The Stuff Of Leaders
Top convenience industry CEOs may have the corner office, but they know success is a team effort
"Leaders aren't born, they are made. And they are made, just like anything else, through hard work. And that's the price we'll have to pay to achieve that goal or any goal," said Vince Lombardi.
He should know: the National Football League Pro Football Hall of Famer who coached the Green Bay Packers to victory in the first two Super Bowls and received the highest accolade of any coach when he was named the NFL Coach of the Year in 1959 (his rookie season), is widely recognized as one of the greatest coaches in sports history.
And while he may have been at the helm of one of the best teams in football history, today's top convenience store CEOs could point to many similarities between coaching a football team and leading a retail company.
"It's about being a good coach," Scott Hartman, CEO of York, Pa.-based Rutter's Farm Stores, said when asked to describe the most important aspect of his job. He leads the now-57-store chain founded by his grandfather 65 years ago. "A CEO has to be able to tell people when they are doing a good job and when they are not."
Convenience store companies have something else in common with a football squad — neither spell team with an "I." "As a leader, I would say my most important job is the development of our associates," explained Kyle Krause, CEO of Kum & Go LC, the 400-plus-store chain based in West Des Moines, Iowa. Krause is the son of company co-founder William Krause, a Convenience Store News Industry Hall of Famer. "Kum & Go associates are the company's No. 1 asset and without personal and professional development, Kum & Go would not to continue to advance."
RECIPE FOR LEADERSHIP
That is not to say, however, that anyone can take the helm of a company. As author John C. Maxwell explained in his book, "Leadership 101: What Every Leader Needs to Know," leaders of any kind possess certain traits: self discipline, the ability to prioritize and the ability to build trust and develop a clear vision.
"Becoming a leader is a lot like investing successfully in the stock market," Maxwell wrote. "What matters most is what you do day by day over the long [haul]."
His remarks apply to leaders in all industries, but when it comes to convenience store industry chief executives, they need to possess a few more skills as well. According to Brian Wright, managing partner of Executive Leadership Solutions, an executive search firm, there are a few common denominators found across c-store CEOs. "They have to have a strong finance background. They have to have strong people skills and they have to have a basic understanding about how retail works," he said.
This does not necessarily mean their résumé must be filled with convenience retailing positions, but experience in small-box retailing helps. "CEOs that do best in this industry have come from smaller-boxed, fast-paced retailers like quick-serve restaurants, pharmacies and convenience store operators," Wright said. "If you look at the bulk of the CEOs in the convenience industry, they grew up in the industry."
Over the past few years, Wright has noticed some changes in CEO searches. Military experience is becoming a top request and there is a big push to find female leadership at all levels, he said.
"I have been recruiting in this industry since 1999 and every year, there is a desire to have more females and more diversity," he said.
The economic downturn that began in 2008 has also led to change on companies' wish lists, he noted. "There is a huge drive, particularly in the last few years since the economy turned south, to have leaders that are very people oriented and put a big emphasis on developing quality — training and developing — much more so than in the past," Wright added.
The leaders themselves agree. "A successful CEO needs to be open-minded with the ability to pick and keep great people," said Sonja Hubbard, CEO of E-Z Mart Stores Inc., the nearly 300-store chain based in Texarkana, Texas. She is the daughter of the company's founder, Jim Yates.
Leo Vercollone, CEO of VERC Enterprises, which operates 24 c-stores in the New England area, echoed the sentiment. "CEOs have to have the ability to hire smart people who are committed to results," he said, adding that a sense of humor helps, too. "Be happy…a good sense of humor goes a long way."
A successful c-store CEO also needs to look a few steps ahead and be willing to step outside the box. "A successful CEO leads by example and lives the core values of his or her company, but will also demonstrate the ability to challenge the status quo to drive innovation and change," Kum & Go's Krause said. "Most importantly, he or she must be deeply passionate and driven to help his or her company and associates get better every day."
EVER-CHANGING TO-DO LISTS
Aside from the human quotient in running a successful c-store business, the CEOs who spoke with Convenience Store News all pointed to the nuts and bolts of their organization as priority No. 1 when they assumed the top position at their respective organizations.
