A conversation with Michael Lacey

Michael Lacey is the CEO of Digineer, Inc. a management and technology consulting firm located in Plymouth, Minnesota. A Microsoft Gold Partner, Digineer specializes in Project Management, Application Development, Business Analysis and Improvement and Enterprise Data Management.

What's your background, and how did you get started?

I have a bachelor's degree in business administration and an MBA in finance. I grew up in an entrepreneurial family; my father started and ran three different businesses. When I was a teenager, my father had computers in his business and then at home, and I just fell into the technology stuff.

In the mid-90's, I joined Blue Cross Blue Shield of Minnesota as Director of Client Server Development, responsible for new technology initiatives. I was recruited by their CIO to be a change-maker and implement a number of new technology initiatives. When I got there, I recognized that the company didn't have the bandwidth, and in some cases, the expertise to do some of the things we needed to do. So I hired other consulting companies to help us.

What I discovered was that as a buyer, I got to see the business of technology consulting from a totally different perspective. Frankly, I was disappointed with what I saw, about how they sold themselves, and this lesson helped me form the basis of what eventually became Digineer. While there, I met a guy with a small business. He had just won a large contract, and he needed help. I moonlighted with him for about 7 months, building a web-based software services platform.

With this success, I went to him and said I was thinking about starting a consulting company and asked if he would be willing to help. He became our first client; I left Blue Cross Blue Shield, and started Digineer. Within 10 months we had a couple of other clients and a million dollar business. Now, after 11 years of increased revenues, we're targeting $14-$15million this year.

What makes Digineer unique?

One, our breadth of services. Two, the way we manage our engagements, making sure they are on time and on budget and meet our client's needs. Three, we developed some intellectual property, a dashboard, scorecard and a metric management toolset, that allows multiple teams, working across the globe, to minimize cost of sales. For large companies implementing change initiatives, we developed some methodology and technology that helps them better implement project and program management offices, giving them greater control over their spending and earlier visibility into projects that risk going over budget or not hitting their goals.

What role does culture play in your company?

I think our culture is very important, as it is in any business, but in our business in particular. That's because the vast majority of our employees are what is called "boundary edge employees."

That is, they are working face-to-face, belt buckle-to-belt buckle with our clients all day long. They are our number one point of service, and they are, for the most part, not working in our offices, so they don't get a chance to experience one-to-one interaction with the rest of Digineer on a daily basis. So having the ability to build an extended culture across distances is important to any business, but especially for ours.

You also have to make sure that you not only have the right people, but that they are very much aligned to your culture. They have to think and feel about your customer in a certain way to best represent your company and your brand.

What are the rock-solid characteristics of your culture?

First is leadership, which we define as leading the way for others. Whether it's with clients or employees, we want to be the ones that can give direction and guidance, be kind of a servant leader, a Sherpa, if you will.

Another is teamwork, and by that we mean no one is better or smarter than the rest of us. The reason this is critical is that we talk a lot about raising your hand if you need help. You will never get in trouble for an act of commission, but you will always get in trouble for an act of omission if it impacts the company or the client. Nobody can help you if you don't raise your hand. Another is making sure you have open lines of communication.

For us, communication is defined as more than just talking, it's listening as well, so we actively coach people, and measure them, on their listening skills. What I find when I'm in front of clients is if my mouth is shut, good things are happening.

Finally, it's about having fun. I believe that when people are having fun, enjoying what they do, work becomes easy and effortless. You kind of get into a zone and people's productivity goes up.

What do you do to keep your culture vibrant?

We try hard to empower our people. We have institutionalized certain aspects of our culture with cross-functional teams, such as a company performance team, a customer experience team, and an employee experience team that look at our business for ways to make us better.

We implemented a performance management system in which you define roles not by the responsibilities they have, or by the outcomes they are expected to deliver, but by the competencies needed to be successful. Competencies include listening skills, dealing with conflicts, dealing with ambiguity, prioritization, etc. What this allows you to do is define the specific behaviors you're looking for within a framework of what is culturally acceptable. It also allows us to review performances along these competencies and course correct as needed.

Years ago, I wanted to do something that would institutionalize the fun stuff we do. So a group of our employees came up with a Hawaiian-themed idea around the name Ohana, which means family. We have an Ohana committee dedicated to making sure we don't take ourselves too seriously.

How has your culture benefited your company?

I think our business, from an employee perspective, is attracting and retaining the most talented individuals and making sure we hire the people that fit our culture, because we know our culture produces results for our clients. Over the 5-7 years that we've institutionalized our culture, we've seen a continual improvement in and increase in both the volume and quality of people coming to Digineer.

Like all companies in this economy, we're trying to figure out how to grow while controlling costs. So I've had employees volunteer to stop getting overtime, to give back raises, to not accept the company 401K company match. The way our people respond to these times makes it easier for everyone to be successful, and frankly, it gives the company the kind of lift that you need when you need it most. I can tell you, as a business owner, this kind of thing is very rewarding and very heart-warming.

What lessons have you drawn about culture that you would like to share?

First, culture emanates from the top. If you and your leadership team can't exemplify your culture, you're not going to have one. If you see something that you don't like, look in the mirror, because I'll tell you, over time, there have been things that I have done with good intentions that ended up with bad outcomes, and I had to realize that I was the problem, not them. Second, I think culture eats strategy for breakfast. If you want to put dollars to your bottom line, look at using culture as part of your toolkit to implement your strategy and not the other way around.

Third, don't underestimate the impact your culture has on your employee's satisfaction with their work and your client's satisfaction with your business. A lot of times culture is relegated to being an HR department party-planning exercise. The fact of the matter is if that's all it is to your business, you're significantly undervaluing it, and you need to take a look at that.

You can contact Michael at mlacey@Digineer.com, or visit Digineer at www.digineer.com.