Gallup is known not only for her determination but also her ability to nurture her employees and provide consistent, top-notch customer service. The success of PC Connection can be explained largely by its ability to produce continuous inn ova-lions and its commitment to putting the customers first. When employees are encouraged to enter into partnerships and learn with others inside and outside the organization, innovative ideas multiply. PC Connection has such partnerships with customers, suppliers, and the community; Gallup has motivated employees help to fulfill those partnerships.
David Hall, the former CEO of the computer mail-order firm PC Connection, vividly recalls the event that convinced him Patricia Gallup would be a great business partner. Back in 1979, for an anthropology course during her senior year at the University of Connecticut, Gallup had to create an authentic tepee from scratch. This involved debarking over a dozen tree trunks, something that took Gallup an entire week. "She chose to remove all that bark manually, using an old-fashioned drawshave," recalls Hall, who first met Gallup on a hiking trip when she was 21 and he was 26. "By the end of it, her fingers were bloody and blistered."
Patricia Gallup, now the 44-year-old chief executive of the $500-million-a-year business she and Hall founded in 1982, is clearly tenacious. But this is only one of the qualities that make her a great leader. When Working Woman set out several months ago to explore the issue of business leadership for the 21st century, we spoke to over a dozen experts, including management consultants, executives, and authors. We asked who they thought best exemplified first-class leadership in corporate America. Many often pointed to Gallup, citing not only her determination but also her ability to nurture her employees and provide consistent, top-notch customer service.
In fact, they say, Gallup represents a whole new breed of corporate leader. CEOs can no longer tap their company's full potential using a command/control style. With words like integration, consensus, collaboration, and teamwork being tossed around, the model for great leadership is undergoing a sea change. The next generation of leaders will be those who can build a vision based on awareness of economic change, then help their partners and staff fulfill that vision. Patricia Gallup has done just that. As Patricia Aburdene, co-author of Megatrends for Women, puts it, "Gallup is not a throwback to the industrial era. Leaders who spark people today don't just tell others what to do. The struggle is more about how to invest in a well-educated work force, then develop effective ways to mine their brain power. The key to this is catalyzing your resources.
Since Gallup is a new-style leader, her success hasn't come in a conventional way. For one thing, she doesn't fit the profile of a typical high-tech entrepreneur. Her headquarters isn't in Silicon Valley but in the unlikely locale of Milford, New Hampshire, where horses and deer graze nearby. She didn't go to Stanford University, the alma mater of many tech moguls, and, of course, she doesn't have an engineering degree. In fact, she credits her background in anthropology with helping her put her business on the map. "My knowledge of primitive cultures taught me a lot about how people use tools and what effect they have on their development," says Gallup. "Although the tools may be different today, the principles are similar. In the computer industry, you always need to think about what technology the customer will need in the future."
In 1982, Gallup was thinking about how personal computers, which had just hit the market, would shape consumers' lives. Twenty-eight years old and working with David Hall as a project manager in his family's electronics business, Gallup was fascinated by the PC revolution and decided to invest some of her savings in a personal computer. That's when she discovered that the nearest computer merchant was almost three hours away. If she could have this problem in southern New Hampshire, she wondered how far other consumers might have to go to get a machine. Then there was the matter of the computer sales staff in electronics stores. Most were techies who spoke a language the average consumer didn't understand.
Though she had no experience in high tech, Gallup saw a business opportunity. Why not sell computers and peripherals through mail-order? At a time when retail stores had only just begun to stock PCs, this was a radical notion. Would people really buy one of these expensive gadgets sight unseen? Gallup thought so, especially if she could offer consumers better sales support and more information than they were getting in retail stores.
Gallup approached Hall, who had an electrical engineering background. She convinced him that she could rustle up business if he could handle the technical side of things-like picking which computers the company would sell and training a sales staff to troubleshoot on the phone. Hall agreed, and the pair set to work. Within a year, they were busy enough to quit their day jobs.
"I learned a long time ago not to listen when someone says I can't," explains Gallup, a tall, thin blonde with serene blue eyes, now perched behind the long, wooden desk in her corner office at company headquarters. "I knew from the start I'd be successful."
Gallup and Hall put up $8,000 and advertised PC Connection in computer and general business magazines. With a handful of staff on phone support and a wholesale stock of several thousand dollars' worth of products for IBM PCs that Gallup had uncovered by poring over computer magazines, a company was born. In 1987, Inc. magazine declared PC Connection to be the second-fastest growing company in the U.S. In 1990, after the business had taken off, Hall scaled back his daily responsibilities and now contributes to PC Connection primarily as a board member. Gallup moved from the presidency into the CEO's job, taking over many of the tasks that were formerly her partner's.
"One of the biggest trends in leadership today is direct communication, because it mirrors the very technology we use to work. The Web is an apt title, Leaders in the next century will lead from the center, gleaning the best Ideas from those around them, not from the top."
