Atlas Amplifier PDF(6.5 MB)
In March, Atlas World Group marked the completion of a succession plan that ensures uninterrupted leadership for the firm and its subsidiaries. Following the retirement of Jim Stamm, CEO Glen Dunkerson assumed the mantle of Chairman. Glen and President and COO Greg Hoover now command the company's top two leadership roles. The Amplifier sat down to talk with them about the leadership transition, the challenges facing the company in the current economic environment, and what they see for the future.
Amplifier: Congratulations on your recent rise to the top leadership posts. Readers of the Amplifier have been following the events of this succession since 2005, when Chairman and CEO Mike Shaffer announced his intent to retire in 2007. Glen, why did the succession take this long?
Glen: The officers and directors wanted complete confidence in the succession and felt that the company's interests would be best served by a very deliberate process. Perhaps it took longer than it could have, but the consensus was it is better to be cautious.
Greg: If anything, this experience has reinforced the importance of succession planning. It's never too soon to start thinking about your own replacement. Every leader should be aware of those around him or her who have the potential, and take steps to see those people receive training and mentoring for greater responsibility.
Glen: Atlas World Group has opened the door for future successions a little wider. While there is still a preference for promoting within Atlas Van Lines, the company will consider candidates from any Atlas subsidiary. Nor is there a taboo on going outside the organization, provided such a choice is best for the ongoing success of the business.
Amplifier: It seems the timing of this transition has come with a special challenge: leading in a time of economic decline. How is Atlas weathering the storm?
Glen: Like everyone, we're feeling an impact in the market, with fewer hauling opportunities and fewer shipments. This is not surprising, given the business climate. However, I think we're positioned well and are handling the downturn better than most.
Greg: Our revenue was down about 10.5 percent last year, while others saw declines as steep as 20 to 30 percent. The COD segment has been hit the hardest, with corporate relocations less affected. In spite of that, we've managed to grow our COD market share. Some of that we can attribute to our investment in iSales (an Internet-based system for attracting, qualifying, and providing COD leads to Atlas agents – see Amplifier Winter 2008 issue).
Glen: There are other bright spots, too. We are the largest carrier in Canada, with an agent network that is second to none and strong corporate leadership. We currently serve 47 percent of the household goods market in Canada, and we're growing share. We're positioned to do well there over the next several years.
Also, we've solidified Atlas International. The new leadership and staff have performed admirably in restructuring. They are operating much more efficiently and are better positioned to serve commercial customers as well as our agency network. So, we're optimistic about our prospects in the overseas arena.
Amplifier: To what do you attribute the ability to outperform peers during a recession?
Glen: There's no doubt our agency network is our greatest strategic strength. Our focus has always been, and will continue to be, helping agents find and exploit opportunities. That's why in recent years we've taken steps to help them diversify their service offerings. Household goods remains the largest segment for Atlas World Group, accounting for about 80 percent of our total volume. But we also bring capabilities for office and industrial moves, records management, and specialized transportation. During the current economic downturn, we see this diversification as more important than ever.
Greg: There's something to be said for the fundamentals, the everyday "blocking and tackling," so to speak. For us, it's a focus on our core values – integrity, quality, and solutions. Customers expect the fundamentals from every vendor. What differentiates Atlas is our ability to bring those values throughout our organization – our agents, our van operators, and our corporate team members – and find ways to apply these fundamentals to new business areas. We know we have to perform at ever-higher levels. This is essential not only for keeping customers, but for gaining new business. If we stay true to the fundamentals, we can use this time to our strategic advantage. Staying true to our fundamentals does not mean Atlas is opposed to growth. This company has seen tremendous growth – among the highest percentage growth in our industry – but it has not come from irrational expansion that has characterized the business models in some industries. Our growth has been deliberate and coherent with our core business, and we are unlikely to deviate from that approach.
Amplifier: What are the primary considerations when recruiting new Atlas agents?
Glen: Quality, quality, quality. If you can't provide quality service to your customers in today's market, you are not someone Atlas is interested in recruiting. We tell our customers we're the best and we have metrics to illustrate our quality. If you can't measure up...stay where you are!
Greg: First and foremost, quality. But with that as a given, how do they fit with us? What market do they serve from a location standpoint? What market do they bring to us from a customer standpoint? What are their business standards and principles? At the end of the day, they have to fit and contribute. We've always been true to both our business model and our agents in this regard, and I don't see that changing. We consider our existing agents as much as we do the potential gains. That consideration is at the core of our company and its "family" values.
Amplifier: How is Atlas addressing the challenge of meeting the demand for qualified professional van operators?
Glen: Fortunately for Atlas, we are blessed with a large group of professional van operators. However, especially during these tumultuous times, we are always in search of qualified PVOs who will contribute to our quality and bring professionalism to our customers.
Greg: The challenge will only become more difficult. On the surface, it demands better margins and the kind of pay that attracts professionals; the reality is that we may need to look at alternative methods – develop new ways of delivering the product to compensate for the lack of qualified, quality PVOs.
Amplifier: What role has technology played in Atlas' success, and what will be the technology focus going forward?
Greg: I don't know if you can place a high enough value on it – from the standpoint of process efficiencies, improved management and availability of data it's been critical. But we need to continue to develop; iSales is a perfect example. Today's customers – people in general from a generational standpoint – are increasingly geared toward more technology and less interaction. If we don't accommodate them, we're out of the loop with our current culture and how people do business. That's at the heart of success in business: engaging your society and culture. The most successful companies find ways to connect at their (the customer's) point of engagement. We need to be there and make it work.
Glen: The "smart" use of technology has allowed us to perform more tasks with less manpower. This has enabled us to hire, promote and retrain our people to utilize this technology. Said simply, we are much more efficient now than we were a decade ago, primarily because of the advancement of our technology.
