Ken Voelker has been CEO and President of Mighty Auto Parts for almost 25 years and has seen the company through two transactions. His greatest challenge in the next year is planning for succession and preparing Mighty for the next set of great leaders. I’m excited to share with you this episode of The Best Team Wins podcast.
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Connect with Ken on LinkedIn.
Show notes:
2:15 – Learn more about Mighty Auto Parts
4:34 – The biggest changes around people and culture over last few decades at Mighty
6:56 – The first employee Ken hired and what he believes are the most useful recruiting strategies
8:19 – Ken discusses how much of his time is dedicated to hiring and recruiting
9:45 – Philosophy on organizational change and how Mighty leadership has changed over the last quarter century
11:07 – The most important qualities for a leader
12:29 – Ken answers: How do you hire for integrity?
14:14 – “A’s hire A’s and B’s hire C’s” philosophy explanation
15:31 -Adam and Ken discuss hiring managers and the best questions to ask in an interview
17:37 -Rewards and recognition at Mighty, some things are more important than base comp
19:50 – Celebrating success with compensation
21:14 – What is the employee/employer feedback loop at Mighty?
24:08 – One thing that Ken thinks Mighty can improve on the people side of their business
24:58 – The greatest lesson Ken has learned as a manager and a leader
26:39 – Ken recommends The Fix
27:46 – The biggest challenge Ken is facing over the next year
Transcripts:
| [00:01:00]
Adam Robinson:
[00:01:30] |
Welcome to The Best Team Wins Podcast where we feature entrepreneurs and business leaders whose exceptional approach to the people side of their business has led to incredible results. My name is Adam Robinson and for the next 25 minutes I’ll be your host as we explore how to build your business through better hiring. Today on the program, Ken Voelker is the president and CEO of Mighty Auto Parts. Founded in 1963, franchising since 1970 and based out of Norcross, Georgia. The best learning happens through the real experiences shared by fellow business leaders and Ken, we are excited to learn from you today. Welcome to the show.
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| Ken Voelker: | Well, thanks a lot Adam. Looking forward to being a part of the podcast.
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| Adam Robinson: | Ken, we have a tradition here on The Best Team Wins. We always start off on what we call the right foot and that’s the best business or personal news whatever is on your mind that happened to each of us in the last seven days. What is your right foot for last week, Ken?
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| [00:02:00]
Ken Voelker: |
Well, my wife is recovering from some neck surgery and we went to her first post op appointment on Monday of this week and she got a great report. We’re just really pleased that she’s on the mend. We have a son who’s getting married in May and she’s looking forward to being part of the wedding. We’ve got a lot to be thankful for, Adam.
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| Adam Robinson:
[00:02:30] |
Oh, that’s great, Ken. Good news all around. Glad to hear it. On our end, my wife and I, we’re expecting number four in the next three weeks. We got a clean bill of health for mom and baby on checkup today. Feel good about that always. I mean four times. We’ve been through this before, but you never stop worrying about it.
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| Ken Voelker: | Absolutely not. Well, congratulations on number four and I’m glad that things are looking well for you and your family.
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| Adam Robinson:
[00:03:00] |
Yeah. Thank you, sir. I appreciate that. Well, we’re here today to focus on the people side of your business and diving right into that, let’s set the stage. Give us the 30 second pitch on Mighty Auto Parts.
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| Ken Voelker:
[00:03:30] |
I would say that the elevator pitch is that we’re in a large fragmented industry. We have good programs that allow our franchise partners to be successful if they follow our business blueprint. We’ve got 108 franchises around the country. We’ve been doing this as you’ve mentioned since 1970. It’s very much a value added service model. We sell programs, not parts. It’s been a successful journey. I’ve been the president of Mighty for 25 years. It’s been a real fun ride.
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| Adam Robinson: | Congratulations on that. In today’s age that is no small feat. If listeners want to learn more about your business, what’s the best way for them to do that?
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| Ken Voelker:
[00:04:00] |
I would say www.MightyAutoParts.com is the best place to start. That will lead you down a path and if you are interested in franchise opportunities, you can let us know that on the website. It’s probably the best way to start, Adam.
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| Adam Robinson: | Excellent. All right. You mentioned value added service. You don’t sell parts. Just to give our listeners a little bit more grounding, you’re typically working as operations within other established businesses like car dealerships or service centers. Is that correct?
