Ergon Inc. is a company that has many similarities to Barry-Wehmiller. They both are families of companies that provide a diversified range of solutions that support manufacturing and infrastructure industries. They both had longtime leaders, who have since passed, who instilled deep cultural values in their organizations.
Chapman & Co. Leadership Institute has had the privilege to partner with Ergon to help articulate the culture that has fueled the company’s success for more than 70 years. Together, they captured the beliefs, values, and leadership principles at the heart of the Ergon organization and translated them into what they called the Yellow Bike Philosophy - a shared cultural North Star designed to guide how Ergon leads, makes decisions, serves customers and grows for generations to come.
On this podcast, we’re going to talk about that process of articulating cultural values and why it was important for Ergon. And it’s through a conversation between Andrew Barenz of Chapman & Co. and Lance Puckett, Executive Vice President – Energy & Specialty Solutions for Ergon Inc., and President of Ergon - Refining Inc., Ergon - West Virginia Inc. and Resinall Corp.
You can listen to this episode through the link above or through your favorite podcast provider.
Transcript
Lance Puckett: Ergon is a family-owned company that’s been in business since around 1954. It’s a very diverse and integrated company. We're now on our third generation of the Lampton family working in the business. We take a lot of pride in that and work for an amazing family, as I think you'll learn throughout the podcast. It’s been a great run, about 30 years of experience for a really phenomenal company.
Andrew Barenz: Lance, you’ve had a tremendous career at Ergon, tell us a little bit about where that started. What did your leadership journey look like?
Lance: I started almost right out of college. I had a chemical engineering degree, and I started as a process engineer at our Vicksburg, Mississippi, refinery. And that role consists of all things optimizing the refinery, whether it's projects, our day-to-day operations. I’m very, very thankful for all the frontline operators and maintenance folks that I worked with.
They really gave me great appreciation for all that they do to make things work 24 hours a day, 365 days a year. And then I went from that operations facility environment to our sales organization. I spent about ten years or so there. I started selling products to our customers and then went on to lead our global sales team.
Shortly after that, I was moved into this role as executive vice president. I lead our energy and specialty solutions business unit. That is two refineries, one in Vicksburg, Mississippi, one in Newell, West Virginia, and two special chemical facilities in Severn, North Carolina, and Hattiesburg, Mississippi. So, it encompasses both the operation side of those businesses and the marketing side, taking the products from those facilities all around the world.
Andrew: How do you think about balancing plans? How do you navigate the tension between all those different priorities and focuses?
Lance: I really think that the balance kind of comes naturally based on my past experiences. I haven't worked with the front line. I haven't been a salesperson working directly with our customers relying on customer service and supply chain and all of that. It really builds an appreciation for where the work gets done.
In a leadership role, you're setting strategy and casting vision. If you can do those things and speak to the people that are right at the heart of your business, I think that creates a natural balance. It really keeps you grounded in how the organization truly works. Now, being in the corporate office, I think one of the real challenges of leadership is the distance that has been created from the people that are on the front line of our business.
It's a challenge. Unfortunately, in the role, you have a lot of responsibilities. You have a lot of things to get done every day. You have to be really deliberate to continue to keep your finger on the pulse of all the people that are actually doing all the hard work every day. I think that that's a critical part of the role. You have to be really deliberate there.
Andrew: Question for you: Just on the personal front, having had a very successful career, what would be the most important lesson on leadership that you'd share with our listeners, something that you've learned in your career?
Lance: I think probably the biggest takeaway is that it's easy to get caught up in the financial metrics. You're leading this organization and you have to be profitable. I think the leadership lesson is acknowledging and remembering that it is people that execute things every day that make all that possible. It really has given an appreciation for the profits, and we must be profitable.
But the balance between profitability and the people and the culture and appreciating their relevance in all that you do. If you can focus on the frontline, and the people that get it are working hard every day, success becomes a whole lot easier. A critical part of it is everyone understanding their relevance in our overall business.
When you understand the relevance—and they understand the relevance—you appreciate the importance of really leaning in to investing in them and creating a work environment that is rewarding and challenging at the same time. I think that's really one of the keys to our success. That stemmed from our founder. That's exactly the way he viewed success.
Andrew: That’s a great segue into our story. Before we dive into that, I just think it's interesting there how you are describing the importance of that people centricity for people in the organization to feel seen, feel heard, feel valued, see their relevance, but also for senior leaders, that were maybe more in charge of strategy, vision, kind of that financial picture that you're describing. It helps you stay grounded in understanding your people, investing in them and then staying grounded in that perspective.
