Glen Knight spent almost a decade working in corporate jobs in California and Tennessee before reaching a crossroads in his career that had him contemplating his long-term goals.
A friend, who knew that Knight had worked for his father’s remodeling company over the summers, suggested that Knight apply for a contractor’s license in Memphis. “I told him, ‘Carrying lumber does not make you a contractor,’” Knight recalls. The friend then suggested that Knight could gain experience by working for his father, and open his own business after that. “I decided to treat it like getting a masters degree with a deadline,” Knight says.
Glen joined his father Eddie at E.A. Knight Construction in 1999. Contrary to his original plan to return to Memphis, the 38-year-old is set to become a full owner in the near future. Eddie Knight is not involved in the company’s day-to-day decisions, but handles some sales calls and weighs in on management issues.
When Glen joined, the company had a volume of about $1 million with six employees. He started off doing the bookkeeping, writing contracts, and learning to use the HomeTech estimating system that the company had just purchased. Glen is now the general manager, handling 85% of sales calls and managing a staff of 35 employees.
Glen says his father had always been frustrated that the people in the industry did not view remodeling as a career, and he wanted to provide employee benefits. “That was his brainchild, and we were able to put that in place after I arrived,” Glen says. Employee benefits now include health insurance, 401(k), bonuses, and life insurance. Glen, Eddie, and the company’s management team are also setting up a formal career path and training program.
Because he believes that standardized processes give employees the freedom to do their jobs, as well as providing clients with a consistent experience, Glen created a system of color-coded documents to track information from sales to production.
“When I was working in manufacturing, there was a huge push for ISO 2000 certification to provide consistency,” he says. “At E. A. Knight Construction, we want customers to know they are getting a predictable service with a predictable product, so they feel they are making a good decision when they call us.”
Glen applied his past experience as a software salesman to E.A. Knight Construction. “At the [software] company, I was in sales training for six months. That is where I formed the foundation for what I’ve brought to this company. It doesn’t matter what the service is, this is how you treat your customers,” he says.
Glen’s contributions to the company:
He built databases and set up spreadsheets to better track information. He also linked the office computers in a network. “We want technology to make us more productive and to help us communicate better and earn more money,” he says.
The company had grown out of its leased space in an industrial park, so Glen headed the search for a new building. The remodeling company purchased and renovated an existing building to house the office, and built a workshop in the back.
Though the company has a display area for product selections, Glen is researching the benefits of adding a kitchen and bath showroom. Another goal is to receive direct access to materials. “We pay lumberyards to provide materials; if we had direct access, it would give us better control,” he explains.
In 2005, Glen set up a customer and prospective customer database that the company still uses to contact clients with direct mail pieces. “It’s the core of how we handle customer information,” he says.
Even though Ben Thompson received his first paycheck from Thompson Remodeling in 1987 at the age of 7, and continued as a carpenter’s helper in the company through summers in high school, he was not originally thinking of joining his parents’ business. But he did want to follow in their footsteps. “I wanted to be a small-business owner. I love the freedom and responsibility it demands of you,” he says. Then, in an “aha” moment, Thompson realized that he could fulfill his goals by building on the 30-year-old company established by his parents, Pat and Sandie Thompson.
The summer jobs he had worked for the company revealed that he was not a skilled carpenter, so when he joined the firm after college, he began by taking over bookkeeping and financing from his mother, Sandie. “I wanted it to be an analytical tool, not just tracking numbers for tax purposes,” Thompson says. He created more accurate job costing by reducing the number of steps to data entry. “The whole system is now more turnkey,” he says.
Thompson then turned over these responsibilities to a part-time bookkeeper, and later to a controller, who now runs the department. “Dad taught me to hire people who are good, empower them, and get out of the way,” he says.
Next, he moved on to marketing, upgrading the company’s brand with a new logo and marketing materials, and he is currently working on a fourth upgrade of the company’s Web site.
Now 28, Thompson has been the general manager for four years. He and his wife, Kristin, became owners of Thompson Remodeling in January 2008. Kristin also works at the company as a part-time interior designer.
In addition to his duties as general manager, Thompson is a salesman, handling 25% of the company’s sales volume. “My No.1 focus for the next 12 months is to improve my professional sales skills,” he says. To that end, he has hired a company called Transform to create a customized sales and leadership training program.
His long-range goal is to build a non-owner sales team. “I will have to get my sales up to a certain point before I can hire a salesperson,” he says.
