Conversation Series: Scott Brickman, The Brickman Group

Scott Brickman assumed the reins for The Brickman Group from his father in early 1998 when the company took on some financial partners. Part of his plan for the company’s future includes a more visible role in the industry, so he sat down with Lawn & Landscape Editor Bob West for this conversation.

BW: Tell me about your personal background?

SB: I’m 38 now, and I really started in the business when I was eight. My brother and I got up at 6 a.m. and went to work in the nursery every morning. I got to go on a crew when I was 13, and then I started running a crew when I was 15 because I had the experience, but they put an intern with me to drive.

I went to Penn State for landscape architecture, and after graduation, I went to Florida for two years because I wanted to work for someone else, so I worked for a landscape architect firm. I worked briefly in our design department when I came back and then I worked in sales.

From there, I got moved to Washington, D.C., because we weren’t performing well here at the time, and I became a branch manager running the design/build branch. I did that, got that turned around and I became the regional manager for mid-Atlantic region and Florida. Then I was promoted to take over East Coast operations. That was the way we stayed until we brought in our financial partners, my brother left the business and my father stepped out of his day-to-day role with our business and let me take over.

BW: What have been the keys to the company’s growth?

SB: The keys to our success started with my father’s and grandfather’s focus on quality. My grandfather wasn’t a businessman, but he loved plants.

My dad grew up in the business, went to the University of Illinois to get his landscape architect degree and joined my grandfather as his first full-time employee. They did $15,000 in gross sales their first year together, and then they really grew the business in design/build with a focus on pure quality with my father as the architect. My grandfather was a meticulous horticulturist and my father was a landscape architect who was focused on quality design and installation, and that has carried through into the business today.

People who have been around here awhile will tell stories about Dad coming out to a job and moving every plant on the job after they had been planted because it wasn’t quite right. His quality ran into making sure we ran the operations so well, and that’s why our operations are so strong. It’s the commitment to taking out waste and rework, the quality of our processes and the quality of our work that drives our success and our profitability, and that’s what drove Dad.

I think a secondary key is that we’ve done a good job focusing on the business end of things. We’ve studied Dr. Deming and his total quality improvement. That was very progressive at the time because that was the mid-1980s when Deming was just getting popular with the Japanese automotive manufacturers. We had to look at setting up divisions that compete with each other and how we would structure our compensation.

Another key has been striving for constant improvement. We’re fortunate that we are being very successful from a financial standpoint, but when I go into management meetings all people talk about are the problems. And that never changes because there’s this need to constantly improve and we’re never satisfied.

BW: How has that drive to improve impacted the company?

SB: What has resulted is a standard model that we’re constantly looking to improve. We have people out there looking at how we mow grass and how to improve it, what are the best practices and how we can apply them to all of our branches.

We’re also looking at the big picture of how a job cost management system should work. We have nine full-time information technology people, so we’re getting the information we need and we’re getting it faster. That way we can plan better because the thing about the maintenance business is that it’s all about planning. The better you plan, the better you perform, and that’s true for any business.

It’s true on a smaller degree – when the crew leaves in the morning does it have what it needs? Does it know what it needs to accomplish? Does it have the resources and equipment every day?

Part of that planning is keeping statistics on key areas. For example, we have statistics that show that the turnover is much higher with employees you hire in the spring and throw into the fire of your peak season compared with hiring someone in the fall, training them through the fall and winter and then sending them out in the spring.

That’s the difference between success and failure when it comes to customer service and efficiency, so we had our executive committee and regional manager meetings [in September] and preparing for next year was the whole focus of the meetings besides the 15 minutes talking about our financial performance for the rest of the year.

What I want my guys in branches to be thinking about is one month from now. You have to have your plans set to start with, and then you can adjust as you need to. Our poorer performing branches don’t have that in place, and they aren’t following core processes to get them in place. Then they’re reacting, they don’t perform as well financially, their customers aren’t as happy and their employees aren’t as happy.

BW: The Brickman Group started in design/build. What triggered the company’s move into maintenance?

SB: Taking care of your employees and making long-term commitments to them was always important here, which is ultimately what drove us into the landscape maintenance business. The construction cycle that the design/build business followed had some big ups and some big downs, and as we got bigger it got hard not to have to lay off some people during that cycle.

But it wasn’t until probably 1990 that we started focusing on maintenance. At that time, 85 percent of our business was design/build, and we were doing $35 million in annual sales. By 1997, we did $100 million in sales with 85 percent maintenance.

