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Action Points
I. Communication Keys
Two-way communication with
stakeholders is key to balancing the
short- and the long-term.
II. The Bottom Line
If teammates perceive that you are
wedded to a long-term plan that is not
steeped in attainable short-term
objectives, you will lose both your
credibility and their commitment.
III. Must-Haves for Managing Goals
Delegation, speed, and focus are the
keys to goal management.
Three top CEOs from Summit Fire Protection, NELSON, and CPI
Aero share their expertise on:
Balancing Short-Term
Imperatives with
Long-Term Goals
IV. The Golden Rules for Managing
Goals for High Growth
Try to make short-term goals steps on
the way to long-term ones. Understand
the exact scope and purpose of your
long-term goals. Be aware that you have
to earn commitment to your vision.
Quintin Rubald
CEO, Summit Fire Protection
John “Ozzie” Nelson
President and CEO, NELSON
V. Essential Take-Aways
Without a good balance between goals,
it is possible to lose control of the
company. Understanding the true
objectives of all stakeholders in this
balance is critical to achieving both
types of goals.
Edward J. Fred
President and CEO, CPI Aero
S
Contents
About the Authors . . . . . . . . . . . . . . . . . . . . p.2
Quintin Rubald . . . . . . . . . . . . . . . . . . . . . . . p.3
John “Ozzie” Nelson . . . . . . . . . . . . . . . . . . p.6
Edward J. Fred . . . . . . . . . . . . . . . . . . . . . . . p.9
Ideas to Build Upon & Action Points . . . p.12
hort-term and long-term goals always exist in a symbiotic relationship. Short-term wins are essential for long-term success, but
are meaningless without the long-term strategy to guide them. Often,
stakeholders and employees do not understand the relationships between
the goal sets, and will lack confidence in the company’s long-term goals
without reasonable short-term goals that are met consistently. CEOs must
find the delicate balance between these goals. They must learn to delegate the short-term, to make immediate decisions when trade-offs are
required, and never sacrifice one set for the other. One essential part of
this process is sharing ownership with all key stakeholders. This means
communicating long-term vision to employees, board members, and
shareholders, and — more importantly — listening to them. The right
balance of goal sets is often to be found in this give-and-take between
CEO and company stakeholders. ■
Copyright 2008 Books24x7®. All rights reserved. Reproduction in whole or part is prohibited without the prior written permission of the publisher. This ExecBlueprints™ document was published as part of a subscription based service. ExecBlueprints,
a Referenceware® collection from Books24x7, provides concise, easy to absorb, practical information to help organizations address pressing strategic issues. For more information about ExecBlueprints, please visit www.execblueprints.com.
About the Authors
Quintin Rubald
CEO, Summit Fire Protection
I
n 1999, Quintin T. Rubald III founded
the Summit Fire Protection Company.
Mr. Rubbald has served as president since
the company’s founding. He is a proven
profit-, growth-, and results-orientated
leader with a financial background and
exceptional business acumen.
Summit Fire Protection designs, installs,
and services fire sprinkler systems. As
Summit Consulting, it provides professional
fire protection engineering services; it also
provides commercial plumbing services as
Dakota Plumbing. The company does business in approximately 15 states and two foreign countries. It currently employs over
250 union and non-union employees
and does over $50 million in annual
revenue. It is the largest fire sprinkler operation in the five-state area, and one of the
largest in the United States.
The company was named among
Minnesota’s 50 Fastest Growing Private
Companies for the past five years by the
Minneapolis Business Journal. It is the only
company in Minnesota to be named to the
list for five years straight.
Mr. Rubald was an Ernst & Young
Entrepreneur of the Year 2006 finalist for
the Midwest region. He was chosen in 2004
to be a member of the Twin Cities chapter
of the Young President’s Organization.
Membership in the organization is limited
to 100 local presidents and CEOs.
From 1996-1999, he served as chief
financial officer at Viking Automatic
Sprinkler Co./VFP Fire Systems in St. Paul,
Minnesota. He led all financial and administrative functions of the $100+ million
service, construction, and manufacturing
company. At age 26, he was the youngest
person ever named to an officer position
within the Api Group, Viking’s $1 billion
holding company.
Mr. Rubald began his career as a senior accountant and auditor for RSM
McGladrey L.L.P. He has a B.S. and C.P.A.
from St. Cloud State University.
