Pat Croce Started One Successful Business, Got Rich, And Saved The Philly 76ers From The NBA Scrapheap. His Secret? Slavish Devotion To The Cult Of Customer Service.
By Brian L. Clark; Pat Croce

(FORTUNE Small Business) – If there's a god of promotion and customer service, he might just be Pat Croce, the 47-year-old minority owner and former president of the Philadelphia 76ers. Roughly a cross between Norman Vincent Peale and Evel Knievel, Croce is best known for revitalizing the downtrodden franchise through his promotional stunts and wanton acts of customer and employee pampering. He once rappelled 110 feet from the rafters of the First Union Center, and he also climbed to the top of the Walt Whitman Bridge to unfurl a 76ers banner. One time, during a game, he came upon a little girl crying inconsolably. After her parents explained she was afraid to sit high up in the arena, Croce led them to club box seats on the lower level. He even invited several of his janitors to take in a game at courtside.

Good stuff--the fans and his workers loved it. Since he took over after the 1995-96 season, the 76ers have increased attendance by 64%. (Okay, winning games and superstar guard Allen Iverson have had something to do with it.) The franchise, bought by Croce and cable giant Comcast Corp. for $140 million, has by some estimates increased in value by almost 70%.

Born and raised just outside the city, Croce is the essence of Philly--a hard-nosed Irish-Italian kid who fought throughout his childhood, often with a father whose backhand was said to be quicker than Iverson's crossover dribble. After graduating from the University of Pittsburgh with a degree in exercise physiology, he returned home to become the personal karate teacher for Jay Snider, son of Philadelphia Flyers owner Ed Snider. That led him to the training room as the hockey team's strength and conditioning coach. He went on to train some of the city's best-known athletes, including 76er and NBA legend Julius Erving. In 1984, Croce parlayed his reputation into a company called Sports Physical Therapists (SPT). It was remarkable timing--the '80s fitness boom was in full swing.

That's when his obsession with the customer really took off. On his way to an executives-only meeting at SPT, for instance, Croce stopped in a lavatory to find an overflowing towel bin, toilet paper on the floor, and clothing dangling from half-closed lockers. He gathered his execs and marched them into that lavatory, where, scrub brushes and buckets in tow, he conducted the meeting. Ten years after he opened his first center, there were 40 in 11 states.

Croce eventually sold out for a reported $40 million, after, he says, it was clear that managed care would put a big crimp in the therapeutic-care business. Not long after that he persuaded Harold Katz, Nutra/System diet center tycoon and owner of the lowly Philadelphia 76ers, to sell the team to him and Comcast. He took over in 1996, drafted Iverson, and later brought in future Hall of Fame coach Larry Brown. Last year the 76ers made their first trip to the NBA finals since 1983.

Earlier this year, though, Croce decided to move on. He says he needed a new challenge. Some say he had pushed for too much power within Comcast. So while he remains a minority owner, fans may have seen the last of him on the First Union Center concourse. These days, when he's not giving motivational speeches to Fortune 500 companies, he's continuing his career as a bestselling author. His new book is 110 Percent (Running Press, $18.95). His first--I Feel Great and You Will Too!--was a bestseller. Recently Croce took a break to give FSB his first in-depth interview since leaving Comcast. Here are edited excerpts:

What were the very first business lessons you learned?

When I was a paperboy, I realized that when I put the paper in the door, people would thank me and give me an extra tip. I think it was a 75-cent bill for the week, and I'd get a dollar. And I realized that if you go above and beyond what's expected and do it consistently, not just once a month, you could make people smile, and they would give you your reward. The other thing was, across the street from the branch where I picked up the papers was a doughnut shop. On Sunday I would stop to get a doughnut, and I remember a lady ordered a dozen doughnuts, and the woman behind the counter counted out 12 and with a flourish put another one in the bag. I didn't know what a baker's dozen was, but I realized at that point that people like getting a bonus or premium. That little extra meant so much that people would buy 12 instead of six. So those two little things really set the foundation for everything I do.

Are you a marketing or a customer-service person?

It's all one and the same. You know, do unto others as you would want them to do unto you. You can be a good marketer, but you might be labeled a promoter if you don't service the sale. If you want to be a great marketer, you have to fulfill what you're selling with customer service, with exceeding expectations, with giving a little extra, with surprising the customer. That's the key. Even patients, when they would come into the facility, that night they'd get a phone call from me or my staff. Within 48 hours their physician would get an evaluation, and whoever sent that person would get a thank-you letter.