THE FEMALE ADVANTAGE: WOMEN'S WAYS OF LEADERSHIP
When it comes to leadership, Patricia Gallup has always been ahead of the curve. For starters, PC Connection is devoid of the bureaucracy that typically comes with growth. Gallup's open and accessible style has a lot to do with that. Even with 824 employees on board, she communicates directly with most of them, either in person or via e-mail, which she starts sending at 5:30 in the morning. As she walks through the hallways of the office, she greets most employees by name.
The ease of communication within PC Connection is one of the company's major advantages. The customer service and sales departments meet each week with product managers to discuss specific problems customers may have had with computers and software. The sales staff also checks in with corporate clients on a daily basis, then updates service and product managers. This information flows to Gallup, who then holds weekly meetings with human resources, corporate communications, legal, and operations. After those meetings, Gallup and Hall discuss tech trends, ways to enhance internal efficiency, and business strategies. Every week, Gallup e-mails all department heads, outlining the company's progress. Anyone who wants to address a problem can simply walk over to her office, which is in a central pod rather than an executive suite. Gallup's door is always open, and Oriental rugs and leather chairs are noticeably absent. Instead, there is a nondescript dark green carpet and a wooden desk, where she keeps her Macintosh Duo Dock and IBM ThinkPad notebook. A space heater rumbles in the corner of the room, and the only decoration is a vase of fake flowers. "I just haven't had much time to fix up my office," she says with a laugh.
No wonder all that communication and accessibility take up most of her day. One thing that hasn't changed about corporate leadership is that it's hard work. Gallup Is trying to scale down to a 60-hour week, so she can spend time with her husband, Randall Minard, an optometrist; the two enjoy hiking, cross-country skiing, and Irish folk dancing in their limited free time. Many people believe that scaling back will be good not only for Gallup, but for PC Connection as well. Jennifer Starr, a visiting research scholar at Wellesley and the author of Women Entrepreneurs. A Review of Current Research, notes that Gallup runs PC Connection like a family business. "She's a micro-manager. She could have grown the company faster, but up until now she wanted to stay private and keep her 50 percent ownership."
That safe strategy may have protected the company from outsiders in its infancy, but it also allowed competitors like Michael Krasny, who runs CDW, a rival computer reseller, to move into PC Connection's territory. "Ten years ago, we were the little guy next to PC Connection," says Krasny. "But since then, we've grown faster than them and our repeat business is higher than theirs-over 70 percent."
Gallup would argue that the advantage of having tight control over her business is that she can move PC Connection in a radical direction at a moment's notice, and be reasonably sure her employees will follow. In the mercurial world of high tech, this Is a big plus. For example, in 1992, Gallup decided to move PC Connection's distribution center from a New Hampshire mill town to the cornfields of Wilmington, Ohio. Gallup's tech department had come up with a way to configure custom-made products overnight, and she wanted to be able to take advantage of the new technology with overnight shipping. The company's shipper, Airborne Express, was located in Wilmington, but many of PC Connection's distribution managers had never left New Hampshire. Still, all 12 were willing to relocate to Ohio. "I moved myself, my wife, four kids, one cow, three horses, and six dogs and cats," says Don Kincaid, the head of distribution. "It was like Noah's ark driving across the New York State Thruway." Kincaid says he was willing to move because Gallup told him about the plan immediately and involved him in making decisions about the transition. There were no surprises. He adds, "I wouldn't have done it if I wasn't excited about how vibrant and alive the company was, and still is."
That employees are willing to jump through such hoops is good news for Gallup. as she plans to move company headquarters this summer for the third time in as many years to Merrimack, New Hampshire, less than 10 miles away from the current headquarters. Gallup hopes the move will allow her to tap into talent from nearby Nashua, where there is a large concentration of workers with technical skills. In addition, the city was recently ranked by Money magazine as the best city in the United States to live in and do business.
How do you keep good people while keeping an eye on the bottom line? That's the major business challenge today. Leaders have to recognize that the perks have changed. In the 1980s, you gave people hefty expense accounts to wine and dine clients. Now, you give them a learning budget for specialized training....and the flexibility to get the job done. Punching the clock is passe. Business leaders have to learn that a staff is paid to think, not just to do."
GOING PUBLIC*
The lPO will also offer Gallup another competitive edge: stock options. Most skilled employees at high tech companies expect options as part of their compensation package, and Gallup says that providing equity to attract and retain good people was her main reason for going public. She wants to turn workers into shareholders, and perhaps even create some options millionaires, as companies like Microsoft and Netscape have done. "It's the perfect link between performance of employees and rewards," says Matt Ward, whose San Francisco consulting firm, WestWard Pay Strategies, designs stock plans for technology companies. "And it's become the currency of choice in the field." Those options, and the extra cash generated by the IPO, may be just the thing that PC Connection needs to raise its profile and take its place beside those well-known, fast-growing Silicon Valley tech firms.