As part of our series about the “Five Things You Need To Be A Highly Effective Leader During Turbulent Times,” we had the pleasure of interviewing Nathan Stallings.
Mr. Stallings is currently President at Matrix Integration, LLC, a regional IT Solutions and Managed Services Provider based in Jasper, Indiana. Nathan has spent the past 17 years in various roles at Matrix from individual sales contributor to vice president of sales.
Nathan is passionate about helping people succeed and improving their lives. As President at Matrix Integration, Nathan leads and inspires a high-performing team to modernize, optimize and manage organizations’ technology infrastructure. The end goal being to positively impact business results while reducing costs — both through IT projects and fixed-fee IT managed services.
As a certified facilitator, strategic planner and creative problem solver, Nathan’s professional value extends beyond the confines of the client conversation. He is a respected peer leader in Trust X Alliance Mastermind — a close network of IT solution and managed services providers, as well as in YPO — a global network of business leaders and as part of the Hewlett Packard Enterprise Partner Advisory Council.
Nathan is a lifelong learner. He has been known to regularly quote Zig Ziglar and is a self-proclaimed Traction (EOS) nerd. Nathan is an honors graduate of Ball State University where he studied Mathematical Economics and Computer Science. He has also participated in executive education at Indiana University, University of Louisville and Harvard Business School. Nathan also teaches the Effective Communication Leadership Workshop at Matrix Integration — a key factor in the company’s 42 years of success.
Nathan lives on a small farm in Noblesville, IN with his wife Meghan Stallings and four boys Parker, Tyler, Finton and Beckham.
Thank you so much for your time! I know that you are a very busy person. Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
Sure. Out of college I thought I wanted to do something in finance. So, I took a job as a Floor Clerk at the Chicago Board of Trade. Floor Clerk is a fancy title for what is more often referred to as a “runner.” I would deliver commodities trades from the trading desk to the trading floor. I soon learned that one’s first job out of college is not always the most glamorous. I also learned that trading was not for me. So, I took a course in Cold Fusion, a coding language used to create web applications. I eventually convinced someone I knew something about web apps and was offered a job as a Business Unit Consultant in the eServices group at Kimball International’s corporate headquarters in my home town of Jasper, Indiana. After about 3 years of consulting I was being recruited to the family business, Matrix Integration, to join the sales team. The attractive part about that was the financial upside and the ability to spend even more time consulting with clients. I saw others in my family who started at Matrix Integration making very little money, soon outpace my corporate compensation path. So, I signed on with Matrix as a Government Account Manager in 2004, covering all city, county and state government in Indiana. It wasn’t long before I was assuming more responsibility managing the sales operations and delivering sales training. When in 2012 our founders asked the second-gen family members “are any of you interested in eventually taking over leadership of the company,” I was the only one who stepped forward. And, so my grooming began. In 2016 I took on the President role and have been working ever since to be qualified for the role. I don’t imagine I will ever stop working to be qualified for the role.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?
Well, I don’t know how funny this is but I can laugh about it now. When I was a runner…ahum, Floor Clerk…at the Board of Trade I would take trades over a David Clark headset, like the ones airplane and helicopter pilots use. On one occasion I heard a trade come over the headset to sell a certain number of lots of soybean meal. The trade I conveyed to the trader in the pit was to “buy” instead of “sell”. So, I lost over $2,000 for the trader, who had to get out of the position himself and then resell for the client. Needless to say I was embarrassed and felt really bad for losing what I thought was a lot of money. I learned a couple key lessons that day. One was grace. The trader told me not to worry about it. He said it happens to everyone eventually and noted that in this case it happened with a relatively small lot (some of the transactions we were making were in the millions of dollars). The second lesson I learned was communication. I learned the importance of first hearing the other person, then summarizing back to them to confirm understanding.
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?
Indeed, there are many. However, no one more than my mother, Brenda Stallings. In the early years of our company (and up until recently) Brenda would work from 7am to 7 or 8pm many days. I remember when I was in middle school I would walk to the Matrix office after school, just a few blocks away. At times I would nap under Mom’s desk because it was darker under there. Then after she “shut down” (as we called it) at work we would head out to eat like to Paco’s Restaurant. At dinner we’d talk about business a lot of times and during those conversations I learned the basics of business, concepts like revenue and the difference between gross profit and net profit.
Extensive research suggests that “purpose driven businesses” are more successful in many areas. When your company started, what was its vision, what was its purpose?
