Hiring a great staff is nearly 100% of the challenge. As CEO, you will often hear opinions about the company’s need to hire for technical skills. “We need a good operations leader…” or “We need a great salesperson…” More often than not, you just need a good team. Of course, employees must be technically competent. But it’s more important to hire people who have the ability to embrace change, communicate a message effectively, and who will own every aspect of the company’s performance instead of just what’s in their functional scope. When I came into my last company, I had replaced two-thirds of the executive team early on. The remaining group of the original team had remarkable technical capability. I was told by the broader organization that the company needed them. While I sensed they were not great at leading change, I kept them due to their compelling technical skills. Ultimately, their lack of ability to lead and be nimble enough to think about things differently was a genuine impediment. I learned the hard way that the time it took to part ways and replace these managers was wasted time.
I had the pleasure to interview Tony Sarsam. As the CEO of Borden, the dairy industry’s most iconic heritage brand, Tony leads more than 3,300 employees across 13 plants and nearly 100 branches. Tony joined Borden in March 2018 and has since focused on building a strong People First culture as the company renews its commitment to innovation and growth. In 2019, he was named one of the Most Admired CEOs in North Texas by the Dallas Business Journal. With more than three decades of experience in the food industry, Tony has come to understand every side of the consumer-packaged goods business — from the plant floor to the C-suite. Before joining Borden, Tony served as CEO of Ready Pac Foods. His People First approach to leadership helped Ready Pac grow by more than 60% and establish a dominant 80% share of the complete meal salad category. Tony’s success at Ready Pac attracted great interest and culminated in the sale of the business to Bonduelle in 2017. Prior to leading Ready Pac, Tony was President of the Nestlé USA Direct Store Delivery Company, which serves Nestlé frozen pizza and ice cream businesses and is the world’s largest frozen DSD sales organization. He has also served as Executive Vice President of Sales and Operations at Dreyer’s, which was acquired by Nestlé. Tony began his career at PepsiCo, where he started as an associate engineer and progressed through a series of leadership roles, including Plant Manager, Director of Finance and Region Vice President for Sales and Distribution in the West. Tony holds a Bachelor of Science, Engineering degree in Chemical Engineering from Arizona State University and a Master of Science in Management from Stanford. He resides in Dallas with his wife and children. Visit Tony’s Blog — “Around the Horn with Tony Sarsam”
Thank you so much for joining us Tony! Can you tell us the story about what brought you to this specific career path?
I rarely thought about what job I’d like to have; instead, I thought about the things I like to do. I always enjoyed leading big teams and solving complicated problems, which led me on my path to CEO.
Can you share one of the major challenges you encountered when first leading the company? What lesson did you learn from that?
My two CEO roles have involved turnarounds. It is often the case in those circumstances that a CEO comes in after a Board of Directors has been dissatisfied with the former CEO. Boards are often unrealistic about what you stepped into, expecting an immediate, heroic turnaround. However, they often do not fully understand why results haven’t been living up to their expectations. One of the major challenges I face when leading a new company is having to educate the Board and helping them face the brutal facts about what the company can and cannot do, and what the gaps and risks truly are.
What are some of the factors that you believe led to your eventual success?
Companies experiences successes and failures based on the team. Success requires great players, so you have to coach them well, invest in them with appropriate training and tools, and establish a sense of purpose for their work. When given a choice, I most often opt to invest in people because it tends to have the greatest impact and return.
What are your “5 Things I Wish Someone Told Me Before I Became CEO”? Please share a story or example for each.
Hiring a great staff is nearly 100% of the challenge. As CEO, you will often hear opinions about the company’s need to hire for technical skills. “We need a good operations leader…” or “We need a great salesperson…” More often than not, you just need a good team. Of course, employees must be technically competent. But it’s more important to hire people who have the ability to embrace change, communicate a message effectively, and who will own every aspect of the company’s performance instead of just what’s in their functional scope.
When I came into my last company, I had replaced two-thirds of the executive team early on. The remaining group of the original team had remarkable technical capability. I was told by the broader organization that the company needed them. While I sensed they were not great at leading change, I kept them due to their compelling technical skills. Ultimately, their lack of ability to lead and be nimble enough to think about things differently was a genuine impediment. I learned the hard way that the time it took to part ways and replace these managers was wasted time.
Cash is king. While people may have heard that phrase, they don’t understand it fully until they work at a midsize company where you must think about cash. There tends to be less focus on cash in larger companies. On my first day as CEO in one of my previous companies, I received phone calls from vendors telling me we were 40, 60 and sometimes 90 days overdue on payments. My first task should have been to examine the AP register. I never imagined cash flow would be a problem. I now know that managing cash is essential to understanding the current health of the business.
Hire people who can model A+ work. When I come into a struggling midsize company, I know I will encounter capability gaps among employees who have not had access to the kind of training you would find at a large organization. There is typically a lot of desire to be successful but a fair amount of raw capability. I used to underestimate just how difficult it is to model what you want in terms of standards, in the absence of people who know what A+ work looks like. It’s critical to infuse into the organization people who model A+ work. Most learning takes place when employees witness and work alongside a star player.