☛ Read Quintin’s insights on Page 3
John “Ozzie” Nelson
President and CEO, NELSON
J
ohn “Ozzie” Nelson, Jr. joined
NELSON in 1987 and became president and CEO in 2003. With his executive team, Mr. Nelson is responsible for
establishing the firm’s strategic direction and
spearheading its growth while maintaining
the quality of its “Best in Class” status. In
this capacity, he has planned and implemented strategic mergers with firms
throughout the United States and around
the world that share a common culture,
vision, and values with NELSON. The
result of this growth is a robust, global service delivery platform that provides clients
with the level of service they require in virtually any location.
As a principal in the firm, Mr. Nelson has
had the opportunity to partner with corporate and real estate executives at companies such as Bank of America, CIGNA,
Citigroup, Nationwide, Microsoft, First
USA, Liberty Mutual, AOL, and Wachovia
on an ongoing basis. Through these relationships, he has helped clients translate their
business plans into the built environment.
Unlike many of his peers who lead large
architecture and interiors firms, Mr. Nelson
has a business background rather than a
design degree. This perspective has allowed
him to enhance NELSON with more than
500 percent growth since taking over as
its leader. His vision for the future of the
industry, as well as insights into what clients
truly need from a strategic, creative and operational perspective, have positioned NELSON
well for continued growth and success.
Mr. Nelson has been a featured speaker
multiple times at national functions including: InterPlan, the AEC convention,
NeoCon, and the annual conference for the
Internal Society of Facilities Executives. He
is active in various civic and industry organizations both in Philadelphia, NELSON’s
headquarters city, and his home base of
Minneapolis.
☛ Read John’s insights on Page 6
Edward J. Fred
President and CEO, CPI Aero
E
dward J. Fred is the chief executive
officer and president of CPI Aero, a
publicly-held aerospace company
listed on the American Stock Exchange.
He joined CPI in early 1995, and
worked his way up the ranks, holding the
titles of controller, secretary, executive vice
president, and chief financial officer. He has
been written up in the Wall Street Journal,
Newsday, The Long Island Business News,
Crain’s New York Business, and Forbes,
American Executive, and Inc. magazines.
He recently had an article published in the
Journal of Management Development on
the decisions a CEO faces during periods
of transition.
In June of 2005, Mr. Fred was recognized
as the Ernst & Young “Entrepreneur Of The
© Books24x7, 2008
Year” in the Manufacturing category for the
New York Metro region. Additionally, CPI
was named the #99 company by Forbes
magazine in its “200 Best-Run Small
Companies” issue, and the #47 company in
the Fortune Small Business issue of “Top
100 Fastest-Growing Small Companies.”
During 2004, Mr. Fred was named the
Long Island Association’s “Entrepreneurial
Advocate.” The Hauppauge Industrial
Association named CPI its “Small Business
of the Year.” CPI has grown under Mr.
Fred’s leadership from $8 million in revenue
to just over $30 million.
Before joining CPI, Mr. Fred spent ten
years working for Grumman’s international
division. He attained the level of controller,
making him the youngest financial executive
in the company’s history. He opted to leave
after the company was acquired by the
Northrop Corporation.
Before joining Grumman, Mr. Fred
worked for Borden Inc., and Sterling Drug.
Mr. Fred received his master’s degree from
Hofstra University in May of 2002, when he
graduated with honors from the University’s
inaugural executive M.B.A. program.
He graduated from Dowling College in
1980 with a B.B.A. in accounting. In
November of 2004, he was honored by
Dowling College as its 2004 “Alumnus of
the Year.”
☛ Read Ed’s insights on Page 9
About the Authors
ExecBlueprints
2
Quintin Rubald
CEO, Summit Fire Protection
Short-Term Goal Strategies:
The Importance of
Measuring Progress
Every company needs to formulate
both short-term and long-term
goals in order to stay on track for
growth. In the short-term, our primary focus is on all the little details
that go into operating a business
successfully, including keeping a
close eye on tracking our projects
and costs. Our philosophy is that if
we pay attention to the small items
on an everyday basis, then the big
picture will take care of itself. To
that end, we hold weekly meetings
with our department heads on a regimented schedule. We also track the
progress of our jobs through our
company’s in-house reporting system; I receive a report on every project that we are doing on a weekly
basis; therefore, I always know just
how well our company is doing at
any given time.
It is essential to successfully
manage the day-to-day operations
of your company in order to ensure
that everything is taken care of and
well-run. We try to measure all of
our activities as much as possible.
Long-Term Goals and
Forecasting Trends
In the long-term, our company’s
main goals are to diversify within the
life safety arena to a greater extent;
to grow and develop more talented
people; and to build the best organization possible. We feel that we
have the ability to continue to
achieve long-term growth throughout the Midwest and the U.S., but
our primary focus is on becoming a
full package life safety system
provider. We believe that we will get
there by pushing the envelope in
© Books24x7, 2008
A good company must
have the ability to say
“no thank you.”
