In a session from the Future of Field Service Live Tour stop in Minneapolis, Sarah talks with Gyner Ozgul, President and COO of Smart Care Equipment Solutions about the company’s approach creating scalable success, particularly in a highly acquisitive business. From customer experience and digital transformation to company culture and talent development, Gyner talks about the factors that Smart Care prioritizes in creating growth that meets the needs of the business, its customers, and its employees – not only today but into the future.
Sarah Nicastro: Come on up. Hello, welcome, welcome.
Gyner Ozgul: How are you?
Sarah Nicastro: Thanks for being here.
Gyner Ozgul: Thank you.
Sarah Nicastro: Last but certainly not least, my friend Gyner Ozgul, President and COO of Smart Care Equipment Solutions. We've been talking a lot today about service differentiation, innovation, transformation. We've talked about some of the challenges the pandemic brought, some of the now growth and new initiatives that have come out of the recovery from that, et cetera. We're going to talk about the tenets of scalable service success. Before we get into that, tell everyone a little bit about you.
Gyner Ozgul: Gyner Ozgul, as you mentioned, President and Chief Operating Officer of Smart Care Equipment Solutions. We are the commercial side of kitchen repair. You had Matt up here earlier talking Whirlpool, that's residential. We do similar on the commercial side. We service commercial kitchen establishments. Typically, people equate those to restaurants, so there's a green check mark there.
But our bigger end markets are actually non-commercial food service spaces. If you think about hospitals and universities and educational facilities, those are much larger end markets for us than the restaurants we all think about. We certainly service them, but the commercial food space is much bigger than just the restaurants.
Sarah Nicastro: Good. We have talked quite a bit over the last few years about the journey that Smart Care has been on, highly acquisitive organization, rapid growth, and working to keep pace with customer expectations and demands and also keeping pace with digital sophistication, et cetera.
A lot of things you've been at the helm of. What I want to talk about today is you're very focused on scalable service success. As you grow, how do you scale the customer experience? How do you achieve repeatable success in what you're doing? Obviously customer experience is a huge factor in that, but what goes into that for you? What are those foundational elements?
Gyner Ozgul: We start with the customer need assessment, and each customer's a little different. Each of these end markets has different needs. If we think about quick service restaurants, so your McDonald's of the world, that customer's needs is speed, because they're serving a lot of customers and they're moving through it, so any equipment down or outage impacts their ability to produce product. Speed is really important to them.
Whereas in an educational facility, harsher procedures around food safety and temperature checks and things like that on their menu are paramount because they can't afford anyone to get sick, especially when one of the school district service does 40,000 meals a day. That's more important than the speed, is I have to make sure that all the food that I'm putting in these children's mouths is safe to eat. We start with the customer, and then we build our processes back against that, and then we use our systems to support that.
If I take the McDonald's example again, we'll build a SLA or a service level agreement with the end customer based on their pieces of equipment that they want to see repaired within not only response time, but also how long it takes to actually fix the piece of equipment. We build that into our process and then put that into our system. What we try to do from a scalability standpoint, and we partnered with IFS back in 2019, was we wanted a system that as much as we could take our process and systematize it so that we could get scale out of it.
We take essentially the air of human interaction of whether or not the SLA should be met or not be met away and let the system drive the expectation because what the process is we should be doing.
Sarah Nicastro: Jorge, you spoke this morning about the work you're doing to set that foundation. That's really the work that you did in 2019 essentially, right?
Gyner Ozgul: That's right.
Sarah Nicastro: We talked at one point about the fact that step one is setting the foundation, getting everyone on a platform from which everyone has access to the same insights. You're taking some of that non-automated friction out of the process. And then talk a little bit about what you see going forward in terms of now that you've done the foundational piece, what will come next in terms of better leveraging now the pool of data that you have and what you can do from that point on?
Gyner Ozgul: There is thousands of service providers in our space across the country. Not many of scale, but many service providers. The differentiation of service itself... I give our technicians a lot of credit and I like to say we are as good or better than our competitors in terms of delivering that last mile of service. But the points of differentiation when you get really good become harder to delineate between yourself and the competitor. So then for us it's how do we take that next step? Well, the next step for us is data. At our scale, we have tripled the business in five years in terms of revenue and customers.