Lance: Whenever you're talking about people, you're really talking about the culture of the organization. When you appreciate the importance of the people, you invest in them. Culture is a huge investment, keeping their environment that they're in one that is rewarding. Whenever you do that, you get discretionary energy from your people. We look at our culture as a driver of performance.
It's been a really interesting process of having that appreciation that culture drives performance. Not performance. When performance is great and you're making a lot of money, well, then, the culture is great. It's the other way around for us. We believe that the culture is what creates the performance. Whenever you buy into that philosophy, culture becomes really important. Investing in your people becomes really important. If you can keep that as a key focus of the company, I think that creates a natural environment for winning.
Andrew: That was certainly one of the things that stood out the most to me, Lance, in working with you and the team, was that focus of culture being so critical and so central to the success of the organization. I think many organizations think about culture as kind of a superfluous, nice-to-have thing on the side.
We focus on business day to day, and culture is kind of a thing that happens around the edges of the business. But certainly, at Ergon, I think you said that well, there's a focus that culture drives performance. Culture is very essential and critical to the business and to your success as an organization.
Lance: As leaders and as employees, the financial aspect of it, and winning with profitability, those are the natural things. Those are the things that are going to occur without you leaning into them much. Whenever you believe that culture drives those things, you get very deliberate in the culture aspect of it because you believe that it's a key competitive advantage, and that's the way Ergon approaches it.
Andrew: Yeah, absolutely. I think one of the lines that stood out to me in this yellow bike philosophy document—we'll dive into that and explain to the listeners why it was called the yellow bike philosophy—was, ‘Our culture is not a result of our success. Our success is a result of our culture.’ I think being really clear in that document and being very emphatic around that philosophy or that belief system certainly seems to be an important part of your culture.
Lance: 100%. We work really hard to keep it that way.
Andrew: Let's talk about your culture a little bit more and the story that led to that. know you mentioned Ergon’s founder. Can you take us back to Mr. Lampton in that story?
Lance: Yeah. Our founder Leslie Lampton was working at Firestone Service Station in Jackson, Mississippi. There was a construction company building a highway that connected Jackson to one of the towns up north. He went to work, and he saw every day these contractors would bring their equipment over, and they would get in a line, and he would service the equipment.
He got to thinking—and it really has been a philosophy throughout the organization—if you can see a need for someone and you can meet that need, then you're adding true value. It's lasting value. If you pair that with strong relationships, a real trust-based relationship, you can provide meaningful service.
Ergon really started as a service company. From his Firestone work, he contacted the contractor and said, ‘I believe that I can save you a lot of time and add efficiency to your business. I see all of your vehicles coming to the service station each morning and waiting sometimes 30 minutes or an hour to get fuel and maybe some service to vehicles.’ He said, ‘I can do that for you at night. Whenever you get ready to go to work the next morning, all of your equipment will be there and ready to go.’
With a great sales pitch and building a good relationship, he earned their business. He left Firestone. He hired a couple of people, bought a fuel truck, and he did just that. On a night shift, he would go and service all the equipment. He did it in a phenomenal way that exceeded expectations. The business began to grow from there.
It was those relationships that he created with his new customer that led to other great relationships. It just grew and grew and grew. From a couple of employees to a fuel truck, we've grown into a marine company where we service, customers with tow boats and barges, a trucking company terminals and then all the way to starting refineries.
We started a Vicksburg refinery, which ultimately is a really interesting story because it was at a point where it had grown so much that he was purchasing fuel, oil and different things to supply his customers, and he really got concerned that he would not be able to service those companies if he did not have production on his own. Even starting a refinery was all about servicing the relationships and the customers that he had grown. So, I just think that that's an amazing story, a young man starting a family and saying, ‘Yeah, I'll get in the refining business.’ His sole purpose was supporting his customers.
That’s really the start of the organization built on strong relationships and a philosophy of, ‘If I can make my customers successful, then my success is inevitable.’ It's always been a very customer-focused organization and a people-focused organization. Mr. Lampton was a phenomenal entrepreneur, but very charismatic and had a genuine care for people.
It was very easy to see. He spent a lot of time in the hallways, traveling to the different facilities, talking with the front line. Those conversations would start out talking about their family and what's going on with them. That grew to where he was on a first name basis with every one of his employees.
It started with a caring conversation about who they were and what was going on in their life, and it led to thank you so much for all the very relevant work that you're doing to meet that customer's needs. That's the start of the company, but it’s also the start of a very, very rich culture, where the people mattered, and they knew that their work was extremely relevant.
