Social Responsibility in Times of Financial Crisis . . . from an Interview with Jan Blomstrann, President and CEO of NRG Systems

In 1987 NRG Systems formally acknowledged the effort Jan Blomstrann was contributing to the young company by bringing her on payroll.  Founded in 1982 by David Blittersdorf, the company’s main accounting system at the time was a proverbial shoe box of receipts.  Working as a nurse, yet intimately involved in the growing enterprise, Jan noted the need to create a balance sheet.

Ahead of its time in terms of producing instruments to measure wind capacity and capability, NRG business management systems lagged behind the creative engineering aspects of the company.  Jan decided to take classes at Champlain College learning about both business and computers, also in their neophyte stage in terms of small business accounting.

In the late 80s, Jan was not particularly interested in wind energy. “This was in the infant years of wind energy,” she recalled.  “At a trade shows there would be 50 people, all engineers very excited about how a gear box worked.”

In fact, when she spoke to people about what she was doing, the initial reaction was: “You’re doing what?  Making wind instruments?  Trumpets?  Can you make money on this?”

Nurse turned CEO implements SR policies instinctively    JanBlomstrann

She was interested, however, in creating a business organization and management systems to professionally run the company.  “I did like the business part:  accounting, hiring people, figuring out how we were going to offer health insurance.

Although she did not label it at the time, the policies that made the most sense to her were socially responsible.  “It was just the right thing to do, especially in terms of (employee) retention.”

“NRG Systems, by nature of the product, is contributing something greater into the world.  I don’t think I ever thought of (the employee policies) as ‘I’m going to do things in a socially responsible way.’  Things just sort of evolved.”

Those policies included a compensation package of both salary and profit sharing as well as other benefits based on their company values.  “Our core values go back ten years or so, when we first got mature enough to do a strategic plan.  We said; ‘Let’s write down how we have been operating for twenty  years, and document it.’  Those core values — Environmental Stewardship/Leadership, Fair Employment, Profitability, Integrity, Innovation, Dedication. Our core values were reflective of who we were.”

Her ambivalence to the company product changed as the business grew.  “In the late 1990s young people started sending in resumes,” Jan reminisced. “They said: ‘I don’t care what it is, is there a job for me?’” Jan was startled at the requests that were predicated not only on the wind industry, but by her socially responsible policies. “It was very infectious for the employees to see the success of the company.  We were contributing to a new way of being and doing business. Those years were very exciting.”

With the success of NRG Systems, there came a time to move out of their rented sheet metal building.  “We had a desire to create something that had a lighter footprint on the planet.  It was time for us to move, and we felt it would be nice to walk the talk.”  This impetus coincided with her being named President and CEO of the company in 2004.

Architect Bill Maclay was given a power budget and this mandate: create a building that performs well, feels good, and is inviting.  “The entire process led to a LEED certification that taught us along the way,” Jan remembered of her company headquarters.  “It was the fourth industrial building in the world to get LEED Gold.  All materials were sourced as locally as possible.  No off gassing furniture or carpet were specified, no formaldehyde, etc.”

Renewable energy industry stalls — SR policies challenged
“The entire renewable energy industry was on a steep growth curve from 2002-2008, when we built our addition.  Then, the crash affected our business, and the wind industry, as capital dried up, and no wind projects were being developed.  A year ago both the US and Chinese market further dipped at the same time due to public policies,” Jan explained.

After years of strong growth the wind industry stalled.  A world-wide recession, coupled with a Congress unwilling to work with the President in supporting renewables, made a comprehensive energy policy impossible. Jan noted:  “Renewables were left with a simple tax incentive policy.”  Financing dried up.  Projects stopped completely.

Quite suddenly, NRG Systems had to make serious, and extremely difficult, decisions. At the onset, it felt like the company was being ripped apart.  Jan found herself staying up nights.  “It nearly killed me to do what we had to do last year, especially letting people go. When a lot of profits coming are in, it can mask the more stressful aspects of running a business; it’s easier to be creative.”

“In the boom years,” she continued, “with the profit-sharing variable as a component of pay, sometime people earned 50% above base pay.  With the downturn, there were some quarters without any profit-sharing at all.  In these times both the loyal and cynical elements can come from employees.  Although the cynical element wondered out loud if management knew what they were doing, the loyal element buoyed NRG Systems.”

“For example,” Jan quietly told a story, “we had an older man in electronics.  It was a tough year morale-wise, and we were not making as much money.  He got a little discouraged and was going to get another job. We talked.  He thought about it and decided to stay.  I saw him a few days later and said, ‘Thank you.  I am so glad you decided to stay. I hope it will be a good decision for you.‘  His response:  ‘I could go to the other company and make more money, but my wife is sick.  If I stay here, I know I can go to her doctor’s appointments with her.’  People go through different stages in live and go through different things.  I want someone coming through the door happy to be here.”

“The soul of the company is still there,” Jan mused.  “Our values are still there.  In terms of the benefits, we need to get some of them back.  But, I am not looking for this just so I can benefit;  I want everyone to benefit as we grow.”