Quintin Rubald
CEO
Summit Fire Protection
terms of finding new people to hire
and new companies to acquire.
Forecasting the future in terms of
likely marketplace trends is essential to staying on track to achieving
our long-term goals. We do this by
reading trade publications, and
by maintaining good relationships
with our key national suppliers and
manufacturers who let us know
where they see the market heading.
It is also important to stay very
active within our industry; several
people within our company sit on
various national boards and codesetting committees. I believe that
staying closely connected with suppliers, code-setting officials, insurance companies, and the overall
construction industry and business
world helps us determine where the
market is going, and helps us
develop effective growth strategies.
The Role of the Competition
Your competition in the marketplace always affects your goal setting process, to some extent. In the
short-term they can change your
market, in that a competing company can suddenly move into your
area and affect your margins by taking away some of your customers.
However, I believe that you must
have the discipline not to chase the
competition; you have to stay
focused on what your costs are and
what you need to do in order to
maintain your margins. We need
to know where the market prices
Quintin Rubald
CEO
Summit Fire Protection
“I believe that if you can measure
something, you can manage it”
• Founded company in 1999
• Operates in 15 states and two
foreign countries; 250 employees;
over $50 million annual revenue
• Among Minnesota’s 50 Fastest
Growing Private Companies for the
past five consecutive years
• 2006 finalist, Ernst & Young
Entrepreneur of the Year
Mr. Rubald can be e-mailed at
[email protected]
are and keep as much emotion out
of the process as possible. A good
company must have the ability to
say “no thank you.”
In that process, you need to
ensure that you are taking action
to separate your company from the
competition. We are always looking
for ways to differentiate ourselves
from the other companies in the
marketplace; in other words, if
everybody is doing business one
way — i.e., offering one product or
service, such as installation, and
nothing else—and we are the only
company that is offering more than
just installation services, then we
have most likely increased our
Quintin Rubald
ExecBlueprints
3
Quintin Rubald
(continued)
CEO, Summit Fire Protection
© Books24x7, 2008
words, working for a growthoriented company brings you more
opportunities for career success
down the road.
Best Practices
Shared vision
for the future
ng
Inte
rna
l Co
nfli
cts
The CEO must be able to delegate
enough of the short-term imperatives to good mangers to keep the
company profitable and moving forward. This allows the CEO and
upper management to keep the
long-term goals moving forward.
This requires finding good people
who can handle the short-term
imperatives with little supervision.
The CEO must be able to identify, very quickly, what the shortterm imperatives are and get the
managers taking care of them in
short order. This requires having the
ability to make long-term decisions
Be consistent
solv
i
r Re
s fo
Balancing your short- and long-term
goals successfully can often lead to
internal conflicts. For example, we
will often get feedback from our
employees with respect to why we
are undertaking certain projects, or
making a particular investment.
While some people within the
organization will always be inclined
to focus on the short-term, urgent
needs within the company, you have
to stick with your long-term vision
and keep pushing and looking for
new growth opportunities.
In order to resolve these internal
conflicts, it is a good idea to communicate with your managers on a
regular basis. At our company, we
hold weekly meetings consisting of
a give and take session with our
local managers; we let them know
what is going on, and they can then
disseminate that information to
the rank and file. In addition, we
will get together with all of our
branch offices several times a
year in order to lay out some of the
long-term goals for the company.
This should be an ongoing
process, because the staff of a high
growth company is often likely to
question some of the logic behind
your decisions. Their feeling may
be, “Why do we need to do something different? Why can’t we just
stay small and continue on our present path?” You have to be able to
communicate to your staff why you
believe the company needs to
change and grow. This is essential,
because all too often your employees will be more concerned with
what is happening in the next
nda
tion
Balancing Short- and
Long-Term Goals
week or month, and their eyes will
glaze over when you talk about
plans for the next three to five years.
The important thing is to be consistent. Over time, you are likely to
find that employees enjoy working
for a company that is on track in
terms of a growth pattern and is not
stagnant — a company that is pushing the envelope and becoming a
leader in the industry. When people
see that your vision can develop successfully they are likely to buy into
it wholeheartedly. For example,
many other companies in this industry are small and stagnant, and they
like to stick with the status quo;
however, the group we have here
enjoys the excitement that comes
with growth. We always stress to
our employees and managers that
growth equals opportunity; in other
Fou
chances of winning the customer’s
business.