We continue to do that year-on-year. What that enables for us is roughly half a million to three quarters of a million work orders completed a year. That type of data aggregation and helping customers who this is a major capital investment for them, they are spending somewhere between 25 and $200,000 for a piece of equipment. It's really expensive. We can use that data then to help guide them in their buying process and repair, replace decisions on predictive or prescriptive maintenance versus reactive maintenance. Data enables and unlocks a lot of that to happen. I always get to ask the question, well, that all sounds good, but it can be snake oil and vaporware and is this all real and does it work?
The answer is yes. We did a pilot of a couple of markets two years ago. Took all our data and said, if we put it into an AI or machine learning environment, what would it tell us about predictive or prescriptive breakage? We used ice machines in our case study, because everybody has an ice machine. All ice machines need to be cleaned. It's something that was consistent across all market segments and customers. We didn't clean any of the data, so we didn't do any of the scrubbing or the governance. We just said, we're going to put it all in and see what this machine does.
Over three months in two states, Texas and Florida, because we wanted to pick states where the ice machine breakage was high because the usage is high, it accurately predicted seven out of 10 ice machines being broke the next month in the location. And within the seven out of 10, five out of 10, it actually produced part failure as well. And that's, again, without cleaning and scrubbing and actually building process around it. It's a long way to answer your question to say we really feel that there's a lot of power in data differentiation. That's just one use case. The second use case besides the... There's three use cases.
One is the customer that I just described. The second is really driving efficiency back to the business. We've talked a lot about efficiency today, so very aligned with that. The third is using the data to help drive back that knowledge to your technicians. How do you create knowledge based tools that add scale? Your senior technicians have their little nope notepad here in their pocket and it's 20 years of knowledge that they've written down. How do you get it from here to somewhere in a centralized database that you can share with the technician that just got released out of training two months ago? We're really focused on that.
Sarah Nicastro: Now, with the acquisitions you do, you're kind of multiplying or compounding change management. Because you introduced a new system a few years ago, you got everyone on the same page and you're good, but then you're bringing new people on, bringing new people on. How do you handle that on an ongoing basis so that it isn't too disruptive to the business or to them?
Gyner Ozgul: We have a dedicated integration team, which helps because you have resources assigned to a specific task. But on that specifically, we put a lot of work and effort into understanding the businesses that we acquire before we integrate them into our process in our system. We begin with process first. The reason is is some of these businesses actually have best practices that are better than our own. We set aside the we're better than everyone that we buy approach.
What we say is, hey, if they're doing something that we should be doing, let's take that on, build it into our process, and then ultimately put that into the system as we integrate them. And then we get immediate buy-in, right? Because now we've centralized their process. One of the first businesses we bought was in Birmingham, Alabama back in early 2018. They had a really good defined dispatch process, even better than our platform businesses. We have taken probably half of their best practices and incorporated them in the last couple of years into our process just because it's so good.
They're a larger entity, so we haven't put them on our system yet, but they are scheduled for mid next year to go onto our system. We feel really good that because we've been on this recognizing their best practices and bringing them into our system, the cutover of bringing them into our system should be smoother because now they have immediate buy-in that we've recognized and respected their culture and what makes it special.
Sarah Nicastro: No, I think that's really good and looking at it from the perspective of having the ability to learn from these businesses, not just automatically put them into. When we talk about scalability, another huge topic has to be talent and talent development and a lot of the themes that come up there. What does that look like for Smart Care? What are some of the trends that you're seeing, challenges you're working through, et cetera?
Gyner Ozgul: Our biggest workforce at Smart Care is our technicians. They make up two-thirds of our entire workforce because they're what we're putting in front of our end customers every day. I'll speak to them and then the general. For the technicians, our biggest challenge has been the onboarding and training process, I was talking about this a little earlier with somebody, especially in that year one. Because as we were coming out of COVID, we had this hockey stick that happened.
Everyone thought it'd be a gradual recovery, and then actually promotes commercial businesses, hockey stick. Our managers were rushing to get technicians in the field to accommodate the volume pickup. We had a lot of turnover on year one technicians. They were leaving because our onboarding and training experience, frankly, wasn't very good, because it consisted of some qualitative view of some local manager or dispatcher saying this person is ready to go and run service calls. We've walked our way...
Sarah Nicastro: Because we really need them today.
Gyner Ozgul: Because we really need them right now. Last year we spent a lot of time and energy building and onboarding and training process and pulling in the technicians for that. Each of our markets has what we call district field trainer, which is a seasoned technician. That technician is the buddy of that new hire. But more importantly, they're the one that's going to release them to be able to do work or not, not the manager, not the dispatcher, not anyone else, not even myself in the organization. That technician is driving the accountability of that.