Our company was founded upon Brenda’s dream to one day run her own business that helped other people in some way. Brenda and her siblings grew up in a German, Christian household where they believed in and practiced the principles of hard work and serving the Lord through serving others. Her family ran a small farm where they grew and processed cane to make sorghum which they sold to local grocery stores. Upon that foundation Brenda sought to live out her dream after graduating high school. She first bought Sound of Music, a local music store and then a Radio Shack dealership. As she evolved the business from the Radio Shack to Jasper Computer Center to now Matrix Integration she always kept the same purpose — to help people succeed and improve their lives — which is still our company’s mission today.
Thank you for all that. Let’s now turn to the main focus of our discussion. Can you share with our readers a story from your own experience about how you lead your team during uncertain or difficult times?
The COVID pandemic this past 13 months has been the most difficult and uncertain time that our company has gone through since I’ve been in a leadership role. Through March of last year our company’s profits were already below first quarter of the previous year. In April, like so many other companies, we were forecasting more negative impact on our business. We are firm believers that “you make your own luck” and that “chance favors the prepared”. So, we began preparing for the worst. In the end there were only a handful of things we did that I believe got us through the pandemic.
Did you ever consider giving up? Where did you get the motivation to continue through your challenges? What sustains your drive?
Our core values are to “Always…Lead With Positivity, Do The Right Thing and Commit to Excellence.” That doesn’t leave a lot of room for giving up…ha! Our motivation was and always has been people. Our employees and their families, our customers and our business partners are what drive us every day. I personally feel like we have a duty to do everything we can to serve others. What sustains my drive is knowing what an impact I and we can have on the lives of others.
What would you say is the most critical role of a leader during challenging times?
I would say the most critical role is to openly and frequently communicate with others. I believe to be a good leader one must communicate the brutal facts of the current reality, communicate confidence in the organization’s ability to overcome challenges, communicate empathy for others and communicate a game plan and expectations for getting to the other side. For the first 4 months of the COVID pandemic I posted an update on our internal, employee website every two weeks. The message contained topics like state mandates, internal work from home policy changes, customer success stories, emotions we were all feeling and detailed actions we were taking so as not to have to lay off staff.
When the future seems so uncertain, what is the best way to boost morale? What can a leader do to inspire, motivate and engage their team?
What a leader can and I think must do to motivate, engage and inspire their team is to identify all of the benefits the team will experience. You’ve probably heard the acronym WIIFM, which stands for “what’s in it for me?” I believe that everyone has different motivations (WIIFMs) for taking action or making a change. The best a leader can do is to identify (and create if necessary) all of the benefits, share them with the team and be prepared to deliver on them. As an example, our company is pivoting from a focus on top-line revenue growth to profit growth. The shift for many of employees has been great, but for others who experienced some changes we made in alignment with the new measure of success didn’t love our decision. So, for everyone in the company we created a company-wide bonus centered around hitting a single net income number. The response was very positive and I believe for the first time in a very long time every employee is shooting for the same target and with more energy now than ever because there is a clear WIIFM.
What is the best way to communicate difficult news to one’s team and customers?
I believe when sharing difficult news the good leaders do so with warmth and directness. Also, I believe difficult news is best shared, when possible, in one-on-one or small group settings where everyone is encouraged to open up. We recently created two unique business units in our organization. Particularly with those individuals who would be impacted most, or who we thought might believe their role would be impacted we scheduled one-on-one conversations. Each individual we did that with appreciated the open dialogue and appreciated being contacted directly to discuss.
How can a leader make plans when the future is so unpredictable?
Last year I had the opportunity to see Rob O’Neill speak. Rob is a motivational speaker and former United States Navy SEAL. I still have in my phone the notes I captured from his talk. When Rob described the preparation and planning that went into the raid on Osama bin Laden’s compound in Pakistan he said simply, “there is a difference between the perfect plan and being prepared.” I think often about this statement in terms of how we operate the business and life really. While it’s unhealthy to constantly worry about all the bad things that can go wrong, it is healthy to develop the discipline to think about and build contingency plans for those things that are likely to go wrong.
Is there a “number one principle” that can help guide a company through the ups and downs of turbulent times?
The number one principle to me is adaptability. We are indeed in uncertain times and I don’t see that changing in the near future. So, if we expect there will be ups and downs then our best path to success is everyone in the company becoming adaptable. Here is a great example. One thing we’ve been doing for about 2 years now to help everyone in the company be more adaptable is using “Issues Lists”. We train everyone in the company how to solve issues that arise. Each team keeps an Issues List and every single week in their team meeting everyone first prioritizes the top three issues, then they get to solving them one at a time. So, as weeks progress and ups and downs happen we are all trained to accept the up or down as just “an issue to solve.” Everyone expects issues will come up and everyone knows that if our company is better at solving issues than our competitors then we’ll win in the long-run.
