And that program is not an easy program to get into is it? I think it's a fairly robust vetting process that they use, is that correct?

Andres

It is a process, because once you come into the YPO, everybody is eligible to participate. But because of the minimum spots in the class every year, you need to be in line to wait to return to get access to one of those seats that become available, like every other year, or each year, depending on how the members move in or out from the program.

Maureen Farmer

And the case study process, you explained to me before is very unique. I think you even invite CEOs in from companies to examine, you know, their journey, is that right?

Andres

Correct. Correct. So, all the cases are written by their professors at the school and are based on true stories from true companies. And on some occasions, we have the opportunity to have the protagonist of the case in class, have him listening to all the discussion, the questions and the comments that are coming from the audience. And at the end, we had the great opportunity to interact with the protagonist and ask him questions and have a discussion about what the case was or discussing key strategy, or his or her approach in the different topics that have been discussed.

Maureen Farmer

And they're actually in the room with you, as the class is discussing, you know, a particular maybe product launch or some kind of a major transformation in their business. Is that right?

Andres

That's correct. That's correct, it is an incredible experience when you are listening from firsthand all the different factors that are going through the process of the case. If he's transforming or if he his improving, so listening to all the thought process that the people go through…it is very interesting and a whole learning experience.

Maureen Farmer

And what's the reaction after they've had, you know, this group of, you know, experienced presidents and CEOs in the room give their feedback on, you know, decisions that they made? Or things that have happened in maybe that product launch? Or whatever the transformation is. It must be so interesting for that person to be sitting there listening to all of these individuals, dissecting all of their business decisions?

Andres

It is. Actually, it is yes, indeed, it is. It is like having somebody like in the motherboard, in which you are right in front of all these experienced individuals, and with great experiences and from different backgrounds, and asking you questions and perspectives, that sometimes the protagonist never thought of, or they thought in a different way, or it’s also a contributing factor for them— it’ also contribution, because I think that as participants gain a lot of those discussions, I'm certain that for the protagonist, it is also a tremendous learning experience by listening to all of the comments and all of the takeaways that they have, after each one of these sessions.

Maureen Farmer

I can only imagine. You know, and I also understand that you are a leader in these groups as well, you've served as a leader of your forum is that correct?

Andres

Not in the school, but in the forum at the chapter that I belong to, which there are six of us, including me. So, each year we will take a who…they would call it the forum moderator of the forum. The forum again of the group or the team 2020 to 2021 I was selected as the forum moderator. So, this is my year in which I need to lead this group of great individuals and discuss different topics within our meetings.

Maureen Farmer

And these are CEOs and presidents of fairly large companies that would be in the south, southeastern United States, is that correct? Or are they from all over?

Andres

They are, they are presidents of their own organizations. So, you find different backgrounds, in terms of the industries, but also in terms of the leadership. So, you find in most of the cases, each one of them are very entrepreneurial. And some other professional managers, as well.

Maureen Farmer

So, I guess, I would only imagine that in an environment like that, as a CEO, yourself, Andres, that you would be able to take back to your organization, some of the insights that are shared among your forum and apply them in your own organization.

Andres

Correct. A lot of the cases, all of the cases that we discuss—the class is very current from different topics, from management, from political, socio economic strategy, growth, and different research. So, it's a great opportunity for us to study the case, as I said, discussing the case with your peers, get among the group. The lessons learned or get to conclusions of what are the most important lessons learned from each case? And how would you apply them going back to your daily activities? How would you apply those lessons learned and the commitment that you make after the program to go back—the commitment, to yourself? How would you implement some of those in your own enterprise or company?

Maureen Farmer

That's just such an intriguing learning experience, for sure. And I know that you, most recently in your organization, implemented a change management project, I guess you wouldn't want to call it a project. It's more of a long-term sustainable change management initiative. And what I'd like to do and I know we had talked a little bit before that this would be the focus of our call today, the primary focus of our call today. And I'm thinking that maybe the best way to approach it is a before and after. So, we think about your organization of 1100 people in the energy business in the southern United States, working across 33 countries. I mean, we have COVID that has just launched upon us 12 months ago, we're still dealing with it. And all of the challenges that type of crisis is going to have on an organization. Why don't you tell us a little bit about this transformation that you initiated sort of from a before and after perspective. That might be an easy way to do it, what do you think?

