Speaker 1:
As a bank that focuses on business, we work with business leaders all day, every day. We have a front row seat to what's working and what has potential. The First Business Bank Podcast is dedicated to sharing insights to help you work better, smarter and faster to achieve your goals. Lets get into the show.
Mark Meloy:
Hello, I'm Mark Meloy, CEO of First Business Bank. Welcome to another edition of the First Business Bank Podcast. Today is part two of a conversation with business leaders, talking about leadership in challenging times. Joining us today are Jim Hartlieb, president of First Business Bank, John Tatooles, co-founder of Sound Devices, David Simon, president of Veridian Homes, and Nancy Spelsberg, president of BCP Transportation.
Speaker 3:
Do, do any of you foresee a time where you will have to be more forceful with, no, your job is in the office, and if you don't come in the office, we'll just outsource your job. Because I, I've heard that from a couple of companies that are taking a harder stance on this, eh, with what I would call more office type jobs that could go remote or could be in the office. D-, do you, any of you have those situations in front of you now, or do you foresee that happening, you know a-, as you look down the road, the next quarter or so?
Mark Meloy:
I don't, I don't foresee that in our organization, but uh, you know, I can understand that for, for some positions. Uh, um, you know, there's some things that just benefit by being in an office, and uh, you know, I can see where there might be some reluctance, but uh, you know, for us, we have not had any of those kinds of experiences. I think the people who are working in [inaudible 00:01:46] are, you know... appreciate having that, you know, that we're open, that, uh, you know, that nothing really has changed, we've, you know, been really conscious to keep a, you know, very safe environment. I think they appreciate that.
David Simon:
Well, as it relates to Veridian, and what [inaudible 00:02:01] Nancy and, and John already mentioned, that, you know, we're collaborative and social beings, really, and I think if anything, our team wants to come back to the office. We're getting much more of that, that maybe at first, remote working sounded really great, and it used to show up obviously on our, our employee, um, you know, experience surveys, satisfaction surveys. Hey, we, we do more remote working, we have more flexibility, and now that they have it, they're, we're, we're finding that, hey, we're, we're, we're missing part of what we enjoyed about the family at Veridian, that, the social aspects, the collaboration, the teamwork, it's just not the same, uh, in their opinions. Yes, we're using, you know, video calls, uh, we used a teams environment through Microsoft, but, uh, y-, you know, you lose some of that. And so, we're feeling just the opposite. Our team would like to come back, and we're having to say, you know, hey, you know, not right now. How can we maybe rotate you through, if you like to have more of that, you know, office experience.
And, and then there are some positions that are just more challenging for us to do remotely, uh, in our organization. So, those are in the office more frequently if not, you know, 100% of the time. And then certain individuals just work better in a office setting than maybe remotely, depends on your ability to focus and your structure and what your home environments like too. Um, so I think it's gonna be a, um, a variety of answers that will come through this out of what we end up doing, you know, long term I guess, from this.
Speaker 3:
About a month and a half ago, I was having a beer at a outdoor patio with some family and a couple friends, and I thought, man, we, we could easily do this with our team. And so, it was a big venue, outdoor venue, so I threw it out to our group, and I think we had like, 95% of 'em jump on it right away, because it had been... at that point it had been, you know, five months before some people had seen each other in person. But I think you're all, all right, it's that connectivity and the cultural impact of not having that connectivity that's gonna be... I think it'll be a challenge here, you know, 'cause we probably won't be out on a patio having a beer in December and January in Wisconsin. So, we're gonna have to get a little more creative there and, and uh, uh, try to keep some of those things going. But it's so important.
Nancy Spelsberg:
Yep.
Jon Tatooles:
I think there's a learning aspect of working together too, right? And being around your coworkers beyond the, just the social part of it, it's, it's really how our youngest employees, the least experienced can see others in action and have that immediate feedback and opportunity to ask, uh, when they are working together or at least near each other, as opposed to this, this virtual communication that really takes, takes time and thought and planning in many cases to, to, to make it occur.