Communicate the need for change
Regular interaction with managers
Quintin Rubald
ExecBlueprints
4
Quintin Rubald
(continued)
CEO, Summit Fire Protection
Balancing your short- and long-term goals properly is essential; if you do
not, you can wind up with serious morale problems among your employees.
Indeed, you can have great long-term goals, but if you are not managing
your company properly on a day-to-day basis, it means nothing; if you are
not taking care of the details, then you will not be around in three to five
years to achieve any of your long-term goals.
Quintin Rubald
CEO
Summit Fire Protection
that will not hurt the company’s
ability to make good short-term
decisions. CEOs need to be able to
rely on their gut.
The CEO and company must be
able to capitalize on a long-term
goal without jeopardizing the shortterm imperatives. For example, if an
excellent company or employee
becomes available to the company,
it is the CEO’s responsibility to figure out how to make the acquisition
work without damaging short-term
needs. Keeping focused on the
long-term goals while still trying to
© Books24x7, 2008
tackle the short-term imperatives is
key.
Final Thoughts
I believe that you need to be optimistic but realistic when you are
creating your leadership plan or
vision. In other words, prepare for
the worst, but hope for the best.
When I look at a new opportunity
or avenue for our company, I
always ask myself, “What is the
worst thing that could happen if we
make that choice — and what
would we do if that does happen?”
For example, if a particular growth
strategy goes south, how we would
react to that development, and
mitigate the damages?
It is also essential to define what
market you want to be in; evaluate
your competition in that market,
and then determine how you are
going to differentiate yourself from
the competition. That is one recurrent theme that must always be
addressed in a service-type business
such as ours. ■
Quintin Rubald
ExecBlueprints
5
John “Ozzie” Nelson
President & CEO, NELSON
Striking the Balance
One critical requirement of the fastgrowth CEO is striking the balance
between achieving long-term objectives while closely managing shortterm goals. This balance is much
easier and the operation more cohesive when the short-term goals are
a cohesive subset of the long-term
objectives.
When this is not possible, the
balance between the short term and
long term will require diligent
and realistic evaluations about the
progress being made on both fronts,
as well as constant communication
with everyone from shareholders to
employees about that status.
In my mind, long-term objectives
relate to elements such as brand,
market position and penetration,
and geographic platform. In
essence, a long-term goal is defined
by questions such as “What does
this company want to be when it
grows up?” or “What is our end
game?” No good strategies are
driven simply by “growth for
growth’s sake.” Without clear longterm objectives, it will be difficult
to articulate a vision to which
others will commit.
Short-term objectives are most
effective when they represent small,
progressive steps toward the longterm objectives. They are typically
more operational in nature,
although that is not always the case.
Finally, the more ambitious the
long-term goal is, the more important it will be to demonstrate that
you have operational control by hitting all short-term targets. The
CEO of an extremely high-growth
company will face constant questioning from those around him or
her as to whether the growth can be
managed. Consistent success with
short-term objectives will be the best
way to quiet the critics and gain
support for the long-term vision.
Identifying Goal Conflicts
It is important for the CEO to identify when short-term goals will
either be a series of interim steps
that may bear little resemblance to
the desired end state, or when they
will be in conflict with a long-term
objective.
In the first scenario, I often
remind those with whom I work that
building a company can be like a ladder. When I am going from rung one
to rung two, rung two is the most
important of all the rungs on the ladder. When I reach rung four, rung
two is completely irrelevant other
than for its historic significance.
Similarly, in a fast moving company,
you will adopt any number of shortterm solutions that quickly will
become outdated “rungs on the ladder” as your company grows. In
such cases everyone on the team
needs to know that the path to the
If teammates perceive that you are wedded to a
predetermined long-term plan that is not
steeped in attainable short-term objectives, you
will eventually lose both your credibility and
their commitment.
John “Ozzie” Nelson
President & CEO, NELSON
© Books24x7, 2008
John “Ozzie” Nelson
President & CEO
NELSON
“The CEO who does not spend the
appropriate amount of time to both
understand the expectations and
tirelessly communicate progress does
so at his or her own peril.”
• Joined company in 1987; became
president and CEO in 2003
• Planned and implemented strategic
mergers with firms throughout the
United States and around the world
• Company has experienced more
than 500 percent growth under his
leadership
• Has partnered with executives at
Bank of America, CIGNA, Citigroup,
Microsoft, and others
Mr. Nelson can be e-mailed at
[email protected]
long-term goal will not be linear
but rather a series of very sharp,
deliberate zigzags.
