Rewind: Keeping airports safe the Conscious Capitalism way
On this Conscious Capitalists Podcast Rewind we bring you a much loved conversation: Meet Ben Richter, CEO and founder of a company that has revolutionized airport security and logistics and built a competitive advantage by creating a conscious business. Bradford Logistics: a big, little company you get touched by almost wherever you travel, but have probably never heard of. Great tips from Ben on building a conscious culture and business model. Originally released on January 26, 2021.
Listen to this episode on Apple Podcasts, Spotify, Stitcher, or wherever you get your podcasts.
References & Resources:
Bradford Logistics main website - https://www.airportlogistics.org
Conscious Capitalism main website - www.consciouscapitalism.org
Rustand, W. (2021). The Leader Within Us: Mindset, Principles, and Tools for a Life by Design. Forbes Books.
Mackey, J., Sisodia, R. (2014). Conscious Capitalism: Liberating the Heroic Spirit of Business. Harvard Business Review Press.
Sisodia, R., Henry, T., Eckschmidt, T. (2018). Conscious Capitalism Field Guide. Harvard Business Review Press.
Timothy: Hello everybody and welcome to Episode 21 of the Conscious Capitalists with myself Timothy Henry and my partner and trying to make the world a better place through business, Raj Sisodia. Hi Raj.
Raj: Hi Timothy. You know it’s interesting, it’s our 21st episode on the 21st day of the 21styear of the 21st century.
Timothy: Wow, you always come up with the perfect bon mot for whatever we are doing. I love it. That’s great. While the good news is that today we’ve got a great guest. A longtime supporter of Conscious Capitalism and somebody who I respect tremendously as a person, as a friend and for what he stands for. Ben Richter. Now let me introduce the Ben. Ben is the CEO and founder of Bradford Logistics. And you probably never heard of Bradford Logistics but you probably touch them much, much more than you think you do because they have actually reinvented a whole category of business with the airport logistics. Ben will talk about that a little bit but if you travel to Heathrow or you travel to Houston or Detroit or almost any of the major airports in the United States, you’ve been touched by Ben and his organization. They are a little over 20 years old. They had been profitable since the beginning and grown every year since. Here he is, the one and only, Ben Richter. Hi Ben.
Ben: Well Tim, what a fantastic introduction and what a great way to celebrate yet another first or I should say 21st. It’s great that you both are delivering such dedicated effort to continue this proliferation of Conscious Capitalism which I am such an amazing supporter of this movement.
Timothy: Well thank you Ben and maybe it would be helpful just to begin with a short sketch of Bradford Logistics and what you do because it’s not a household name. You may went all of these awards in your industry and be a well-known force for good in your industry but outside that niche people have a necessarily come across Bradford. So tell us a little bit about it.
Ben: So there are some things, some services that are better felt than seen and we happen to be one of them. So our typical security organizations, the great organizations like TSA provide this overview of security of people that go to airports, we provide oversight for all the commercial goods that are consumed in a moderate airport. So what most passengers don’t realize is all the things from like food and beverage and retail goods, custodial, operation goods, radar parts for the FAA and firearms for law enforcement all come through a central distribution system that that’s all of the vendors, and removes all the commercial goods from the normal roadways that you would want to meander to get to an airport and they are rerouted to this facility that then redistributes these goods in a very consolidated and systematic and timed way so that these many economic engines for the cities that represent the airports, all of the logistics of the airport is managed in a very synchronous way, that allows you as a traveling public be hassle free and everything appears to be exactly where it needs to be when it needs to be there. And that’s kind of what we do.
Timothy: So you are the guys that make sure that when I go to the Starbucks at the airport, there’s a Starbucks there that’s got coffee for me.
Ben: Sure. And along the way ensuring all the goods and the people that are providing all of the logistics have been vetted and the materials exactly where it needs to be when it needs to be there.
Timothy: Ah that’s brilliant. That’s really brilliant. So tell me a little bit about the history of the founding of the company and what got you into this in the beginning and why.
Ben: Well I think it’s really important that most folks understand that there is just a natural journey that I think entrepreneurs go on in their discovery of how to make impact. And I think what has attracted me both to this journey of entrepreneurism and has uplifted me along the way is really the thought that business can be a tremendous force for good on the planet. And I’m not just a simple advocate of it, I think we have to reduce that to practice if it’s going to make sense. I don’t think businesses about what you get, it’s about what you give. I know there’s a lot of fundamental business principles and often times we had this unbelievable preconceived notion that what business is about is following some very rigorous financial model to yield some financial result.
I’d love to tell you I have never managed a business to a P&L. Not that they don’t exist and not that there isn’t prudent financial structures in every business I have been involved in what we focus on a number of other things. Things that I referred to as our da Vinci code and that has always yielded some amazing results. I would tell you the kind of results that may be are even better than some of the proscripts that you follow “a business financial model.” I don’t think it’s any accident and I think Raj had been in the business measuring this in a number of publications including terms of endearment on however we’ve seen this play out for 20 years. And what was my third business thrift but also one of the ones that’s been so enjoyable for me because of the legacy we are leading as a result of being able to participate in this unique business.
So fundamentally on part of this da Vinci code really is combining a purposeful pursuit with an amazing culture and highly defined vision for the future that brings people and stakeholders and principles to produce results that have significant positive impact as a result of executing some business model. All this sounds very heuristic. Price I can break it into really fundamental specifics about our business and bring to light how these kind of principles play into a 20 year big experiment gone right.