Mark Meloy:
Right. Those connections have to be much more deliberate, you know, when uh... when you wanna reach out to somebody in the remote environment, you have to, uh, you know, see, are they available? Oh, they are available, and even if they, if you ring them, they may have stepped away for a moment, so they may not necessarily be available, whereas, you know, in a, in a live environment, you just walk by and you have that casual interaction that just doesn't exist. So, you really have to make that effort, and it's, it puts a much bigger responsibility on the individual to continue to keep plugged into their own organization.
Speaker 3:
Mm-hmm (affirmative).
Jon Tatooles:
Yeah. Yeah. That's for sure. I think a big part of being a leader and being a manager is a, is a little bit of that, uh, um, managing by walking around kind of thing. And, and to your point, that doesn't happen when people aren't in the office, so it does take, um, the intentionality, if you will, of, of that communication.
Jim Hartlieb:
Well, I, I do say, when I do come into the office and um, uh, we do have obviously team mates working here right now. I always walk around and I try to get eyes on everybody. At least I can see, you know, where, where are you, and to get at least some, some, um, contact, uh, and communication. And so much, as you know, and some people say that 93% of all communication's non verbal, y-, y-, you lose that, um... So, (laughs) one of my pet peeves early on was, turn on your camera, okay. (laughs) I need to see you, because we communicate, you know, that way. Um, so in my organization, you know, we, we've continued, and we, we have a, because we're a really close knit group, I, part of our culture for years is to have an all, all company hands on deck meeting twice a month in person. We have an, a large enough facility to bring 100 plus people together, and focus on our, what's important, our vision, our values, our, our culture, education, communication.
And so we've been continuing that, um, on a, a virtual environment of, you know, 100 or so people on a virtual Team Meeting, uh, uh, call. But please, still turn your cameras on, I need to somehow see you. I can't have a portion of a team see all you. I figure with a Zoom call, you're, you're probably so small you wouldn't get the same impact. But it's still trying to continue to ha-, um, have that, that, that continued, uh, uh, focus on our vision and our values and communicating that on an ongoing basis to try to keep your culture g-, moving forward. And so we have adapted to moving it, you know, virtually. But it doesn't have quite the same, you know, feel, of course, and I'll h-, I'll be doing one, in fact, tomorrow morning at 9:00, 9:00am with our, our h-, entire team. So, it's been another way we've been trying to stay, uh, connected as a, as an organization as well.
Mark Meloy:
Yeah, we have a [crosstalk 00:07:56] Monday morning call with uh, with all the remote folks, and uh, we have, uh, an office in Lockeford, UK, and so they're on it as well, and uh, we kind of go around the, around the room, so to speak, and everybody kind of shares where they're at, and uh, you know, we get to hear a little bit about what the experience is in the UK, and uh, you know, kind of have the, the, look at the dashboards and see where we're at from a, you know, statistical, uh, position, and uh, you know, it looks like we'll be continuing to do this for a little bit based on, you know, what those dashboards are looking like.
Jim Hartlieb:
Yeah.
Nancy Spelsberg:
[crosstalk 00:08:30] there's, there might be a little bit of a benefit. I mean, you, you, you're into peoples homes, so, so you are getting to know, you, you see the chaos in the background, you hear dogs barking and kids (laughs) kids voices, and, and so it's always interesting, you know, maybe, what, what your perception is about somebody, and then to actually get a live look into their home, into their life, um, you know, so, so there's some, some pros and cons to it as well, to seeing that other side of, of, of where they come from and where they live.
Speaker 3:
Ma-, maybe we can get a l-, a little personal here. If, if you think of the old saying, it, it's lonely at the top, you know, and you think the last six months when all the questions and concerns are coming up to you, and you as leaders are having to answer to those, and, okay, so where do you go as leaders to figure out, what's my outlet to figure this our? Or, what... you know, just your personal life. You know, how, how do you get that release? Was there anything that you did, um, personally... Um, I've heard people say they drink a lot more, um, so that's one option. (laughs) But if there anything... Seriously, is there anything personally that you did differently over the last six months that other leaders that might listen to this might pick up on as a, as a tip?