A consequence of not making the
value of such incremental strategies
clear to the team is that they may
end up with a watered down, “one
size fits all” solution in an attempt
to satisfy all the various stages of
growth instead of selecting the
solution that works best at that particular time. In my own case, the
brand of our company is a good
example of this. While the end goal
John “Ozzie” Nelson
ExecBlueprints
6
John “Ozzie” Nelson
(continued)
President & CEO, NELSON
was to build the brand of a global,
multi-faceted services provider, the
brand that we projected changed a
number of times based on the
opportunities that our market position offered over time. In fact, for
a number of years I refused to invest
in brand elements such as PR and
advertising because I wanted us to
remain below the radar. Such positioning better enabled us to pull surprise attacks against much stronger
competitors. As the firm has entered
a point in which our capabilities,
financial resources, and platform
support our desired final brand, we
have gone from no short-term
objectives about brand to highly
aggressive ones.
In terms of the latter scenario,
where you have conflicting shortand long-term goals, one clear
example is high short-term profit
targets vs. ambitious long-term
growth-market objectives. In order
to reach fast growth, the temptation
will be to reduce price. Meeting
profitability targets requires a prudent evaluation of the cost to provide services and charging
accordingly. Mitigating the tensions between such competing
objectives requires appropriate diligence to ensure that both the shortand long-term goals can be
achieved. Additionally, it will
be vital to ensure that operational
teams are integrated and have
appropriate incentives to create a
balanced focus. The failure to
address this issue is bound to create in-house fighting, which will
destroy the proper level of focus on
both the short- and long-term goals.
True Objectives
Understanding the true objectives of
the shareholder and investor in this
© Books24x7, 2008
Essentials for Balancing
Conflicting Goals
Achievable
short- and longterm goals
Integrated
operational
teams
balance is critical to achieving both
types of goals and will ultimately
determine the way that the performance of both the CEO and
entity are judged. Always consider
how patient shareholders and
investors will be in the short term,
as well as what their expectations
for monetary return are over that
time. The CEO should ensure
that he or she has engaged in
enough dialogue to understand both
the stated and assumed long-term
objectives.
Specific targets in terms of ROI
in the short- and long-term are critical elements of vision alignment
and expectation setting. Particularly
in high-growth companies, it is
important to understand how
quickly shareholders are expecting
short-term returns, and if they are
willing to ride out a long-term
investment.
Similarly, it is vital to communicate the balance between the
short-term and long-term objectives
Appropriate
incentives to
balance focus
to teammates and to be open to discussing the conflicts that they either
perceive up front or those that may
occur along the way. If teammates
perceive that you are wedded to a
predetermined long-term plan that
is not steeped in attainable shortterm objectives, you will eventually
lose both your credibility and their
commitment.
The CEO’s Role in the
Balance
It is vital that the CEO understand
the importance of both short-term
and long-term objectives. However,
he or she cannot be a “one-man
band.” A strong team is required to
handle execution of most of the
short-term goals. The CEO is
the visionary trailblazer who needs to
be free to roam ahead and scout out
future direction and opportunities.
While the CEO needs to be able
to refocus quickly when short-term
goals are in jeopardy and require
John “Ozzie” Nelson
ExecBlueprints
7
John “Ozzie” Nelson
(continued)
President & CEO, NELSON
attention, continued lack of strategic focus on long-term objectives
will significantly limit the growth
potential of the enterprise. For this
reason, I try to spend on average at
least 60 percent of my time on more
strategic and long-term objectives.
This average will change greatly
based on the operating challenges
and specific phases of the growth
cycle.
Balance as a Competitive
Advantage
While all this balancing process may
be challenging, managing the balance between short-term and longterm objectives can be a competitive
advantage. Hitting short-term
objectives requires discipline and
excellence of execution while superior long-term objectives require the
vision to see the maximum opportunities available. When a company
creates a strategy and successfully
begins to emerge from the crowd of
competitors as a result of it, the
industry will take notice.
The more success one achieves in
executing the day-to-day wins and
advancing toward long-term objectives, the more others will begin to
focus on the CEO’s strategy instead
of their own. Why is that important? Consider a sports analogy: the
team that controls the tempo and
style of play almost always wins the
game. That is because you are now
playing to your strengths and others
are playing a game with which they
are less familiar and comfortable.
The Road Map to Success
In conclusion, the long-term objectives of high-growth companies
paint a vision and high-level road
map of the organization’s potential.
