LEADERSHIP INSIGHT AND WISDOM FROM OUR COVER CEOS

Q: What role does creating a work environment play in leadership?

A: We spend most of our waking time at work, so it is incredibly important that a leader focuses on creating a great work environment. Simply put, you want to shape an environment that brings out the best in people. And you want the environment to bring the whole person into the job – not just the work person. We have a campus-like feel and I’m constantly inspired by walking around our global offices and seeing all of the amazing tribes that are forming, soul-nourishing community initiatives in play, and pioneering work that we are doing for our clients.

As a leader, the best thing you can do is to give your team permission to shape the environment and then encourage it when they act. For example, our team wanted lower cube walls for more collaboration, and I encouraged that change. In addition to fostering tribes, I’ve encouraged bringing in non-profit CEOs for our speaker series. While optional to attend, these talks put many things in perspective, including sparking passions in our people to be better citizens at large. A non-profit CEO is duty bound, and you can literally see their passion come out when they present – it is contagious. We also bring in our clients to celebrate key milestones. And, of course, our client events, including our Social Summit (summit.bazaarvoice.com), are an extension of our work environment where we all see, together, how we are “changing the world, one authentic conversation at a time.”

Brett Hurt, Venture Partner, Austin Ventures & Former CEO, Bazaarvoice

May|June 2010

Q: Does a leader lead best when treating employees as employees, or as humans?

A: A leader will lead best when employees are viewed as human potential. A leader will seek to develop the talents and potential of the members of their organization for the benefit of all who depend on them.

Spencer Berthelsen, M.D., Chairman & Managing Partner, Kelsey-Seybold Clinic

July|August 2010

Q: How important is it for a leader to give his employees autonomy to do their own jobs as they see fit?

A: Peter Drucker said, “Management is doing things right; Leadership is doing the right thing.”  The CEO’s leadership role starts with setting the example of “the right thing.” Leadership is the art of getting people to accomplish things that they thought were un-attainable. I’ve developed a theory called, “The GRASS is Greener” approach . . .

G stands for establish the Goals

R is for providing the needed Resources

A is for establishing Accountability

S is Supporting your team when necessary, and

S is for Staying out of the way and letting the person operate

Experience has indicated when a CEO develops a solid team of people, gives them autonomy, and uses the “Grass is Greener” theory, the odds for success increment dramatically. Therefore, it becomes a critical component of success to have autonomy as part of the company culture.

Bob Heard, CEO, Credant Technologies

September|October 2010

Q: How can a leader inspire his or her employees to trust him/her?

A: Employee trust is something you earn each and every day.  Employees know when you care more about them than you care about yourself because it shows in the way that you conduct yourself and your business each and every day – in all matters – big and small. As they say, employees don’t care how much you know until they know how much you care. And, employees know when you genuinely care for them.  This is not something that you can fake. Employees intrinsically know when they are truly valued and appreciated. It shows in the way you interact with them,  in the salary and benefits you provide for them, in the way you respond to them during challenging times. To gain and keep the trust of your employees you must always puts employees first and always lead by example. You can never ask an employee to do anything you would not be willing to do yourself. You can never hide behind arbitrary rules or precedent or bend to popular opinion when faced with tough decisions. Rather, employees have to know they can count on you to always do the right things for the right reasons. They want to see you setting the example by arriving early and cheerfully to work – always with positive “can do” attitude.  They want to see you demonstrate pride in your employees, your company and the community.  They want to see you working hard, setting a vision for your company, volunteering in your community and giving generously to charity. In the final analysis, employees want you to be a role model that sets the bar high because they want to be a part of a winning team and want to be a part of something bigger than just a job.

Bill Greehey, Chairman, NuStar Energy

November|December 2010

Q: How important is it to give your employees autonomy to do their own jobs as they see fit?

