Pointing To Success
Thanks to TV shows, movies and news reports, even people who’ve never set foot in the executive suites of a major corporation can easily imagine what it must be like. And it’s not a particularly pleasant picture. Hard-driving, Type-A alpha males in blue power suits — like Gordon Gekko, J.R. Ewing and (formerly) Conrad Black — stalk the hallways, plotting to stab each other in the back, while terrorizing underlings who have to duck and cover as the bosses’ massive egos pass by.
But on a bright autumn day at the Mississauga, Ont., headquarters of Compass Group Canada, something’s terribly amiss. The assembled executives, led by CEO Jack MacDonald, are clearly bright, committed and ambitious, but they’re also…well…awfully nice. While respectful toward the long-serving MacDonald, the team is relaxed, affable and there’s even some playful shoulder nudging. Women are also well-represented in the senior executive ranks and — so long stereotypes — there’s no navy Armani either.
It’s not that Compass — F&H’s 2007 Pinnacle Award winner for Company of the Year — isn’t big and powerful. Specializing in contract catering (but with fingers in several other pies), the privately owned foodservice management company employs 22,000 people across Canada, and serves more than one million meals a day in schools, hospitals, workplaces, sports arenas, correctional facilities, remote sites and even the high-end C5 resto in Toronto’s Royal Ontario Museum. But although annual sales for 2007 are projected to be $1.1 billion — besting its closest rivals by hundreds of millions — there isn’t a whiff of hubris.
“This is a great award for us,” says MacDonald. “We had a great financial, growth and retention year, but we don’t want to get caught up in that. We’re always staying humble and asking what we can do better.” Naturally, MacDonald credits the company’s success to its people. “Along our path we’ve pulled together a group of what I consider to be the most talented women and men in the industry,” he says, and it feels like more than the usual platitudes.
“When Jack announced the award, he said, ‘It’s not for me, it’s not for the Board — it’s for [everyone] here,’” says Jeff Patt, London, Ont.-based executive vice-president of Business Excellence. “To me, that was a huge message that touches deep into everything we do as an organization.”
What that organization does is a little dizzying. An independent division of Compass Group PLC, a $21 billion behemoth based in the U.K., Compass Canada has eight divisions, including the education-focused Chartwells; ESS, which offers food and facilities management in remote sites; Eurest Leisure & Entertainment operating in sports and cultural venues; and Morrison, which covers healthcare and senior dining. With its market dominance, it’s a little shocking to recall Compass has only been on the scene for a decade.
MacDonald joined Compass’s predecessor, the $58-million Restauronics in 1996. During the next year that company changed hands twice, eventually becoming part of the multinational Compas. Group, where it had sales of $67 million in 1997. Over the next few years, the company grew through a series of acquisitions, the key one being the 2001 purchase of Beaver Foods, which added $285 million in revenues. “What we got was critical mass and outstanding management talent,” MacDonald says. “To this day, other than through retirements we probably have 95 per cent of those managers still working for us.”
Keeping such a sprawling operation running smoothly can be tricky, but MacDonald and crew say one advantage is the way sectors with very different challenges learn from each other. For example, the company’s much-lauded Balanced Choices healthy-eating program was launched by Chartwells and has now been adopted by all divisions, including remote sites. “Rather than bringing a prepackaged solution (to clients) we go in and listen, ask a bunch of questions, clarify the need, then come out with solutions that match what the client wants,” Patt says. “So the combination of a retail focus with a hospitality mindset helps us grow through [new] channels.”
Additionally, sector heads meet regularly to share best practices. “It’s about trying to build upon what someone else has done,” says Brenda Brown, vice-president, Human Resources. “And we do it not just in Canada — we do it internationally.” As well as regular international powwows, Compass managers interact virtually via an internal Web portal, sharing client information and ideas from across the globe. “We have a reputation for stealing great ideas from around the world, implementing them here and making them better,” says MacDonald.
Of course, sharing doesn’t always come naturally — even the best-managed large companies need to guard against internecine rivalry. “How do you prevent the ‘not-invented-here’ syndrome?” says MacDonald. “We’ve got (slow-growing) mature sectors and very dynamic sectors. Presidents in the mature sectors don’t like to hear that,” he says with a chuckle. “That’s where the competitiveness comes out — they all want to be strong contributors to the company.”
There’s no single solution, but one successful strategy to break down barriers has been transferring staff between sectors. While the divisions operate and are branded independently — for example, a hospital diner sees “Morrison” on nametags rather than “Compass” — Chartwells president Ross Munro says senior staff take a wider view. “A good part of our incentive is around being part of Compass Group Canada first, and it matters in every way,” he says.
While collaboration among divisions at the highest levels is fundamental, mid-level account managers concentrate on a single sector — a lesson MacDonald learned earlier in his career when working at a company that cross-supervised. “As a district manager I might have had healthcare accounts, schools, business dining and a remote site,” he says. “They all have different client characteristics and needs, so you have to switch hats. You have to speak the same lingo, and that’s very difficult to do for five or six sectors. While we find it’s a little more expensive to do it our way, it’s well received by our clients.”
Today, Compass’s most pressing strategic concern is, not surprisingly, long-term staffing. “One of Brenda Brown’s biggest HR challenges is not just finding people, but finding the right kind of people — ones who have retails skills who can make customers feel welcome,” MacDonald says. “We can teach people about food — you can’t teach energy, attitude and enthusiasm,” Brown adds.
So along with the usual employment fairs, pitches to students and job ads, Compass has an applicant tracing system, competitive and frequently updated benefits packages, and reward programs like “Real Advantage” which gives employees discounts on various group purchases. An internal referral system, which pays current employees for acting as unofficial headhunters, has also been a hit. “That program has been very successful in the retention and turnover of individuals who are hired, as well as the employees who make the referral,” says Brown. “Last year we paid out $190,000 in referral fees.” Compass also conducts an annual survey of about 3,000 associates and has made major policy changes to health, family and financial benefits after hearing the concerns of front-line workers.
Whether it’s figuring out how to feed 500,000 during the Pope’s 2002 Toronto visit or fuelling rockers with the munchies at the 2003 SARS concert, MacDonald says the company’s most prized cultural value is a can-do attitude. “We weren’t always winning — 10 years ago we were a distant fourth in our industry,” he says. “There’s a feeling here that people aren’t comfortable just doing what was successful last year. We’re a very good company; we’re not a great company. We’re working our way to become great, but we never will be because that’s a moving target.”