BW: Can you tell us about the decision to bring on the venture capital partners?

SB: We hired an investment banking firm in August 1997 to talk to potential partners, and we had two options. The first was an outright sale of the business to a strategic buyer, which no one in the family wanted to do. But how much money was my family willing to leave on the table so I could continue to run this business?

Our other option was a financial buyer, at which point we could continue to own a significant part of the business. While we were going through that process, these rumors got out that there was this roll-up getting started called LandCare. TruGreen always had been interested in acquiring our business, and it had a strategic plan that got it in the landscape business in late 1999 and early 2000. But we didn’t want to be bought by ServiceMaster. Their culture didn’t match with our culture, and that was more important than their offer.

So we have two financial partners along with myself and my wife. Our move happened to coincide with LandCare, and we got TruGreen to start buying, who thought LandCare would buy a bunch of companies and that our strategy would be to get venture capital and do our own buying.

That was never our strategy, and for good reason as we can see now. We did more acquisitions than we were doing, but we’re not an acquisition company. We were always very conservative, and we wouldn’t take on debt. We were basically a $100-million company with no debt.

BW: Has it been difficult for you to take over the company at a relatively young age since some people will just think you got the job because of your name?

SB: I did get this position because my name is Brickman, but the people that gave me this position aren’t named Brickman – they’re named Bank One and Bank America. Now, they believed I could do the job, and I wouldn’t have gotten the opportunity if my name wasn’t Brickman. So I’m fortunate, and now I’ve got the chance to prove I can do this.

I think thus far I’ve proven myself to them, and that was important to me and is part of what drives me. I don’t do this for the money. I do this because it’s a challenge and I like to do this. But the dynamics of a family business are very challenging, and I’m very fortunate, as my brother and sister were when they were in the business, to have a father who was very forward thinking and gave us incredible opportunities.

He made us work our butts off, and he made us get prepared, but then he gave us these opportunities to make it or break it.

He sent me here when I was 27 years old to run a region, and I was fortunate that it was very unsuccessful when I came here and it was turned into a success. He was willing to give up control to us and the managers before him. But he made us do everything and more that every other employee did. When I was 13 years old and on a crew I was expected to work every bit as hard as the laborer next to me, so I got up at 6 in the morning and got home at 7 in the evening seven days a week. If the crew was working, I was working, and I loved that. I took great pride in being part of a crew.

BW: What do you think are some of the upsides and downsides to the size of the company?

SB: The upside is that the opportunity out there is tremendous. We were at $100 million in annual sales in 1997, and we’ll do about $230 million in 2000. I think we can keep this growth rate with the same amount of effort that it has taken us. So, look at that and say four years from now we’ll be $460 million, six years $920 million.

The upside is that we can continue the culture. What’s important to me is how we take care of our customers and the difference that makes for people. Besides, on the most basic level, when you have someone who treats you really well and gives you great service, whether it’s a waiter at a restaurant or someone going out of their way to help you, it makes the world a better place.

I think we as a company can set that standard where we treat people fairly. We give them extraordinary service, great quality and we can improve the world we live in and take care of how it looks. That excites me.

The other thing that excites me is that right now we have close to 4,000 employees, and they spend the majority of their waking hours working at this company. If we can create an environment where people treat each other with trust, honesty and respect, and they can find joy in their work, then that’s a great opportunity. Those things make a difference and leave a legacy. If we do better at those things than others, the growth rate will be better because people will come to us and customers will come to us.

The downside is that we are a business, and the bigger you get the more challenging it becomes to buffer the difference between a focus on dollars and a focus on doing the right thing.

Eventually, and we’re looking five years out with our partners, we’re going to have a new capital structure, and the bigger you get, the more public the markets are likely to become. That means there’s less tolerance for a variation of numbers, which means more focus on managing the numbers for me. To me, that’s the challenge. Ultimately, as a leader, I think that will be my challenge because I’m the buffer.

BW: How would you compete against The Brickman Group?

SB: The way we look at it, The Brickman Group is 70 small businesses. We do that because as a small business you can serve your customers better. We want to stay close to the customer with the guy making the decisions leading the branch, talking to customers and the people serving the customers every day. That’s our success. The smaller operator is doing that. And if I wasn’t doing this job, I would be running a small landscape company because the most enjoyable part is dealing with and serving the customers.