A: In the early days at Sweet Leaf I used to think that I couldn’t afford to hire the best and brightest and liked to have a lot of control over all aspects of the business . . . the result was we stayed small and my controlling nature was an impediment to our growth.  Now I know – I can’t not afford to hire the best and brightest – they pay for themselves quickly and help ensure success. We hire great people, give them plenty of rope to do their job as they see fit but measure their results and communicate frequently on progress and issues.

Clayton Christopher, CEO, Deep Eddy Vodka

January|February 2011

Q: How can a leader inspire his/her employees to trust them?

A: Colin Powell wisely said, “Trust is the essence of leadership.” Without trust in leadership, there is no leadership. Although styles, strengths and approaches vary, if a leader aspires to have influence, he or she must embrace and exemplify certain tenets to establish and build trust.

An effective leader focuses on relationships. He or she seeks out opportunities to help others. For example, we are very much a family with a common vision. If one of our members experiences a difficult situation, it is critical for the leader to demonstrate authentic empathy. This, in turn, reinforces confidence in his or her leadership.

Confidence is also reinforced when leaders demonstrate reliability, consistency and integrity. When a leader commits to doing something, he or she must follow through. Responding the same way, every day, in every setting is critical for building trust. All individuals need to know without question that they are valued members of the organization.

Finally, clear and regular communication throughout the organization is essential. Entrusting personnel with the facts that affect them builds solidarity. When we faced the possibility of a $30 million budget reduction, we kept all employees informed throughout the planning process – before the cuts were presented to the media and the public. Teachers were able to focus on instruction because they had trust in the process and the leadership. It was a difficult time, but I believe this approach of open, honest and regular communication strengthened our organization.

While leaders are often acknowledged for their great ideas or accomplishments, it is the everyday small acts that often make the greatest impact on others.

Dr. Linda Henri, Superintendent, Mesquite ISD

May|June 2011

Q: How important is it to give employees autonomy to do their own jobs as they see fit?

A: Our employees have significant input in the direction of their careers because our guiding principles give employees the autonomy to infuse creativity and innovation into their jobs.

Employees are not usually told how to solve a problem because they don’t usually know the ‘how’ at the start, but rather have the freedom to try creative solutions and risk failure for the sake of learning.

Our guiding principles, which focus on customer service, innovation, and continuous improvement, center around a common vision. The vision drives our culture and employees rally around this shared purpose. The guiding principles spark inspiration and originality, encouraging employees to autonomously complete their jobs. As we continue to grow around the world, the company’s shared purpose ensures employees can operate independently while working towards the same vision.

Each year, we conduct a survey to measure employees’ satisfaction with the company. Not only do the survey results show employees have above average trust, but the levels tend to increase when employees feel they have more responsibility in their jobs.

We purposely recruit the best and brightest talent from around the world because this type of thinking is required for our jobs.

Dr. James Truchard, CEO, National Instruments

July|August 2011

Q: How important is it for a leader to be a tyrant?

A: In my opinion, tyrants are not good long-term leaders and the two terms (leaders and tyrants) should not be confused. Because tyrants appear strong, many times they do end up in leadership positions. We’ve all experienced them and what we often see is that their goals are the most important; often they’re oppressive and harsh. Leaders on the other hand are visionaries who focus on seeing the big picture, as opposed to the narrow one seen by tyrants. Leaders are influential and communicate the goals passionately in order to help others be a part of the process of achieving goals for the company. Leaders operate on the idea of gaining others trust, while tyrants work on the basis of fear. As a leader, I prefer to be viewed as being concerned for the people I am leading. At every opportunity I am asked, I am clear about the fact that without my employees and those with which I partner, it would be difficult to accomplish all that we have accomplished. I prefer to be seen as the type of leader that is open to dialogue, new ideas, cares about people, and the goals of my organization as a whole.

Arcilia Acosta, CEO, CARCON Industries

September|October 2011

Q: How can a leader inspire his employees to trust him?