For Vercollone, that meant growing the company's store count from 15 to 20 (his sights are set on 30). For Hubbard, it was assimilating 125 locations that E-Z Mart purchased within 45 days of her taking the CEO seat. For others, their first job was to conduct an overall strategic review of the company.
"The No. 1 priority when I took over was evaluating if we had the right locations, offerings and organizational structure to compete; examining trends in the industry that were fundamental and not simply cyclical, and how they translated to threats and opportunities," explained Joseph Petrowski, CEO of The Cumberland Gulf Group, the Framingham, Mass.-based company with more than 900 Cumberland Farms and Gulf Oil branded convenience stores and gas stations.
Similarly, Sam L. Susser, CEO of Susser Holdings Corp., operator of the 500-plus-store Stripes chain based in Corpus Christi, Texas, concentrated on the business side of the company when he took the helm from his father, Sam J. Susser. "I joined the company in 1988 at a time of great financial stress for our company and for businesses generally throughout Texas," he recalled. "The No. 1 priority for the first six years of my tenure was always raising cash and enhancing liquidity."
With time, the CEOs said their to-do lists have changed. These days, both Petrowski and Susser are turning their focus to developing their teams and bringing customer service up a notch.
THE OTHER HALF OF THE BATTLE
Having priorities and evolving to-do lists are important in leading a convenience store chain, but they are only steps in the battle to succeed. Knowing what not to do is just as important in the makeup of a good leader. Ignoring questions or concerns from an associate or customer is a major no-no for Vercollone. For Hartman, resting on your laurels should be avoided at all costs.
"It is OK to reflect on your accomplishments, but it's never good to be too happy with where you are," said Hartman. "It is dangerous to get too comfortable with your current situation."
Chet Cadieux, CEO of QuikTrip Corp., the 600-store chain based in Tulsa, Okla., believes a good leader should never stop listening. "It is really easy to fall into the trap of thinking that your idea is always the right one," he said. "The fact of the matter is that most of the time, someone else has a better idea."
INNOVATION NATION
New ideas are vital in this retail channel that faces stiff competition at every turn. Not only do convenience store chains battle against one another for consumers' dollars, they also have to contend with channel blurring as grocery, drug and even quick-service restaurants move into what was once their domain. That is where innovation plays an important role.
"Innovation is huge. Look at Kodak, Wang, Compaq Computer and Kmart — the landscape is littered with companies that did not innovate," Petrowski said. As leaders, CEOs can nurture innovation by embracing failure and putting naturally curious people who are bored with routine in key development positions, according to the Cumberland Gulf chief.
Cadieux agreed that innovation is very important, but thinks it may be the fad of the moment. "Companies will always need innovation, but some get so wrapped up in innovation, they fail to ever get really good at one thing," he explained. "I think that a company has to be focused but still willing to learn."
Hubbard shares a similar view, indicating that the industry obsesses about innovation too much. "We sell convenience and that hasn't changed dramatically over time," she said. "That's what we sell ... time. It changes, but not overnight. We've been behind and ahead of the curve, and both can be costly."
She added that a convenience store CEO needs to be in tune with what is happening in the industry, economy and business environment as a whole, but must also remain reasonable and level headed, and "not just jump on every silly idea that comes out." "This remains a business of convenience, and the overall goals and strategies haven't changed that dramatically through the years," Hubbard observed. "Serve the customer in a friendly and convenient manner with products they desire priced competitively ... sounds simple but it isn't always so."
As Susser puts it, "This business is about lining up 1,000 small things in the same direction and getting everyone to pull their weight. It's not about one big idea or one big technological innovation. Retail is detail."
Inspirations in Leadership
Kyle Krause, CEO of Kum & Go LC, didn't have to look very far to find business leaders that he could admire and use as examples to shape his own leadership style. His grandfather Tony Gentle and father Bill Krause — founders of the West Des Moines, lowa-based convenience store chain — played a critical role in his personal and professional development.
"They established early on the focus and culture they wanted Kum & Go to represent: customer service and a values-based culture. These two things have never changed," he said.