David Simon:
Let's see here. I'll, uh, jump in on this one. I, I, ha-, I guess, you know, there's both a personal side and a business side, and I've been fortunate to be part of a, a Vistage organization. Uh, Wisconsin used to be called [inaudible 00:09:53] but for years... So, I had... I've got a number of... I don't know if it was 15 CEOs from Southern Wisconsin that are part of my Vistage, uh, group. So it was really, really g-, beneficial there because they're all from different types of businesses, uh, from manufacturing to software to so forth. So really, to have a way of sharing in real time on a daily... we were, we moved our Vestige meetings [inaudible 00:10:16] the monthly [inaudible 00:10:18] uh, twice a month to really, at a CEO level, really share information on, a-, and have a think tank of, how do we work with our organizations?
You know, and then of course on a personal side and family side is, you know, I'm, I've always been focused on a lot of travel. Well, that obviously stopped, you know, um, to give me my break. So I, I, in some ways, I've been working without a break since uh, the first week of March in a way. I, you know, I've always been an individual that is seven days a week, you know, kind of a 365 guy, but... even when I'm traveling and, I'm always thinking about the business in a way. Uh, so, for me it's been almost break-less with that, uh, but fortunately I've been able to keep my exercise up. Early on in the pandemic I would do, uh, seven, eight, nine mile hikes with a 40 pound pack, just to be out in the nature, and I'd be on the phone talking with a peer maybe in, uh, [inaudible 00:11:14] Virginia, about what, what are they doing in their business. Um, um, and then, and then fortunately I've been to just take m-, little more personal time, and those of you who know me, I've been able to set up my, my boathouse in Northern Wisconsin as my office, and was working up there most of the summer and interacting with my team, and getting back to Madison occasionally, uh, for, for eyes on, you know, team as well.
So, so, it's just, how do you take care of your, your mind, uh, your, your body, uh, and then, how do you focus on... with others going through the same experience, other leaders, uh, to, to be able to play off of those, those, those, that energy and those ideas, um, as well, is how I, I at least approached it, personally.
Nancy Spelsberg:
Yeah. I think it'd be very similar for me, David. I think it was relying on other business owners. How are you handling this? How are you approaching this? Um, and maybe even just commiserating, um, on, on all the, all the things going on. And so from a professional standpoint, it was relying on other people in a similar situation to... if anything, just to, um, a lending ear, or, or to get some advice and guidance as well.
And then on the personal front, you know, without so many meetings and activities and things going on at night, I, I've actually been able to exercise quite a bit more than I ever have been, and, and so, um, I guess that's been a positive thing. It's been a great release, and, and I've actually been very thankful f-, for, for that opportunity.
Mark Meloy:
I, I have the benefit of having a, a business partner, and so the two of us are, uh, you know, kind of, w-, we look at the business in two slightly different angles, and uh, and, and it's great thing to see th-, that, you know, our, w-, we've always consistently looked at things in a similar way with a similar value structure. Uh, but then we also extend that out to other business, uh, peers and such. So, in our industry we have good relationships with other, uh, manufacturers and, and we can see what they're going through, what their experience is, and, and that shared experience really, you know, is kind of part of it, and, you know, and that extends to the personal world.
You know, it's this shared experience, that we're all at home and, and with my, uh, you know, high school aged children at home, and we're all kind of going through this together. Uh, but yeah, you know, echoing the others, you know, certainly getting and staying active is, is a big piece of this, and I think that's, you know, central for... you know, it, it always has been for me, to, to get outside and to, and to be active and to, you know, continue my cycling and continue, you know, walks in the, in the woods and such are, are really, uh, important, and yeah, you, you take advantage of that and you appreciate that and you realize that, you know, you have that. And I too am typically on a plane every four weeks, and uh, I have not traveled since uh, February, so it's a very unusual environment for me to right now not be in Europe right now, so uh, it's uh-
Jon Tatooles:
Exactly.