A: Trust is the foundation of every human relationship. The fundamental requirement for leadership is trust. People will follow the leader who demonstrates trustworthiness by his words, only to the point that his actions demonstrate who he really is as a person and a leader. Principles, policies, procedures, practices and actions of the leader help define the direction and alignment of employees. The cumulative effect of an organization with a clear vision of purpose and direction creates a synergy and energy where the sum of the parts and efforts far exceed the whole. This holistic energy creates a competitive advantage for any company, and that is why our company motto is “People Matter.” We truly care for each other, and as a result, the leadership comes from the people within our company who are the REAL LEADERS. My people inspire me with what they do.

In our organization, our driving principles and practices are based upon a true belief in God and doing what is right in every situation and following the Ten Commandments. We say, “Do the right thing,” basing our decisions on running a business on a set of values and principles where the right thing is easily identified based on a foundation of moral turpitude.

In everything we do, the leader must follow these principles in order to inspire people to follow his lead. Employees will follow a leader who demonstrates shared values, beliefs and principles, and therefore the leader must be strong in his conviction to a prescribed set of principles and values. Leaders are endowed by God with the responsibility to uphold their principles in their every action. We have a responsibility to serve God, our employees, our customers and our trade partners with a foundation of the highest moral values.

Stephen Brooks, CEO, Grand Homes

November|December, 2011

DR. JAMES TRUCHARD’S PRESCRIPTION FOR CUTTING HEALTH CARE COSTS & BOOSTING EMPLOYEE WELLNESS

The fitness center on the first floor of National Instruments Building B bears a striking resemblance to workout rooms in any health club. The usual collection of machines stands ready – treadmills, elliptical trainers, devices that work arms, shoulders, legs – and in the late afternoon, traffic picks up as people come through the door for their daily exercise session. Several staffers from the Cooper Institute in Dallas stand by to help with individual exercise concerns.

The fitness center is perhaps the most visible aspect of National Instruments’ emphasis on employee health and wellness. But right out the door are sand volleyball courts, and scattered around the company’s three-building campus in Austin are basketball courts and walking trails. Dr. James Truchard, the company’s CEO, has viewed employee health and wellness as an important component of NI’s culture since he started the company in 1976. Truchard was joined by Mark Finger, NI’s VP of Human Resources, to discuss the company’s health and wellness efforts.

“We want National Instruments to be a national role model in employee health and wellness,” Truchard said.

The emphasis on healthy employees stems from pragmatic concerns. Like other companies, NI saw its health care costs going up as much as 13 percent each year. As a self-insured company, NI was spending a lot of money on health care.

“When you forecast that out, eventually it doesn’t work,” said Finger. “We saw a car crash coming.”

Mark Finger, VP of Human Resources & James Truchard, CEO

Finger said NI did its best to negotiate its health care costs.

“At first we did some plan design changes and then we rebid our network,” he said, “all things I’d call low hanging fruit. But eventually, there just wasn’t any low hanging fruit anymore to impact our incremental costs.”

The answer: Either get healthier or pass a lot more in health care costs on to employees.

Finger cited a Michigan study charting age and the number of risk factors for health – things like smoking and high cholesterol.

“If you can move people from five risk factors to two, the cost is one-third,” he said.

NI began offering health risk assessments – HRAs – to its employees. The company encountered some resistance from employees who didn’t want to go through the process, so it used a carrot-and-stick approach.

“We make it personal,” Finger said. “We say, ‘If you want your premium to stay where it’s at, let’s get healthier.’”

NI employees pay $15 per month for health insurance, but if they don’t take the HRA, the cost is $60 per month. All but seven of NI’s 2,500 Austin employees took the HRA the first year it was offered. The company established an onsite clinic because the doctor has a strong impact on an individual’s health.

“A lot of our folks are new grads who came in from other parts of the country and they don’t have a doctor,” said Finger. “When they don’t have access to a doctor, how do you make an impact on health?”

The clinic, managed by Take Care Employer Health Solutions, LLC, was set up to offer only acute care. Now it also offers preventive and primary care.