We get the buy-in then from the technician group that this person's ready and the specificity of the feedback the technician can also give, like they can only work in these three pieces of equipment and do it well. We follow that and our technology tools help us enforce that, because we assign skill competencies within our dispatch tool, within PSO. We can actually only assign the skills that they have and they can't be dispatched to anything else. It creates a little bit of a good blocker. We have improved our technician retention rate of year one technicians by almost 50% this year.
It's astounding, even to me. I'm very skeptical. Our CPO and I have one-on-ones and I always say, we should double check that number because I'm a little worried that it's a little overstated. And with the general population, it's been pay them what they deserve to be paid. We all have this trepidation to pay people what they deserve to be paid. Pay them what they deserve to be paid and set the expectations very clearly for them for success and enable their success. If they don't deliver on the pay that you paid them, then that's a separate conversation of accountability.
I am not one for the carrot. I will give you $1,000 and I'll give you another $1,000 if you do something right. I'm more like just give them the $2,000 and help them be successful. If they're not the right person, then they're probably not the right person at $1,000 or $2,000. They're just not the right person. I say compensate them well because it's hard to overcome culture if the compensation is right to begin with because that person feels they're undervalued immediately. That's something really important for me. For the rest of our group, we really focus on that.
I drive a fair amount of push of intercommunication of those groups. One of the first questions I always ask when something comes to me, whether it be a steering committee meeting or a process improvement meeting, is I'll say, well, did you communicate with finance, or did you communicate with supply chain and get their input on this or sign off on this if it's applicable?
If the answer's no, I say, well, then I don't really have a lot to add because if your coworkers aren't aligned with you, then my alignment is irrelevant. My alignment is the team is aligned, this is a solution, and I support that and help them be successful.
Sarah Nicastro: The other thing we talked a bit about, the onboarding and training, which is obviously having a huge impact that you are wanting to double check. But the other thing we talked about is the idea of career progression in service and how that might be evolving going forward. I fully agree with you on pay people what they're worth.
At the same time, we know that for today's talent, it isn't just about dollars the way it once was, there's these other elements and one of those is some want the ability to progress, they want to know what that progression could look like, et cetera. What are you doing to keep pace with what things look like today, but also start mapping out the evolution of what the role is looking like going forward and what those progression steps may be?
Gyner Ozgul: For our technician base, the way I think about it is the progression for them is two buckets. One is the bucket of technicians that are happy in their current roles and they really don't want to do something else, but you can't forego them either. You have to think about what the answer is for them. And then there's the progression for the technicians who want to be more in the organization. For the first bucket, what we do with them is, hey, what is a training path to help them hone their skills and feel energized every single year?
We work with their managers on a development that's customized that we track in our LMS systems for that first bucket of technicians that every year we're improving their skills, because they want that, right? They're like, just because I only want to be a technician, and I correct them when they say only, I'm very clear with them to say we need to still train them and make them the best technician possible in the business and make them feel good about coming to work every day. With the other technicians, we've created a number of different career paths.
You can obviously grow in your technician career all the way to this district field trainer that I talked about. You start as an apprentice and you can grow to district field trainer. We also have a training group primarily made up of former technicians that does classroom and field training specifically with technicians. They feel good that they have this training path they can join. We have allowed technicians to become district field sales representatives. I mean, they know the product, they know the customer.
We teach them the sales skills that they need to know and how to present them well. And then finally, there's a subset of technicians that just want to go into field service operations. They can start off as a service manager and then work their way up in the operations group. We've been very clear to map out each one of those for our technicians, so they feel that this is an organization that no matter what path they take, they can feel supported and get successful.
Sarah Nicastro: And they have choice.
Gyner Ozgul: And they have choice.
Sarah Nicastro: Which is important now. When Matt was up, he was talking about how they work to nurture that entrepreneurial spirit that the independent service providers have. It made me think of a conversation you and I had about how you look for and figure out what to do with talent that you or others think has very high potential. People that are maybe more innovative, maybe higher drive, et cetera. What should leaders look for in recognizing that? And then how do you maybe put them on a different path or fast track them in some way or make sure that they don't get bored or that sort of thing?