Mark Meloy:
I-, it's something that, um, you know, we're all adjusting and changing, but again, it's, it's, this is where we're at, this is the here and now, and you just kind of move forward based on where we're at right now.
David Simon:
Yeah, definitely a lot more of a day to day mentality. Try to inject strategy in there, of course, but much more of a day to day mentality is what I've seen and felt myself.
Speaker 3:
Maybe just pivot just a little bit for... those are important EQ, as you said, David, issues. If we pivot more to IQ and business issues, are there things that you're seeing in the supply chain, maybe for your specific business that, um, has disrupted things or increased costs? Uh, what can we expect, maybe, in each of your different industries, as a consumer, as a business partner, to see as a result of those things?
David Simon:
Yeah, well, since we're relying on a lot of different companies to supply the parts and pieces that we put together to create a home, uh, w-, i-, it has been a, a continued challenge for us, uh, uh, as you can imagine, as, as, as c-, as COVID enters into the manufacturing plants, uh, we're, we're seeing, you know, slow downs in the assembly and the, and the, and the production. So, we, we've seen it in all aspects of our business. Uh, the one that's been getting most of the headline recently, um, has been lumber prices, and, and they've gone up, uh, uh, at a very... they more than doubled, um, since the low. And partly, I think it's a, um, certainly s-, supply and demand, but demand hasn't, hasn't picked up, a-, and supply was disrupted, and it's been disrupted again by wildfires, you know, in the north west. And then the issues of border crossings and things in Canada, uh, where our wood comes from. But even from that point, we, we ha-, we couldn't get colored tubs, uh, you know, a month ago, so we're trying to swap out tubs at the last minute to continue to build our home. So, appliances, we've had to have, uh, a, loaner appliances in homes 'cause we couldn't... manufacturing couldn't get us the appliances that the homeowner had ordered, uh...
Uh, siding your drive through neighborhoods, we're, we're very fortunate we don't have as much of a problem, but many builders you'll see... we call it a house wrap, it, it usually is white, may, might say Tyvec, in our case, it's called a house wrap. Houses are sitting with house wrap, because people can't get siding. Uh, shingle shortages, uh, it's pretty rampant in our business. Uh, window blinds, I can see a window behind John with blinds on it. We can't get window blinds or there's a much longer lead time, for example.
So, it has been challenging, uh, uh, [inaudible 00:16:41] Windows having some challenges and their clients in [inaudible 00:16:44] Tennessee, um, back orders, uh, sending people back to finish. And, and we're a, a very, maybe a different, um, home builder than many, because we actually, uh, commit to a, uh, move in date when you sign your, um, a, a... building [inaudible 00:17:01] agreement with us. So, we'll quote you... let's say right now I'm quoting in, let's say, in Madison, I'm quoting early March, and I may quote you March fifth. So, we're working hard to really manage our, our, our f-, our f-, process flow, including the supply of products around a, a, a, uh, a process that we've grown to know and understand. Now, we're doing it with the COVID interruptions, how can we continue to, to meet the, uh, the promises we made to our, our consumer. So, it has been a day to day challenge, everything from early in the pandemic, where building inspectors said, hey, we're not going to inspect your home and issue permits. Well, we went from an essential business in that case to a non-essential business, because we couldn't get the inspections. Fortunately, that only lasted a few days while we, we worked through how to make that happen.
Um, so we're all dealing with many different challenges, and I think the thing we talked about earlier is, is how do you adapt and innovate in this changing landscape? Uh, and um, we're continuing to, to deal, deal with those types of things on a daily basis, and I'm, I'm proud of our team, of how they stepped up and have dealt with the challenges [inaudible 00:18:10] And our supply chain, for that matter.