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| Ken Voelker:
[00:04:30] |
Yes. I mean that’s really our end user customers of our franchisees, but in a strategic franchise model, they actually embed a Mighty franchise within their car dealership that you mentioned and use our parts in their service bays and also sell to third parties outside. All in the what we call the DIFM space, the “do it for me” not the DIY or “do it yourself” space. We don’t have any retial locations. Strictly B2B.
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| Adam Robinson:
[00:05:00] |
Excellent. Excellent. Okay. Thanks for that. Let’s talk about the people side of your business. Ken, you’ve been there 24 years. You’ve seen a lot of growth. If you were just to sum up the arc of that journey of the people side from where you were 24 years ago to now in terms of how you and your team managed and intended to culturing people? Walk us through that. What’s the same and what’s different?
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| [00:05:30]
Ken Voelker:
[00:06:00] |
I would say that the biggest difference is continuing to set expectations and provide the resources for our franchise partners and our employees to grow and develop. I’ve been reading your book “The Best Team Wins” and David Barr says that, “People don’t want to just punch a clock. You have to find people who just don’t want a job – they want an opportunity.” I think giving employees and franchise partners that vision of an opportunity where they can improve themselves and develop and grow personally and professionally is probably the biggest learning that I’ve had over the last couple of decades.
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| Adam Robinson:
[00:06:30] |
Tell us more about that. How do you take that and make that real? Certainly looking at the Mighty website, I think you guys do a great job of saying, “Look, people are the key ingredient in our success.” You put that front and center. You’ve got testimonials from current employees up there. What are ways that you put that employment brand out there and communicate to the world that, “Hey, this is a place where you can really grow a career.”
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| Ken Voelker:
[00:07:00]
[00:07:30] |
Well, I would say that in preparing for this discussion, we have only 45 people. We have about 125 employees total, but only 45 here at the home office. They are pretty much subject matter experts because we are providing programs and tools for as I mentioned about 108 franchises, but then over 15,000 service providers. What I try to do is paint the opportunity in showing the size and scope of the network and that we are continuing to grow. We’ve had our fourth record sales year in a row. I think growth provides opportunities for your existing employees and for your franchise partners. That commitment to growth I think really comes through to them in terms of their opportunity for themselves as well as for the company.
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| Adam Robinson: | Do you remember the first employee you hired?
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| Ken Voelker:
[00:08:00]
[00:08:30] |
I do remember the first employee I hired. It was Mark Spruill, our director of information technology. When I got involved with the company, it was actually with a venture capital firm. We acquired it from its founder and I felt one of the real shortcomings was our IT. That was my first hire here at Mighty. Referrals and networking I have found to be the most useful recruiting strategy. I’ve used search firms. Had some mixed success. I’m always on the lookout for talent. We’re a growing company and sure we’ve got constraints. If I see somebody who I’d like to get on the bus, to borrow a Jim Collins term, and then find the right seat for him, I’m not afraid to do that.
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| Adam Robinson:
[00:09:00] |
You mentioned and I loved that you’re always thinking about that. It’s one of the core tenets of what I think leads to successful hiring programs is that the leader is always thinking about that next hire. What percentage of your week do you spend actively engaged in or thinking about talent in building that bench for Mighty?
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| Ken Voelker:
[00:09:30]
[00:10:00] |
Wow. Good question. I would say 20-30% of my time because I’m spending a lot of my time interacting and communicating with our franchise partners and helping them to be successful. The franchise or franchisee relationship is kind of a unique one. It has elements of supplier-customer. It has elements of business partner and to some extent it has some elements of employer-employee. I really look at the development of our franchise system and our franchise partners and their success as probably my number one responsibility. Then I would say 20-30% of my time is then spent with the development of our internal team here in Norcross and our distribution center in Tennessee as well.
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| Adam Robinson:
[00:10:30] |
All right. The business over the last 24 years it sounds like the story is that you came with a financial partner, acquired the business from the founder and then proceeded to make some changes. One of the things you mentioned is that you had an upgrade to IT. Tell us about the leadership team and the structure. How has that changed over the years as the business has grown? Have you had to do major surgery? Is that been mostly a maintenance effort?
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| Ken Voelker: | I think organizational change should be evolutionary, not revolutionary. We’ve really tried to evolve the organization as the company grew. We’ve been through a few transactions which have been new challenges. As I mentioned, we were part of a … You may know Sam Zell, Chicago.