Timothy: Well I love the fact that you are combining the fact that you know that sometimes when I talk with people I said there’s some conscious capitalism isn’t an excuse for not having a good business strategy and a good business model. So we sometimes get lost in the, you know some of the software aspects of conscious capitalism and we forget you know really you still got to have a really good operations model. You got to be able to execute. You’ve got to have a good strategy and vision for what that means in your industry. These things, your da Vinci code that helps you move from being just a good organization to really be an extraordinary organization. I think that’s what I would love to explore a little bit more with you here today. Raj how are you doing?
Raj: Good. I do want to underline that point. You know having a sound business model is part of being a conscious business because that means you’re going to be a good steward of the lives of your employees and your suppliers in general because if your business falls apart, that’s not being stakeholder oriented at all. So I think that is core to this. A business model that actually leverages all the other elements. It leverages the fact that we have strong stakeholder relationships right. And we have the sense of purpose so that our strategy in fact this predicated on those elements as well. So I think it becomes a strong reinforcing system. That we have stronger sustained competitive advantage as a result of all of those elements as well which then feeds into a sound vale proposition to begin with and it enhances that over time.
Timothy: I think that’s really important. I would love to maybe take one or two parts of your da Vinci code Ben. You know like what are one or two things that you are most proud of our really feel best about in terms of your da Vinci code that has helped me get these extraordinary results in your business.
Ben: So fundamentally your business, this sound business model has to solve some prevailing problems. In our very first deployment we were bringing out of the ground a brand-new $2 billion airport terminal in Detroit but the old Detroit airport some 21 years ago, this Smith terminal was not one of the worst customer service airports in the country. They had the unique and distinguished title of being number one in that category, dead last. You would have had a better chance of fighting with a vendor over a pallet of goods in the middle of a hallway that simultaneously at all the passengers passing through it, 267 freely roaming vehicles on an airfield with busy aircraft trying to get to and from gates and it was absolutely non-optimal and I will leave it at that. And when Wayne County, and at that time Northwest Airlines decided they were going to invest in a brand-new build, a giant green field build. Something that was had the lofty goal of setting a new standard for how aviation terminal should be built. They also wanted to reinvent logistics. And there was a wide net cast for models on how this might work and we were fortuitous to win that beauty pageant. Eventually led to an eight-year contract and it started in Bradford Airport Logistics.
More importantly we began to execute on Raj’s sound business model. Some thought leadership around how airport could be executed in the future and why we are doing it the events of September 11 completely changed our model. We started out as a technology model around logistics to change the efficiency by which we operated in solving these problems in a very unique customer service super efficient. We took 263 vehicles and we replace them with three. We took $90 million of construction on the project to replace all the dock infrastructure with the centralized operation. But then the events of September 11 by happenstance, we also happen to be the single most secure way to get goods into a modern airport and it didn’t exist anywhere else in the world.
This charter for changing the way aviation works became part of that sort of big a mantra and we had some people involved in this. And you could ask them at the time, what was your mission. And if they were telling you to move boxes around the airport they got it wrong. If our line level leaders, and that’s you know a lot of people call the last guy and is all kinds of employee in sort of bad persona names, there are our top leaders in the organization. And we believe in a mantra called leaders at all level of the business. And if it’s lip service or just writing on a wall, it means nothing. If I wake up every day and you know I’m the bottom of the pyramid, as a CEO my job is to uplift and support all those around me and the layers kind of go, and the line level leader that’s it. And if that guy is going home or gal to their significant other and saying what I do every day is I help this airport run great and without me there would be no airport running. Then they got it.
First of all they have now carried the mission, the purposeful mission along with them every day. Along with a set of core values that we firmly believe in and they were not discovered by yours truly. Those first set of employees we went on a little mission to Mars is the discovery process by which you discover core values from within your net. Don’t get me wrong. There’s positive core values and negative ones. We just don’t put the negative ones on the wall and aspire to achieve them. We put a few positive ones that really and for us it was being knowledgeable about our industry and our customers. It was keeping all of our promises, not just the ones we make to ourselves but especially the ones to our stakeholders. And then it was innovating faster than anyone else in the industry in a succinct way. Everyone carries that with them and it doesn’t mean that they don’t show up in a unique and transparent way, Tim. And it is as if we don’t value people for their own personal brands but there is something about our filter, about how we hire for core values that we are fundamentally looking for people who are looking for a purposeful pursuit and then we develop folks from within to the extent that they say please stop. Otherwise you can go as far as you would like to go.
Timothy: I love that and the part that I love about it is that part of it is around how you develop people organically. But I know also that when you took over the business a big, big win, one of the most largest and complex airports in the world, the Heathrow, right. You inherited a group, didn’t you? I mean you inherited people and now the question was okay, we didn’t handpick these babies but you know they are now. So how did that work when you brought your culture and that sense of strong sense of purpose and core values and you brought it to a group that might have been, I don’t know, might have been a little cynical? That cynical thing got a chuckle, didn’t it?
