People of the Year Awards

Combining the benefits of a big operation such as high volume purchasing power and the capital to provide the best technology with the benefits of a small operation personal service has been proposed as a formula for success in automatic merchandising in recent years. Two proponents of this philosophy are brothers Stan and Steve Ledbetter, co-owners of LaFayette, Ga.-based RE Services Inc., who share the honor of being the Automatic Merchandiser 1997 Vending Operator of the Year.

The Ledbetters, who grew up in the business, are among a handful of enterprising vending professionals who have pursued an expansion strategy that leaves homegrown management in place under a large corporate umbrella. The Ledbetters have also paid close attention to technology over the years, and were instrumental in establishing Debitek Inc., a supplier of prepaid card systems. But no area vending management has received greater attention from the brothers than personal management. As their company has grown to include five companies throughout the Southeast, including their own family's Restaurant Enterprises, the Ledbetters have fine-tuned an employee management system designed to foster good employee morale.

Growth strategy: Acquisition

RE Services has expanded over the years since Ledbetters, seeing large volume as imperative to survival, set out on an acquisition strategy in 1992, as described in an article in the May 1996 issue. Each of the five divisions is managed by a general manager, who is connected via computer to corporate headquarters. All information, aside form payroll and route accountability, is shared between the divisions through computer system. General managers are given full control over the division, with the exception of capital asset budgeting and operating budgets, which require the brother's approval.

Team leaders: Driver's Friend

One benefit they have implemented is the team leader concept; team leaders assist drivers in the field and do not administer discipline, which is left to the route supervisors. Besides filling in for drivers who are on vacation or holiday, the team leaders audit the machines. "We think it keeps morale higher than when we didn't have it," said Stan. Team leaders are experienced drivers who, by virtue of their seniority, can relate to every situation a driver is likely to run into. "Their basic function is to keep the route driver producing in a helping way." The program has impacted driver turnover in a positive way for the company. There is a team leader for every five routes.

Another successful innovation has been the Zenger-Miller management training system, a formal system that emphasizes the emotional aspects of worker/manager relations. Making extensive use of role-playing and video presentations, managers study real-life scenarios, such as dealing with a driver who comes in from the rain and didn't get all of his stops.

Issues vs. Personalities

Managers learn to focus on issues rather than personalities, something mush easier said than done. "It helps develop management philosophies for how you deal with that," said Steve, who oversees the operational and financial aspects of the business (Stan oversees the sales and public relations aspects). "It gives the enforcement and at the same time brings these issues out that you need to be dealing with."

The principles of the Zenger-Miller system are posted in the different branches. Saturday classes were initially held for management personnel. For the last two years, management personnel have been evaluated based on these principles.
A more recent management innovation has been a computer-aided interview, which has reduced the amount of time screening applicants and results in better screening. An outside consultant, Chattanooga, Tenn.-based H.I.R.E., interviewed the company's best employees and came up with three lists of questions, one for each of the following areas: rolling routes, attended services, and cafeterias. Job applicants simply answer the questions on a computer, which identifies the best prospects for the follow-up in person interviews. "What we're trying to do is hire the best qualified person who wants to be in the business," Stan said. "Most of the people (managers) struggle with the (initial) interview."

As noted above, decentralized management is a cornerstone of RE Services' service philosophy. This is good for providing high quality service, to be sure, but what about the need to minimize purchasing costs? "That's been a real challenge for us because of decentralization," Steve said. The Ledbetters recently placed long time employee Dave Hillard in charge of central purchasing. Hillard will seek opportunities to streamline purchasing without compromising branch performance.

Networking with Colleagues

Employee relationships aren't the only ones the Ledbetters have sought to cultivate over the years. From their late father, Earl, the learned the importance of visiting fellow operators outside their market area, and visit operators five or six times a year. "You learn more that way than any other process we have," Steve said.

One of the areas they are Presently focusing on is handheld computers and electronic cash audit, which they plan the test early next year. The brothers feel that handhelds will eliminate the need to memorize product lists. "It's going to speed up that learning curve," Stan said. Besides making drivers more efficient, the handheld had the potential to improve morale. Drivers get very upset about their mistakes.

The Ledbetters hope to give their employees even more incentive by providing them an opportunity in the company. "We strongly believe in grooming our key people," Stan said. "We see the legacy of us passing to our key people."