Managing remotely (and well)

(FSB Magazine) -- Early on in the search for a vice president of sales, Ted Murphy, CEO of PayPerPost, knew that Randy Mountz was the one. Mountz, who was then heading Midwestern sales for MySpace and had previously worked for America Online, had the new-media chops to help lead PayPerPost (payperpost.com) to faster growth. The Orlando-based company arranges online product placements, matching advertisers with bloggers who are paid to mention their wares - a somewhat controversial but fast-growing form of viral marketing. Murphy felt that Mountz, who had called on McDonald's and Procter & Gamble for AOL, could get key advertisers to try PayPerPost.

There was just one big panhandle-shaped problem: "I'm not a Florida fan," Mountz says. "I love Chicago and have family in Ohio. I'm a big Buckeye fan. Relocating was just a deal breaker for me." So Murphy set about building the perfect remote relationship. In the first three months he brought Mountz to Florida for a week every month, then set up a communications routine. The two execs have a daily catch-up call, which gives Mountz virtual face time with the boss. And there are weekly phone or video conferences in which all execs share updates.

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It seems to be working: Since Mountz joined in January and assembled his sales staff - all in different cities and managed virtually too - the 37-employee company has more than doubled the number of advertisers to 8,000, including new auto and entertainment accounts. Monthly revenue is up fourfold.

Needed: flexible owners

Business owners such as Murphy know that in the contest for talent, small companies may need to be extra flexible about hiring folks who won't relocate or can't make lengthy commutes. These execs are hiring smarter, supervising more closely, setting up communication routines, and reexamining their leadership styles. They're creating corporate cultures that embrace everyone, whether in the next cubicle or on another continent.

The most common mistake owners make is being too hands-off, says consultant Bruce Tulgan, CEO of Rainmaker Thinking (rainmakerthinking.com) and author of It's Okay to Be the Boss. "Remote workers tend to be pitifully undermanaged," he says. "Managers will say, I'll get more involved if I see problems developing down the line." By then, the employee - and the business - could be in trouble. Tulgan's advice: Set up an unbreakable date for regular calls. Then summarize the conversation by e-mail; that's the agenda for the next call.

"It's not enough to say, E-mail me your progress once a day, or Let's have phone conferences three times a week," Mountz says. "I've found I need to be much more specific, instructing my team to give me detailed e-mails with bullet points, not a novel."

Ted Myerson, president of FTEN, which provides risk-management software to investment companies (ften.com), says he learned the tricks of remote management when he used developers in India. Now he sends an e-mail to five key managers in Denver and New York every evening, summarizing the issues that need to be addressed. They respond by phone or e-mail the next morning. "Even though we have brought all of development back into the U.S., it still works for us - we operate from disparate locations without missing a beat." Top officers use instant messaging so that the 15-person New York City sales office can quickly convey client requests.

A successful long-distance relationship requires hiring smart and managing smarter, says Mike Gorlick, president and co-founder of Zenith Marketing Group (zenithmarketing.com), an insurance wholesaler in Freehold, N.J., with four satellite offices. "You need self-starters," he says. "Instead of drawing energy from co-workers, they have to find it in themselves."

Starting is one thing - getting to the right place is another. So Gorlick is hypervigilant, reading daily call reports to spot trouble early. "I'll say, I see your calls are down. What's going on? Are you distracted? Can I help? I'd much rather make a call like that than have to call at the end of the month and say, Your numbers suck - what happened?"

Use tech tactfully

Pay attention to the nuances of electronic communications, Mountz advises. He had one employee who was great in person but held his cellphone too close on conference calls: "He came across like a loud older man," he says. Another rep sounded as if he were in an echo chamber. Mountz coached the first rep on call etiquette and ordered new phones with better sound quality. The company also invested in Apple computers to use iChat for videoconferencing. With such technology, Mountz says, "we're constantly updating our best practices without making people feel micromanaged."

It's also important to remember what electronic communications can't do. "In person, I can tell in two seconds how an employee is responding to my comments," says Aryeh Hecht, CEO of Vitalicious Inc. (vitalicious.com), a 23-employee muffin baker based in New York City, with offices in Hampden, N.H., Winthrop, Mass., and Anaheim Hills, Calif. "They don't have to say anything - I can see if they get it or not. But over the phone, I can't tell." Hecht winds up taking more time, asking more questions. "I have to be willing to do that. I have to realize that while someone in my office can see I'm happy, someone can't see that on the phone. I've even started saying, 'I'm hugging you' over the phone when I want them to know how pleased I am."

Then there are things you should never do electronically - like give an employee negative feedback. "Obviously, if it's an emergency, I'll deal with it," Hecht says. "But if it can wait, I'll get on a plane."

A gregarious personal style that builds camaraderie in the office may come off as overbearing to a remote worker. "My partner and I are very headstrong, very loud," says Gorlick, who recently hired a consultant to help managers sharpen their skills across all offices. "But what comes across as normal in a large group can seem far more intense over the phone."

Finally, there's the biggest issue of all: creating a corporate culture that is as easily understood in branch offices as it is at headquarters. Zenith uses its intranet as a kind of virtual water cooler. "Every day we say who is having a birthday, a service anniversary, or if we've had an incredible sales day," Gorlick says.

But there's no substitute for human contact. Hecht takes out-of-towners to trade shows and brings all employees to New York City twice a year, treating his foodies to a meal at a hot eatery. Myerson recently took his Colorado crew to an indoor wind tunnel for fun, and Murphy brought his to Key West, for activities ranging from scavenger hunts to parasailing. "Every gathering is part education, part vision, and part team building," Murphy says. "People need that kind of camaraderie, and they need to bond - even if they don't get to see each other in person very often." He still wishes Mountz would come to Orlando.