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A Video Conversation with Roger Kauffman, CEO of Electric Motor Repair Company on Succession- Part 2

Click Here for Part 1 Providing commercial equipment, parts, and repairs to the region’s businesses for over 85 years rogerkRoger Kauffman is the CEO of Electric Motor Repair Company (EMR), a service company based in Baltimore, Maryland. For more than 85 years, EMR has served generations of businesses across the Mid-Atlantic region. The company splits its service areas into two divisions: Industrial and Commercial Kitchen. EMR’s Industrial division handles equipment installation, repair, and fulfillment in industrial, printing, elevator, and processing settings; while the company’s Commercial Kitchen provides parts and services in the commercial cooking and refrigeration industries. Last year, Roger celebrated his 50th anniversary at EMR—he joined the company in 1964 as a repair technician.   Tell us about your daughter Caroline’s role in the company. ROGER KAUFFMAN: Caroline is my oldest daughter. She went to college, got a degree in public relations. All the years she went to college she said, “I’m going to come work for EMR,” but when she graduated, she called me up and said, “Dad, I think I’m going to work for a larger company,” which was okay with me. I’ve never forced any of my kids to come into the company. About a month after that, she said, “Dad, I have to do the EMR thing.” So she came in, and I put her to work in accounts receivable. After about a week, she came into my office and said, “Dad, I love it.” I said, “What do you mean?” She said, “I love the service business.” I knew at that point she had acquired the passion that I had for the service business. From accounts receivable, she went into HR—worked there for four years—then she moved into the operations, went up to the Delaware area and ran our small branch up there for four years and actually turned it around. It was in the red, and she turned it into a profit center. And then she came down to Baltimore and ran the Baltimore branch for four years. Then, I made her general manager. Her next step will be to take my place as the president—in maybe a year or two, I would say. How has technology changed what EMR does? This past year, we’ve started to introduce tablets into the field with our technicians, and employing this technology has allowed us to have better information in the technician’s hands. He can pull up a wiring diagram, a part schematic, while he’s in front of the piece of equipment, and do a better job diagnosing and troubleshooting that piece of equipment. If he needs parts, he can put them in the tablet, and it immediately comes into our Baltimore fulfillment office where they either take it out of our inventory, or order it from the manufacturer and have it drop-shipped to a UPS drop box where he can pick it up and finish the repair. On the billing side, instead of a 10-day turnaround for billing, we can bill it within 24 hours of him completing the job, which helps cash flow quite a bit. When you started, it was a much different business. Do you feel ready to hand over the reins to Caroline? Actually, handing this off to my daughter makes sense to me now. I hold back because time in job is still a little too short. She still has some development and experience to go through before I give her the full reins of the company, but, for all intents and purposes, she’s doing 80% of it now. The general manager interacts with all the ops [operations] managers, who interact with all the branch personnel, who actually do all the work, so she’s really running the majority of what goes on now. I’m just 30,000-foot oversight. What are some of the major challenges you’re contending with as a company? The internal communications we’ve done a poor job at times talking to each other internally about—particularly, a customer’s issues where the person on the phone that talked to them to begin with fails to mention to the technician who’s going out that they need to bring this particular part with them. So, our technician gets out and then the business owner says, “Did you bring that part?” And if he [the technician] says “no,” well, we don’t look good. So, we’re working very diligently now to break down barriers between departments, between jobs, so that everybody’s communicating. It’s important for everybody to pass on the word—what’s going on, what’s the customer asking for—and that’s starting to have its effect. Caroline is a great cheerleader for that because she’s a big believer in that. Actually, when I came through, it was more or less “you take orders, you don’t talk, if I want you opinion I’ll beat it out of you” kind of thing. So, the next generation coming through is more about talking, more about sharing, and that’s what she’s very effective in doing, and it’s already starting to show some benefits in the company. Yeah, we recently ran a survey of employees’ opinions of EMR and what they like and don’t like. I didn’t really know what to expect, but it was an overwhelming satisfaction with the company. There are places we need to improve, which we’re going to be working on in the coming year. We’ve started a new—I call it a game—but it’s a way to recognize good performance. Everybody gets to recognize somebody’s good performance; it’s called “I Spy,” and a group of the new leadership in the company came up with it: you get to find somebody doing something good and report them. And, at the end of the year, there’s a reward for who was spied the most and who did the spying the most. It engages everybody in the positive idea of “don’t keep finding wrong things that people are doing”—you’ll always find those, and if you look for them, that’s all you’ll find. Instead, find something they’re doing and recognize them for it, and that’ll encourage more of that behavior. So, we’re trying to turn that snowball around and get it going in the right direction.    

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