“I tell the story of one of our engineers who had some health concerns,” Finger said. “He said, ‘I’m a guy and I’m not going to the doctor, I’ll tough it out.’ But then he decided to see the doctor, who said, ‘Go across the street immediately.’ [St. David’s Hospital is across the street from National Instruments.] I don’t know if we saved his life, but maybe.”

Spouses have always been covered under the NI plan.

“When we were starting the company we were all fairly young,” said Truchard, “and having care for the family was part of our philosophy, and that set the stage for how we were going to operate over the years.”

But spouses account for 40 percent of a company’s health care costs. Finger said there are limits on covering them.

“The spouses that are covered on our plan – most of our employees have their spouse on the plan – can come to the clinic,” he said. “If you’re not covered on our plan, we don’t want to get into the paperwork of billing.”

Most of NI’s employees are male, and because they’re generally young, baby issues are common, said Finger.

“When you hire new grads, those new grads get married and have kids,” he said. “We deal more with baby issues and adoptions, which is a great thing to deal with.”

But it’s the youth of those employees that can also open them up to potential health problems.

“We have a lot of young folks right out of school, so they are learning,” Truchard commented. “In college you don’t always follow the best routes or rules. They do need to grow up a little bit.”

Mark Finger and James Truchard

For example, eating habits might need attention. National Instruments participates in the HEED program (Healthy Eating Every Day) to encourage employees to adopt good eating habits. The program is run through the Cooper Clinic, and covers 12 or 13 weeks. But some employees rejected the program, because their weight loss needs were greater than the average employee. NI responded by developing a Super HEED program. Finger said employees who have poor HRA results consult with a doctor.

“When you find out your cholesterol is high and your blood pressure is high, you come back for the physical,” he said. “Now you have a chance to change behavior – you’ve got to get educated first. That’s the bet we’re making.

“Obesity is really the issue,” he said. “Smoking is bad, but obesity is really the issue – that’s where the costs are. If we could reduce that number, that’s the one. If you reduce weight, that weight loss would have the greatest impact on their health and our costs.”

Productivity would be enhanced, said Finger. Absenteeism reduced.

“I think we’re on that path and healthier, but we have to get even healthier,” he added.

Finger elaborated on the company’s strategy to get a healthier work force.

“It’s likely we’ll go smoke free next year,” he said. “At Dell, they had 12 percent smokers and they are now down to 3 percent. We’re at 6.5 percent, and we want that to go down to two percent. We’re going to require an HRA every year. We’ll also require age-based physicals. I’m over 50, so I need to get a physical every year, instead of an HRA. Under 30, the physical will be every three years, 30 to 50, every two years. We’re going to require that so you start to catch some of this stuff via screenings, and catch it earlier.”

Like most companies these days, National Instruments is keeping an eye on the Affordable Care Act – health care reform. Right now, they’re unsure how it will affect the company’s efforts to keep employees healthy.

“Obvious things that could have been done were not done,” Truchard remarked. “Some of the things you’d hope for like tort reform, for example, that should have been a part of this weren’t done. Expecting something different would be challenging.”

Although tort reform is not an issue in Texas, NI has employees in California and other states, and is affected by the issue there.

“The health care reform act promises a lot,” Finger commented. “So far all we’ve seen is it increases costs. From our perspective there’s nothing that begins to manage costs until 2014 with the health exchanges. We don’t know whether that’s real or not.

“Covering children up to age 26 sounds great, but for NI to be covering the cost of an able bodied 24-year-old? Our competitors are not doing that – our competitors outside the U.S. are not doing that.”

When 2014 rolls around, it will be time to make a crucial decision.

“Do we continue with the current coverage or get out of the health care business?” Finger asked. “As it now stands, the decision will be in 2014 – if you pay a $2,000 fine [per employee] you can get out of the health care business.”

A recent McKinsey study found that 30 percent of the nation’s employers plan to get out.

“If enough big companies go, you may see a tidal wave,” continued Finger. “We don’t want that to be the answer, but we cannot exclude it as an alternative because at some point, it’s a math issue. It’s not that NI is not spending enough in health care – it’s that the cost is too high.”