Ben: Probably an understatement but that he also say you know the United States and England are two countries separated by a common language. And more importantly there are cultural norms that were inherited in London and it may be one of the great conscious capitalism and commercial experiments of its time. Because both myself and my co-CEO, David Fitzgerald, pondered greatly and had lots of concern that if we are not using as you said our incredible filter to hire every employee with purposeful bounds and make sure their core values are aligned with the organization and we do this. We have such an unbelievable process for how we onboard people including a values interview filter that’s done at the executive management level for every higher in the organization that’s quite extraordinary and we weren’t going to do that in London. And as you said we took over an existing operation and the big question was, people with an existing culture and people with existing characteristics can you have this and you were going to bring, there was no preconceived that we are just going to bring them over to our culture and they are going to be morphed into. We were going to have a shared culture, a combined culture or something that was in between you know our absolute ideal. And we needed to bring folks along on a journey but it was big experiment of whether it can be done. And in London it was even a little more challenging because some of the preconceived cultural norms including alignment of incentives, there kind of KPIs, they were very kind of entitlement based. And generally speaking in London also, there still is as great divide between workplace and management and how they look at each other. There’s just some preconceptions that have just been around for decades and we were looking to disrupt that.
We wanted to have a different kind of relationship with our employees; one built on trust. And what we say is what we do and transparency. I remember my first talk with our employees and I specifically did a few things. Number one, he told me don’t wear a tie in there but I normally do so I did. I wanted to be my authentic self. When I gave the presentation to some of our board members, there was one particular person who was probably my biggest critic. It might’ve even made some defamatory comments around this is really not going to work. But I also think your biggest critics for being honest is the greatest feedback you can get and you should know going into it, what other risk profiles and then be able to look into the mirror and say it’s worth it.
So I kind of went into this first talk and looked at the line of leaders across the board and we literally had a couple hundred employees in London. And I had to tell them the story of where we wanted to go. And I started off by talking about mission, vision, values, our management team and if you want to bored to death a bunch of London line level leaders, that’s where you start. And I knew I could take them there and I also kind of new that I might ruffle a few feathers being up there, you know all tie driven and suited up and they are not. But along the way I told them that our employees in the US we had a number of discussions amongst our facilities at the time and they told me I was supposed to charter a 747, bring them all over there and let our employees talk to their employees at an employee level and therefore they would really understand our culture and know that we were authentic and virtuous and really trying to bring them along on the great journey. And I told him that similarly got rejected due to financial reasons but I am here and what I did do is we sent camera crews to seven facilities with really no preconceived agenda and they got to talk to the camera and we played a video for the guys in the seats.
And they went back in the chairs with their arms crossed and within three minutes leaning forward, chuckling a little bit and listening to real **** and you know I think most of the folks if they had said just themselves and I suspect this is going through their head, if any of this is true. This could be a really cool. This could be a great place to work. And what is this about we get some of the cultures. So David Fitzgerald likes to say you’re either adding to or taking away from our culture at every moment and you get to decide what the culture of the organization looks like. We don’t own it. We collectively own it.
And so I’m boarding this direction and they got to see hey I can only our own culture and we can have something really fun and engaging and purposeful and different than what we have today. And over the course and I would tell you it was a three-year multi-year journey, Tim, you don’t earn respect and trust in built one promise kept at a time. But in the course of three years we eventually got to a place of peril where we were altering our union contract to align our KPIs with the contract and there were those who thought we are trying to take away their bonus. Because before it’s kind of in entitlement, you are just going to get a check. And here we make it real but we can’t achieve what we are promising to the customer unless everyone is pulling on the same rope. And it came to a don’t blink moment like we are going to either have an industrial action or we’re going to get together. In May it was folks from within told their own unit representatives we believe these guys. We have seen three years of nothing but authenticity and sometimes that’s what it takes and in London it was that for the experiment. And then post that we have gone in KPIs beyond anywhere, even London and ourselves we believe achievable. It’s probably the finest run benchmark operation and the largest of its kind in the world and it’s super system driven and the leaders we have there are super appreciated. I just want to let you know and it’s not normal nor was it our desire but I can’t make it through operation without a high five on the floor of the warehouse and that just doesn’t happen in London.
They’ve got me to reduce my tie wearing and I have spent just a lot of time listening to what needs to happen. Like I will get a hallway hijacked and they will tell me how to be a CEO and I let that happen every day of the week.
Timothy: I love it. I love it. I also think it’s really unique that you are co-CEO. If I recall right, came up from the HR side of the organization side of things.
Ben: Originally he was an ops guy and what’s interesting about FedEx is that the vast majority of their executive team came as either a driver or a line sorter or something that’s - and they develop from within. And David went through the ranks as an operations guy and then a swot team fellow but was eventually invited to HR and help build their fabled leadership development institute and was really at a time where they were the fastest in the world, $0 to $1 billion in revenue before the dot com era. It’s an extraordinary journey. So he brings all of that with him.
Raj: Well that London story is terrific you know and I think it illustrates some generalizable points. It reminds me of about Chapman in what he did. Eventually he acquired 120 companies all them was some kind of toxic culture with a lot of pain and dysfunction in the past, with a lot of hostility and suspicion. And because he brought sort of a universe, a culture that is based on universal human values, everybody wants respect and dignity and a sense of safety and being cared for. When you do that and when you build trust and people feel cared for then you can hold them accountable and set high expectations. So I think there’s a culture that if you’re moving them towards that, it’s sort of almost doesn’t matter where they came from because that is something pretty much everybody aspires to move towards. I think this is a great illustration of that being true.