When I joined Borden Dairy, I told employees that we would focus more on innovation, and this was met with great enthusiasm. Throughout the journey to innovation, employees expressed very positive feelings about what we were going to do and how we’d do it in the marketplace. When it came time to execute, I anticipated a few bumps in the road as we are commercializing new products we hadn’t tried before. What I didn’t realize was that the team broadly didn’t even know what to do because they hadn’t experienced or seen a product launch before. They did not know how to rally to get extra shelf space at the supermarket or how to stage a new product. Big companies know how to do this well; small companies learn it through experience. I learned that we need people who can take others by the hand and lead them through the process. We’d had plenty of theoretical discussion, but we didn’t have enough people in the organization who could actually show people how it’s done.
You are in charge. It takes awhile to realize that on many topics as a CEO, you aren’t going to have someone in the building, on the phone or on the Board who can really help you and be there to bounce ideas off of. Midsize company CEO roles can be lonely in this regard, so you have to find a way to get your own guidance and inspiration. In larger companies, you typically have a function lead with someone who has greater experience and authority; you also have more peers around you.
In a previous role, there were compensation and benefits decisions I needed to make for the entire organization. I never wanted to assume those things had been done well before I joined the company because in many cases, they are not. It’s difficult to get unbiased opinions about employee compensation and benefits from within the organization. I informed the Board of Directors about the situation and sought their opinions. I quickly realized their positions weren’t based on experience or rigorous knowledge — just how they felt. My Board members were financial experts — not people who had been in my shoes leading a company. With a little help from folks I trusted outside the company, I made the final call. Later, the Board saw that my approach was working, and they became less involved in these kinds of detailed conversations because they had developed more confidence in my judgment.
You have to be comfortable rolling up your sleeves and doing the work. Even as CEO, you must teach at multiple levels in the organization. In a previous company, there was a person on my team who wanted to be more of a general manager than a teammate. He was always looking for ways to build the organization below him to delegate accountability. He wasn’t rigorously involved in the details because he had delegated them all away. I told him that in our company, there is precisely one general manager, and we don’t have room for a second one. I was constantly working with him to ensure he maintained a teachable point of view. He learned to go one, two and three layers below his position to communicate what needed to be done and the importance of the work. It’s important for leaders to show employees how to do the job they would have done a couple of roles ago. Many CEOs miss that it’s important to engage employees continuously through teaching.
What advice would you give to your colleagues to help them to thrive and not “burn out”?
Take your job seriously but not personally. Often, the greatest gravity you feel at the end of a day, week or month is someone’s assault on your capability or questioning of your decisions. That’s OK — this makes you stronger. It’s important to find ways to renew and refresh your approach to the business. Personally, I am energized by visiting employees on the front line. Those are always my best days at work because I get to have real conversations with real people who keep me grounded. CEOs should schedule whatever renews them so they can catch that breath of fresh air.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
There are several people who have helped and inspired me. One in particular was a leader at Frito Lay who had an uncanny ability to connect with people. He had aggressive goals and a mission, but he knew his people. When he visited a plant, he’d remember the fryer operator’s name. He knew something about everyone. That combination of having high expectations but personal care for people is what I found most inspirational.
What are some of the goals you still have and are working to accomplish, both personally and professionally?
I’ve gotten into this career where I’ve done a lot of turnarounds. Every turnaround has its own story. I enjoy making a business more stable and providing employees with more personal stability they didn’t have before. I’ve had a couple of roles where the business wasn’t in jeopardy, but it became more stable and a better place to work. My overarching goal is to hear people say, “The time I worked at __ with Tony were some of the best years of my life.”
Outside of work, I’d love to invest more time and energy into helping the voiceless people who need help, whether that’s people who are struggling as they start their families, immigrants or refugees. There is a lot of work we need to do as a society. I intend to play a bigger role in applying what I do at work to the purpose of making someone’s life better in their most dire moment.
What do you hope to leave as your lasting legacy?
I hope my teams learn that there is nothing more important at work than caring for your co-workers. Really caring. All that stuff at work won’t be important 25 years from now. Twenty-five years from now, the organization as a collective probably won’t remember I ever worked there. What will matter is the difference I made in individual lives. The collective impact I can make is never as special as the individual differences I can make. I want to make a stark and personal difference in employees’ lives, especially in their times of need. That’s a much more worthy mission than being CEO of a company.
You are a person of great influence. If you could start a movement that would enhance people’s lives in some way, what would it be? You never know what your idea can trigger!
I want to inspire people to become more educated about civics and culture, to listen and understand others’ points of view. We are losing this. Society needs to keep talking about what matters. On social media, people with bad ideas have a lot of time on their hands to spread these bad ideas. I don’t see as many good, thoughtful, uplifting ideas going viral. There is a lot of misguided anger and raw ignorance that gets slopped around. People who have a different and more informed point of view should speak up, so we don’t have such wildly off-balance opinions and conversations taking place. Many CEOs are afraid to express their opinions due to fear of what it could do to company performance. But there should be a requirement for us to share ideas and have a safe space to say, “I think that’s wrong, and here’s why.”
How can our readers follow you on social media?
They can find me on LinkedIn or visit www.tonysarsamblog.com.