Finger and NI’s COO/CFO, Alex Davern, conducted town hall-style meetings on the issue with employees.

“It was straight talk,” he said, “trying to stay out of the politics and just give you factual information. I think a lot of people came out of those meetings thinking, ‘This is not what I thought it was going to be.’ It has and will bring in a lot of cost in taxes.”

Companies smaller than NI face a tougher struggle to hold down their costs. Finger says it’s insurance. Typically, a smaller company has to be fully insured. That is, the company buys insurance and the insurance company assumes the risk.

“So, regardless of what your health and wellness efforts are, your premiums are set by what happens in the community,” Finger said. “You can drive health and wellness from the aspect of the right thing to do, but you may not be getting any benefit from your efforts because you’re rated against the whole community.”

Which brings us back to NI’s employee health and wellness program. Because it’s important for its people to be healthy, the company is flexible when it comes to working out.

“Most people work out at lunch,” said Truchard.

In the evenings, employees can pursue team sports. NI has 30 sand volleyball teams, as well as basketball leagues. A cycling team boasts more than 100 members. Truchard says small companies can take a page from NI’s playbook and start an athletics program.

“Even as a small company we had sports teams and cycling is inexpensive – those kinds of activities can be encouraged,” he said. “As a small company, you work into things you can afford. You can’t have everything a large company would, but even as a small company we had memberships available to the local gyms. There are alternatives.”

“If you’re with your friends playing volleyball against the archenemies, it just helps build the community we are,” added Finger. “I look back to when I played softball – they are still some of my best friends because when you do athletics together it’s pretty enjoyable. When you’re together with other NI employees participating in sports we think we win, so we encourage it.”

Truchard thinks the company’s health and wellness plan is good for employee retention, too.

“We’ve been one of the Fortune 100 “Best Places to Work” 12 years running,” he said. “There are a lot of elements that go into that, but obviously health benefits are a part of that.”

Finger added: “I think part of retention, in today’s workplace, is trust. When our employees see the kind of investment we’ve made in their health it builds trust. They see long term decisions to balance the needs of the employees, shareholders, customers, and suppliers, and trying to be fair and reasonable.”

“We talk about the one hundred year plan – it’s about trust and the environment where they can count on you as an employer to do the right things,” said Truchard.

Part of building trust is setting an example. So do NI employees see Truchard in the workout room?

“No, but I do have a very large garden I take care of,” he said with a smile. “That’s my alternative plan.”

MAKING STEM FOR K-12 MORE ACCESSIBLE VIA MENTORSHIP AND CREATIVE ENGAGEMENT

By Dr. James Truchard

The National Academy of Engineering recently published the 14 Engineering Grand Challenges, authored by a select group of our country’s most esteemed scientific and engineering minds. The engineering grand challenges lay out the 14 most important and significant issues our world faces. By taking on society’s most pressing problems, engineers will improve quality of life throughout the world while also improving economic prosperity and stability. I often refer to these issues not only to highlight the need for more corporate and government funding and research and development in these areas, but more importantly, because students can use this list of challenges to easily identify a cause that they can get involved with and positively impact. 

In order to have any chance of finding solutions to these complex problems, we must first enhance student interest in the fields of science, technology, engineering, and math (STEM).  Of the developed nations, children in the U.S. perform in the bottom half on standardized math and science tests and show little interest in pursuing careers in science and engineering.  Their waning interest, combined with the impending retirement of the scientists and engineers of the Space Race era, will make it difficult for companies to produce necessary research and develop cutting-edge products here in the United States.  In order for the U.S. and Texas to maintain their competitive edge, we must foster the growth of domestic talent by encouraging young people to explore STEM.