One of the things I’ve been reading just recently, in fact this morning, Unilever has just announced that they are by 2030 going to require that all of their suppliers pay their employees a living wage and Unilever has already made that commitment, already is doing it I believe in 190 countries. They define the living wage based upon the local cost-of-living but that includes food and housing and education and health care and transport and clothing and a buffer you know a margin to save in the event of something happening. I wanted to get your thoughts on that. That’s just fresh on my mind. As a CEO, how does that land with you when you talk about the people at the frontline and how motivated they are and inspire they are and purpose driven they are? What about this idea which think about the biggest crises and threats that we face, to me it’s climate change and social inequality.
Ben: So I will try to address it in brevity but it’s quite an interesting topic. And when we first arrived in London and also in our US operations we don’t have any temporary labor and although in London we did have a significant temporary labor. There were some things about the temporary labor I really didn’t understand Raj at first glance. Normally temporary means pretty much you can bring them in but it’s done for seasonality in this business because we have big things that happen in Europe and in the month of August everyone travels. And the holiday peak is a very different thing and so having some variability in operation that runs 24/7 365 supporting one the largest engines in the world needed that. So we accepted that going in. What I didn’t know and I learned, we had town halls and in one town hall I had one employee a gentleman who literally started crying in the middle of my town hall and what he was telling me is I do the exact same job as a guy with the permanent position. And when I get to take home after this intermediary area, a temporary organization is a fraction of this guy doing the same job Mr. Richter. And you know I’d love to tell you that that didn’t move me. It did. You know first of all Tim knows me well enough to know that’s exactly the kind of thing that moves me and when I look that man in the eye I said I’m going to solve this problem. We began to come up with a program that moved people from temp to permanent. We also work with one of the most exceptional management teams in the world. London’s executive management team has been promoting a London living wage and they had something prior to the current debacle we are in. We are on our way to what we call Heathrow 2.0 and we were leading the charge in Heathrow, not just on London living wage but so many others, paying your vendors timely. It is a long list of things that you would call came right out of the playbook of conscious capitalism and Heathrow may not know it but they are living the dream and that’s a purposeful thing.
Now obviously will be lost 20% of passenger enplanements we thought the world was ending and then we realize the world really was ending while we were at 95% of passenger enplanements evaporate from you know this is biblical this is apocalypable period we are in now. And we all fundamentally know how resilient aviation will be and we are all there to bring everyone back into the chairs and ultimately get back on Heathrow 2.0 and make that happen. So Raj emphatically I think it’s the right thing to do. It reads on getting there is easier said than done. It requires some patience. It requires forethought.
So we created a plan that basically gave people a path temporary to permanent but had to convince our stakeholders that have more permanent positions was important and then we had to come up with a plan where we insured that even though they were temporary, they really were except for these various periods. There really kind of permanent employees, just call temporary. Although we didn’t get an economic advantage, they got it economic disadvantage. And so we basically tried to minimize our need during peak periods of that resource by doing all kinds of super smart stuff including building systems and infrastructure for better predicted measures. And ultimately I think we solved 70% of that problem. Generally speaking we couldn’t take everything out of the business and we did need to be able to have certain flex but the problem change the systemically and more importantly everyone in our organization; it was not my mission the minute became a mantra of our group the Wade line level leaders work. They owned it and so they came up with proposals and the model we ended up on was a collective model of everyone’s vision of what’s the best we can do and still have a resilient infrastructure that can support the needs of the business. But Raj nothing gave me more joy than being able to look some of these folks and we uplifted their condition in life and they really felt like I make equal to everyone else on the team and it was just a hugely beneficial thing and something I think we can look back in legacy and say that was done right.
I also want you know there was one other thing that came in out of some great concepting with employees which is Tim loves our employee service excellence coins. And I wanted to share a little bit about a way that you can elevate line level leaders and really make them special and along the way do some really unique things with culture and relationship. And so we developed a coin that you don’t give to the employee. You give it to all the key stakeholders. So if you’re a manager of like a retail enterprise at the airport or the CEO of Heathrow and we do this domestically in the US and I think just as Tim is sitting in London I seem to be [inaudible] in our London operation for Tim’s benefit. He knows the story well. But Huffington wrote about it. It was really highly acclaimed but I really want to get to the crux of why it’s special.
It’s not just another employee engagement thing. I think it’s a way to elevate line level leaders and make their prominence and importance and the thing that when we say they are a leader this is why. What happens is we give all the stakeholders coins in London. We distributed I think 300 of them a year and it’s one year and every coin is serialized. So the CEO is carrying it in his pocket and he’s got one charge. You know if you see someone doing something exceptionally right, pause them, tell them why and then hand them this. And what uniquely happens, how many times in years prior with that CEO ever stop to - didn’t have a reason. And then more importantly if you are the employee and you get this cup, and whether it’s a CEO or the manager of the you know pink men’s clothing store or the particular café, it’s really exceptional that your pause, a member of your client or stakeholder team then tells you I so appreciate you for this and then and see something. That exchange if you can imagine the electricity that flows through two human bodies when you give something and you receive something for just doing what you think is your normal purposeful mission and somebody calls you but they have a relationship at that moment and never had it before. So my line level leader, I did meet the CEO that year but he did. And he had a hallway meeting that was – and guaranteed he goes back. The first thing he does he tells a supervisor that - and when they look up serial number 165 and they realize it’s oh my word. This was the Chief Operating Officer of Heathrow are this was the Head Chef of Peculiar Café. You know that’s meaningful. Now we end up calling it and asking him the story, recording it and then proliferating the story to elevate the employee and to provide ample support, what our great mission focusing things you can do to stakeholders and we get hundreds of them a year. And we elevated it what you going to do this year and it’s really Raj wanted this prolific distributed organic ways to make the words on the wall come out and make them real. And it’s just one of hundreds of things that we have experimented with that kind of what I say carries the torch for making our people the most intrinsic center part about what we do every day.