Andres

Yeah, I think it is a good way. Well, first of all is in any other market or any other company, when you start having headwinds coming at you and you start evaluating and assessing the situation, in most of the cases, when you are in these situations, you try to look outwards and when I mean outwards, you always try to blame it on the market. So, what's the situation on the market and you have your team coming back, “Well, there is not really much we can do because the market is the competitor. The competitors are doing a better thing and the market is going down, there are not many opportunities, the customers are demanding different types of services”. So, you hear all kinds of situations. And when you start hearing those kinds of situations, then you need to really look inwards. Sometimes, the way I see it is that level is not outside, it is inside. It is basically on us. It is us who needs to embrace change and look inwards and see how we can or how we need to react to new situations, new market trends, evaluate what is happening outside and then looking at the things that we need to improve—react very quickly to those new market conditions and market trends.

Maureen Farmer

So, can I stop you right there for a second and ask you this? Was there a particular trigger event that was the catalyst for this change that you initiated? Or was it a combination of things?

Andres

I think it was a combination of things, but mainly headwinds in the market. And, and I was transitioning, different position in the company to be number one, and leading the whole organization. So, we were having a change of management, and at the same time situations in the market that really forced us to think differently and see how we were going to face the new market environment, a lot of competition in the market. That was obviously driving our rates, or the prices down. Customers were demanding better solutions. So, it was the combination of all of this.

Maureen Farmer

And so how did you start? How did you start this massive intervention?

Andres

Well, one of the first things that you need to look at is if you're going to really do a transformation or a turnaround. And I would say that those are two different things. Turnaround is about looking at your numbers, reducing cost and other things that you usually do in the business. But transforming an organization, I think it goes deeper, it goes deeper than the turnaround. So, the way I see it, transformation is about the software, not just the hardware. So, when you're going through a transformation, you really need to begin by asking yourself, what's my purpose, why are we here? What is the purpose of this organization and to understand the purpose of that organization, you need to understand also the purpose of the individuals that are part of your team and start having those discussions with them and discussions of why we exist, why we are here working together, why do we believe that we are here and how we think we are contributing to society. I know profits are important.

So, the purpose of having positive results. Indeed, those are very important, but I think beyond a net income or a balance sheet or a profitable organization is a purpose and I think people are driven by that purpose. And that's part of the leadership that we really need to find. To have your team believe and align with the purpose, then you need to start asking yourselves about the environment in which you are. What is the customer segmentation? What are the different segments and business environments in which you can participate and start evaluating? Where do you need to be? And not only where you have to be but how you can better serve certain segments than others?

Maureen Farmer

So, it sounds to me as though you must have had to do a lot of market research to do that, is that true?

Andres

Correct. So, first, once you have the purpose, then you go to the segmentation, as I said, in the power of segmentation, you actually see how you are serving your current customers, you will go and do the whole research on the different segments in which you can participate or you will have been participating or you intend to participate, evaluating all different aspects of the business, evaluating competitors, the landscaping of your competitors, evaluating your core competences, in each one of the activities that you are performing, considering all the different processes that will contribute to that segment. If you are in each one of those things, a product-oriented company or a service-oriented company, that's one of the main changes that we encounter when we are doing this whole transformation.

We were evaluating ourselves and seeing ourselves initially more as a product-oriented company. In the different segments we were basically pushing more product than understanding what was the customers needs and what was the customer requirements, or the particular solution that he was looking for. So that really pointed us to move from that product-orientation to a customer-driven organization and start evaluating what a good service meant to the different clients that we were going to serve in the future.

Maureen Farmer

So, did you involve your current customers in this process?

Andres

We did, Yes, we did. Like we were mentioning, Maureen, the first thing that we were understanding is the segments, understanding where we were going to be more effective, and have a better outcome for the customer and for the organization. And once we identified those segments, we started to have better conversations with each one of our customers, in terms of how we were providing the service. We implemented something that is called the net promoter score—that is basically driven by different questions to the customers and you give some score to these questions. And you are able to determine out of your customers who is a promoter, or who is a new client not really inclined to use your services. And you start reading those comments and understanding what was needed to improve our work, to transform or to change the different parts of the services that we were providing.

