Moving at the speed of molasses - Interview with Mike St. John

By Peter Roosen

Freight trains and toilet paper have a lot in common when looking from a marketing perspective. They are examples of products that have been around long before we were born that will still be around long after we are gone. They are among the 95% of the things we see and use that are considered established products and services from traditional industries. You won't see them featured in media because they are simply part of the landscape.

Marketers can easily lose sight of everyday products and the marketing opportunities related to them. This is especially the case for stove-pipe industries that produce the many industrial goods and services that form the backbone of our modern industrial economy. The highly popularized electronic gadgets that entertain and keep us in contact do not exist in a vacuum. Most of them are brought to market on the backs of those freight trains that trudge back and forth across the landscape virtually unnoticed. And let's face it, the only time anybody notices toilet paper is when there isn't any.

This month's newsletter takes a look at a great marketing and innovation example from the very traditional lumber industry. Marketers be warned. Making a big splash in a traditional industry isn't an easy thing to do. Last week, we traveled to Boise, Idaho to interview someone who has done just that - in spades - and who continues to do so. Former navy seal Mike St. John was the marketing man behind the shift to engineered structural residential building products from the basic sawn timber that has been used for centuries to hold our floors and roofs together.

Mike has over 32 years selling and producing these structural building products that involve efficiently using the whole tree rather than just the pieces sawn out from the middle to make our buildings. Introducing Trus Joist products was the highlight of his career. These products now have approximately 50% market share and are still growing. At the start, 1976 sales were less than $1 million, and today sales of over $2 billion are made annually. Mike is currently a board member for the APA (American Plywood Association) and he is chair of the EWS (Engineered Wood Systems) committee. He is also a director for Pacific Woodtech Corp. www.pacificwoodtech.com where he also serves as vice president of sales and marketing. Mike teaches courses on marketing and innovation to engineers while remaining keenly interested in these areas.

The road to successfully transforming an industry is not an easy one but Mike is someone who has traveled this road and is happy to share his insights for those of us who are undertaking a similar journey. You'll gather from our interview that there are some key ingredients that can be used to help transform any industry where a good idea's time has come.


Interview with Mike St. John.

Q. Who would you hold out as an inspirational leader?

A. Harold Thomas and Dick Hansen are two who spring to mind immediately. Harold is still alive while both were highly influential from our beginnings in the 1970s. I'll focus on Harold who is a salesman who started a company. He always believed and still believes that if you give salesmen an opportunity to make money, they will perform. The good ones will sort themselves from the rest. When I was vice president of sales, there were more than 300 salesmen of which 250 made more money than executives and managers. We celebrated that. We truly had an organization that the head of was a salesman's champion.

Trus Joist would not be alive today had it not been for the sales guys. The products were very expensive compared to traditional methods.

Q. How were you able to get such expensive products into the market?

A. I had an important accomplishment back in the early days. It was in Colorado at a time when there were fancy ski resorts being built that needed very large roof trusses that if made using conventional materials and methods were too big and difficult to truck through the highway tunnels. At the time, we were just making floor joists. I figured that since we could make these engineered pieces in any length, they could make great trusses while being relatively easy to transport. It worked.

Q. What drove you and your team?

A. We were and still are on a mission to build better homes.

Q. What do you see as the success drivers for successful innovation in a traditional industry such as yours?

A. You need to be truly committed to the idea. Beyond that, execution is important. In my experience, the long term follow up gets bound up in financial performance numbers. So many underestimate the time and cost of doing the execution - even in a traditional lumber business which is like watching molasses flow. It took 30 years to get 50% market share. Sometimes great ideas take that long. A $2 billion market is all it is in our case. Initially we were 5 people going after this market.

In some industries some great ideas, no matter how great, have very slow traditional speed. This is unlike ipods, cell phones and other tech products that move at the speed of light. The backbone of all commerce in the world are still ugly traditional products like sheet rock, timber, steel, petroleum and rubber. These are traditional businesses or products that just don't move as fast.

I've always been envious of the computer and software guys who build extinction into their model. If you buy a computer today, it will be gone in a couple years. If you buy an I-joist today, it will still be around and you'll be able to buy one 25 years later just like the one 25 years before. I've had three Blackberries in two years because they keep advancing. Take the two by fours in my house. I could have bought the same ones in the mid 1800s.

The big lessons are having great patience, deep pockets and making sure the traditional products and industries evolve so that we don't lose our planet. Today we plant 23% more trees worldwide than we take. But not all countries are on side. Hardwood from southeast jungles are an exception as they are stripped for cash - as our northern lands not so long ago. The lumber business can outgrow demand but we have to do it right. Switzerland, Finland and New Zealand have been doing a good job and are able to grow more than they demand. The lumber business takes a huge amount of carbon out of the atmosphere.

The innovation gets down to using every bit of the wood fiber from the tree. Today, in North America, we don't waste a single ounce of wood fiber. The forest products group as a whole has really figured out how to preserve itself through sustainable practices.

The Billion Dollar Question: An Interview with Jim Estill

We found a secret weapon in marketing - an engineer that can sell! Jim Estill was a University of Waterloo engineering techie who got into selling computers and became really good at it. The business he started from the trunk of his car became a substantial acquisition for one of Canada's leading computer distributors, Synnex Corporation. Jim is currently CEO of Synnex Canada which sells about a billion dollars of computer products a year.

Jim also became a highly involved shareholder at an early stage with Research in Motion (RIM), makers of the popular Blackberry device, where he remains on the Board of Directors.

On top of this, he is as curious and interested in new ideas as ever and has become an expert blogger. His CEO-Time Leadership blog at www.jimestill.com is a great place to learn about leadership and making the best possible use of your time.

We interviewed him to bring some of his insights into marketing and leadership to you.

Q: How has your engineering background helped you in your business?

Jim: When I started my business, it gave me credibility (I was young and looked younger). And simply spending the time in school helped my maturity level and gave me confidence.

Q: What made you go into selling from the trunk of your car, rather than staying in the engineering world?

Jim: I was designing a circuit board and needed a computer. I got a better deal if I bought 2 so I did and sold one then someone else wanted one etc.

Q: Who were your early role models and what were the main things you learned from them?

Jim: My father taught me self discipline. I have always loved business biographies so was inspired by many of them like Edison, Ford, Weston etc.

Q: What was the most important thing you had to learn to become able to take your EMJ business from zero to $330 million in 25 years - with 99 consecutive quarters of profitability?

Jim: I had to learn to give things up - to trust that other people were capable of doing parts of the job. This can be a very limiting challenge for an entrepreneur.

Q: What were the keys to R.I.M. Blackberry success?

Jim: Success is usually never just one thing. I think their focus has been good. RIM has always hired good people. RIM thinks big. RIM has good technology backed with great marketing and market understanding.

Q: What have you mainly been bringing to the R.I.M. organization (in the early stages and now)?

Jim: In the early stages, I was the big company, the public company, the company who had grown etc. So I could help with growth issues/rolodex etc. I have always been a techie so I always float my ideas on product (most of which were not done and I do not want you to think I was the brains behind product because I was not).

Right now, continuity helps. I am also a working CEO running a $1B+ tech company so certainly have relevant experience.

Q: If you could redo something in your past, what would it be?

Jim: We are the product of all of our past - including our mistakes. One of the things I often say is "Fail Often, Fail Fast and Fail Cheap" and "Having a failure does not make you a failure" so there is nothing I would want to redo.


Thank you Jim for sharing these insights with us. This should serve as an inspiration to any engineers or techies among us to explore developing our leadership abilities and learn how to become really great at selling. Visit Jim’s blog and connect with him at www.jimestill.com