Timothy: Well I love that because I think it makes a lot of points about appreciation and people’s energy and everything else but it’s also fueled a lot of innovation for your business because when people are passionate. I love the way you say, you know we push a lot of responsibility down to the front line to find ways to innovate and you have won awards for innovation because of this you know positive cycle you have gotten into of appreciation and caring and passion and understanding what the business is about and then combining that and unleashing that as a power in the organization. Say a little bit more about that.
Ben: So innovation cannot originate from your most likely set. You know we don’t invent it in Houston. Ultimately we have to be just incredible listeners. The best ideas in the organization come as Tim alluded to comes right from the front line of people touching a customer. So we have this amazing interface and everything we do in the system called AMIS or Airport Material Intelligent System. But this acronym for the system I love to tell you we designed it. We came up with the software guys and truly what it was is every stakeholder meeting, every commentary they came back it was user inspired software. We have the most incredible. I mean there’s millions of lines of code and you know it helps us operate at incredible levels. It’s a predictive system. It’s extraordinary KPIs and if you can imagine a business for any anomaly that could occur warns you well before you fail. We never see the sharp end of the contract or a regulatory problem because we have this incredible infrastructure and I’d love to tell you we architect it at this executive level. It really came from just a thousand interfaces with both stakeholders and our employees and then listening. Much of the features and functions in the code are named after employees. Yeah and you know it’s extraordinary. And so I think you are getting at something. That every time you have one of these touch points, every time you have hey this was - it’s another way to reinvent yourself and if one of your core values is innovation faster than anyone else in the industry, that’s a tough challenge. And if it is going to be words on the wall that’s where it stays. If you are going to make that happen then you got to have - you have got to use the two ears you were given and everyone is a listener and everyone is a creative genius and return that as you know into innovation fuel.
Raj: Well Ben, we always like to learn about the journeys of the conscious leaders we get a chance to speak with her. You know, people are brought up in a certain way or they have certain influences from their parents or from a mentor. Like what made you into the kind of leader that you are and who thinks the way that you do?
Ben: There are, and Raj, I first want to start out with some basic beliefs that have been formulated over decades, but I’ve analyzed the same question but for myself. And there is a fundamental belief that I believe every human is basically born with the same human potential, and barring some medical or physical abnormality, which I think accentuates, you know, skills that you would never know you otherwise had, generally speaking everyone can get to where you are, and so your job on planet earth during the time we have the luxury of breathing breaths, is to uplift everyone around you and to see if you can assist them in some small way on their journey of enlightenment, and generally, speaking that’s where everything starts for me.
Raj: And where did that come from?
Raj: Where did that come from?
Ben: Right. So I got to start with a dad who gave before he got every step of the way, and he had – when he married, he married a woman who already had four children, and then took on two more and I just want you to know he had that kind of heart, and he wasn’t a soft-willed individual. He was brilliant and strong willed, but at the same rate, had a heart with no end. And I learned a lot, not just necessarily from words, but more from behaviors and how he interfaced with people on what he was willing to give to help others and it was just an extraordinary example. Certainly along the journey, I think what parents try to do is to put people and influence you in your life, and I believe kids kind of grow up and every once in a while the camera lens goes off, and in a couple circumstances, individuals my father knew became mentors of mine because the camera lens went off. And along the way, there’s countless I can remember and then the journey through college, you know, there were our kids who go to school and, you know, they want to get the piece of paper and the pedigree and move on. I wanted to get the learning.
Like for me, I have a love of learning that has no, I can’t seem to quench that thirst. I think Tim knows me well enough to know the inquisition part of my skill base is strong, and I ask intriguing questions. It happens to be a parenting style. I used to have this special chair in the room in my home which I refer to as a listening chair and where kids are supposed to be able to come in and, you know, talk about whatever they want with no, you know, opinion and my kids commonly refer to it as the talking chair because they can’t get me to shut up once they give me an opportunity to respond. I wish it didn’t feel that way to them, but it's – you’ve got to accept feedback, honest feedback.
But along the way, in the entrepreneurial world, in the business world, there’s been some significant influence. I think Verne Harnish and his teachings and my going through this gathering of Titans and Birthing of Giants programs first with EO and then my transition to YPO and this network of likeminded folks and especially the ones who have cultivated that with a sense of purpose and passion and have really learned that this journey is all about learn and at some point you get the privilege to earn and bring others along the journey, and that at some point you go to return, which is where you give back. And I don’t think it’s just a fine line, but that’s the transition, and if you’re doing it right, at some point you stop climbing the mountain and you teach people to climb, and I’m on that journey and I just have loved every second of it and every phase of it.