Maureen Farmer

That's so interesting. Can you give us a sense of maybe before you transitioned into the CEO role? And so before that, you know, you noticed, maybe your team noticed that there were things that could be done differently? Then was this headwinds in the marketplace. And you then involved your own people, determining you know, what's the why—why are we here? What type of service do we want to deliver to the marketplace? And then launch into a customer segmentation to your current customers and into the markets that you want to be serving. Was there a change in terms of market shift? Like did you shift dramatically from one market segment to another?

Andres 

We kept the same type of markets. But one of the important things here, it was also the team, it was going to be impossible for one person to change the organization and move it forward. So, I had meetings with all the teams, not only my direct reports, but also different people in the organization, most of the organization—I addressed them openly and invited them to participate actively in the company's future, inviting them to participate with their ideas, with their solutions, to look at their own responsibilities and duties that they were performing to communicate what they were hearing from the different customers and approaches with opportunities to improve. So that was shocking, because they were delighted to hear that the company was listening and that we were asking them to participate actively in the future of the organization.

Maureen Farmer

Well, I'm sure when people are asked to engage and to offer their insights and feedback, I think you get a more engaged workforce, I would think.

Andres

Absolutely. If the organization or if people do not have information, how do we expect that they're going to act responsible in their duties when they are missing pieces of what to do? I noticed that once you start deploying and having these conversations, the enthusiasm in the organization and individuals changed drastically. It really created a completely different environment inside the company that helps move it forward.

Maureen Farmer

Better energy?

Andres

Much better. Exactly. Yes.

Maureen Farmer

So, tell me a little bit about the challenges that you encountered when you were along this journey, so it was over a period of about three years, is that correct?

Andres

Yes, yes, it was over a period of three years and a little bit more. Some of the situations that we encounter is that we were trying to serve every single customer that was really knocking on our doors. So, all the different types of solutions that were coming out, we were trying to serve, right? We really needed to evaluate first our skills, and then the market. And then this understanding if we could really offer the customer, the right solution, the appropriate solution. And if we were going to not only offer this solution, if we really were going to bring value to them. So, we started to evaluate, where we could provide value for each customer.

The way we started to approach it, each segment was how valuable our services were for this company, not in terms of profitability, but in terms of creating better productivity for the customers. Understanding their needs, understanding their situation. And understanding if that solution that we were going to provide was going to be beneficial for their productivity, if it was going to create the outcome for them, instead of looking inwards to the organization only. As in seeing if this is the probe that we have, this is the probe that we're going to push. And this is where we’re going to be generating profits and forgetting about the customer. If it was okay for the customer, the customer was accepting the proposal. Fine. But in this different approach, we're looking more on a consultative scale. Having a better conversation, having a deeper conversation, understanding, what is it that you need the energy for? What it is that you need electricity for?

Maureen Farmer

So, I know a little bit about your business. But I'd love for you to give if you can, Andres, I realize that there may be some confidentiality involved here. But if you could give us an example of what you know, maybe one customer that fits into this category where you were able to add value within a consultative manner, and, you know, really help deliver an innovative solution. Are you able to do that even if it's just in broad terms?

Andres

Yeah, there was this oil and gas company that needed power or electricity for their own operations. And in looking at the operation, they were burning diesel to generate power using diesel fuel, to generate or to transfer that diesel into kilowatt hours using certain technology. When we approached the customer, the customer wanted to have the same solution at a better rate. If you were going to provide the same solution at a better rate, you were really going to commoditize the opportunity. And second, you were not really understanding what was the real situation that the customer was facing. So, we had the conversation with the customers to understand what they needed the power for, what the different sources of fuels that were available in the area where he was operating were and find out that one of these fields that actually he was producing was flaring gas in the field.