Amplifier: Where might Atlas find new efficiencies for its business model?
Glen: We have to look beyond our industry for efficiencies; as a service industry, we must be willing to learn from other service industries. Communication is also key to our success. Keeping up with advancements in the communications arena promises to be enormously beneficial for our company.
Greg: The key is to ask what other sources of business can you drive from current core activities. For instance: might we find partnership opportunities as a claim center for another market segment? A lot of things we do have potential to drive new revenue to the company, create opportunities for our agents and, in so doing, make us more efficient in our current business. This should be central to our growth strategy.
Amplifier: What do you see as essential qualities of leadership?
Glen: Right now, leadership requires caution to avoid potential pitfalls. It also includes a vision for where the business is going. In many ways, this is a perfect time for Atlas to grow. We are financially and fiscally stable, and the industry knows we are solidly managed.
Amplifier: Where are the chances for growth likely to come from?
Glen: Some of the best opportunities will likely come through the selective addition of agencies. But a great benefit of our structure is that opportunity can take different avenues. It might come from an agent or board member, or from a company looking for a suitor. If we were so inclined, we could probably buy a transportation company every week of the year. But any opportunity we would consider has to enhance revenues for our agents. Their well-being ultimately determines the health of our business.
Greg: We will also look for ways to enhance the performance of Atlas brands and services, such as Accel, Avail, and iSales. Sometimes, opportunities can be gained by scaling up a proven model. Or, by taking what's been learned in the development of one idea and applying it in another area. The challenge is to bring a fresh vision, to look at things in a new way. As Glen pointed out, the touchstone for evaluating any idea is its potential to create income for our agents.
Getting back to your question on leadership – it sometimes takes a willingness to do the necessary thing, even when that thing is unpopular. In December, we had to make a difficult decision to trim pay by five percent for everyone at headquarters. That's the kind of call that comes with sleepless nights. To the credit of our employees, they've been supportive. The subsidiary companies have also had to make difficult decisions; employees have reacted positively to these actions and realize these are unusual times.
Amplifier: Do you anticipate further cuts?
Greg: Time and the economy will tell; but, I think too many businesses today operate with a "fast food mentality." They have a short-term view of investment and react in a knee-jerk fashion when they don't get quick results. Atlas takes a longer view, perhaps because we've learned some things the hard way. When we returned to agent ownership in the late 1980s, we had to overcome the debt of a highly leveraged buyout. In some ways, it's a miracle we survived. But it's also a testament to the determination and foresight of our agents. More important, the experience made us a more disciplined company. It reinforced the importance of operating responsibly with a long-term view.
Amplifier: It seems that the company's agent-owned history, including a comeback from the brink of dissolution, has had a profound impact on the corporate culture. How does it affect the way Atlas allocates resources?
Glen: The Atlas culture is a double-edged sword. We are fiscally conservative and financially sound, highly regarded by our competitors. And we are somewhat risk-averse, so we tend to bet only on what we perceive as sure things. During these times, there's nothing wrong with that. But we have taken chances in the past. Conservatism does not necessarily preclude a willingness to take well-calculated risks.
Amplifier: What do you think is important for the Atlas family to keep in mind as it works through these tough economic times?
Greg: I think it's important to remember that people are still moving. Companies are still relocating employees and the military is still relocating service men and women. So, even in a down economy, there is business out there. Job one is to respond as we always have, focused on excellent service for every customer.
Glen: I encourage customers, agents and colleagues to not become discouraged; these times will pass. Let's use them as an opportunity to learn and grow. After the events of 2001, it was a very interesting time for our business. We saw how customers reacted, and we tried to learn from the experience. This recession will probably surpass previous ones, and no doubt it will shake up the industry. Some smaller players will disappear, some larger ones will cut back, and some will consolidate. Regardless, it will make us all better business people.
Amplifier: The consumer price index fell in 2008 for the first time since 1955. How is Atlas dealing with the pricing challenges in the market?
Greg: Downward price pressure is to be expected with softer demand. For our part, we'll stay positioned as a good value provider. Atlas Accel is a good example of how we approach the market in general. There are lower-priced alternatives out there. But Accel comes with Atlas packing and customer service. It delivers the value our customers want, and they tell us it is worth the price. With Accel, and every product in our mix, our task is to continually assess how we might improve the value proposition to strengthen our position and win share. We recognize there may be customers we cannot come to terms with. In other words, we can't deliver the quality inherent in the Atlas brand for less than it costs.
Glen: Our core business remains our primary focus. We have streamlined our business model the best we can, and we'll continue to revisit it over the next several years. I think there will always be a demand for the full service move, which is our hallmark. But we also see an evolution on the horizon, brought on by price pressures and a growing scarcity of professional van operators who are willing to adopt the over-the-road lifestyle. Eventually, I think we will see a greater demand for containerization, with different service providers at origin and destination and a separate crew for transit.
Amplifier: I notice the ceiling lights aren't all lit... although it seems there is plenty of light in here. Would you comment on why Atlas is "going light on lights"?
Greg: You're not saying we're dim bulbs, are you? (laughs) Last year we took a look at how our consumption habits impact the cost of our operations. We found we could lower usage and realize immediate savings, not just in electricity, but also in a number of ways. So, we implemented several ideas to conserve resources and lower costs, with no compromise in our efficiencies or service delivery. As a result, we earned kudos for environmental stewardship from the Chamber of Commerce of Southwest Indiana. That is gratifying. But the bigger issue is that we feel a responsibility to our customers, to one another, and to our community. Regardless of whether we earn recognition, we want to do the right thing in every area of our business.
Amplifier: I know readers of the Amplifier will appreciate the chance to see things from your perspectives. Thank you for taking the time to share your thoughts.