We know what the problem is.  Students today find STEM irrelevant, difficult, and just plain boring. We’re raising a generation of digital natives who don’t know a world without Google, prefer texting to calling, and find email too slow. Today’s students desire to see the immediate impact of all things they do. We acknowledge that this mentality spills over into their educational environment as well.  It is our responsibility to stop talking about the problem and start helping change student attitudes regarding STEM.  The means by which we introduce and teach STEM must be more “hands-on.”  Even in the university setting, engineering students are too often drilled with math courses that seem irrelevant to them, which leads many freshmen to choose another major.

At National Instruments (NI), we are deeply committed to working with the leading programs in Texas and the U.S. that are directly addressing the pipeline of young people entering the technical workforce.   For the past 10 years, NI has been developing products specifically designed to inspire students and help them learn science and engineering through a hands-on approach. NI co-developed, with LEGO, the software for LEGO MINDSTORMS.  LEGO MINDSTORMS gives students the tools to design, build, and program robots that can perform a set of tasks, all decided by the student.  The software is based on our industry standard NI LabVIEW graphical programming software and is touching the lives of millions of students all over the world. Students are able to combine computers, software programming, logic, and physical construction in a manner that is not possible with any other youth product. 

LEGO MINDSTORMS is the key technology used in FIRST LEGO League, an after school competition for elementary and middle school students, which has become a favorite here in Texas.  The competition is run by FIRST, (For Inspiration and Recognition of Science and Technology) and is the most popular robotics competition in the U.S.  FIRST competitions challenge students with difficult problems that they must solve using math and science skills, while also allowing them to develop leadership skills and learn the importance of teamwork. NI is a major supporter of FIRST along with many other great Texas companies such as Intel, Texas Instruments, Lockheed Martin, and Time Warner Cable.  I encourage more companies to get involved not only by offering financial support, but also by asking your engineers to become mentors for the middle and high school FIRST teams in your community.

If we are truly intent on re-chartering the course of education in this country, there is another group that needs our focus just as much as our youth: teachers.  Teacher preparation is an extremely important element of developing a talented high-tech workforce.  We are very fortunate here in Texas to have the UTeach program, started in the College of Natural Sciences at the University of Texas.  UTeach prepares math, science, and engineering majors to also be certified high school teachers without extending the amount of time needed to attain their bachelor’s degree.  UTeach is now being offered in 22 universities in 17 states and has been cited in both the America COMPETES Act and President Obama’s recent State of the Union address. UTeach is creating the nation’s most qualified math and science teachers, and it is imperative that more universities here in Texas offer UTeach programs.  NI’s co-founder, Jeff Kodosky, worked closely with UTeach founder and visionary Mary Ann Rankin, Dean of the College of Natural Sciences at UT Austin, to get this program off the ground.  Jeff and NI are proud to be active supporters of this critical program.  I also applaud the major support of ExxonMobil that has made the replication of UTeach possible across our state and the U.S.

While National Instruments and its partners create products and programs designed to prepare teachers and engage students to bring them into the world of STEM, these products and programs cannot have their full potential unlocked without respective elements of curriculum.  In order to allow our STEM teachers to share how they are using these elements of curriculum and what they are teaching, National Instruments has created K12Lab. K12Lab is a resource for teachers to share creative ways to engage students in STEM coursework. Now that more and more teachers are preparing themselves for the challenge of gaining and keeping students engaged in STEM, they need a place where they can share their experiences, their lessons plans, and their inspiring stories.

The children of today will be responsible for solving the engineering grand challenges. Industry, parents, and policy-makers can’t do it alone—it takes engaging products that allow them to “do engineering” to build the confidence that they can tackle tough problems. Additionally, we need the help of the teachers that touch our students’ lives for five out of seven days a week.  Together, we can inspire the students of today to become the innovators of tomorrow.

Dr. James Truchard is the co-founder and current president and CEO of National Instruments. Texas Governor Rick Perry appointed Truchard to the state’s Advisory Council on the Digital Economy and invited Truchard to chair the Texas Science, Technology, and Math Industry Advisory Council, which seeks to reverse the declining interest of young people in technical careers.