Gyner Ozgul: Yeah, it's fun, there's this group of individuals in the organization that I like to keep my eye on with my direct reports. Al is my VP of IT standing over there and he knows that... We talk about this with my direct reports. Who are the bright star, I call them in the organization, or who are the ones I should be on the lookout for? And then I proactively like to reach out to them and just talk to them. Sometimes not about anything specific, like just what's their experience like, what are we doing in the organization I should know about.
And then sometimes in those conversations they give you something, a little spark. We should go improve parts this way. And then you say, well, tell me more about that. And then you have a little more conversation on it and you're like, they have a pretty interesting idea. Then I take them and I'll put them in a little bit of a discovery special project and empower them to go do that. They may be or may not be in that work stream function and that's less relevant to me. I just want to give them an opportunity to go do something and shine.
If it works out, it could evolve to something a little more permanent for them. If it doesn't work out, I just like the fact that I'm giving them an opportunity to show us what they have, a competency of creative thinking that they have, and bring it more broadly to the organization. I do keep track of those. I mean, we had a very young talented woman who left because her husband moved to Iowa because he got a job out there a couple years ago. She recently moved back to the Twin Cities and now she's working for the Alan's team again.
I kept my eye on her, and it was a fun conversation. Because as soon as I learned she had moved back, I sent Al a note and I said, "Hey, you should reach out to Kathleen. She's got a lot of potential. She left the organization on good terms. She had to move. I'd really like her back in the organization because she was one of those sparks that we had." Of course, Alan interviewed her and calls me the next day and says, "Wow, yeah, we're bringing her on board." I feel really good about those folks.
I mean, they need an opportunity. One of our VPs of service on the specialty side, which handles coffee for us, I hired him as a materials planner in supply chain 10 years ago, and now he's running all of service on our specialty division. It's really cool to find them in there and work with them.
Sarah Nicastro: It's also a fun part of rapidly growing. There's a lot of opportunities for you to watch for those shining stars and help them progress. How would you describe the importance of culture in scalable success?
Gyner Ozgul: Very important. You said we do acquisitions. We spun out of a company here in the Twin Cities called Ecolab back in 2017. We were part of a corporate environment for roughly 20 years or so. We spun out to be independent, and we immediately started doing acquisitions to scale our business up. Of course, the culture we had was a culture that was very Ecolab, and there's nothing wrong with it, but it wasn't our culture. It was an Ecolab culture. What we learned in our first few acquisitions was our culture will always be evolving.
As long as we continue to do acquisitions, our culture can never be stagnant. The scalability of our culture has to be, here's what our culture is today. We just bought these two or three organizations. What does that do to our existing culture? How does that move now as we bring these organizations into our own? It's an ongoing resolve to revisit that culture and that statement for us.
But there are tenets within that, things like safety that we're very resolute on, integrity we're very resolute on, quality of service is something we have a lot of passionate on. There are tenets within that, but we allow ourselves the flexibility to evolve our culture as we buy more and more businesses.
Sarah Nicastro: You mentioned really just in passing one of the things that I know you value a lot, which is not only communication but listening. I think that's really important because the leaders that are doing the most to stay in tune with, here's not what I want our culture to be, so let me just assume that's what it is, right? But we have these objectives.
How do people really feel? What is it? Is it hitting the mark? What could we be doing better? The people that are having those conversations have the most opportunity to get the transparency, make the people you're talking to feel valued, but also course correct and continually improve.
Gyner Ozgul: Yeah, lots of questions. I have to watch it a little bit of my blind spot too. In one of our breakout groups I mentioned that. That sometimes if you're the leader that asks a lot of questions, it can intimidate people in the room. I have be a little careful. But a lot of times I ask questions because I want to learn a lot about the organization because that really drives the decision making process for myself. What you said is right, for me, that's really important, really utmost important. Listen to the teams and hear what they're saying.
Oftentimes you might think you're hearing them, but you're not. I do a lot of playbacks for myself. Here's what you said and here's what I heard. I'll even say it like that just to make sure the person's acknowledging that that's correct or not correct. You said we do a really bad job of stocking parts. What I heard is we need to probably think about what our planning parameters should be, because you're giving me the output and I'm giving you the upstream of where we should go work.
If they agree, then I feel like I have good direction. If they disagree, it's good because then I can get to what they're really trying to say. I like to get them there so that they feel like I'm hearing them.
Sarah Nicastro: And so you know what the real deal is. We talked recently about the fact that like everyone, you had your challenges during the pandemic, and now you're at a point of stability, which probably feels pretty good. But also you mentioned that puts you in a position where you need to be looking at organizational structures, the quality of the people you have in each of those structures, and making sure that with that stability you're not getting complacent and that you are continually improving. What does that look like for you and for Smart Care?