So, our approach was a little bit different once we had the whole clear picture about the different needs that he had. And we were able to provide a solution in which instead of continue burning diesel, we were going to move the solution towards using the flare gas that was considered high delta volume that they were burning and use this flare gas to reduce emissions. So, reduce emissions in two aspects, not burning diesel, reduce emissions in using the flare gas into power duration. So, it identifies the opportunity in which that fuel was not going to be a cost for the customer. And by not having that cost as part of their electricity. The solution by itself was going to be much lower than using the other alternative fuel. So, the project was implemented, the power that he required was delivered at a much lower rate that he had. And we were able to provide the quality and the reliability that he was needing in his operations or in their operations.

Maureen Farmer

So, in the older model that you refer to before, you might not have taken the time to sit down with the customer or the client and figure out what they needed, you would just sell him diesel, for example, or just operate his project on diesel versus something else. And now, you are training your team and your organization to really understand the customer's entire picture.

Andres

That's correct. That's correct, Maureen. In the old model, we were going to push a product, right? In this new model, we were going to be more service oriented, and value, customer driven. Having that conversation, and not only conversation, really developing long lasting relations with the customers. It was not only about doing one project, it was about going with him along the way and understanding what were their needs and being their partner in their solution with their energy or power solutions. Through the years that was the difference.

So, through that process, as I was mentioning, you need to really identify the purpose of the organization, what was the real purpose of existence, of existing or existence for the product and company. Then going into the market and understanding what the landscaping of all the different customers was that you want to serve. You then define what were the solutions that you were going to be more successful at and that you could serve better. In our case, we identified that was going to be the oil and gas. We serve different customers in different segments. But we identify that for ourselves, that the competencies of the organization, the core competencies, the competitive advantages, and the knowledge and experience was there to better serve that specific market. It didn't mean that we were going to serve only the oil and gas. No, it was going to be our focus, we were going to look into opportunities in other segments. But our main focus was going to be that segment, a segment that we know very well, a segment in which we had people trained, that needed additional training. But it was a segment in which the organization was going to be more profitable, but also the customer was going to be better served. And therefore, that we're going to have better productivity by using our services.

Maureen Farmer

And so rather than trying to boil the ocean, you chose a specific niche so that you're not trying to be all things to all people.

Andres

Correct. We were trying to be 100% better in one thing instead of 1% better in a lot of things.

Maureen

And so that had a major impact on your organization, not just from a profitability perspective, but from, you know…

Andres

Aligning the organization. And that comes in the third point here which is communication. Communication was very key in the whole process, extremely important. So, in order to have the buying of the whole organization, we needed to communicate what we were doing. And we developed a booklet, a small booklet, and a short video or that lasts no more than three minutes, from which we were telling all the employees, what was the strategy about what we're doing. So that helped us tremendously in getting the whole organization aligned at the same time, once that was deployed, almost parallel to what was happening. The small book was a very simple booklet in which we explain the whole strategy, the whole plan, and the video. Usually, people would have questions about and comments. So, we conducted a meeting with the organization. Because the organization was spread, all through different countries, it was difficult to have one single REM, which we can bring together, all the different teams operating in different countries, so we needed to do it in different stages.

So, first opening virtual meetings, anyone could participate in the organization and conducted the same presentation. And after the presentation, open the microphone for questions. having different people interacting with us and asking questions, clarifying questions about the strategy and receiving comments as well, or receiving comments, people that had initiatives in how to make it a little bit better were taken, those comments were taken. So that was one of the major things that we needed to make sure that everybody understood—where we were heading. With that came the empowerment of the employees. Once you have a clear understanding of what you are going to do, and what you're supposed to do in each one of the roles, then comes the responsibility. So that generated responsibility in each one of the different roles in the organization.

So, we came with a deal that was necessary to change the structure in the organization…we were becoming more project driven. By becoming more project driven, we needed to push to the different levels, their responsibility to make decisions and the accountability of those decisions. So, we needed to flatten the pyramid and push all decisions that were aligned with the strategy and those decisions would be taken by the project leader. So, project managers in each one of the different projects that were operating.

Maureen

So, the town hall meetings that I'm assuming across, you know, 33 countries, that must have been quite a few meetings, I do realize that some of them were virtual, but did you travel to some of those town hall meetings?