Jon Tatooles:
Yeah, m-, for us, material is definitely a, you know, something we spend a lot of energy, and our purchasing folks. Uh, you know, we saw the reduction in belly freight, which is, you know, kind of that excess freight, uh, internationally that is used on passenger planes, where, you know, you've got your baggage, but the, the rest of the plane may very well be cargo. We do a lot of air freight because a lot of our shipments are smaller, higher value types of freight. Uh, so we've seen a dramatic reduction in the amount of freight that we're able to bring in. Uh, we also see longer delays in customs for some of that material that we're bringing in from outside the US. So, uh, we've had to accommodate in our schedules, our purchasing folks have been incredibly busy, and, you know, sourcing material and making sure that we have a second source in case that primary source has any delays or issues, so, you know, that, that area of our company is, you know, spending a huge amount of time to make sure that we have material in hand, 'cause, you know, we may have an electronics assembly, and it might have several thousand parts, but if one of those parts is absent, we can't make that product. Uh, so, you know, all of these are contingent upon each other. We can't deliver a product with uh, you know, with a shortage of any particular part.
So, uh, you know, it's a, it's a critical piece of our, of our process, and, you know, that supply chain i-, is essential, and we've really tried to accommodate that in our schedules and make sure that we have enough, uh, you know, leeway and cushion and, and, so that we can make sure that we have material on hand.
Nancy Spelsberg:
Yeah, I thinks it's been f-, eh, Jon and David, it's very similar to what I'm hearing from a lot of our manufacturing customers here in Wisconsin. There's just been some unprecedented demand, I think there's been a shift in consumer spend, um, people aren't going out to eat as much, they're not going to concerts and doing other entertainment type, um, services and, and spend, and so they're, they're buying stuff. They're buying stuff online, they're buying stuff that's coming in from overseas, and then they're building. And so, they're, whether they're building or buying homes, they're adding on, they're, they're redoing their spaces, outdoor spaces, and, and so that, that consumer spend, that shift, has gone from services to, to stuff, which I think has ultimately also then just put this huge strain on the, on the trucking industry, and so... And major capacity issues right now with just seeing this unprecedented demand in raw material supply as well as finished goods, getting 'em out, just getting things around.
And to Jon's point, y-, you can't make your product unless you have all of the raw material. So, so a delay in one of those raw materials is just causing this ripple effect. And so I'm hearing from a lot of 'em that right now the cost of stock outs is exceeding the cost of inventory. So, this just in time inventory mentality in manufacturing might be going away for a little bit, uh, because of that one raw material that wasn't there to finish the part and so that's exasperating this issue, where now everybody's trying to ramp up their inventory so that they have that, that, have those materials there in order to make things. And so it's been, it's been fascinating to, to watch and to hear a lot of stock outs, a lot of back orders, [crosstalk 00:21:18] um, and I think that's just causing this whiplash effect as well and then causing additional delays, um, in, in getting things across the ocean, as well as then delivered to, to the end user, so...
Speaker 3:
Yeah, I just have... uh, we gotta wrap things up here. I just have to say, e-, it's impressive what you all have done, you know, a-, a-, as we think through the questions that we just went through as it relates to your employees, your personal life, business issues, all thrown at you at the same time in the last six months, none of... many of which we've never seen before, and the success that your companies are having is, is impressive. And I know you would all deflect it to your team, but, but it is impressive. And part of the reason for these podcasts and what used to be our in person seminars, is to try to impart some of that on our client base, to try to add value to our relationships. So, I really wanna thank you guys for taking the time today to, to talk through some of these stories. Uh, because just as you did during the pandemic, you, you listened to your peers. And so this is really valuable information, and I want to thank you for taking the time to do that today.
Nancy Spelsberg:
Thank you. Thanks for having us.
David Simon:
Absolutely our pleasure. Thank you very much.
Nancy Spelsberg:
Okay.
Mark Meloy:
Yeah. I go back to the word resilience. I think as all of you talked through, uh, your experiences and your thoughts that you shared with our audience, um, that were, continue to ring in my head, that uh, I think all of you are, are, are great examples of that, and, and appreciate you taking the time today to, to share your thoughts. And hopefully our audience, uh, who's listening in and watching in, um, can take what they heard today and apply in some small way to their own businesses. So, Nancy, David, Jon, and Jim, thank you very much for taking the time to be part of our First Business Bank Podcast.
And to our audience who's tuned in, thank you for taking the time to listen, and we hope you find us again soon.
Speaker 1:
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