Taking over in a downturn is challenging. “This official year of transition is critical. We are behind on sales goals and have had to adjust,” he says.
After watching his parents reap the benefit of belonging to a peer review network, in 2005 Thompson joined Remodelers Advantage (www.remodelersadvantage.com). “I knew I wanted that experience for myself,” he says. Thompson strongly believes in the benefits of mentoring and being mentored. He also joined a next-generation forum, which is part of the Family Business Alliance, a collaboration of the Grand Rapids Chamber of Commerce and Grand Valley State University. “It’s not industry-specific, so we’re not open book, but we discuss strategic issues,” he says.
Thompson’s contributions to the company:
Using Enneagram, a personality profiling program, to improve management, sales, and communication. “It’s about how you say something, not what you say, and having a better connection with people,” Thompson says. He, Kristin, and father Pat are using the program to maintain a healthy business/family balance.
This year, Ben, Pat, and mother Sandie renewed their contract with a local radio station to continue hosting a weekly show to answer homeowner questions about remodeling.
Thompson has improved office and construction waste recycling at the company and plans to expand green remodeling practices. He recently earned the National Association of the Remodeling Industry’s Green Certified Professional (GCP) certification. “We’d like to contribute to creating a sustainable housing stock,” he says.
General manager Mike Steed is one of nine children — and the only one interested in taking over the company established in 1978 by patriarch Bo Steed. But he didn’t start off with that goal. He earned a structural engineering degree, spent five years as an officer in the U.S. Navy, then worked at a Seattle telecom company. He returned to Kansas City, Mo., in 2001 to join Steed Remodeling as a minority partner. The 36-year-old then became majority owner in 2004. “I think [the transition] went well. My father was willing to let go. He did not have a control issue or a need to micromanage,” Mike Steed says.
Around the time that he joined Steed Remodeling, he earned an MBA, which helped round out his engineering education and helps him run the company today. Steed is now general manager, overseeing departments run by a sales manager and production manager. “What draws me to this industry is a plan on paper becoming reality,” he says. “And I enjoy working closely with homeowners.”
One of Steed’s first changes was hiring an office manager and purchasing new accounting software. He then took on the role of production coordinator, creating a service-oriented team of carpenters and subs. “I wanted people on the team who fit our model. I knew what I wanted to sell to homeowners,” he says.
The biggest initial change Steed made at the company was in the production department, especially where it overlapped with the financial side. He wanted to improve how jobs were organized and managed and to keep better track of job costs. Field employees are now given the budget for each segment of the job. “This is versus what we used to do: telling them to do what it takes to frame the job and hoping they were close to the budget we set,” Steed says. He created formal channels to hand off this type of information from the office to the field.
Once the changes were made and the company was on more solid financial footing, he was able to spend money on creating a strong team. “I wanted to get the business in a stable financial position with three years of profitable, stable history, then spend money in key areas,” he says. “This made it easier to branch out and hire a production manager with a management background and provide formal training to our salespeople. You need money in the bank to support these investments.”
It helped that his father, Bo, worked full-time during the transition, providing firm footing while he was making changes. Bo is now a salesman, working three days per week.
One of the things that surprised Steed the most is the personal aspect of working with customers. “I used to view [what we produce] as a product,” he says. “Now I know we’re not selling a kitchen and bath, we’re selling a process and a comfortable living environment. To have a successful job, you not only have to make money but develop a close relationship with every client as well.”
Though the company occasionally sends out direct mail marketing pieces, it relies more heavily on the 80% of leads that come from repeat business and referrals. The company sends a thank-you letter to every client who recommends its services.
Steed’s contributions to the company:
In 2007, Mike Steed earned the National Association of the Remodeling Industry’s Henry Spies Superstar Award for the highest score in the written Certified Remodeler exam. For the past four years he has been an active board member with his local NARI chapter. He enjoys helping new members become successful remodelers: “Friendly competition keeps the industry professional,” he says.
Most of the company’s communication with clients is done via e-mail. Some field employees also have PDAs to allow for regular updates. The company keeps detailed records: “We transfer all the e-mails, specifications, etc., from our computers onto a CD that we store for 10 years,” he says.
Steed is proud of setting up and managing a sales department — he feels it’s difficult for someone to both sell and manage. He reviews contracts and estimates and sets up weekly role-playing to improve his staff’s sales skills.