How did you determine the best way to follow up?

It was just my intuition on how to make people feel great. And I truly would put myself in the other person's shoes, be it an employee, a customer, a physician, or a season-ticket holder. The vendors, the TV people--I made sure we made it easy for them to do what they do. When I lived in the bowels of the Spectrum as a conditioning coach, I saw that a lot of the press were treated like crap. Why would you do that? They're your conduit to the community, to the masses.

Do you think about customer service all the time?

Yes, because I believe it's a lost art in our society. We appreciate and compliment great service because we don't get it on a continuous basis. It's so easy. All you have to do is adhere to the golden rule--treat everyone as you want to be treated. Put yourself in the other person's shoes. How easy is that? It's just remarkable how many times you say, "Can you believe that?" because you got some rude attendant or you're in some dirty environment. It's just amazing. So when you get a good waitress or bartender, you say, "Wow, isn't that person cool?"

Given how demanding your father was, how much did he influence your attitudes regarding customer service? I'm sure pleasing him made you feel good.

I would say a dramatic influence. I do feel great when I please people. And you always tried to please him, because if you didn't, it hurt. But really, I'd have to pick lint up in the house or he'd whack me in the side of the head. He came from an orphanage, a really tough background. This was his castle, and I respected that. He was fanatical about cleanliness. You take that in and you realize, I like a clean environment, so do patients or season-ticket holders. You come in that First Union Center or into my car--I want it neat, clean, and orderly, so that you can conduct business.

Where did the ten commandments come from?

They came from my experiences in life. I wanted a cookbook for my employees to follow using the strength-training principle of KISS: Keep it simple, stupid. They knew all ten--I had them posted in every cubicle and every office in the facility. Even in my 76ers life, they were everywhere, because what you see tends to be your most dominant thought. I wanted to make sure people used first names, that they listened, that "Do it now" was always at the forefront of their minds. So they came from my own life experiences, and I put them down in a very instructive way for people to use. People need that; they need ABCs.

Is anyone more important than the others?

Think of the ten commandments as a really cool utility tool, like a Swiss Army knife. The beautiful thing about them is you can use one of the applications, or you can use two of them. But I wouldn't say any one is more important than the others. I love "Listen, listen, listen" [No. 3], but if I don't "do it now" [No. 10], I might miss the knock of opportunity. And if I did it right now and it failed or was rejected, and I didn't use No. 7, ["Be positive"], I'd give up. So they're intertwined.

Talk a bit about the season-ticket-holders meeting you held in your first year. Was that the best customer-service lesson you ever got?

That was unbelievable. It was my goal to adhere to a promise I had made earlier in the season. I promised them we would have a meeting in the middle of the season to review the progress we had made. They felt ownership never listened to them--that management never heard their requests, their wishes, their demands, their ideas. So all the little things I went over in the first 15 minutes--the progress off the court, the show surrounding the game, the new fan-friendly environment, the new community initiative, the free newsletter, the alumni association, the education of the ticket takers and ushers they said were rude--it all fell on deaf ears. All they cared about was that the team stunk, the coach couldn't coach, the general manager couldn't select talent. And I listened, and I took it, and at times it was heated. But it was a great experience. Those individuals felt they were empowered...because changes were made at the end of the year.

You ran SPT for ten years. What's the best thing you learned during that part of your career?

Delegation, because I always did it myself, even up until 1983. When I created SPT, I realized I couldn't train the Flyers and the 76ers, do a radio show, write and speak, and treat patients. I had to delegate. And that's the hardest thing, to give over to someone else. When we opened the second center, the only reason I could delegate was that I had faith in my COO. He convinced me, "Pat, I can do it." And once I realized it worked, I thought, If I can do two, I can do 22. If I can do 22, I can do 40.

What was your approach in hiring the right employees? I was real strict in the beginning, because I had a good reputation with the pro athletes and referring physicians as well as the insurance companies and employers in the area. Physical therapists and trainers would come and seek out my way of working. I'd make them volunteer, because I was very skeptical. I wanted it done my way, and I had to see not only who had the right mental acuity to do physical therapy and evaluation, but who cared about the patient. So we created Croce University. I even had one of my executive VPs train employees to answer the phone in two rings. You do everything right.

In 1992-93, you decided to go for the Malcolm Baldrige National Quality Award. Why?