Over the years, Krause has found inspiration, too, in business leaders outside his own company and the convenience industry as a whole. One such leader is Tony Hsieh, CEO of Zappos. Hsieh was able to establish and determine what was most important to his company and through that, has been able to drive behavior and a culture that is matched by few, according to Krause.
"By sharing the same views on two important aspects of business — culture and customer service — I have gained further insight and ideas through his writings," he explained.
The Kum & Go chief recently finished reading "Delivering Happiness" by Hsieh, and said this book helped in the advancement of the c-store chain's associates, as well as the company's focus on customer service. Kum & Go has long established that customer service is its focus.
"Tony's insights and personal examples that he provides in this book have created a different way of thinking within Kum & Go," said Krause. "It has helped me to view situations from a different perspective, all while still having a focus on culture and growth. I also believe this book has helped the leadership throughout Kum & Go to see that the paths to success are endless."
— Linda Lisanti
A CEO's Most Important Job: Listening
A chief executive fills many roles and has countless responsibilities, but QuikTrip Corp.'s Chairman, President and CEO Chet Cadieux believes what's most important is for the CEO to have a vision of what he or she wants the company to look like and behave like in the future.
"The vision doesn't have to have come from the CEO. In all likelihood, it came from a really smart and passionate employee or group of employees who suggested it," noted Cadieux. "[The CEO] needs to make sure everyone in the organization understands and embraces that vision."
It's very difficult sometimes, though, for a CEO to slow down enough so that he or she can hear those good ideas and how they should shape the vision, according to QuikTrip's chief. This is why Cadieux emphasizes that one good thing a leader should never do is stop listening.
"It is really easy to fall into the trap of thinking that your idea is always the right one. The fact of the matter is that most of the time, someone else has a better idea," he said.
— Linda Lisanti
A CEO's Leadership Style
A chief executive's leadership style is forever remembered by his or her employees, and often the general public as well. When it comes to leadership, though, no one approach is best, as many styles have proven to be effective. Joseph Petrowski, CEO of Framingham, Mass.-based The Cumberland Gulf Group, categorizes his leadership style as "non-hierarchal."
"A command control structure, except for safety, compliance and ethics, is deleterious to an organization in two ways," he noted. "First, it does not enable your professionals and/or make them accountable if the smallest decisions are made at the top. You cease to be a learning organization, and a top-down organization moves too slowly to be truly competitive."
Petrowski much prefers to operate in a friendly environment. "No one should have to say, 'Do this because I'm the boss,'" he said. "That is a sign of weakness. It should be, 'Do this because it makes sense and if it does not, tell me why and I will be confident enough to reconsider.'"
— Brian Berk
Nurturing and Encouraging Innovation
Many CEOs believe innovation is the most important aspect of a successful business. Without new ideas, a company can often fall behind its competitors. Susser Holdings Corp. President and CEO Sam L. Susser knows his business must constantly innovate to meet the needs of today's consumers.
"The successful CEO has to operate 'periscope up' — always looking and listening to frontline teammates for better ways of getting the job done and remaining curious as to what direct competitors and other businesses in similar and dissimilar industries [are doing]," he noted.
In fact, a CEO must look everywhere for innovation. All potential sources of ideas should be exhausted, as one never knows where a good idea will come from, according to the chief executive.
"I cannot over-stress the importance of being curious and in touch with what's going on all over the world with respect to consumer behavior trends and business practices," he said.
— Brian Berk
A Group Effort
Sonja Hubbard's name may be on the door as CEO of E-Z Mart Stores Inc., but she acknowledges that it takes a village to run the successful 300-plus-store convenience chain.
"I've described it as a hierarchal team," she said in explaining her leadership style. "I truly believe the very best decisions we've ever made in the business have been ones vetted through the group."
Decisions at the Texarkana, Texas-based company are studied, debated and improved upon. "That said, there has to be a chain of command, and while loose and allowing for controversy, it remains respectful," said Hubbard.
Hubbard, who became the first woman inducted into the Convenience Store News Hall of Fame in 2010, worked her way up the company ladder from assistant controller to CFO, and assumed her current role following the death of her father, E-Z Mart founder Jim Yates. Despite growing up around the business, she admits she is still receiving business advice and taking it to heart.
