A better way to scale a family-owned business
How Master Electronics grew from 160 to 450 people by empowering them to make decisions without family input
Riad Nizam is the President of Master Electronics, a leading authorized distributor of electronic components. When Master Electronics became our client over six years ago, they were doing well as a company but it was hard to scale. Without a tool like Rhythm, they would start with a plan but four weeks later, lose momentum.
In order to scale, Master Electronics had to:
- Build a culture of trust to empower their employees to make decisions without having the family last name
- Track their plan and stay focused on the activities that drove their growth initiatives
Increasing trust and focus was the winning combination
Rhythm provided a disciplined system to track their plans and create a culture of trust
"We had a $140 million business and no decision was made without family input," said Riad Nizam. They had to find a way to empower others to make decisions and start trusting people.
Here is how Rhythm helped create and sustain a culture of trust and stay focused on their initiatives:
- Core Values: The Rhythm team helped them develop a set of core values as a foundation to create a culture of trust and empowerment. This allowed them to start trusting people to make decisions because they knew they had the same values. "Now we trust people based on the same values. Before we trusted people because of the same last name," Riad said. Now they were able to confidently hire the right people. This was a critical breakthrough that allowed them to grow.
- Retaining New Hires: As they grew from 160 to 450 people, one of their initiatives was to reduce new hire attrition to 20%. Rhythm software provided a disciplined way to track this initiative. They created a hiring and onboarding process, then documented and executed on all the steps in Rhythm. Weekly meetings with the new hire and mangers were recorded in Rhythm to touch base and uncover any roadblocks. They were able to exceed their goal and got it down to 12.6%.
- Grow Existing Accounts: Rhythm helped them focus on growing their existing customer accounts. Every sales person had 300-400 customers they were servicing. They weren't able to cover them all so they put in an initiative called DLO (Do Less.. then Obsess). Everyone now had a smaller account base of only 100 and they increased the sales team by 10%. Using Rhythm, they stayed focused on tracking this initiative and exceeded their goal of $6 million and instead hit $14 million in 2020.
Achieved over 100 initiatives with family and team input
"We won because we had a system to stay focused"
Using Rhythm software helped create a culture of trust and more transparency company-wide. "Since everything is documented in Rhythm and seen by everyone, it helps with self-discipline and accountability. They don't want to let their peers down," Riad said.
Over the last six years, Master Electronics has built a system they can rely on and as they set bigger goals, they can break them down into bite-size pieces, cascade their plans to the rest of the organization in the disciplined and structured way that has proven to work.
Here are some of their results:
- Grew from 160 to 450 employees
- Crush their goal of reducing new hire attrition (goal was 20% and they achieved 12.6%)
- Scaled from $140 million to $335 million in revenue
About Riad Nizam, President and Speaker
Riad has had much success finding practical and systematic ways of scaling family-owned businesses. Riad is so passionate about helping other family-owned businesses that he has become a public speaker on this topic to help others grow and scale using proven easy to implement strategies. To learn more about Riad, please contact him at email@example.com
About Master Electronics
Master Electronics is a leading global authorized distributor of electronic components. For more than half a century, our family-owned company has remained focused on strong relationships, responsive service and added value. This is how Master Electronics has grown to serve hundreds of thousands of customers in partnership with hundreds of world-class suppliers.
Visit Master Electronics' website here