That vision must also articulate how
this tall order will be realized. It
must aim to anticipate and understand the strategy well enough to
dare to predict a winning position
well into the game. In turn, shortterm goals must be measured
against their progress toward the
long-term objectives and their
dynamic reaction to the way the
game is actually playing out.
To achieve high growth successfully, I would suggest that any CEO
in this arena carefully live in the
moment of having just achieved
the long-term goal. Literally close
your eyes and picture it. What does
that feel like? How did you get
there? What does your team and
company look like? Why is it successful? When you are in touch with
and intensely focused on that vision,
you will find crystal clarity and confidence in devising short-term goals
that will inspire all those around
you.
The most successful high-growth
CEO will not only accomplish this,
but will be equally successful in
helping others to see the vision.
Because of that, these organizations
will become highly sustainable
enterprises in which the ability to
envision the long term and correspondingly modify the short term
will be hard coded into a company’s
DNA. ■
I have found that the greatest challenge to the balance is gaining that initial
credibility and momentum. Picture a new CEO walking into a crowded
room and outlining an extremely ambitious long-term plan. After hearing
the plan, you think to yourself that while it sounds great, how in the world
would your company get there? If the first set of short-term objectives seems
equally unattainable, you and everyone else will probably take a wait and
see attitude. If, however, the short-term goals are ambitious but perceived to
be attainable and not in conflict with the long-term objectives, people will
tend to commit to them. Early wins in short-term goals will be essential to
building credibility, and credibility will help make people believe that the
long-term goal is possible. From there, the CEO can ramp up the short-term
goals and introduce more ambitious plans.
John “Ozzie” Nelson
President & CEO, NELSON
© Books24x7, 2008
John “Ozzie” Nelson
ExecBlueprints
8
Edward J. Fred
President and CEO, CPI Aero
I tell all of our shareholders that I run this
company as if I was running a marathon.
Edward J. Fred
President and CEO
CPI Aero
Achieving Imperatives
We are a very small, publicly held
company. My short-term imperatives are making sure that the
stockholders are happy. We only
have 5.7 million shares outstanding
and there are fewer than 20 shareholders who own half of those
shares. The slightest blip in the
screen and our stock price can get
buried. Unfortunately, the stock
price doesn’t seem to go up a few
points when we announce good
news.
I fight a constant battle with trying to maintain the price and keeping the investors happy. I go on the
road monthly to meet with different groups of investors. I let them
know what we are doing, and I reiterate this information in quarterly
conference calls. I provide as much
information as possible, including
when we are about to face tough
times. I never want them to be surprised by any changes and have
worked hard to build a solid foundation of trust by building a track
record of always telling the truth.
Short- and Long-Term
Goals
In this industry, there are always
new short-term goals that crop up
now and again. A contract or proposal could come up that we must
try to win within a three-month
window. Those contracts are important because they drive the market.
They also grow our business. The
long-term goal is to build the
© Books24x7, 2008
company to the point where we are
not hurt when business decreases or
unnecessarily praised when it
increases. I want to become relatively stable within three years. The
best way to meet both short- and
long-term goals is to choose the
right customers and the right platforms. I don’t necessarily want to
win a contract that will require the
company to work for a finite length
of time or on a project that will
shortly be extinct. It is far better to
work with customers on projects
that will lead to repeat business. I
want to win awards for projects
that last for several years.
Balancing Goals
My process to ensure that there is
a good balance between our shortand long-term goals is to interact
with the board of directors regularly. I use them as a sounding
board to make sure I am moving the
company in the right direction.
Since I have sole responsibility for
goals and strategy, I want to make
sure that I have the right ideas and
the right processes in place to
make the company successful.
Without a good balance between
goals, it is possible to lose control
of the company. Ignoring short-term
goals might lead to closing the
doors on excellent opportunities. In
return, ignoring long-term goals
might cause you to be incredibly
short-sighted and fall off a cliff
when all the short-term projects run
out.
Edward J. Fred
President and CEO
CPI Aero
“Dictatorships never work.”
• 2005 Ernst & Young Entrepreneur Of
The Year, Manufacturing category,
New York Metro region
• Has grown company from $8 million
in revenue to over $30 million
• Company among Forbes magazine’s
200 Best-Run Small Companies
• Company named to Fortune Small
Business’s Top 100 Fastest-Growing
Small Companies
Mr. Fred can be e-mailed at
[email protected]
Shareholder Concerns
Smart shareholders worry about
achieving and sustaining growth.
However, there are always ones
who are short-sighted and only
focus on stock price. In our business, focusing on stock price is
problematic at best. We work with
multi-billion dollar corporations
that have a mile-long bureaucracy.