"You can't be good at everything," she said. "To be great at something, you have to be bad at something else. I heard that recently and it so resonated to the battles I fight for perfection."
— Melissa Kress
Tech Is Important, but CEOs Need Broader Experience
Sitting down at NACStech recently with Scott Hartman, CEO of York, Pa.-based Rutter's Farm Stores, we asked the tech-savvy executive if he thought a leading convenience store retailer would ever appoint a CEO from the ranks of information technology (IT) executives. After all, technology is so intertwined into every aspect of the business now.
"I think it's much more likely [for an IT exec to become CEO] at a family-type business than in a large, public company," said Hartman, who won the Convenience Store News Top Tech Executive award in 2009. "There's a lot of young, bright children or grandchildren of c-store family businesses that probably have a high inclination and interest in technology, which didn't exist when their fathers and grandfathers started the business. Plus, having grown up in the business, many of them likely have broader exposure to other disciplines."
Hartman, a CEO whose background was mainly in finance (MBA in Finance and Operations from Duke University) has been an industry leader in pioneering new technology.
"However, for the larger c-store companies, particularly the public ones, being a CEO is as much about accounting and SEC [Securities and Exchange Commission] rules as it is about actually running a convenience store today," he said. "A public company CEO probably needs the broader view — especially the financial perspective — in today's environment."
— Don Longo
A New Age of Communication
Tony Kenney, president of Enon, Ohio-based Speedway LLC, considers the most important trend impacting retailing today to be the consumer's growing sophistication in accessing and communicating via technology.
"Mobile marketing via your website, through smartphones and Facebook and Twitter is growing. People are seeking out offers by location and this is going to be a growing opportunity in our business," he said. "It's extremely important for a retailer to have the ability to make people aware of your offers at your locations. It's also very important to leverage connections with your vendor partners."
This is a major point of differentiation for Speedway, a division of Marathon Petroleum Corp. With its Speedy Rewards loyalty program, the chain of 1,375 convenience stores has a unique way of working with vendor partners and conveniently providing value to consumers.
By looking at the behavior of its Speedy Rewards members, the company knows that targeted offers will get customers from the island into the store. And so, the company is using technology to create a dialogue about the exciting things going on at Speedway.
"Smartphones and mobile payment platforms allow us one-to-one communication that is superior to the traditional pumptoppers, window signs, etc.," Kenney said, adding that social media is also potentially very significant for Speedway as it tries to increase its reach to millennials.
"We're just getting into mobile marketing and social media, but I think it can be the next game-changer. We see three legs supporting this marketing opportunity. The smartphone enables communication, mobile payments and electronic coupons. Social media enables retailers to create more of a two-way dialog with their fans. And our Speedy Rewards loyalty program provides us with purchasing behavior for 3.3 million active rewards members that we can use to make relevant offers," he explained.
"We are looking at putting these elements together in a meaningful way so that our active customers will tell their friends about something nice that happened to them at Speedway. I want to use a customer to create a customer."
— Don Longo
Community Spotlight
Leo Vercollone, CEO of VERC Enterprises, recognizes that business is not always about dollars and cents. Human capital plays a key role in the success of any company's bottom line.
"The most important job as CEO is that we have a culture where people care for one another and support the customers and communities that we operate in," he explained. Reaching that goal, though, requires giving his employees the right tools. "The most difficult job as CEO is making sure we are providing our associates the support and training to do their jobs."
Year in and year out, VERC is recognized for its commitment to its employees and the communities it serves. In November, the company was honored by the Boston Globe with a 2011 Top Places to Work award, making it one of the 100 best employers in Massachusetts.
The accolades have continued into this year. In April, VERC was honored for its commitment to hiring people with developmental disabilities during the 16th annual "Celebrating Families" at the Massachusetts State House and one month earlier, its was named Employer of the Year by the Point After Club, a rehabilitation center in Lawrence, Mass., for people with mental illnesses.
— Melissa Kress
SELF DISCIPLINE
CLEAR VISION
BUILD TRUST