February 2016 | Case Studies | LeaderSHIP

All in the Family

Tags: Education & Careers, Logistics, Supply Chain

Kristy Knichel, President and CEO, Knichel Logistics

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Relationships play a major role in the business strategy at Knichel Logistics. Employees at the Pittsburgh-area third-party logistics (3PL) provider take pride in maintaining a personal touch with customers and carriers, and in fostering excellent communications. Kristy Knichel, president and CEO, sets the tone by treating the company—founded by her father, William, in 2003—as one big family. Knichel took over as president in 2007 and has led the company through a period of dynamic growth—from revenues of $2 million in its founding year to $50 million in 2015. Inbound Logistics recently sat down with Knichel to learn the secrets behind her success.

IL: What kind of work prepared you to eventually become president and CEO of the family business?

Before entering the logistics field, I managed a small pizza shop. I did everything from cooking to delivering pizzas, ordering and managing inventory, and reconciling the registers. A lot of customer service was involved as well. Once I got into logistics, I started at the bottom, booking loads. After a few years, I started handling claims, collections, and human resources (HR) duties such as payroll and healthcare. I did anything that needed to be done, regardless of my title. That's probably what prepared me most for my current role—doing every job in the company. I took initiative, learning a great deal on my own and reaching out to industry peers about things I wasn't so sure about. I continue to do that today. I even reach out to some of my competitors, so we can share insights on how to operate better.

IL: How do you spend a typical workday?

I answer emails and phone messages, and then make the rounds to say good morning to everyone. I want to make sure that all of the approximately 40 people in our office see me at least once a day. I spend time analyzing financial information and talking with the chief operating officer about what's going on for the day, week, and month. I read industry magazines to stay on top of trends and news that could potentially impact my own business decisions. On some days, I call customers or visit their sites. I occassionally travel with the salespeople, and work one-on-one with sales staff every day. I also attend numerous meetings about HR and operational matters. In addition, I devote time to networking with other women business owners and industry professionals.

IL: What do you do to promote great communications?

I make a point of talking with everyone in the company at least once a week. I know my people incredibly well, and know a good bit about their personal lives. I also make sure to answer all my emails. Because of the diverse roles I've held here, many customers and vendors still email me directly, especially carriers who are looking for more freight. If someone—an employee, customer, or vendor—takes the time to ask me a question, that person deserves a response. This is not a strongly hierarchical organization. Obviously, we want staff to go to their managers about certain things, but I want employees to feel they can come to me as well.

IL: You also emphasize staff training. How do you deliver that?

Often, we rely on our veteran employees. Hard-working, dedicated people who have been with us for more than one decade can pass along their skills and knowledge to newer employees. Because these veteran employees have gained the trust of customers and vendors through repeated positive interactions, they are the perfect role models for our new hires. We also send employees to classes and industry events when there's an educational benefit.

IL: How would you describe your leadership style?

On one hand, I'm an affiliative leader, which means I put people first and try to bring a feeling of belonging to the organization. We ask for advice and put out suggestion boxes, so we can include staff in our decisions. We also share a lot of information, including financial data, with our employees.

On the other hand, I'm a democratic leader: I try to build consensus through participation by asking employees, "What do you think?" I want my people to make decisions on their own and take accountability. I feel this helps motivate them, letting them know I trust them and trust what they're doing, while also creating emotional bonds.

IL: Tell us about a tough decision you've had to make.

In 2013, we hired a COO from the outside, and gave him a great deal of power and our trust. In hindsight, we did not perform enough due diligence before bringing him on. After this COO made a series of unwise business decisions and improper hires, and formed an operational strategy that we did not have the resources to execute, our profit margins sank to an all-time low. We had no choice but to eliminate nearly 40 percent of our staff in order to stay in business.

My decision to replace the COO with our former intermodal manager created a rift in my family, which I had to weather in order to turn the company around. I had to prove to my family, my remaining employees, and myself that I was following the right course of action. But we had a great comeback year in 2014 and continued to do even better in 2015.

IL: What's the most enjoyable aspect of your job?

I love creating a positive and fun environment for people to work in, while making a good and honest living. I believe that my employees consider everyone here an extension of their families.

IL: What's on your agenda for the near future?

We are creating a new sustainable growth strategy for Knichel Logistics. Our goal is to reach $100 million in annual revenues in the next five years. Some things in the works include: new sales strategies; new technology, including business intelligence software and possibly a new pricing tool; and learning to do more with what we currently have. Our main goals are to become more efficient as a whole, and to continue to grow.

IL: Who are your role models in the business world?

My biggest role model is Sheryl Sandberg, COO of Facebook. It's amazing what she has accomplished in her career while also managing a family. I have a five-year-old myself. I've learned that you can do both. It's not easy, but you find a way. My father is another important role model. He taught me the value of a great work ethic, and to never give up—to keep pushing forward.






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