Timothy: Ben, I always think of you as this great big hearted man. So you have a big heart. You’re very generous with your time and your energy, and at the same time you’re also very determined, very focused, very disciplined, and it’s a really interesting combination to be big hearted and focused and disciplined and really action oriented, and I love that combination about you. But tell me a little bit about where that big heart came from. I mean that’s a big heart you’ve got, and it hasn’t been an easy journey for you I know at times. So tell us about that heart. Where did that big heartedness come from?
Ben: There is not one thing, Tim, that I think I’m genetically predisposed. I’ll give you one of the frailties. Somewhere in my wiring is, and I believe because people showed up in my life and gave me an opportunity to know I was more than I thought I could be, and every time that happened for me, I just wanted everyone else to experience that and how to play that forward became sort of a logical investigation for me in my young life, and once I knew that I could inspire others to have a healthy disbelief in the impossible and to take steps that they didn’t think they could take and to challenge themselves in unique ways and to see them blossom was just a gift I could not comprehend. I had a dear friend, Raj, and my best friends are the ones who have challenged me most heartedly, have given me room for pause and sometimes have said things to me that otherwise I would say you might not think a friend says that. So I had a particular friend who was a well known business speaker, and one day I was telling him the kind of people I like to align myself to, and I said, “I like to align myself to the people who have a natural tendency to want to give before they get,” and he said, “Well you don’t know the first thing about giving then.”
And I thought to myself, “Oh my word, this is a dear friend.” And of course when I get a little upset or a little shaken, I usually say, “With all due respect.” If you hear that, Tim, you know I’m running. I said, “With all due respect,” and this guy is an American Indian, and I said, “Walking Bear, could you please describe for me why you think this?” And he said, “Well in our culture, in the culture of American Indian, this notion of giving is central and there’s some fundamental notions about this that you and your culture just can’t possibly understand and you’re not predestined to think and feel in this way.” And I said, “You know, I’m a smart guy. You’re going to have to explain this a little bit further,” and he asked me to call out the three things that somebody in his tribe might do that would be an act to consider of great giving to the other members of the tribe.
And so, you know, I threw out, you know, hunt. That wasn’t it. Give out your life. That wasn’t even close. I said, you know, to foster children and teach them. You know, I got three X’s and in Family Feud, you know, I was… So I said, “Please tell me,” and he said, “It’s doing something for the dead.” And I asked him, “Why?” and he said, “Because they can’t possibly do anything back, and as soon as you learn the notion that when you give it should have no expectation, and you live in a transaction world, and even the notion of you seeing somebody do something great after you’ve helped them across the parapet, you know, that’s not true giving.” And it dawned on me that he was teaching me a super valuable lesson, and although I will have you know, I have not reached this ninja state, I aspire every time I give to do that with a sense of nobility and a sense of I don’t expect something in return.
Timothy: So tell me, you know, a time of challenges, on your journey of building a conscious business…
Timothy: …what have you found to be the one or two points that were really critical to the conscious capitalism part of your business?
Ben: Getting the culture map right, number one…
Ben: …and adopting a philosophy around servant leadership that has to permeate with everyone. And they were not instinctively embedded in my entrepreneurial rulebook. I discovered it through amazing people, amazing journeys, amazing places and a ton of micro failures. So first and foremost, this purpose, mission, vision, values cannot be understated, and the process of developing those doesn’t happen overnight. You don’t walk into a room, come out with them and you just offer them. Some of them are discovered from your team. Some of them you do go through some thought transition. I know you both clearly understand how vitally important it is and the journey that must go on to create that aligned culture, but I think organizations taken for granted and they think they can emerge from a board room and create the edict and then tell people to follow it and it just doesn’t work that way. It's got to be embedded in every human heart that comes into the organization from the moment you’re hired to everything you’re doing every day, and either people are all bought in or you have detractors, and there’s no in between. You’re either adding to or taking away from that culture at every moment.
Ben: And we want to invite people to this great family we’ve developed that are really engaged, that want to be involved in an extraordinary interchange. I like to think that people, you know, some of their funnest parts of their day happen right here. And when they go home, they’re uplifting others around them, and I also would love to feel like when somebody comes home and they walk through the threshold of their door, they can take off their business and be the best dad and the best mom and the best partner and the best whatever they want to be, and then come with their authentic self the next day and be that person again. And if we’re doing any of that even close to the way I’ve just described it, we’re doing a lot of good.
Timothy: I love it. I love it. So when was that moment? When did you first do that? What stage of the business did you say, “Okay, all right, team, let’s get together. We’re going to articulate our purpose, our vision and our mission and we’re going to drive that into the culture”? What was that and what drove that moment?
Ben: So really the teachings of Verne Harnish and Rockefeller Habits drove this notion of core values, that was really the start of discovery into how vitally important culture is in a successful business. And then using that as a filter to drive greater vision, more positive intentions, higher definition visions down from project level work to the infrastructure of the entire organization, and I believe I was still developing our sense, and we rewrote our purpose during our early years of conscious capitalism, and it was this notion that businesses need a higher pursuit as much as the individuals do, and that the purpose of business cannot just be a P&L.
Ben: And it can’t just be stakeholder value. It just can’t, and that honestly didn’t excite me. So initially the things that excited me about entrepreneurism was just the fascination of creating and, you know, building teams, and it was very altruistic and eventually it became super purposeful, like we can do a lot more with this than we thought we could. We can enrich peoples’ lives, we can make differences to entire industries.
Ben: We can be disruptive and shake things up, and all of that has been a fascinating journey, and along the way, and something that’s teachable.
