Becoming a great contractor

There’s a difference between good chief executives and great ones. Louis Gerstner is credited with being a good CEO because he saved IBM, a hidebound, bloated, 400,000-employee behemoth that was in danger of sinking under the weight of its own inertia. But IBM was an existing enterprise and Gerstner was forced to radically reorganize the company because the alternative was bankruptcy.

Sam Walton is considered to be a great chief executive because in the 1960s when Wal-Mart was still a minor fiefdom of a couple dozen stores with revenues in the millions, Walton walked his stores with a notebook looking for ways to make things better and encouraged his employees to do the same. Wal-Mart was already successful in a conventional sense, but Walton was never satisfied and continually strove to make it bigger and better.

Mike Agugliaro was, by his own admission, a pretty lousy contractor back in the ‘90s. In turning around Gold Medal Service, starting in 2004, Agugliaro transitioned into being a pretty good contractor for a couple of years and kept going to become a great one.

In becoming a great contractor, Agugliaro went way beyond what even the country’s best contractors do. Think about who the best contractors in the country are — members of the Nexstar Network, the Service Nation Alliance, the leadership of Plumbing-Heating-Cooling Contractors – National Association and Quality Service Contractors.

Our primary criterion for selecting a Contractor of the Year is that the contractor does something so well that it’s worthy of being emulated.

Agugliaro leapt over all of their usual sources of contracting advice and looked for ideas from 1-800-GotJunk, Zappos, Nordstrom, Disney, Target and Wal-Mart.

One of their suppliers believed in them so much that it paid for Agugliaro and his partner Rob Zadotti to spend a week at the Disney Institute. Agugliaro learned from Dan S. Kennedy, author of 13 business books on sales, marketing and management, and from Joe Polish, the founder and president of Piranha Marketing Inc. and the creator of the Genius Network. They learned how other companies deliver world-class service. They learned how best-in-class companies handled operations, company culture, and marketing, and started applying the lessons one by one.

Look for the traits of great business leaders and you’ll find plenty of lists. Agugliaro has lists of his own.

Contractors need to learn marketing, sales and leadership, he says. There’s no business without marketing. Are you having trouble recruiting new employees? That’s a marketing issue too. There will be no money without a high-integrity sales process; he emphasizes high-integrity. There will be no wealth unless the contractor is an amazing leader.

Additionally, Gold Medal Service has four core values, he says. Core value number one is safety-first for both the contractor’s family and the customer’s. This is an industry in which we work on things that can kill you, like carbon monoxide and electricity. Core value number two is to deliver “Wow Service,” the highest level of customer service experience on the planet. Give the customer the quality of Nordstrom’s, but the emotional experience of Disney. Core value number three is integrity. And, number four, the company must be a great place to work — all for one and one for all. He’s had employees with him for 14 years.

Our primary criterion for selecting a Contractor of the Year is that the contractor does something so well that it’s worthy of being emulated. I hate the trite phrase “thinking outside the box,” but Mike Agugliaro has sought ideas and inspiration from places far beyond the experience of most contractors. Doing so has turned Gold Medal Service in a 190-employee, $28 million-a-year juggernaut. I think that’s worth copying.