A lot of small landscape companies measure success by how much business they have. But they don’t realize that equipment is waste unless it’s productive. Figure out how to better manage, how to streamline, how to take out waste and rework, work more efficiently and, at the same time, build relationships with your customers. It’s all about relationships.

We see it all the time when we’ll have a site that looks wonderful, and the property next door looks horrible. We go to that property manager and say, ‘Look at what we’re doing next door. We can help you.’ And he says, ‘What do you mean? My property looks great. I get the best service. I love Johnny.’

Johnny has made a friend out of this property manager, so he overlooks all of the weeds and the poor performance. If you can build those relationships, and at same time do great work, Brickman won’t touch you.

BW: Are there companies out there that you measure your company against?

SB: It’s not this industry because I feel we set all the standards, and I want to set the standards for our industry. I look at companies like Nordstrom, Home Depot, and companies like GE for how they grow leadership. I look at companies like MBNA for how they create loyalty with their customers.

BW: There is a common conception that The Brickman Group wins a lot of jobs on a low price and then makes the money back by selling more enhancements than most other companies can sell. Is that accurate?

SB: And I think our price on add-ons is usually competitive or lower than other companies’ because we work very hard at looking at our profits. These are $2,000 to $30,000 jobs. But our focus is not selling add-ons. Our focus is listening to our customers and providing good service.

We do lots of customer surveys, and the No. 1 thing every year, for every branch, far and away is ‘I wish you people were more proactive. Tell me how I can improve my site. What I can do to make it better? Communicate with me.’

What does it mean to be proactive? It means offering them opportunities. Show them ways they can do more, which means sell add-ons or enhancements. So, we do not begin to meet the customers’ desire to be proactive on their site, yet we sell a lot of add-ons. Part of what they want is for us to tell them ideas even though they’re not sure they can buy them, but they want the idea.

People negotiate hard with people on a contract, and contractors make the assumption that because customers negotiate hard on a contract they don’t have money to spend. Actually, they negotiate hard on a contract because they want to make sure they’re buying right. They might have three times the amount of the contract to spend on additional things. People are stupid in making the assumption these customers don’t have money, and the customer sees that as not being proactive. If the site looks bad because the customer should do replanting, we should be telling them this even if it’s not in the contract. That’s what can set you apart.

BW: What are your thoughts about consolidation in the future?

SB: It’s here. Where it goes from here, who knows? We’ll continue to grow and we’ll continue to acquire companies that fit our model on a conservative basis. It has to do with the people, customers and their culture.

It wouldn’t surprise me to see others get into it. People will be conservative when consolidating because the financial world sees what has happened to TruGreen. But I think there’s tremendous opportunity, and I second-level management in companies that were sold who are now starting their own business, and there’s tremendous opportunity for that. So I see that continuing, and that’s the opposite of consolidation.

I don’t think consolidation is going to happen nearly as fast as everyone thought it would or as fast as the people at Service-Master said it would. They are not going to do in this business what they did in the lawn care business – I think that’s obvious. This is a much bigger business, first of all, and lawn care is lawn care while there are so many variations in landscape from residential design/build to residential build to bid to maintenance to irrigation to tree to commercial.

That’s why we’ll never consolidate the landscape construction business, and that’s a whole market we’re never going to touch. We don’t know how to do that work, and I don’t want to know how. We’re very focused on the landscape maintenance industry, and only certain segments of that market. So, I think it will be hard for someone to ever consolidate most of this business. Look at TruGreen, Brickman and Environmental Industries combined – what do we have? Maybe $1.5 billion, at the most. That’s less than 2 percent of the whole industry.

BW: How would you describe your management style?

SB: My approach is probably a lot driven by personality, theory and philosophy. Then there’s the company management style, which I hope goes hand-in-hand with my style, but I think we take a long-term approach with our leadership style. My goal is to present a vision for the company. My full-time job is telling our people exactly what I’ve been telling you about – customers, service, people, quality, teams, process. It’s an easy message.

Basically, we’ve got to create a great service level. We’ve got to thrill our customers. We’ve got to produce great quality on the jobs. We’ve got to build teams and treat people with trust, honesty and respect. We’ve got to focus on the process that run our business and reduce waste and re-work. That’s our management message.

I still get involved in sales, finances, human resource issues and so on, but I try to delegate that stuff and focus on delivering that message and making sure everyone else is focused on it, because that is our challenge. It’s that simple.