Raj: Well you made an interesting observation there. You said it’s not just about creating stakeholder revenue, right? Although that’s a big thing for conscious capitalism, it’s not about shareholders, it’s about all stakeholders.
Raj: [Inaudible] goes beyond stakeholder value to some sense of uniting purpose. So there’s value, then there’s also being part of something greater for all of the stakeholders.
Ben: No, absolutely. It’s sort of like glue, Raj, and that’s why there has to be more than one pillar. And generally speaking, I think we start with this underlying great purpose and we build this intriguing culture and then we do things together and it germinates into other people and all stakeholders wanting to join, and we have something in our organization we’ve developed called the Hierarchy of Satisfaction. I kind of want to let you know a little bit how it works, and it might sound contrived, but it actually has a – it’s a fundamental observation, but it’s happened with us so many times that it’s no longer a coincidence and we had to give it a name and give it a process. Otherwise, we couldn’t describe it to others. But the notion that a client pays you to do a job is the lowest form of appreciation in our hierarchy. You got paid, great. And then a lot of organizations want awards, and I know, Tim, you’ve said your organization and your people have gotten all kinds of awards. That’s great, but that’s just the next step.
Ben: When organizations and people start mimicking what you do, that’s a level higher. They look at your methods. They look at your meaning. Then at some point, they start advocating you.
Timothy: One of the interesting things, Ben, is when you’ve created a great culture and you’re really values and purpose driven, and you’re growing really fast, which is all good news, right? At some point, there comes this point where you’ve got to sort of say, “I need growth capital, and I’ve now got to be thinking about who are my investors going to be and how’s that going to change our mission, vision or even our culture when we start to do that?” So I know you recently went through that process, and you know, so tell us a little bit about how did that process feel and, you know, how’s it working?
Ben: so I have a good story with a great outcome, and obviously in my world of fellow entrepreneurs and leaders, the vast majority of the stories do not match mine. So to the extent I can give some guidance, first and foremost, you might expect somewhere in the process of finding a capital partner, there was going to be a culture conversation. Now I think my investment banker may not have known that upfront, and I think I scared him at one point pretty significantly, and I’ll try to summarize this for brevity because I know this isn’t supposed to be a two hour podcast, but I need you to know I first went out and we found a really extraordinary investment banking group to represent us who understood us at a deep level, and I will have you know, Tim, it’s very uncomfortable for me to allow someone to be our spokesperson, and you know, I’ve refined my skill over 20 years and to somebody to step in and, well there’s a gentleman, his name is John Mackey. Heads up the security infrastructure side of Imperial Capital out of L.A., and he was that guy, and because he was a former CEO and because he walked in these shoes, and I will have you know I sat in meetings where he was informatively describing who we are and what we are, and I said it could not be better than that, and it wouldn’t have been better if I did it.
Ben: And if you can feed that, that’s great. Now at the same rate, John and I, when we agreed to disagree and it was on the side of the investment banking knowledge he had accumulated over his multi decade, I acquiesced except for a few times, and I’d like to talk about one of them.
Ben: I came to culture, and how we were going to measure the prospects. First and foremost, I think one of the great assets we had is we had a global growth initiative that was a nice to have, but not have to have, and at any point in time I could have said, “No thank you,” and continue on our great journey, and it’s great and we don’t need it. Now if I want to conquer the globe, it was necessary, and of course we have great high-definition visions around a global company. So, and we also wanted to find an organization with some international exposure, a team that really was there to help, not hurt, didn’t treat as a number and there were a whole bunch of other things, and of course all of this are great aspirations for most people going through, and we’re looking, this is a minority equity investment, so it’s a little different.
Ben: The folks who really were engaged with us always said had a number of highly engaged potential investors, and when we were done, we had about eight finalists. And of the eight finalists, I was told one day to whittle it in half and I was supposed to keep all eight, tell four of them that they would continue to phase two and four of them would continue not. And I thought I fired four and hired four, and I did this in a very graceful Ben way, and the very next day the four that were rejected all put new offers in. And of course I got a call from John Mackey, he goes, “I’m going to have to do this now. You didn’t do it right.”
And lo and behold, we got through that first phase, but the second phase, when we were down to the final finalists, I told John I wanted to do something called a reverse RFP. He first said, “What’s that?” I said, “We’ve spent months now pitching our wares to potential investors, and they’ve now told us in the form of a bid they want to play.” I said, “I want to hold them to all the promises they made. I’ve got people, here’s how I’m going to treat you, this is the reporting requirements, here’s the culture that we represent, here are the people that will be on your board,” and I came up with a list of 16 highly detailed questions that I was going to rank them on, and it included deep questions around purpose and culture and people and exactly what was the reporting requirement, how do you handle things when things are not going up, they’re going down. Give me your five customers that you actually hired and give me five of your rejected. I want to talk to those too. And it was just, it was very probing.
And so John was like, “Okay, that sounds interesting. We’ll do that.” He said, “How much credence are you going to give for all this culture stuff,” like in the scorecard because we’re evaluating a financial bid that they just gave us.
Ben: And I said, “I’m going to give 50%,” and he just about – there was a little bit possible some profanity, and he said, “You’re out of your blank-blank mind.” And I said, “I very well may be, but that’s what we need to do,” and we did that. So everyone presented a 30 minute session. They did a full formal report to us. We evaluated that, and our third highest bidder financially, lowest bidder financially, was our selected partner. A 200 year firm. Every single partner of this particular firm is individually and separately liable for the entire company, that doesn’t exist anymore in our universe.
