INSPIRING PERSPECTIVES
Each Sunday, the AJC brings you insights from metro Atlanta’s leaders and entrepreneurs. Henry Unger’s “5 Questions for the Boss” reveals the lessons learned by CEOs of the area’s major companies and organizations. The column alternates with Matt Kempner’s “Secrets of Success, ” which shares the vision and realities of entrepreneurs who started their dreams from scratch.
Find previous columns from Unger and Kempner at our premium website for subscribers at www.myajc.com/business.
It’s not your typical career path — consultant, retiree, investor, then CEO.
But Ron Stewart wouldn't have it any other way. Stewart spent 29 years working for Andersen Consulting, which later became Accenture. After advising global businesses on a variety of strategic issues, Stewart throttled back his career to spend more time with his family.
But his retirement was short-lived. Stewart’s full-grown “little brother” from the Big Brothers program he joined three decades ago dreamed about starting an upscale burger chain. So Stewart became chairman of Atlanta-based FLIP Burger Boutique and the sole investor in its first restaurant.
Then PRGX Global, a publicly traded Atlanta firm with a specialized auditing expertise, asked him to be CEO last November. The company finds overpayments made by corporations to their suppliers and then shares in the money that’s recovered. With $195 million in annual revenue and nearly 1,700 employees in 30 countries, PRGX’s revenue dropped last year and it posted a small loss. Stewart, 59, talks about how he’s trying to reverse its fortunes, as well as what he learned as a consultant and from his father.
Q: Who influenced you early in your life?
A: I grew up in Birmingham. My father was an entrepreneur in the mobile home business.
He absolutely insisted that I work in the summers and during school breaks from the time I was 12-years-old. I washed trailers and clipped grass at the mobile home lots. I got a strong work ethic from that. I may not be the smartest guy in the room, but I assure you I’m the hardest working guy.
Part of my father’s business was financing mobile homes. Unfortunately, when someone doesn’t pay their money, you’ve got to repossess their home.
At the tender age of 15, I remember being in the passenger seat of a truck. The guy I was with was a hardened repossession guy who threw every bit of the family’s clothes and dishes out into the yard.
I’ll never forget looking in the rearview mirror of the truck with the family sitting in the front yard with all of their belongings. I was devastated. I got exposure to some of the harsh realities of life.
Q: You went to Tulane University in New Orleans, but then your father got sick. What happened?
A: My father got cancer and died in the summer after my freshman year.
It was a tough time to lose my dad in terms of direction. I always felt I didn’t get closure with what he had to teach me about business. I was just getting to that stage in life when he died.
I was never bitter, but I was probably adrift in college.
Q: How did you get your moorings?
A: It took me a couple of years. I went to graduate school in business at the University of Alabama. I became close with a professor of entrepreneurship. He and I actually started several businesses together when I was a student — a T-shirt business, a worm farm and an energy business.
The energy business audited usage for companies. Prices back then were sky high. When making cold calls to sell our service, I learned that only certain people can say yes. Be nice to everyone, but focus on the people who can say yes.
I learned that selling was a frame of mind. I always had that spirit of wanting to get out there and sell something. I wake up in the morning and that’s the way I’m wired. I got that from my father.
Q: What did you learn as a business consultant for nearly three decades?
A: In the consulting business, you've got to constantly reinvent yourself. You have to move up to the next thing to sell to your clients — that new opportunity to expand your relationship.
To get new clients, one experience early in my career enhanced my ability to make cold calls. My boss called five of us into his office when business was slow. There were five binders representing five cities. There were hotel reservations and a one-way plane ticket.
“Don’t come back until you sell something,” he said.
There’s nothing like making cold calls to teach you how to sell to people.
Also, when managing a project as a consultant, you have to realize that bad news doesn’t age well. It’s not a fine wine. Get help early when you’re having issues. Don’t keep them to yourself.
Q: Why did you leave consulting?
A: I was traveling too much and spending too much time away from my family.
I retired at 53. But I failed at retirement.
When I was in my 20s, I got involved with Big Brothers. My little brother was 10 at that time and we’ve kept our friendship.
He loved restaurants. After I retired, he told me he had an idea for starting a new concept. This was about seven years ago and the upscale burger category was new then.
I invested in his idea — FLIP Burger, which is fine dining in a hip, creative format with a full bar. I was the checkbook for the first restaurant. We now have three in Atlanta, one in Birmingham and a new one is planned for Nashville. We’re profitable.
Bonus questions
Q: What have you learned about the super-competitive restaurant business as chairman of FLIP Burger ?
A: Cash is king. It's a cyclical business, so managing cash is critical. You have to understand your cost of goods and you have to have enough working capital that you can stand on.
Also, when you’re in the service business interacting with customers all day, you’re only as good as your lowest paid employee.
Q: Six months ago, you became chief executive of PRGX, which needs some strategic fixes in the wake of two straight quarters of revenue declines and losses. How are you approaching that?
A: I'm not here to ride this thing down the hill or babysit it. I was looking for something fun and challenging to do. It's the next chapter. I won't say it's the last chapter, but it's getting close to the back of the book.
We’re still very healthy. We have $46 million in cash and no debt. We’re in transition. 2014 is not going to be a pretty year, but we’re getting some things in place where we can grow.
I’ve been to Europe twice, India once, and I went to see all of our major clients around the world. They are marquee companies — top retailers, top manufacturers, and oil and gas companies. I went to hear what we’re doing well and what we’re not doing well.
Q: Please explain what your firm does.
A: We're in the recovery audit business, which is a specialized business with a few major players. We're forensic accountants and we find errors.
For example, a big retailer receives billion of dollars of invoices from suppliers. We go through the invoices, looking for mistakes, promotional discounts that were not given, double billing, etc. We find money and we get a percentage of that.
The large retailers literally put tens of millions of dollars and sometimes hundreds of millions of dollars on their bottom line through this process of recovery audit.
Q: Why is your business declining and what are you doing about it?
A: After we find errors, the companies fix their processes so it happens less in the future. They get better, so over time it becomes a declining business.
We have to find new areas to audit. We have to go to new clients. We’re getting more into contract compliance, like auditing subcontracting agreements for large construction projects to see that the general contractors are billed correctly.
Q: What did you learn from other CEOs when you were a consultant that may help you now?
A: To focus on what's really important.
Don’t get distracted by external influences. I’ve seen a lot get swayed by the board or by Wall Street.
Q: Do you get distracted by your daily stock price?
A: I don't even pay attention to it.
I am about creating shareholder value. But that ultimately means making this place more profitable and showing some top-line growth. When we do that, we’ll get great returns on the share price. But up until then, there is not a lot I can do on a day-to-day basis to impact that stock.
Q: What’s your best career advice for younger workers?
A: When you're starting out, many of the people who you are working with will be CEOs or CFOs one day. So the relationships you build along the way will stay with you for the rest of your life.
Be real in relationships and get to know them as people. Get to understand their lives and what’s important to them.
Relationships build trust. Having high integrity and being honest and straight-forward opens doors.
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