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| Adam Robinson: | Oh yes. Oh yes.
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| [00:11:00]
Ken Voelker:
[00:11:30] |
The vulture inventor. He was our partner when we acquired Mighty the first time. Then we’ve bought it from him, from his venture portfolio in 1996 and the management team of the company. There were really three shareholders that were all domicile here and ran the company and then sold it in 2009 to an OE manufacturer based in Monterrey, Mexico. My two partners retired and I got the short straw and had to stay. Each of those changes has really required organizational evolution. I do think that the leadership team has been here for a long time, experienced and worked together pretty well.
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| Adam Robinson: | As you think about the qualities of a leader in a business model like yours, what do you think are the most important things that predict success in your business?
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| [00:12:00]
Ken Voelker:
[00:12:30] |
Well, I would have to put integrity first. I believe that business is a marathon, not a sprint. I’m not looking for the next deal or the next short-term win or the next quarterly earnings. I’m looking for long run success. Warren Buffett is a hero of mine and I don’t use the term hero lightly. His quote on hiring is and I really like this, Adam, “In looking for people to hire, you look for three qualities: integrity, intelligence and energy. If they don’t have the first, the other two will kill you.” He puts integrity first because if you have somebody who’s smart and energetic, but does not have integrity, they could really hurt your company. The economic cost of a bad hire, of retaining somebody who’s not really on the team has real financial impact.
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| [00:13:00]
Adam Robinson: |
What are you doing or what have you done over the years to zero in on that question of integrity? How do you assess that? Where did you learn to do that and how have you developed that skill because it’s certainly an important one?
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| Ken Voelker:
[00:13:30]
[00:14:00] |
I guess my initial training was at a firm called Arthur Andersen which was a Big Eight accounting firm, actually Chicago based. It was one of the Big Eight accounting firms. They believed a lot in training. I learned a lot there. One of my favorite sayings from there is that “A’s hire A’s and B’s hire C’s.” I’ve always tried to surround myself with people who are better than I am. Getting back to your question of integrity though, that’s always a tough one during an interview process. I try to ask some questions about family, about things outside of work, tell me about something that didn’t go well or you failed in a prior job experience.
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[00:14:30] |
Particularly on key hires, I spend a lot of time on questions outside of just competence for the job, but more try to get to know the individual. Also for key hires we use a management psychologist. We send our candidates to someone we’ve had a relationship with for a long time and he does a series tests and interview questions. He’s very experienced and insightful and he’s been a good resource for us.
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| Adam Robinson: | That’s excellent. You mentioned this notion of “A’s hire A’s and B’s hires C’s.” For the benefit of all listeners to make sure we’re grounded in that principle because I believe it as well, tell us more about that.
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| [00:15:00]
Ken Voelker:
[00:15:30]
[00:16:00] |
Yeah, okay. Not to try to grade people as an A, a B or a C, but there are some people who are very confident, competent, capable, kind of A players. They want to be challenged and to grow and to be surrounded by people who are better than they are and who push them, while a B player who is not quite as good or confident in their own abilities feel threatened by A’s. If you’ve got a manager who’s kind of a B player, often they will bring in a C because they are afraid that if they bring in somebody equal or better than they are that they’ll be shown up. I think that’s a real danger in organization to have kind of middle level managers who are afraid of the hiring process and thus don’t bring in people who might be the best fit because they see them as a threat to themselves.
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| Adam Robinson: | That’s interesting.
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| Ken Voelker: | How did I do with that, Adam?
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| Adam Robinson:
[00:16:30] |
No, I think it’s great. It’s a tool and a mindset that sounds like it served you well. It certainly served me well over the years. One of the things, to that point, I like to do in an interview or discussion formal or informal is ask about the team. If I’m hiring a leader, I’m asking them about the team. Tell me about the team that you have now. What percent of that team did you inherit? What percent of that team would you say are above average performers versus people that are struggling? Tell me what you’re doing to upgrade that team. What team do you have now versus the team you started with? You can start to put the dots together. Is this a manager that is accumulating mediocrity? Are they driving the best people off?
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| [00:17:00] | Are they making the necessary changes? Are they self-aware or even honest with themselves about the team that they have? Those are all indicators that I certainly look at. It sounds like it’s worked well for you.