It was centered around helping our customers be successful. You can take that foundation. That's truly created the culture that we all take a lot of pride in and work really hard to not only maintain but continue to grow. We grew into different companies and then refineries and then a major asphalt company based on that mission of meeting needs, serving customers and supporting families.
That is our purpose. That's our mission statement. In the pursuit of all those employees, customers and meeting the needs of communities and everybody that he came in contact, they reinvest back into the company a significant amount of the earnings. It’s kind of an unheard of in our industry amount of the earnings. That was his philosophy. He felt if he was growing at that in those ways, then he was creating more opportunities. It’s creating more opportunities for people and employees, and more customers would be successful.
Since 1954, that's been a philosophy. Whenever you reinvest that much into the organization, we are now a company of more than 5,000 employees, 260 locations doing business in 100 different countries around the world. We are growing. We double in size every six and a half years. It is a high growth, high energy organization.
Living out that mission is an extremely important part of it. I believe that we've done that extremely well, just sheerly in large part by the reinvestment of our family, the family that runs our company, which is a really, really special story and one that, as you probably can hear, so many of our employees take a lot of pride in exactly that.
Andrew: I think that's such a beautiful story. Overall, I thank you so eloquently described Ergon’s culture right there. I think that couple minutes is the Yellow Bike philosophy, and that is really well said in terms of Ergon’s culture. I think it's really interesting landscape, as you describe, the Lampton family’s reinvestment back in the business.
I think that speaks really well to this alignment of culture and business and how the Lampton family reinvests back in the business. That's not just a financial calculation. That's very much a cultural calculation, just as well. It's a part of reinvesting in people and growing the organization, building better futures for the communities that you serve and the people who work in the business and that driving that doubling in size every six and a half years. You spoke to that so well, the alignment between the culture side and the business side. Those aren’t separate things. Those are really one and the same.
Lance: It's so important, especially with that growth. We were a company of 2,600 employees not very long ago. Within eight years, we were 2,600 employees. Now, we're at around 5,000—a lot through acquisitions. When bringing new people into the organization, we all know that before you came into Ergon, you were you were with a company that lived out their culture and their mission. So, bringing those into the fold of Ergon, that's quite a challenge. We still are working really hard to create that same employee experience, regardless of your location.
Andrew: It’s obviously a great story, and I know it wasn't all easy along the way. There's challenges. You spoke to the M&A side—acquisitions, bringing them in and integrating culture. Certainly, I think scaling the organization and keeping that culture consistent as you moved from 1 or 2 employees now to 5,000. I know the yellow bike project was a part of your focus on culture and trying to keep that sense of culture consistent across the organization. Could you share a little bit with our listeners around what was going on inside Ergon, and what were the internal conversations that were happening that led to this Yellow Bike project?
Lance: I think that we knew that with the growth rate and the amount of employees that we were growing, that we had a challenge ahead of us to create that same employee experience. We had a leadership meeting where we brought and extended the leadership team. Maybe we had 25 people together working to identify ways that we can work better together and use the integrated companies of Ergon to drive more opportunities.
We gave the group a survey. One of the questions in that survey was, ‘What do we believe that the greatest threat to our company is?’ Of the 22 people, I think 20 responses were exactly the same. They said that the greatest threat to our organization was that we lose the culture that we have today.
As leaders, almost 100% of the responses were around protecting the culture. That's the greatest threat. What are we doing about it? You got to kind of appreciate that culture that I talked about with Mr. Lampton walking the halls and talking about family and talking about meeting the needs of customers. If our customers are successful, we are successful.
That culture was spread in in so many ways and one-on-one conversations. Everybody knew the culture. They knew the culture because of Mr. Lampton and the family and the other leaders all being aligned in the messaging to our people. It was easy to live out.
As you grow all around the world and in locations away from where the company started, those conversations were fewer. Obviously. The company would grow and you had less hallway time for those conversations. So, that's really where the yellow bike project started.
We've got to be able to train our culture. We've got to ingrain it into all the systems, whether it's hiring or how you do performance management and or how we give feedback and how we receive feedback.
All the things that are critical to culture were through osmosis before. And we said, ‘We've got got to be very deliberate. We've got to build this culture into our systems.’ So, the yellow bike project really started out as we've got this phenomenal culture. Let's document that. Let's create let's create a tool that's really serves as a foundation for growing, our culture and getting it to all the different places around the organization.
That's how it came about. I think it has served us really well so far. The kind of the sky's the limit from here. We've got a foundation. We understand it well. We're aligned as an organization and as a family around the definition of our culture. Now, we're going through the process of really, ingraining it in our systems and the day-to-day interactions around the organization.