Can you share 3 or 4 of the most common mistakes you have seen other businesses make during difficult times? What should one keep in mind to avoid that?
One common mistake I’ve seen other businesses make during difficult times is to quickly and deeply layoff or outright fire staff. For many businesses, including ours, people make up the bulk of the operating expenses. While, at the same time our people are our most important contributors to success. So, I believe that any reduction in force should be an option of very last resort.
Another common mistake I’ve seen is that companies, during difficult times, reduce spending on sales & marketing. I believe this is another area that should be of last resort. The saying goes “you cannot cut your way to growth.” Companies are better off finding other areas to skinny up and should even double down in those areas in sales and marketing that are working.
A third mistake I’ve seen companies make is to cut prices to drive more business. Compare Five Guys Burgers and Fries to Steak ‘n Shake for example. Five Guys has always chosen quality ingredients and then set the price based on the cost of those ingredients. Whereas, Steak ‘n Shake has focused, at least in the time that I’ve been eating there, on price alone. I believe cutting prices is a death march and there is far more upside to creating real value for customers with a quality product or experience.
Generating new business, increasing your profits, or at least maintaining your financial stability can be challenging during good times, even more so during turbulent times. Can you share some of the strategies you use to keep forging ahead and not lose growth traction during a difficult economy?
We are not perfect by any means but there are a few strategies that I believe have helped Matrix survive and even thrive during difficult times.
First, we expect there to be difficult times. We are in the technology business so our world is changing regularly simply due to the constant evolution of technology. Add forces of nature like flooding that can and do regularly impact the supply chain. Mix that with economic downturns like the great recession of 2009. No matter how good things get we are always conscious of the possibility and even likelihood of catastrophe. The famed business author, Jim Collins, I believe calls this “productive paranoia.”
Second, we always maintain a 12 month rolling budget and sales forecast. Monthly we compare the two for discrepancies. This allows us to make adjustments to expenses if needed based on changes we are seeing develop with market conditions and demand.
Third, and perhaps the most important factor I believe is our core values: Lead with Positivity, Do the Right Thing and Commit to Excellence. When everyone in the company is living our core values there isn’t a whole lot we cannot tackle together.
Here is the primary question of our discussion. Based on your experience and success, what are the five most important things a business leader should do to lead effectively during uncertain and turbulent times? Please share a story or an example for each.
Here are the five things that I believe helped us weather the most recent COVID pandemic. I think these could be applied to many other types of turbulent times as well.
- Adopt a “people first, people last” frame of reference.
During the pandemic we focused our attention on our people. Specifically, all of our focus went to keeping our people safe, employed and productive. We immediately increased communication — we held more frequent leadership mtgs (daily for the first couple of months of the pandemic), we posted weekly internal memos from the President and I made personal phone calls to check in with employees’ well-being.
2. Create and execute a “rapid recovery plan”
On April 1 of 2020, in the early days of the COVID pandemic we created and began executing what we called our Rapid Recovery Plan. We essentially made a checklist of things to do right away, and also things we would due in the future depending on how bad things got. Here are a few line items from the plan to give you a sense for what was in it:
Understand likely today-to-nine-month cash situation
Costs to cut quickly
Hold on pay increases but retain incentives
Renegotiate vendor agreements
Closely monitor AR
3. Leverage peer networks for best practices (don’t try to go it alone)
Even prior to the pandemic we relied heavily on our peer networks for guidance. During the pandemic the collaboration with our peers was even more valuable to validate and shape our thinking and actions. I personally relied on my YPO and MasterMind peer group. Dan Fritch, our COO, leveraged his University of Louisville CEO roundtable as well as his MasterMind and ISA peer groups. We used Service Leadership (our benchmarking company) extensively throughout the pandemic — they were responsible for the Rapid Recovery Plan template we used. Our VP of Sales leaned heavily on his Vistage peer group.
4. Focus on profitability not top line revenue
I have to admit here that our firm, for many years was focused more on top line revenue growth than profit growth. We were already considering a pivot to focusing more on bottom line profits and the COVID pandemic pushed us over the edge. With the help from our EOS (Entrepreneurial Operating System) Implementer and some key components of Great Game of Business (by author Jack Stack) we pivoted our entire company’s focus to that of net income.
5. Leverage technology
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
“You can get everything in life you want, if you just help enough other people get what they want.” Zig Ziglar
This quote is very relevant to all my roles in life. There are many other people that rely on me to support them and their efforts. This quote has always helped steer my thinking and action toward serving them, which has been a huge benefit. It’s helped me be a better husband, father, family member, friend and colleague.
How can our readers further follow your work?
The best way for readers to follow my work is on LinkedIn.