Freedom, Inc_ - Brian M. Carney [115]
So, SOL’s margins are very high because its costs are very low, we assumed.
“No, the costs are awful because the human costs are so expensive in Finland. Ninety percent of our costs are human,” replied Joronen, adding another dimension to the puzzle.
So how does she explain the margins, we wanted to know.
“We don’t spend money on overhead. Our overhead costs are very low…. Even if we are very profitable we do count every cent. We are very, kind of, lean. Lean, and stingy,” Joronen explained, switching suddenly from company to family: “I mean, our family is stingy also.” Not seeing what the family’s stinginess had to do with keeping costs down, we asked instead how the company controls costs without an army of controllers.
“No, no, no. We don’t control,” replied Joronen forcefully. “I think if we, the managers, would have spent a lot on flights, good hotels, cars, the employees would follow our example. They understand the message we give here,” Joronen continued. “We are a family company, 100 percent family company, we have always been. So what that means is that it belongs to the family, too, to set the example. I think that’s very important. If I had a big office here, everyone would want to have one. I think the example is important.”
A big business owner who flies only economy class? That filled our bag of paradoxes over the top. But before we attempt to resolve them, let’s take a look at what Joronen achieved at SOL.
OUT WITH THE CLEANERS, IN WITH
THE SERVICE AGENTS
The headquarters in the picture, which Joronen characteristically calls “awful, but…the cheapest and best place” available then—is still in use. But Joronen always wanted the action to be elsewhere. SOL is a cleaning company, and you don’t make much money cleaning your own offices—and even less sitting in them. Joronen wanted her people out in the field, exercising their “freedom to decide,” as she put it, and dealing directly with the customers. The first step was to build an environment in which the cleaners were treated as equals. So, like Bill Gore before her, she began by changing their title—from “cleaners” to “service agents.” They also got bright yellow and red uniforms, so they became highly visible. While an ordinary office cleaner can be expected to dress in drab colors, registering just barely above the office furniture in the awareness of many of the employees around them, SOL’s newly outfitted service agents would be impossible to miss or to mistake—if you ever saw them. Most office cleaners work at night, out of sight and mind. But not SOL’s. This was the big breakthrough in how SOL did business: SOL negotiated with its clients to do the cleaning during the day, not in the evening or at night. SOL was the first in Finland to do that. It started to clean during the day not for its many business development benefits—more on those in a moment—but because it wanted its brightly outfitted service agents to be visible and proud of themselves and their work.
Once this groundwork had been laid, Joronen spent almost all of her first year in a permanent tour of the regional studios—named after the first one and, like the headquarters, designed by the people who worked there. She repeated the same cheerleading message over and over: “We are the best. You can do anything.” But, of course, employees don’t develop their skills and become able to “do everything” simply because they are cheered on and treated superbly by their CEO. All service agents were offered substantial training to acquire the skills to serve the customers for their full satisfaction—which they measured and collected from the customers themselves. They were also trained in understanding the numbers so they could grasp their own team’s business rationale, profit making, and even pricing, and to grow into service leaders.
Finally