Andrew: Why was it called the yellow bike project? Or in the final document as the yellow bike philosophy? Where did that yellow bike come from?
Lance: And thinking of a title, what we would name it, a story kept coming up. We purchased the refinery in Newell, West Virginia. Our founder, Mr. Lampton, went to the refinery and wanted to meet people. He wanted to introduce himself and start engaging in those conversations around the culture. He arrived at the facility, and the leaders of the facility came out and said, ‘Mr. Lampton, it's great to have you here.’ He said, ‘It's good to see y'all. Now, let’s get out and meet the front line.’
Within five minutes of him arriving, he was ready to go meet the front line. Those leaders, typically, whenever someone like that had come to the refinery, they would get a golf cart, and they would ride around to the different groups and wave at the employees and make a few introductions.
They started taking Mr. Lampton into the golf cart. He said, ‘No. How do the employees get around the facility?’ They said, ‘Well, they ride those bikes, but we're going to go in the golf cart.’ He said, ‘No. No, we're not. We're going to meet them where they are, and we're going to ride those bikes because we are just like them. We are all a part of the chain of work, and none of us are more important than the other. We're going to show them that. We're going to ride those bikes, and we're going to meet our people.’
I think that that is such an authentic story of our founder and exactly who he was. We are all part of the team. Every job that we have is important. There are no small jobs or big jobs there. They're all very important jobs. That's the way that's the way he approached it. As you can imagine, it meant so much to those frontline workers for Mr. Lampton to ride up on that yellow bike.
Andrew: I think that certainly speaks to his character, or really his philosophy, around leadership.
Lance: Another great part of documenting our culture as part of the yellow bike philosophy is in our core values. One of my favorite ones is empowered service. Mr. Lampton believed that everyone had something that they could add. Everyone added value, and he loved empowering people, giving people power and responsibility and true ownership where they worked really hard because they were given the responsibility to make the best decision that they can. They put extra effort in there.
He went on to follow that up. It's all very clear in the definition of our core value. He said, ‘Some companies want to get three out of three right. I want to get eight out of 10 right.” What he meant by that is he wanted us to have a bias for action.
In a couple of instances, the outcomes are not going to be as we expected or what we wanted. Whenever he says, ‘No, I want eight out of 10,’ he gives you the freedom to fail. Whenever you know that if it doesn't go right, there's not going to be a witch hunt, and nobody’s going to get in big trouble.
He acknowledged that. He said, ‘Sometimes things are not going to go the way they are. We use those as learning experiences. We put those things that didn't go right on a pedestal so that not only the person that made the decision can learn from it, but the organization can learn from it and continuously improve.’
From a culture perspective, that's tough. That's tough to get all through every location. That's not the way that it is in all cases. Something goes wrong and somebody is in bad trouble. Mr. Lampton believed that they're in trouble, but are they ever going to take responsibility again? Are they ever going to take ownership?
That philosophy was promoting growth through taking risks and making decisions. If you punish someone in a big way because they took responsibility and it didn't go well, you really stifle an employee's growth. I think that's one of the really cool things about our culture that's not easy to teach without it being black and white.
Because that's a difficult one, it creates a sense of accountability. Number one, are you empowering people? Number two, whenever something goes wrong, are you learning from it?
Andrew: How do you respond?
Lance: Yeah. So, I just think that that's a really special part of a people-centric culture. I think it's one of those defining core values that really says who we are and how we approach people and business in general.
Andrew: It's such a neat way that you all frame failure and learning. There's certainly not human psychology to want to put your failures up on a pedestal so everyone can look at them and learn from them, but it's really neat how you all have made that a core part of culture to enable that and encourage that type of behavior when we as humans probably don’t want to do that. It's good for the organization as a whole, and it's good for people, too.
Lance: When you talk about humility and vulnerability and trust, those are things that truly drive discretional energy, and that drives performance.
Andrew: I have to say, Lance, eight out of 10, not three out of three, is one of the favorite phrases that we heard from working with you. I've even started to use that internally at Chapman & Co.
Lance: Whenever we talk about our secret sauce, that's one that I really feel strongly about. People understand their relevance when they do that and how important they are to the organization and to the future organization.
Andrew: Maybe we could talk a little bit about what the document was and what the importance of its parts and pieces were. I know the document was made up of Ergon’s founding story. You shared with us three core beliefs that really came from Mr. Lampton and have continued in the organization as leaders have joined and reinforce your company values, guiding principles and some non-negotiables. Can you tell us why those different parts and pieces were important to include in this document?
