. When the call was complete, he explained how he would have handled the customer call. "I would have told the customer I was the duty manager. I would have listened to the problem and then located the appropriate person to solve the problem," says Lloyd. "Instead of passing on the call, you should take charge and own it."

Preparing For The Future
VARs that do not separate management from leadership will be hard-pressed to succeed in the 21st century, according to Lloyd Lewan. Being a good manager does not necessarily mean you are a good leader.

The credit manager at Lewan & Associates has held bad debt to less than 0.1% annually, but he does not want to be a leader. However, he manages the department to near perfection. "We honor him for the job that he has done, but we are not going to ask him to be a corporate leader. That doesn't take away from him or his skill," explains Lloyd. "I believe there are different skill sets. Many companies pretend that management and leadership are the same thing - they are not."