Gyner Ozgul: Yeah, I'll give you an example. Last summer, right about this time, we had gotten to a scale in the recovery, where my old operational leadership structure was showing some fractures. The fractures were showing up in lapses in customer communication and service delivery and some of the culture and turnover I talked about earlier. Those to me were all outputs and indicative of a scale problem we had. Not necessarily that the leaders I had in the organization were bad.
Some of them had some opportunities, to be quite frank, but more so that I hadn't stepped back to the organization and say, okay, this is an organization that now has twice the volume that it did at the onset of COVID, and yet it still retains the organizational structure of what it did during COVID. I stepped back and reorganized the service teams and really add two objectives in doing that, which is how do we personalize our connection with the technician and how do we personalize our connection with the local customer?
I wanted to bring local field back to the organization because we had the stretch during COVID. We redesigned the organizational structure in the fall, brought on two new VPs of service externally. I needed some talent, some new talent in with some ideas and some thought process. I also aligned the acquisitions to the service leaders. In the past, they were aligned to either an integration manager or myself.
I didn't feel like I was giving those acquisitions the time they needed to feel like they were part of the culture. I align them to a service leader who could be more observant, give them the time, meet with them, help them understand their needs, and bring them into the organization in the right way.
Sarah Nicastro: I'm thinking about the fact that after a period of time where there was so much change that we weren't choosing, now that things are a bit more stable, we run the risk of avoiding change because we're tired of it, which could be detrimental to forward progress.
Gyner Ozgul: I agree.
Sarah Nicastro: How do you navigate that yourself?
Gyner Ozgul: In recent months specifically, I have taken an approach when there's what I'll call a really big problem usually shows, we all call them that and we know what they are because they suck up a lot of our energy. If you start seeing lots of conference calls and phone calls on something, it usually means the process itself is strained for whatever reason. I've taken the approach for myself to step back. When I start getting pulled into a lot of meetings on something, now I might pause at some point.
As opposed to just going to all those meetings and doing the firefighting, I'll step back and say, okay, can we get the right people in the room and have a more holistic discussion about this? Because all these meetings are telling me there's some other problem in this, whether that be scale or culture, and we're not stepping our way back to go solve that problem. And that has been with intent. I've been asking the team to do that a lot. Look, I'll just give you an example. I showed up in one of our product sprints.
Our finance team had been trying to accommodate a work in progress accrual problem we've been having for almost a year. I don't know, we've done six sprints on it, and I just felt like we kept putting the fire out on this thing. And finally, I called our CFO and I called our leader of finance and I said, I'm putting the brakes on this. The team needs to come together and understand what is the solution they want, what is the output they're looking for, build those requirements, and then come back to the technical team so we can solve this.
Because otherwise, doing it iteratively with failure in perpetuity never really gets you the solution, but it also frustrates everybody with the time it takes. I mean, that's something I have a lot of conviction around recently, like that continuous improvement.
Sarah Nicastro: Yeah, that's good. Going back to the first thing we talked about with the data, you're also at the early stages of not only having that, but looking at all of the ways you can leverage that. That frontline role is really shifting not just to be a mechanical or a hands-on role, but a knowledge worker role where they're going to consult with the restaurants on maybe it's usage scenarios, maybe it's peak times and how to better... There's a lot more to it that fits that experience story than just the machine itself and is it or isn't it working.
Gyner Ozgul: Yes. We've seen in the data, as an example, some customers have undersized the equipment that they purchase. They know that they need a lot of ice because they're a bar and they've gone and bought the smallest ice machine and they're always constantly running out of ice.
Sarah Nicastro: Go get a bucket of ice. Go get a bucket of ice. I worked in the restaurant industry for a long time.
Gyner Ozgul: More importantly, the ice machine is running so hard that the breakage happens more often. If you teach them the buying behavior of, hey, what do you expect a business volume for you to be? I expect it to be this. Okay, you should buy an ice machine that fits that. Not go to a dealer and say, well, that's $1,000 less than the step up. Literally you save on the front end on the capital purchase itself, you're more than going to pay for on the repair because you've undersized. We like the fact that we can help them provide value for that.
Sarah Nicastro: You can report to your same stations as the morning in four minutes. Okay, thank you so much.
Gyner Ozgul: You're welcome.