There have been times when we
have won something from a major
contractor and it has taken six
to eight weeks from that date to
release the information, due to the
multiple layers of bureaucracy.
Our other major customer is the
U.S. government and obviously
Edward J. Fred
ExecBlueprints
9
Edward J. Fred
(continued)
President and CEO, CPI Aero
there is a wide range of privacy concerns that lead to us keeping certain
contracts and projects under wraps.
I tell all of our shareholders that I
run this company as if I was running a marathon. I am not a
sprinter and have no interest in
landing contracts that will cause our
stock price to temporarily increase
a few points every week, and then
plunge downwards again. I much
prefer to build the company slowly
and choose contracts that will
impact our future.
Communicating with
Employees
Communication with employees
regarding out goals is relatively
informal. We hold a monthly
employee recognition lunch where
we give one employee a plaque that
recognizes their efforts in our company. I also use these monthly meetings as a forum to give what I refer
to as “state of the company”
speeches. I explain everything that
is going on in the company, down
to all of the contracts on which we
are bidding. I like to tie it all
together so that everyone in the
company can easily understand all
of our long- and short-term goals.
Obviously, our employees are
always concerned when we
are forced to cut employees or take
a hit in the market. The key is to
show them that neither I, nor the
shareholders panic during downturns in the market. Senior management knew exactly how and
when we were going to come out of
it by opening new channels of business. The employees working in the
shop every day might not have the
same level of awareness. It is my job
to keep them aware of the big
© Books24x7, 2008
picture and try to distill fear about
job security.
Setting Benchmarks
We use two benchmarks to ensure
that our efforts to create a good balance of goals are effective. The first
one is stock price. I keep an eye on
how our stock price is doing in relation to what it should be doing. I
always know what the value of the
company should be, so if we reach
that value on the stock market, then
I am happy.
The other way I benchmark our
goals is to look at how many
projects or contracts we are
Communication Essentials
Listen to your board of directors
Listen to your shareholders
Listen to your employees
Weigh these views
Create a balanced analysis
Keep all parties as fully informed as possible
Make well-rounded decisions
Edward J. Fred
ExecBlueprints
10
Edward J. Fred
(continued)
President and CEO, CPI Aero
currently bidding on. I need to
know how many things we have in
the hopper as well as the dollar
value of each contract. The
dollar value of those contracts
needs to grow quarter by quarter if
we are to remain successful.
Best Practices
The three best practices for balancing goals are clichéd but true.
The first is to listen to your board
of directors. Second, listen to your
shareholders. Third, listen to
your employees. If you are able
to listen to your top three constituents, and pay attention, then
you will receive the best possible
feedback pertaining to how you are
doing your job. You should not necessarily listen to one group more
than the other, but carefully weigh
the views of all three to create the
most balanced analysis.
Top Challenges
One of the greatest challenges for
balancing objectives is getting the
© Books24x7, 2008
In general, ROI is tied into true investing and
true assets of a company. The company usually
has the ability to take capital and build upon it.
That is not our business model. On our balance
sheet, it does not appear as if we have many
assets. However, when you invest in us, you are
investing in a company that is working toward
long-term growth in the business. Few companies
that accept our bids worry about their ROI.
Edward J. Fred
President and CEO
CPI Aero
results today while still making sure
you have results tomorrow. You
have to keep all interested parties as
fully informed as possible without
confusing them. You also have to
know your boundaries. I don’t
know everything, nor do I try to. It
is far better to gather the advice and
input of others to make a wellrounded decision that incorporates
varied viewpoints.
When stock prices drop and the
wolves start to circle, it is instinct
to try to take over a problem and
fix it myself, but I made that mistake once and have hopefully
learned from the experience. It is far
better to circle the wagons and
gather everyone together to fix a
problem. ■
Edward J. Fred
ExecBlueprints
11
Ideas to Build Upon & Action Points
I. Communication Keys
Two-way communication with stakeholders
is key to balancing the short- and the longterm.
• Stakeholders should never be
surprised by any changes.
• Work hard to build a solid foundation
of trust by building a track record of
always telling the truth.
• Provide as much information as
possible, including when you are
facing challenges.
To ensure that there is a good balance
between short- and long-term goals:
• Determine how you are going to
differentiate yourself from the
competition.
III. Must-Have Best Practices
Delegation
• The CEO must be able to delegate
enough of the short-term imperatives
to good mangers to keep the company
profitable and moving forward.
• This allows the CEO and upper
management to keep the long-term
goals moving forward.
• Listen to your shareholders.