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| Ken Voelker:
[00:17:30] |
Yeah, I like that. I like the talk to them about their team. You’ll also get a sense of whether … Success is always built on the team. It’s not the individual. It’s their ability to build a team and to lead. When you ask people about success, it’s always interesting to see whether they take responsibility or whether they credit their team for the success.
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| Adam Robinson:
[00:18:00] |
Absolutely. You’re looking at somebody take credit for the wins and assign blame for the losses. That’s the recipe for a poor performing organization for sure. Let’s shift gears a little bit and talk a little more philosophically around a couple topics. I want to cover rewards and recognition and I also want to talk about employee feedback. Let’s start with rewards. Again philosophically, what do you believe is important with rewards and recognition on the range from pure monetary rewards all the way to just slap on the back, good job type of recognition?
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| [00:18:30]
Ken Voelker: |
Well, I certainly think the compensation is an important element of employment. My paycheck’s important to me. I want to put food on the table for my family. You’ve got soon to have four mouths to feed, right?
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| Adam Robinson: | That’s right.
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| Ken Voelker:
[00:19:00]
[00:19:30] |
At the end of the day and I think this is particularly true with the next generation if we’re going to talk about millennials, there are other aspects that I think are equally, if not more important than just base compensation. I think those things include flexibility, respect for the individual, appreciation, family first. We try to really have a flexible environment with professionals who I don’t expect to punch a clock. I expect them to get the job done. Sometimes that means they have to work on the weekend and sometime that means that they have to take the afternoon off. I also think that I try to use recognition of successes all the time. I try to praise people in front of their peers.
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[00:20:00] |
I try to send emails and copy their superiors or their managers if you will. I try to let people know that their performance matters and that we care. I think that appreciation for performance is an important element of our culture hear at Mighty and important to the employees.
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| Adam Robinson: | What are some things you do specifically to make that real either anecdotally or otherwise you could share with us?
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| Ken Voelker:
[00:20:30]
[00:21:00] |
As I said, I try to do it through written and verbal communication. I try to get the manager in the loop. I look for successes and celebrate them. It’s not really done as much on a monetary basis, although we do have an annual bonus program. As I tell everybody who has a technical background, it’s kind of a nested if. If the company performs, then we have a bonus pool. Then if the individual performs, they get to participate in that pool. To be honest, it is a bit subjective. Kind of the managers and I get together and look at the contributions of the individual. We do try to really reward performance both through praise and through compensation.
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| [00:21:30]
Adam Robinson: |
All right. What I’m hearing is public praise, make sure their manager knows, right? You’re creating a chain of recognition that benefits everybody.
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| Ken Voelker: | That’s the intent, yes.
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| Adam Robinson:
[00:22:00] |
That’s excellent. Let’s talk about your philosophy toward things when you’ve got to give constructive feedback or when it’s not working out or when an employee or team member or franchise partner has got some colorful feedback for you. How are you approaching that? How do you want to receive that feedback? What’s your overall approach to learning let’s call it?
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| Ken Voelker:
[00:22:30]
[00:23:00] |
I try to have an open door policy. I know there’s a lot of lip service to that in business. I literally do have an open door and I really do have employees who come in and share ideas with me or thoughts. We have a suggestion box. I had an employee pull me to the side today and say, “Ken, this conference room where we entertain folks, we really need to update this.” I guess we’ve gotten a little house blind. I think they’re comfortable approaching me and sharing ideas and things that they think need to be changed. We do measure performance of our franchise partners. We have a top dollar report each month. We rank all 108 franchises based on sales and market penetration. They look for that. We talk about it.
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[00:23:30] |
We have an internal kind of blog that people share information on. There’s a lot of competitiveness. We have different methodologies that we use to solicit input. Then the most important things is to follow through and close the loop and either explain why we can’t do something or we actually do take action and do those things.
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| Adam Robinson: | I certainly appreciate the thoughtful and measured approach to feedback, to the open door policy, to rewards, to recognition. It sounds like people know where they stand in your organization.
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| [00:24:00]
Ken Voelker: |
I don’t think they should ever be surprised in performance reviews for example. I think they should be getting feedback all along. It should validate. I look at performance reviews as the opportunity to do two things: pat people in the back and kick them in the butt. There are always things that they can do better and you always start with something positive and then you have the areas for improvement in the middle and then you end on a positive note as well.
