Vienna Beef CEO Jim Bodman on the cost of compromise
When Vienna Beef hot dogs made their debut at the Chicago World’s Fair just over 125 years ago, it forever changed the Chicago food scene. Chicago-style hot dogs are now a cornerstone of the city’s identity, and Jim Bodman has been at the helm of this iconic brand for more than 35 years.
Jim’s had an interesting leadership journey. He started at Vienna Beef nearly 50 years ago, stamping 39-cent stickers on packages of hot dogs. He worked his way up until 1982, when he and his business partner bought the company and became co-CEOs. They continued in that shared role for nearly 20 years before Jim took on the job by himself. Jim says that the “co-CEOs” role was where he learned one of his biggest lessons in leadership: A company needs to have one clear leader.
“Trying to operate the business with two CEOs was just a total mess,” Jim said. “The problems didn’t stem from the relationship with my business partner — he’s a great leader that I have a lot of respect for. The challenge was how people perceived our roles. People had camps — his camp and my camp — and they’d compete with each other instead of pulling for the overall greater good.
“The worst example of this is when we decided to close our Los Angeles factory and take all of our manufacturing to Chicago. The location wasn’t the issue, but our recipe was. You see, the recipes at each factory were a bit different, and we needed to settle on one.
“We lost almost all our business in both cities because of our unwillingness to make the proper decision.”
“My partner and I were divided on the decision, which caused our ‘camps’ to be divided, too. The argument raged for weeks and, because we didn’t have a clear leader, we were paralyzed and couldn’t make a decision. Instead, we compromised and changed both recipes in an effort to find a middle ground. Big mistake. We made a product that pleased neither group, and we lost almost all our business in both cities because of our unwillingness to make a decision.
“We ended up scrapping our plans and going back to separate recipes that we very slowly combined over time. In the end, we recovered, and our customers were happy — but it was a bumpy road, and we learned a lot of lessons.”
This story struck a real chord with me. As a leader, you have to be willing to make a choice and move the company forward — and sometimes those decisions can be hard. There are times when I’m asked to make a decision or implement a new change at Plante Moran, and I find myself wishing I had more information or a better sense of what the outcome would be. But the reality is, more often than not, it’s just not possible — and, if I waited until I had all the information, the firm would be at risk of falling behind.
Keeping the company moving forward is not an easy task, but then neither is being a leader. You have to be in tune with what’s right for your customers and your staff, all while learning from your mistakes and focusing on the bigger picture.
But, as Jim said — it’s all for the greater good.
More from Jim
What else did Jim emphasize during our conversation? Here are a few additional points:
On diversifying your portfolio
“Over the last 20 years, we’ve added other businesses. Early on, we were very, very dependent on the beef cycle and decided that we needed to diversify what we were doing to get rid of that dependency. Now, a third of our revenue comes from pickles, and about 10 percent comes from soup and chili.”
On the importance of customer input
“Sometimes, when people are raised in the production side of the business, they tend to think customers complain too much. It’s important to understand that you’re lucky when a customer complains, because that means they still want to buy from you — they’re giving you a second chance.”
On the proper way to eat a hot dog
“I have a way that I make my hot dog — and I love it ‘my way,’ but if someone standing next to me does it a bit differently and leaves off the relish, that doesn’t necessarily make it wrong. Having said all that, there is one thing that should never touch a hot dog: ketchup! No one over the age of 10 should put ketchup on a hot dog. It just doesn’t fit.”
Leadership personality profile:
Your leadership approach in one word: Uncomplicated
The leadership quality you most admire in others: Quiet and unwavering determination
Your best piece of business advice: Don’t allow little decisions to drive big decisions.
What you look for when you hire: Someone who is better at a specific job than I
To be an effective leader, you cannot… allow anyone to think that you do not totally appreciate their efforts.