CEO magazine ranks company as one of best for leadership development
By Dave DeWitte
Six years ago, with the Great Recession fading into the rearview and the recovery underway, Cedar Rapids-based ground transportation company CRST International saw a growth opportunity.
While many other trucking companies had struggled or failed during the recession, CRST was emerging debt-free and strong. Satisfied customers said they needed more shipping capacity, and CRST wanted to provide it.
The company added trucks, hired drivers and bought a string of other specialized carriers. But as CRST grew and the owners of the acquired companies retired, gaps in leadership emerged.
“As we grew and expanded we looked back, and we were pretty short on the bench,” recalled CRST Chief Executive David Rusch. “We were to the point where it hampered our growth. We didn’t have the ability to reach down in our ranks and pull people up.”
Part of the issue was CRST’s location. Most of the large transportation companies CRST recruits from are located in the South or major metropolitan areas. Although many potential recruits have heard of CRST, they often don’t know Cedar Rapids nor have any interest in relocating to an unfamiliar Midwestern city, Mr. Rusch said.
Keeping leaders once recruited was a separate challenge, Mr. Rusch said, in part because of a business culture that demands high performance and accountability.
The company’s solution to that challenge was recognized this month, when CEO magazine ranked it as one of its “2016 Best Companies for Leaders.”
CRST ranked No. 10 in the private companies category. The selection criteria includes a formalized leadership development process, time spent by the CEO in leadership development, and the size of the company’s leadership funnel.
“We always get excited when we get recognized, because that’s important to us, but there’s none that’s been as satisfying as this recognition,” Mr. Rusch said.
CRST began putting the leadership program in place in 2009. Brooke Willey, a new head of human resources from outside the transportation industry, was brought in to develop a strategy to fill the gap.
Ms. Willey began by calculating how many new leaders the company would need to meet its growth objective of $1.8 billion in revenue in 2018. The final calculation came out to one manager to every $7 million in revenue.
“We had 175 [managers] and needed to get to 241 by the end of 2018,” Ms. Willey recalled. “That didn’t account for turnover. Roll in retirements and turnover, and that’s at least another 51.”
Looking at it from that perspective, the numbers appeared daunting.
“I needed to have 120 people hired by 2019 to meet that growth, just to manage people,” Ms. Willey said.
CRST’s leadership program has three major components. The largest is a three-year program, Leadership Development for Management Professionals, which consists of a curriculum of 25 courses for CRST managers. The courses are divided into four different zones structured to meet the needs of different levels of management. Foundations of management, the first level, includes such areas as interviewing and managing across generations. The highest level covers such advanced topics as financial intelligence, strategic planning and advanced presentation skills.
The leadership courses are offered onsite at CRST headquarters in Cedar Rapids, and at its centers in Birmingham, Alabama, and Fort Wayne, Indiana. Employees at other CRST locations can take the courses via the web or in their offices.
Once CRST started its program, the conversation turned to specialized training for high-potential leaders. Company leaders say they often look for that something extra which they’ve dubbed the “it factor.”
“It’s that moxie,” Ms. Willey said. “You can’t train it. You either have it or you don’t.”
CRST’s senior leaders select participants for an intensive, six-month training course, dubbed the Emerging Leaders Group, from applications submitted by employees. The course concludes with teams of four or five emerging leaders addressing a complex issue facing the business with the support and advice of an executive sponsor.
“What’s a better way to cultivate management skills than to throw them into the thick of it,” Ms. Willey said.
The final component of the company’s leadership training addresses a different need. It is an online portal that allows future leaders to strengthen their technical skills in areas such as spreadsheets and PowerPoint presentations.
Underpinning CRST’s efforts to promote leadership is a simple classification system for leadership potential. Employees are assigned a promotability classification, based on input from employees and their supervisors during annual reviews. Categories range from “green light,” with high promotion potential, to “yellow light” for seasoned professionals that perform well but lack the aspiration or abilities to advance, and “red light,” for employees who may not be in the right place in the organization, or need additional skillsets to perform well.
The leadership development program enabled CRST to fill 75 percent of its supervisor roles from within during 2015, Ms. Willey said, up from only 30 percent five years ago.
Mr. Rusch added that the word is getting out that CRST is a company where aspiring leaders can build a career, and the leadership program is here to stay.
“Without it, we wouldn’t be able to do what we have to do in the next five years to get where we want to go,” he said.