Andres

Yes, I did travel to many of them. I did travel to many of them, because part of the process, of listening to your customer was me going and meeting with them as well. So I had two opportunities, just not only meeting with the customers, but also meeting with our own people and listening to what was happening. So, listen to the voice of the customer and listening to the internal voice of our teams.

Maureen Farmer

So, Andres, in that whole process of the town hall meetings, what surprised you the most? What type of questions surprised you the most?

Andres

The comment that surprised me the most was that individuals were really delighted to have them actually participating in the definition of what the company was becoming. Listening was tremendously…listen to them, and just having them be a part of it. There was already tremendous gratitude from them. Just having them considered for an invitation to those minutes. Just having his name on the list was probably one of the first comments that I heard—it was the first time in in many years in which they were being called to participate in these meetings and listening from firsthand what was happening. And it was not only myself, so what we did also was instruct my direct reports on having discussions with them to have these meetings with their teams as well, and not necessarily when I was present. So, we've said also, we don’t need townhall meetings in which the topic of that meeting was exclusively about operations, or the next meeting was going to be about human resources, human talent, etc. What are we going to do to develop the initiative that the organization was taking to develop the skills, the technical and the soft skills of the people to align them with a new strategy? A lot of questions came from that side. So, if we were going to do X, Y, and Z, how they were expecting the individual was going to achieve those kind of goals and how we were going to contribute to his or her development in the process. A lot of questions came from that.

Maureen Farmer

I would imagine that a lot of people knowing that this transformation was coming, would be worried about their jobs. Did you have to do any layoffs or terminations throughout the process? Or were you able to retool the human resources that you had?

Andres

As part of that transformation and as part of that change, one of the things that became very important, and it is actually one of the most important thing in these type of transformations, is the culture. And that's one of the differentiators that I mentioned, I think earlier, Maureen, that when you transform, it is different to turn it around. When you transform, the most important thing that you need to understand is culture, in the organization, underneath all of the processes of an enterprise to find the culture. So, culture is the most important thing. Sometimes for us, as leaders, we understand our culture, like if we were talking about advertising, or marketing, or production as an additional tool that exists there, but not something that is mentioned. But culture is everything. If you want an institution that wins in the marketplace, if you want an institution that is high performance enterprise, you need a culture to support your strategy, otherwise, you're not going to succeed.

I'm not implying that when you get into your culture you need to implement layoffs. That is part of the natural process of doing these activities, but you also need to realize that when you are defining a strategy, you need to go into the different processes, you need to understand if those processes support the strategy and the culture that you're trying to implement. And if that cost or activity, does not support that strategy, does not support that culture, then you need to call it or let it go. But some of these activities, I would say they are counterintuitive, in the sense that in one area of the organization, you are cutting costs, but if you are seeing that in other areas, like I'm going to give an example—marketing, if you see there in the organization, that's something that you need to improve, then you're going to put the resources there.

Maureen Farmer

Right, strategic allocation of resources to support your new strategy.

Andres

Correct, right. In our case, while we were cutting costs in some areas, we were aware that we needed to change the way we were selling. Something that we mentioned, the conversation would change the way we were selling, we were moving from being just a sales organization to becoming more consultative, right? So, while we were cutting costs, in some areas that were not really supporting that cultural transformation, and the strategy, we work supporting some areas to develop new skills, or to prepare for different activities, to better serve the customers that we already decided to serve.

Maureen Farmer

So fascinating, especially where you were operating in 33 different countries, I can only imagine the cultural diversity, the language diversity, that must have been…and not to mention the logistical diversity, because I know you've worked in some very physically demanding environments as well. So given that, you know, you've had this initiative to change the way you do business to serve a specific niche and grow the market, better serve the customer, the fact that you were able to do that in, you know, a three year period, I'm sure was not an easy feat, and then add the difficulty or the challenge rather, of the transformation that change management…we have a global pandemic, a crisis that falls upon the organization…why don't we talk a tiny little bit about Covid-19 and how you helped your employees across these countries, these 33 different countries manage through this very difficult period.