I wanted a goal. I'm a goal-driven person. In '92 we qualified but weren't a top-ten candidate. In '93 we were. And that's when we created the concept of ichiban, with signs in every center. Everyone was on a common mission to preach that we were striving for this award. Everyone felt compelled to add something, from aides to managers. It was a way to focus on a common goal. And every month we would see how we were working toward this, because I get bored. One of my secrets of success is I hire great people, motivate them, and make them stars unto themselves, which leaves me less to do. The Baldrige award was like this year's playoffs: It gave me juice to learn from the Ritz Carltons and Federal Expresses of the world.

Your mission statement is three words: quality, profit, fun. How did you come up with that?

It was in the '80s, when mission statements were the big thing. I was doodling, and I drew a triangle. At one end I wrote "quality." I always wanted to instill fun, and you do that by "Listen, listen, listen." And then profit, because there's nothing wrong with demanding to make money. So really I had these three words, no one more important than the others. What I didn't want was to sacrifice quality to make money. Or to make as much money as I can but not have fun.

How did you bring your way of doing business to such a large entity as the 76ers?

I was a startup king--everything I did was from the ground up. So...the first thing I did was interview every person for one or two hours. I didn't care who they were, from secretary to public relations assistant to controller. I wanted to know how they thought we could make the 76ers world-class. That's all I wanted to know. And I just took notes that first week. I was around for the year prior to that because I knew I was doing the deal, but no one else did. So I got the feeling that when someone didn't return my call, I didn't care how good his interview was.

What was the most difficult lesson you learned?

You don't have control of the final act of the play. That's the hardest thing for me, because I like to have control. If it's not working, change it. I had experience in finance, public relations, marketing, customer relations, but I had no experience in basketball operations. So I relied on the input of others throughout the league when hiring a general manager, to whom I delegated the authority to hire the coach. And so, as a rookie owner, my mistake was that I hired a rookie general manager who hired a rookie head coach, and the issue expanded exponentially. In fact, I should have hired experience. I did the second time. But here I am at the end of year one, and I fired the general manager and coach. In my previous ten years at SPT, I never fired anyone. Not one. Now I have a basketball franchise in the city of Philadelphia with the most passionate sports fans imaginable. And I'm the only one in charge of basketball. I can't coach. I can't select the players. That's when I went after Rick Pitino, Phil Jackson, and Larry Brown.

What was the most important thing you came away with?

Creating a culture and placing high demands worked the same in professional sports as it did in the medical world. That same thing: You can delegate authority, but you can't delegate responsibility--that is ultimately yours.

After all that, why did you decide to leave your position as president of the team?

Five years ago I said I wanted a five-year deal. They gave me a two-year deal. Because the owner, Ed Snider, who was the managing partner, controlling partner, knew me as a physical therapist. And after two years I said I wanted three more. I wanted to fulfill my five-year obligation. I knew I'd get antsy. And as the five years progressed, more roles were delegated, and I got bored. So Ed Snider knew, and so did [Comcast CEO] Brian Roberts, that I wanted to run the [Comcast subsidiary Spectacor], Flyers, Sixers, Phantoms, both buildings, and the outreach of management, because then I'd have to learn more. I'd have to do more. There's Comcast SportsNet. There's the TV component that you could help with programming. Just to run the Sixers without the ancillary divisions really limits you. I needed more. I needed to grow or go. I wanted more responsibilities, and there weren't any, so I decided against doing another deal. So I left with a seat on the Sixers board and as a consultant with Comcast. As they progress and hopefully Comcast continues to build their global company, they're going to need branding. And they know I can really help with that. Brian has said that. And at the same time, it keeps me with the Comcast family. I keep a finger in the Sixers in the sense that I'm still minority owner. And I get to build something, and create something again.

Tell me a little bit about your new book, 110 Percent.

Everyone asks, "How do you always feel great?" and honestly, I don't. We all have our low-tide days, our low moods. It's so tempting to succumb to discouragement and despair. You can really think yourself into a funk. My idea is, Why not think happiness? Why not unleash and access happiness anytime, any place? It's my belief, for the most part, that you, not your circumstances, determine how you feel--that it's not what happens to you but what happens within you that matters. There's that old saying "Happiness comes from within." Well, sometimes it needs help to be coaxed out. And that's what 110 Percent is all about: It's 110 strategies to help alter your thoughts, to adjust your attitudes, to access your inner happiness at will. If you can change the way you're thinking, you'll alter your feelings and help change your mood. These strategies have worked for me. It's a way to change your thought process.