Freedom, Inc_ - Brian M. Carney [96]
And so, the training programs McDermott implemented became an employee-education project. Most of his employees had never been to college, so he partnered with local universities to teach classes at night—at the company’s expense and in whatever subjects captured his people’s imaginations, provided it was related in some way to work. It all came back to this one thing: Satisfying people’s needs of fairness, growth, and self-direction made them happy and they, in turn, made customers happy. And if you kept the customers happy, the business would take care of itself.
It’s not every new CEO who would come into an underperforming, sluggish company and begin by rewarding its employees with fairness—including equal pay for men and women—education, and greater freedom of action. Many, in fact, would do exactly the opposite—embark on a program of cost cutting, including benefits, and a more rigorous set of controls over employee performance: the proverbial tightening of the thumb screws.
But when McDermott came to USAA, the company had an implicit employment-for-life guarantee. USAA was run mostly by former military men, for the military, and many of its frontline people were themselves military spouses in the garrison town of San Antonio. It was not the sort of company, in McDermott’s view, that would respond well to mass layoffs or draconian measures. Tony Hsieh’s pay-not-to-play program works for Zappos because it is a young, fast-growing company based in Las Vegas. A CEO like McDermott, with thousands of employees already, did not have the luxury of trying to influence the culture through hiring. He would need another way.
Moreover, he was convinced that his people knew a lot more about the business he was now running than he did—and could quickly acquire more knowledge when necessary. They just needed an opportunity to act on what they knew. “I couldn’t sit on top and make all those [customer service] decisions,” he told us. “I didn’t know how to handle them—even the typewriter, you know? But that wasn’t the point. [The point] was to give [the employees] the opportunities to get into the frontline [where] all services [are] delivered… Top-down isn’t going to get the right thing [done].” In other words, McDermott saw his people as part of the solution, not as the problem. At the same time, he didn’t see himself as a solution or as somebody who could deliver the solution. All he needed to do was give his people the tools—and the skills, if they needed them—and then set them loose.
For McDermott, education would start his employees on a journey of self-discovery that would, in the end, redound to USAA’s benefit. “In the service,” McDermott recounted, “I learned what a great thing for America [the] GI Bill of Rights was. That’s what made America great after World War II. The Germans had the highest level of education going into it,” the former P-38 Lightning pilot recalled. “Ten years after the war, we had the highest level of education in the world. Choice and assistance was the key to that. And we put that into our…system here at USAA.” A former dean of the Air Force Academy who transformed it into a first-class academic institution, he explained how it worked at USAA: “We had six colleges and universities…come into our building at night and use seventy-five training classrooms…. And we picked up the tuition if [employees] made C grades or better for a baccalaureate, as long as they passed their courses. And then B grades or better for a master’s degree. So we wound up with the most highly educated workforce in the whole financial services industry in the United States.” On any given day, about 30 percent of USAA’s workforce was in some kind of training