FMCA meeting addresses path toward change
Clint Engel -- Furniture Today, October 7, 2013
GREENSBORO, N.C. - Three years ago, the Furniture Manufacturers Credit Assn. was at that scary mature phase in the business lifecycle, facing rising expenses and declining revenues.
Established in 1961, FMCA had a long and noble history, but, "So what?" said Corwin "Mickey" Metcalf, business consultant and associate professor of law and management at Gardner- Webb University in Boiling Springs, N.C.
"There are a lot of companies with long, noble histories," Metcalf told FMCA members at their annual meeting here last month at the Grandover Resort & Conference Center. "If you don't change, you're going to hit a wall."
A study of FMCA - from its history to its operations - was the final project in masters of business administration course work led by Metcalf and done by Angie Mills, an FMCA member and director of customer finance at Bernhardt. At the company's annual meeting here, Metcalf and Mills walked about 45 attendees throug h parts of that study process and recommendations that led to significant changes for the agency. Metcalf said FMCA was facing the same problems as many mature companies: It "had fallen into a businessas- usual pattern, and business as usual was steady deterioration."
FMCA was still pretty flush with cash, Mills and Metcalf said. But with declining revenues, it also was chewing into its equity and cash. Without a course correction FMCA was likely to suffer that final stage of the business lifecycle: "exit."
In the comprehensive study, Mills, Metcalf and the rest of a small MBA class performed a SWOT analysis, evaluating FMCA's strengths, weaknesses, opportunities and threats in various areas.
Declining membership was among its weaknesses. So was a lack of goal setting. And while a vast database of financial information was among its greatest strengths, FMCA's hardware and software, which supported that data and the agency's small staff, were old and worn out after years of benign neglect, said Metcalf, who in addition to teaching has been a CEO for several companies.
The study findings were presented to FMCA's board in May 2011, and the group immediately went to work on related sales and marketing initiatives, said Ron Teglas, director of credit for Lexington Home Brands and current FMCA president.
One of the biggest concerns was the information technology deficiencies, Teglas added, but the problem was tackled head-on this year, and the FMCA is now equipped with up-to date workstations, computer software and a speedier Internet connection.
Separately, David Johnston, now FMCA's IT and administrative manager heading the High Point office staff, spent his own time and money developing his skills and receiving several IT certifications, Metcalf noted.
The results are starting to trickle in. Teglas said FMCA posted a $26,000 loss this past fiscal year, and although it's projecting to lose a few of its 70 members this year - and the related dues, collections and report purchases - it's forecasting net income of more than $40,000 by this time next year.
"We began working on new initiatives in late 2011 and that work continues today," he said. "In the end, the biggest hurdle for FMCA to overcome was change itself."
And that was the subject of Metcalf's presentation at the meeting - change management and all the barriers that naturally come with it. Change management, he said, involves defining and instilling new values and behaviors, building consensus and then planning, testing and implementing.
"Change doesn't just happen," he said. "It's planned. It's organized. It's specific." Metcalf also said communication is key to getting that needed consensus and he warned against seeking perfection in the planning stage, noting that taking action is much more important and that kinks can be worked out later.
"Come up with a halfway reasonable plan and get about it," he said.