Ben: This firm has an extraordinary team of people who passionately care about what they do, their alignment of culture or their process for portfolio, and then all of the promises they made in the pitch were reiterated in very special ways in their reverse RP, but more importantly now, I’m going in on two years with this organization every single word. Every single promise.
Ben: And all the behaviors associated with them, and mind you, we are not going through a difficult time now. We’re going through an extraordinary trying time. As I said when we were 20% passenger employment loss in March, the world was ending for aviation. We went down to 95% loss in London. Now, you know, with it closed down again, you know, this is biblical, apocalyptical. This is the – and if you want to figure out how a partner behaves, don’t walk down a downhill sunny road with them, walk through a firestorm, and you’ll figure out whether you’ve got a partner. And I will have you know, some of the other partners, had we picked them, they’d be picking us apart.
Ben: They’d be paralyzed and scared. They’d be in a place where they’re worried about, and we’ve gone on offense. We’re the first to reach out and want to help airports. Even before things – never held our hand out, what can we do to help you? But it almost required us putting up capital to do that in a time where you should be rolling it all back.
Ben: And I think it’s been our saving grace. I also think this particular partner, Brown Brothers Harriman, leaned in every step of the way and has been an extraordinary partner. And if any of this is helpful as people go through that journey of picking, just you cannot be shortsighted.
Timothy: No. Well Ben, what I love about that is that, you know, we say it, but you’re just, you just gave a great example of it which is, you know, you get the investors you deserve, and…
Ben: That’s right.
Timothy: …you know, you don’t work to get that relationship, then you’re going to get something else.
Ben: That’s right.
Timothy: And I think you’ve illustrated in a beautiful way the intensity and the purpose that you brought to finding the right investor, even if it wasn’t necessarily maximizing your financial benefit, it optimized an important element of your business for it, and I think it’s just a great example.
Raj: Yeah. So you said you’re a perpetual learner, which is wonderful. That’s one of the great qualities of conscious leaders, I think, with growth mindset. So what’s inspiring you? Is there anything you’re reading or learning currently?
Ben: Yeah, so a couple things. First of all, I’ve been a little bit of a leadership buff. You know, growing and learning requires sometimes, as you know, the most formidable way to be a student is to become a teacher. And so along this journey, I’ve done some very interesting work in the realm of leadership, and heading up a few leadership programs both first internally in our company and then externally. The largest law enforcement agency in Texas happens to be the third largest sheriff’s department in the United States. I have developed a 10 year leadership program that has now graduated 200 amazing people on an unbelievable journey of self-development, and in an era where policing is being questioned, the folks here are not having the same sort of issues elsewhere, and more importantly, a lot of folks are leaving this because it used to be a vocation where, you know, when I grow up I want to be an astronaut or a policeman or a teacher, and policemen maybe falling far from the list. So the folks who are staying, is this what I want to continue in my journey? And the message I like to tell the folks who are still sitting in those seats is if you vacate them, and you being one of the folks who really get it and understand, you’re going to, first of all, by staying here, you’re going to be one of the ones to say, “Remember when we were challenged the most and we were needed the most to make a social difference,” and the ones who are great really need to stay there and continue doing that journey.
One of my great friends and mentors and fellow YPO, Warren Rustand, has just released an amazing book on leadership. He’s taken the culmination, and I can’t begin to tell you how many people he’s helped and what an influence he’s been on my life, but this latest culmination of the book that he has produced is priceless, and it’s just about to be released from the press.
Timothy: So Ben, let me just check and make sure I’ve got that right, it’s Warren Rustand and the book is “The Leader Within Us” which I believe was just published in January.
Ben: Warren Rustand, and Tim, an – he was the former scheduling chief for President Gerald Ford, has sat on some 50 boards, some of them very prominent. He’s been the CEO of a number of NYSE entities, but more importantly has been an advocate and an uplifting influence to entrepreneurs and has spent the vast majority of his return years working with younger entrepreneurs and helping them. And Warren and I were involved in a project in Washington, D.C., and that was about connecting entrepreneurs to public policy leaders in a really special way, and that’s where I originally met Warren, and then he adopted the younger entrepreneurs in EO and has been a resource for them like no other.
Timothy: Ben this has been an incredible story. Thank you so much for your generosity in sharing it. You have created a great organization. It’s been wonderful to have you. And thank you all to our listeners for joining us this week and whatever channel you are listening on, please feel free to hit that little subscribe button that’s there and if you have any comments or thoughts you would like to get back to us on then please go to the ConsciousCapitalists.com and you can leave a note therefore Raj or I. And Raj if they want to know more about that incredibly important topic Conscious Capitalism, where should they go.
Raj: They can go to ConsciousCapitalism.org and sign up and be part of the community and join the local chapter if there is one or they can start one if there isn’t.
Timothy: Thank you Ben. Really appreciate you taking the time with us today. Great stuff. Thanks so much.
Raj: Yeah thank you Ben.
Ben: My absolute pleasure gentlemen and as you know the opportunity to give back and be an example for others and more importantly a resource for folks who are on the journey is part of my personal purpose and so thank you for giving me this opportunity. I’m so grateful.