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| [00:24:30]
Adam Robinson: |
All right. As we bring this on here, I want to close with a couple of questions here. What do you think you could do as a leader to improve the people side of your business?
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| Ken Voelker: | I think that I could do a better job of … Me personally or the organization?
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| Adam Robinson: | Either/or or both.
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| [00:25:00]
Ken Voelker:
[00:25:30] |
I don’t think that we have as good a close looped performance feedback mechanism as we should. Our performance review model is a bit unstructured I guess I would say. I’ve been reading a lot about individual performance improvement plans and a little bit more methodical approach to performance and feedback and development. We’re looking to do that. I think that will be a step in the right direction, Adam.
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| Adam Robinson: | In the same vein, what’s your greatest lesson learned as you’ve been in the role about managing and leading people in an organization?
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| Ken Voelker:
[00:26:00] |
I would say that it is to hire good people and then give the resource to be successful and then get out of their way. I would say that I’m the opposite of a micromanager. I want people to take ownership. I’m not going to look over their shoulder. I want to be a resource for them. If I can help them, I want to help. I hire good people and I give them the tools to be successful and I want them to get the job done.
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| Adam Robinson:
[00:26:30] |
You have a lot in common in that regard. Down to the word choice and how I describe it. I’m with you on hire great people and get the heck out of their way. That’s I would say almost to a fault sometimes. Give people the ability to get the job done. Maybe let it go a little too long sometimes.
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| Ken Voelker: | Well, I love your pathologically optimistic. That part of your culture. I mean I’ve been using that. I hope you don’t mind. I’ve been stealing it. Optimistic to the point of it being a sickness.
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| Adam Robinson: | That’s right.
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| Ken Voelker:
[00:27:00] |
I think that’s great. I think that’s great. Own the result. I just think that accountability is also an important trait of any culture that’s going to be successful.
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| Adam Robinson: | I appreciate that, Ken. All right. We have the final night stand question here, what book are you reading right now and would you recommend it to our audience?
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| Ken Voelker: | Well, I’m reading “The Best Team Wins” and I certainly would recommend it to my audience.
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| Adam Robinson: | All right. That’s the plug bell.
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| Ken Voelker:
[00:27:30] |
Wait a minute. Wait a minute. Wait a minute. The real answer to that is that I’m a finance junkie. I’m reading a book called “The Fix” which is how bankers lied, cheated and colluded to rig the world’s most important interest rate which LIBOR, the London Interbank Offered Rate. I don’t know if you read in the Wall Street Journal several years back about how there was collusion going on in setting that rate.
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| Adam Robinson: | I did in fact. Yeah. That gentlemen was just sentenced I believe.
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| [00:28:00]
Ken Voelker: |
Yeah. Thomas Hayes I think is his name. The book is called “The Fix.” If you’re interested in that type of intrigue and financial chicanery, it’s a great book.
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| Adam Robinson:
[00:28:30] |
Fantastic. Thank you for the recommendation. All right. Here’s our close here, Ken. If you were to come back on this show a year from now and report to us on whether or not you successfully tackled the single biggest issue or opportunity that you’ve got in front of your business today, it could be people related or otherwise, what would you be reporting on?
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| Ken Voelker:
[00:29:00] |
I would be reporting on succession actually. As I mentioned, I’ve been the president and CEO here a long time and many of our senior executives are long tenured and we need to be building the next leadership team for Mighty. There’s a lot of time and attention going on that and we’re bringing in some outstanding young people. John Granat who may know through our use of Hireology platform. He’s our director of franchise operations. We got a lot of head room in our company. I would say that that’s the biggest and most important challenge facing Mighty today.
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| Adam Robinson: | All right. Ladies and gentlemen, that’s the final word. You’ve been learning from Ken Voelker, president of Mighty Auto Parts. Ken, thank you so much for being with us on the program today.
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| Ken Voelker: | Adam, I really enjoyed it. Thank you.
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| Adam Robinson:
[00:29:30] |
That’s a wrap for this episode of The Best Team Wins podcast where we’re featuring business leaders whose exceptional approach to the people side of their business has led to incredible results. I’m Adam Robinson, author of the book “The Best Team Wins” which you can find online at www.TheBestTeamWins.com or at Amazon. We will see you next week. Thanks for tuning in.
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