I’m working to get more removed from the operations so I can spend more time in meetings sharing the vision. The only way I think you can share the vision is with stories. I can go in there and talk about customer service or talk about building teams and treating people with trust, honesty and respect, but if I can illustrate with a story, it’s so much more powerful, so I try to make that a big part of my leadership style.

A big part of my job, and one of the huge advantages we have over our competitors, is that when you have 70 branches you have 70 laboratories. If all of the landscapers in the Washington, D.C., area were willing to share everything they knew with each other, they could teach each other a tremendous amount. Well, we’ve got 70 branches who do that, and if one branch makes an improvement it may improve its business by .5 percent in labor, but multiply that by 70 and the numbers get huge. So our job is to share that and get the standard improvement.

BW: How do you accomplish that?

SB: The challenge there is to create an environment where people are open to criticism and a new way of doing things, where they always want to figure out a better way to do something. People who fear for their job and how well they’re doing are defensive, they close down, they show you what you want to see. If people trust you, know that you believe they’re doing best they can do and it’s the process that doesn’t allow them to do any better and what we have to work on is improving the process, then they’re open to it.

We do a lot of management and leadership training. We’re spending a lot of time on emotional intelligence right now. Basically, Daniel Goldman wrote the book on this, and he did a tremendous amount of research by the Hay Group. I was fortunate enough to meet with the people who did the research, which shows that the No. 1 factor influencing an organization’s success is the environment people work in and their attitude. That’s a 30 percent determinant on an organization’s success, which is far and away the biggest leverage point. Seventy percent of what determines the environment is the leadership, so that’s enlightening to me.

Now, when I go to a branch and I think that we’re not getting the results that we want, I look at the environment. What is the environment and what is the leadership since that is what is probably creating the environment? So, we’re educating our leaders on different leadership styles and what makes a good environment and what doesn’t. The biggest challenge we have with our leaders is that they are doers who came up through the field and want to be out doing the work, meeting with the clients, looking at work orders or else they feel like they aren’t doing things. What they need to be doing is meeting with their people, sharing the vision and giving them feedback.

They do this work because they love the work, not because they love to communicate. We’re teaching them how to communicate, and we’re putting processes in place to improve the communication, which improves the leadership, which improves the business. We spend a tremendous amount of time and money on training and education. I would bet we spend four to five times what our competition spends, and that’s overhead, but it comes back to you in spades. And that’s why we can run that much more efficiently.

BW: Where do you see The Brickman Group five years from now?

SB: I see the growth continuing. I see us continuing to focus on the core because we have such an incredibly small percentage of the market. All I see when I look at the business are our deficiencies. I can be real negative and tell you how bad we’re doing – I can tell you about unhappy customers, I can tell you about unhappy teams, I can tell you about people who aren’t being treated fairly, and those are all the opportunities. I can tell you about people who aren’t getting good leadership, which kills me, but that’s partially my responsibility. But you know, I’m young, I’m still new to this job, I’ve got a lot of improvement to do. We’re a young team that is growing very fast and learning to improve and focus on that.

One of the things we need to focus on is balancing our lives and getting more balance in our people’s lives. It’s easy to get so driven on growing fast that people aren’t spending time they should with their families, so we have to build processes in there to allow that to happen. That goes for me personally and everyone else because when it’s all said and done the time you spent doing other things is more important than how successful you were at business. That’s part of leadership – saying, ‘We all know what we have to achieve. How do we do it in 45 to 50 hours a week?’

BW: What do you think are the biggest challenges facing the industry?

SB: I think government regulation when it comes to labor is far and away the biggest issue we’re dealing with. And I don’t think we have an effective way to address that. We’re just going with the tide responding to what happens to us. All we have for an industry lobbying effort is one person, part time, and that’s not enough for this industry.

But this is an industry of little companies who are at the end of the tail who get whipped around by what the bigger body does, and most of them probably aren’t following the regulations. They’re just hoping and praying every day that they don’t get caught. Then, if they get caught, all heck breaks loose, and we’ve seen that when the INS raids some of these companies and they’re just devastated. They work too hard to have that happen, so we have to work to get systems in place that they could follow to take away that risk.

With the risk out there you’re looking at a business equation of what sort of return can I get for the risk I’ve got? The returns most landscapers are getting don’t justify a lot of risk, so we have to figure out how to minimize that risk.