One example is the mental health of the company.  With the difficulties, Jan wanted to give the NRG Systems team an opportunity to process their stress as a group. “This fall, we brought in a consultant who works on happiness, leadership, and personal accountability.  I gave him the charge to give a recasting exercise.  How do we recast this time into a new intentional story?  How do we look at this time as a positive step in the evolution of the company?

“The entire staff was split into four groups and did this exercise.  I was not part of it so that everyone had a full chance to vent.  People expressed anger, frustration, doubt.  It was just therapeutic.  They all said they appreciated the opportunity to do so in a group supportive way.  It was a good chance to get it out.  The gossipy water-cooler conversations came down, and the faith in leadership is coming round.”

With creativity, SR values adhered to
Jan found herself questioning how to stay true to values during this transition, realizing that things could never go back to where they were.  She explored new initiatives to offer positive reinforcement and recognize people in ways other than cash with a constant wish to portray her sentiments:  “You are all valued, you are all here, we have a job to do together.  This is what we are going to do going forward to rebuild.”

“We prioritized and focused on doing what we need to do to keep what is most important, such as preserving 401(k)s.”  While maintaining NRG’s policy of Open Book Management, “I brought in the word “budget’”.  This is one way of keeping core benefits, and core values, while evolving the company as a whole.

In doing so, some green benefits stemming from the NRG Systems core value of Environmental Stewardship, had to be shelved.  Jan ruminated about the decision to no longer subsidize employee hybrid vehicles.  “I’ve had to take some of the benefits away. I could not do it anymore.  No one lost the benefit who already had it, but nobody new can access it.”

She also mentioned a change in the company holiday party where, in the past, a band had been hired.  This year, in recognition of all the musical employes, Jan smiled, “Two bands formed themselves and got up at the party!  It was all in house.  Although it was a little quieter, it was more fun!”

While some company policies had to change, there is great evidence that the company values of NRG have never been at risk.  As Jan said, “It does not cost money to have integrity.  There are values behind what we do that don’t go away such as community relations and corporate giving.  This is still an important piece.  We give away less, but our program is still there.  I really don’t think its an either or.  Neither is Flex Time.  It is easy to have flexible work hours regardless of bottom line.”

One particular change, Jan is very disappointed about.  “We brought in a chef in 2006 or 2007 and provided lunch four days/week.  During this transition, I had to take as much cost out of our budget as possible. I would love to put that back in.  I keep asking myself, ‘Is there something else I can do to make sure everyone gathers at noon and has that benefit?’

“Previously, no one was using cars.  Everyone would collect at noon and there was a company conversation.  Productivity-wise it was unbelievable.  Meeting was productive.  Now we’re back to people getting in their cars for lunch, or eating at desks.” Jan ruefully concluded.

“It is easy and enjoyable to offer such policies when you are profitable and growing and things look great.  It’s more difficult when it’s not.”  Jan is looking to create changes that are not only for now, but the long term health of NRG Systems into the future.

Market stress re-orients business; SR still foundation
Jan’s words conveyed her long term thinking and belief in the future:  “The past is the past. Don’t think that if a certain contract comes in, it will go back to the way it was.  We need to create a new future for ourselves.  New things might happen, but in a new way.”

“We’re in a real transition phase as a company.  I would describe us as a company that grew quite steadily, we had a tremendous record.  It was exciting and fun to be in this business.  The ability was there to provide a great experience for employees.

“The last couple of years have been a huge wake up call. We are about half the size in terms of revenue and 25% smaller in terms of staff.  There’s had to be a real refocusing on what does it mean to be in business and what does it mean to be a good business?  I am asking that question of myself.  A few people were not there in the beginning and now see a company that is much more serious and much more stressed.  Where is the room for Social Responsibility?

“How do I take this company to the next stage in a much less privileged way, and emphasize the social responsibility aspect?  How do I make sure we continue to evolve?  I don’t think it’s an either or.  I think a lot of those things we did in those years contributed to our success, our intellectual level, institutional knowledge.  Keeping people improves institutional knowledge.

“The company is now a smaller group, working hard.  Policies were put into place that, once things turn around, a smaller group will see the benefits of.  The structure is still all there.  The morale and feeling about the company will turn around.

“There is the story to tell that we went through hard knocks, had to let people go, but we survived as a group and will continue.  By letting go of things of the past, we will be far more careful; lots of lessons have been learned along the way.  We are a smarter and better business than we were three years ago.”

Several years in, after fully establishing the values and policies of the company, Jan started feeling a connection to what NRG Systems was producing as well as the business administration of the company: “I started getting excited about wind energy when we talked about distributed energy, all the things that start to make it more than a machine.  And wind energy doesn’t put out belching smoke!”

“Fast forward today, it is in my blood and who I am.”  Good thing for NRG Systems, the blood flows both ways.

http://www.nrgsystems.com

NRG Systems Headquarters • Photo by Carolyn Bates

NRG Systems Headquarters • Photo by Carolyn Bates

Julie Lineberger

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