Andres

Yeah, well, remember, it was I think, beginning of year 2020, in which we started to listen to the news coming from China, in regard to the virus that was spreading very fast. And it only took almost three months. Because I think it was March, beginning of April and most of the countries were entering lock down. There was not a complete lockdown here in the US, but in other countries…completely locked down. I think it was April 20 in which the price of oil went negative for some. Yes. So right there, at that moment, we needed to really pivot what we were doing completely, we had our plan, we were coming with the plan. And at that moment, that plan was out of the window. And we needed to really change and pivot to the new circumstances, but first taking care of our employees. And understanding what was happening in the operations, understanding how well the organization was prepared to react to a pandemic. We had operations in different countries, different power plants running and operating 24/7, serving different customers. And at a moment we were having people in oil and gas fields, which were not really allowed to travel or conduct their shift change. So, we had changed in shift in the operations every seven days in those projects.

So, seven days, the people work in the field, and seven days, they rest because of the situation and for prevention. Some of the customers did not allow to conduct those changes and people were locked down long periods of time. So, it was one of the things that I first thought…it was very important to give courage and enthusiasm for the people there. And having teams understanding because everybody was new to this. We didn't know much about the virus…understanding how viral, how was it going to be transmitted, what were the different actions that we needed to take in our operations to prevent the virus to spread?

So, I decided to conduct direct meetings with the different projects, calling them directly. And asking them how they were, were the conditions in each one of the projects, giving them support, or letting them we were there to support them, and how you react if there was anybody that needed to be treated or was sick, what was going to be the procedure that we were going to follow. So, it was a really whole new experience in how to combat the new virus within your operations and implementing having a team that was going to be able to react very fast and listening to the different concerns and situations in each one of the projects. So, that was the first reaction…is let's take care of the people, let’s put attention on avoiding the virus to spread and supporting them. By itself, the situation unfolded also in serving the customers. So, in full coordination with the customers also working hand by hand and supporting each other in the different projects.

Maureen Farmer

Now that we're kind of easing out of the global pandemic, after about 18 months, what I think I would like to know, and I'm sure that the listener would like to know, too, is during that period of time, through this deliberate plan, this deliberate change in business model. Is there anything that you would have done differently Andres? If you could, if you could, you know, rewind the hands of time? Or did everything unfold the way you had expected it to? 

Andres

Good question.

I think, yes, I think I would have done something differently. I would have started the processearlier than we started. I would probably also do it faster. Okay. We took some time to go through the preliminary phase of establishing what was required. And and I think we took a little bit longer on that part. So I would encourage the team to go faster, at a faster pace on that aspect. Could have we done it? I think we could, we could have put some more time and effort on it. So and the reason why I say this, because at the end, that will bring results a little bit faster as well. And that will, I would say that would have generated more clarity into the organization. And what I mean with clarity is, is when you are in the process, and you start defining your path and your goals, and communicated it throughout the organization, you notice how people start getting excited about all this process. And I would say that would have been beneficial  for  the organization if we would have done it a little bit faster.

Maureen Farmer

Well, hindsight is 2020, isn't it? Yeah. Okay. Okay. So look, I just want to say thank you so much for sharing your story with us today. On the get hired up podcast, and I guess I would ask a final question for aspiring CEO or new CEO listening to us today. What one piece of advice would you give him or her as a new CEO?

Andres

I think something...common sense...we sometimes believe that common sense is very common. But what  i would say is in regards to people really the way you treat your people the way you encourage your people, the way you motivate your people. I think that's what drives results in the organization. I think it's not about compensation, it's about making them feel important. They are important...evaluate what they bring to the table, and listen to the different perspectives. That's what really makes a good team. And that's what really encourages people when they feel that they belong to the world that they're building.

Maureen Farmer

Well, there's no doubt that you were very effective at doing that. And, look, I can't thank you enough for spending your time and sharing your stories with us today. Between the why the harbor YPO program and your experience as a CEO and a very tumultuous industry. And so I'd like to to sign off by saying thank you, and I wish you all the best and the next leg of your journey.

Andres

Thank you very much, Maureen.

Maureen Farmer

And I have an offer for the listener listening today. That if you would like to connect with Andres, you can do so by contacting us at Maureen at Westgate career coaching .com, and we can take your contact information and hand it off to Andres.

Andres

Thank you.