Lance: They all gave an opportunity to better define who the company is and what we believe and how we how we treat people. This is a document. This is something that we incorporate in our onboarding processes and all these different things.
In clear black and white, we say that this company believes that it can be a vehicle for making a positive impact on society. In black and white. It talks about the balance of culture and how we do things to profitability. Neither are to the detriment of the other. We're not going to sacrifice one or the other in our pursuit of profitability.
This is who we are. It's about people. It's about running a great business that supports customers. So, each of those different things gave you an opportunity to tell a little bit different story than what you would say when describing a core value. The core values are great, and they have a phenomenal message. But by themselves, it felt like that there was a gap and that there was a bigger story to be told.
Andrew: I think it allowed you to put that down in black and white and in non-uncertain terms of this is our culture. This is what we believe. This is how we show up as an organization.
Lance: The key word around our culture and that we talked a lot about is it brings accountability. As we are going around and talking about the yellow bike philosophy, you can't very well talk about it and read it without living it. That's hypocritical. There's a lot of accountability that comes from standing in front of a group and talking about how we do business and our expectations of them.
If we as leaders and family members and board of directors get aligned with the expectations of the culture, I think it's going to be a phenomenal step forward in taking this great culture that was spread in the hallways in one-on-one conversations to be scaled around the world.
Andrew: One of the neat things about observing this process of that extended leadership team coming together and working through these conversations and really documenting your culture, putting pen to paper, was seeing how the team came together and the conversations that happened. What was that experience like for you as an individual, but also for the broader leadership team at Ergon?
Lance: Every alignment process has its challenges. In so many of the conversations, especially at a leadership level, it didn't matter if they were here for five years or 15 years or 25 years, I wouldn’t say that there was this vast difference in how we saw the culture and how we how we believed in the culture. But whenever you put it in black and white, you kind of hang onto every word and every sentence. Getting aligned around very specific traits of our culture, it was really eye opening to see that. It's very natural, depending on what part of the business you're in, to view the culture a little bit differently.
A frontline person viewed it differently than someone in the corporate office. Those are natural based on their interactions and their work environment. To get everyone to get on the same page and understand those specific aspects of the yellow bike philosophy, that was a really, really cool experience. It was eye opening, to be quite honest, that other people had different experiences with Mr. Lampton, but the culture was the same.
We just talked about it in different ways. It's powerful to put things in writing and then also know that this is going to be the foundation that we use going forward to continue to build our culture. It's really important to people, so there was a lot of really good around that. We all got aligned and feel great about it. I don't want anyone to think that it was a difficult task to do that, but it was very it was very interesting.
Andrew: You mentioned the future, Lance, and I know you've spoken to how you think about integrating it into different people systems and how you operate and run the business. What does the future look like in terms of taking this document, living it out and being very intentional with it?
Lance: We do have a lot that we want to accomplish, and we're breaking it into waves. If you're going to have a strong culture, and we're going to all be on the same sheet of music, that starts with the leadership. Our focus is to is to develop leadership training that has the yellow bike philosophy woven in that.
It's going deeper into the core values. What are the do's and don'ts of the core values? What do we mean by guiding principles? There are non-negotiables in our culture document. Getting aligned and understanding those really well at the leadership level, and then whenever leaders can support that in the way that we intend, everything else is going to flow really well.
I talked about the distance between the corporate office and the front line of our facilities and in our sales organizations. I can say something. I can do a video and get it to the masses, but I promise that has a very small amount of staying power. People get it, but it's their interactions with their supervisors and their frontline managers and the managers of those supervisors that you have to have to sustain it such that everyone is really living out that culture.
Getting aligned with the leadership and training them to be facilitators of conversations around the culture so that there's no distance between the message you're going to hear in the corporate office and the message you're going to hear in one of the refineries or an asphalt terminal, that's what's critical. That'll be the responsibility of the leadership going forward.
Andrew: I think it's so fitting, Lance, that as you describe Ergon’s culture and the people centricity, the people focus of it, that certainly came through in the document as well. That was a core part of that. But even as you talk about how to take that forward into the future, you're describing doing that through people still.
I think that's just such a beautiful throughline of your leadership story, Ergon’s culture and then how you're thinking about the future of the organization and how you're taking this document out to the organization.
Lance: It's leadership. If you were going to talk about the future, a lot of it is in training leaders, but it's also creating an environment. When someone first enters into the organization, we talk a lot about the yellow bike philosophy. We use that tool to get them started in a good way and understand the expectations. I think that's a very important part of this because their experience coming into an organization right out of the gate, that first impression is very important. Doing that well, with good onboarding practices, I think that that's another key element of getting it started in the right way.