• This requires finding good people
who can handle the short-term
imperatives with little supervision.
• Listen to your employees.
Speed
• Listen to your board of directors.
• Carefully weigh the views of all three
to create the most balanced analysis.
Communicate the balance between the
short-term and long-term objectives to
teammates and to be open to discussing the
conflicts they perceive or encounter.
• The CEO must be able to identify,
very quickly, what the short-term
imperatives are and get the managers
taking care of them in short order.
• CEOs need to be able to rely on their
gut.
II. The Bottom Line
Focus
If teammates perceive that you are wedded
to a long-term plan that is not steeped in
attainable short-term objectives, you will
lose both your credibility and their
commitment.
• The CEO and company must be able
to capitalize on a long-term goal
without jeopardizing the short-term
imperatives.
• You can have great long-term goals,
but if you are not managing your
company properly on a day-to-day
basis, it means nothing.
• If you are not taking care of the
details, then you will not be around in
three to five years to achieve any of
those long-term goals.
Your long-term plans must be concrete,
realistic, and thoroughly vetted.
• Define what market you want to be in.
• Evaluate your competition in that
market.
© Books24x7, 2008
• Keeping focused on the long-term
goals while still trying to tackle the
short-term imperatives is key.
IV. The Golden Rules for
Managing Goals for High
Growth
• When this is not possible, the balance
will require diligent and realistic
evaluations about the progress being
made on both fronts, as well as
constant communication.
Understand the exact scope and purpose
of your long-term goals.
• No good strategies are driven simply
by growth for growth’s sake.
• Without clear long-term objectives, it
will be difficult to articulate a vision
to which others will commit.
Be aware that you have to earn
commitment to your vision.
• The more ambitious the long-term
goal is, the more important it will be
to demonstrate that you have
operational control by hitting all
short-term targets.
• Consistent success with short-term
objectives will be the best way to
quiet the critics and gain support for
the long-term vision.
V. Essential Take-Aways
Without a good balance between goals, it
is possible to lose control of the company.
• Ignoring short-term goals might lead
to closing the doors on excellent
opportunities.
• In return, ignoring long-term goals
might cause you to be incredibly
short-sighted and fall off a cliff when
all the short-term projects run out.
Understanding the true objectives of all
stakeholders in this balance is critical to
achieving both types of goals.
Try to make short-term goals steps on the
way to long-term ones.
• This will ultimately determine the way
that the performance of both the CEO
and the entity are judged.
• Balance is much easier and operation
more cohesive when the short-term
goals are a subset of the long-term
objectives.
• CEO must take the time to both
understand the expectations and
tirelessly communicate progress. ■
Ideas to Build Upon & Action Points
ExecBlueprints
12
Ideas to Build Upon & Action Points
(continued)
?
10 KEY QUESTIONS AND D ISCUSSION POINTS
1
What are your company’s short-term imperatives? How will you achieve these imperatives? What
new short-term imperatives do you expect in the next 12 months?
2
What are your company’s long-term goals? How will you achieve these goals? What new
long-term goals do you expect to formulate in the next 12 months?
3
What process do you use to ensure there is proper balance between short-term imperatives
and long-term goals? What tensions are inherent in this process? What are the consequences
of not achieving proper balance?
4
In what areas do tensions between short-term goals and long-term imperatives become most
evident? Funding issues? Staffing issues? Strategic direction? Other?
5
How do you communicate with shareholders regarding balance between short-term
imperatives and long-term goals? How did you develop these practices? What is the most
frequent concern of shareholders regarding balance?
6
How do you communicate with employees regarding balance between short-term imperatives
and long-term goals? How did you develop these practices? What is the most frequent
concern of employees regarding balance?
7
What percentage of your time do you spend on efforts to balance the short term and the long
term? What percentage of your focus is on short-term imperatives? What percentage of your
focus is on long-term goals?
8
What are the consequences of not properly balancing short-term objectives with long-term
goals? Could you describe the potential effects on the company? Have you ever experienced
these consequences?
9
How can success in balancing the short term and the long term create a competitive advantage?
Could you describe a situation when proper balance did create a competitive advantage? What
did you learn from this situation?
10
How can ROI be calculated for efforts to balance the short term with the long term? Is ROI an
appropriate measure of success for these activities? How can ROI be improved for these
efforts?
ExecBlueprints is a subscription-based offering from Books24x7, a SkillSoft Company. For more information on subscribing,
please visit www.books24x7.com.
© Books24x7, 2008
Ideas to Build Upon & Action Points
ExecBlueprints
13