CEO Brings New Life to Historic Cemetery

Systems as ground level assures continued growth into the next century.

By Larry Heiman, Certified E-Myth Mastery Coach

	Client: Ken Varner
	Business: Cypress Lawn Cemetery Association
	Home Office: San Francisco, CA
	Personnel: 178
	Began Mastery: 3/2003
	Revenue/Profit in 2003: $12.4 Million
	Revenue/Profit Today: $22.3 Million
	E-Myth Mastery Coach: Tom Bardeen

Q: HOW DID YOU COME TO BE THE PRESIDENT AND CEO OF THIS REMARKABLE CEMETERY?

A: Our Board of Directors recruited me nine years ago.

Q: WHAT WAS THE BOARD'S INTEREST IN HIRING YOU?

A: When I came to Cypress Lawn, it was a non-profit public benefit corporation that was losing close to one million dollars per year from operations, and the number of families being served each year was also in decline. It was a one hundred year old historic arboretum and cemetery which at the time had approximately eleven years of burial space left at the then current rate of usage. They needed my know-how in the industry to help them turn around the operating results of the company.

Q: HOW DOES A CEMETERY LOSE MONEY?

A: We have a couple hundred acres, roads, landscape needs and also several structures that need continual maintenance. Our annual operating expense budget is about $6 million and our capital repair costs are also a significant obligation. These fixed costs are incurred each year. Making operations pay for itself and generating excess funds from operations for capital needs purchasing and developing more property was the ultimate goal for the Association.

Q: WHEN YOU CAME ON 9 YEARS AGO, THIS PROPERTY WAS TRULY AT A CROSSROADS. WHAT WAS YOUR IMPRESSION?

A: Yes, it was a company in desperate need of attention. The Board was really facing two options: We could have gone into what industry terms "maintenance mode" -- which is basically pulling in our horns, do what we could to reduce expenses, or we could expand the cemetery and revitalize it for the next hundred years. The Board of Directors made the wise decision to revitalize the cemetery under my operational leadership and that decision has proven to be the right one.

Q: WHAT WAS THE FIRST THING YOU DID?

A: Market research analysis. We needed to look into the community or market place -- just as the E-Myth Mastery Marketing processes suggest -- and ask: "Who are our customers? What do they want? And are we providing that?" Because, if we were going to make a go at it, the land that we were purchasing for the continuance of the cemetery had to be properly positioned with respect to the needs of the families that make up our community.

Q: WHAT DID YOU DISCOVER IN THAT MARKET ANALYSIS?

A: In our community there are four major demographics -- Asian, Philippine, Hispanic, and Anglo. Each has different needs, desires, and customs. The E-Myth Mastery program teaches you to look also at the psychographics of our target markets. My task was to make sure that we had the right burial property for each of those distinct communities. If we were going to be able to serve these various distinct communities, we needed to acquire more land. So about eighteen months ago, we completed the development of a new $30 million dollar addition that was seven years in the making -- that was the biggest addition in the company's history. If we're going to increase our burial property, we have to have somebody to market the property. I hired more salespeople, increasing the number from 5 to 117. I installed a sales system. I installed a marketing structure -- hiring sales and marketing managers, unit managers, and so on -- and getting trainings in place, compensation programs -- everything essential to a successful cemetery marketing program.

Q: ARE THERE ANY PARTICULAR CHALLENGES IN SELLING CEMETERY PROPERTY?

A: The sales process is universal whether you're selling cemetery property or any other valuable commodity. You prospect, you set appointments, and you make a presentation, answer objections, and prepare an agreement to purchase. We are like an estate planner preparing your final estate, and like an insurance company in that we sell a concept. Our marketing team does not sell cemetery property for what it is but for what it does. The benefit of what it does is providing peace of mind and creating a way to protect your family against the inevitable expense. That's a concept sale. It is the definition of a product sale as E-Myth describes it, where the customer has a problem and we have the solution. I understood all this before I began the Mastery program, but the Mastery program has put it all down in black and white. Mastery puts everything in perspective and helps you create a clear roadmap of what you need to do. It said to me -- "What you did was right... and you need to do this, too." So I'm using the Mastery program material as a way to integrate that universal understanding into my marketing and administrative departments. The Mastery program's seven areas of management focus -- Leadership, Marketing, Finance, Operations, Client Fulfillment, Lead Generation and Lead Conversion -- are all you need to know to focus on for your business. It doesn't matter what business you're in; these are the seven essential areas that make up any business.

Q: HOW HAVE YOU DONE?

A: We've gone from $4 million in revenue in 1996 to being on track to do $27 million this year. That's is a substantial increase for a cemetery. We have turned this little place into one of the best operating properties for its size in the United States.

Q: KEN, WITH ALL OF YOUR PREVIOUS EXPERIENCE AND THIS SUCCESSFUL TURNAROUND, WHY DID YOU THEN BECOME A MASTERY CLIENT?

A: What happens in any business -- and Mastery addresses this so well -- is that when your marketing program is very successful, your administration and operations have to keep pace. I had this small company that experienced massive and rapid change. I needed to make sure the company was positioned to handle that change or growth. That's one of the key reasons I entered the program. What I knew from experience in this industry is that people do not necessarily have well thought out systems and don't know how to control growth or keep pace with the changes. Without the proper systems in place they react poorly to problems. They do not solve the problem they eliminate the problem which some times means the sales person or sales program altogether. A system-based business model became very important to me to be able to handle growth and change. E-Myth Mastery filled that need. Another example, a lot of the funeral homes and cemeteries in this country are local, third and fourth generation family businesses. They are very tuned in to service-- but they don't understand accounting, they don't understand marketing, they don't understand sales -- all they understand is operations, delivering the service. They are the definition of E-Myth; they are technicians that understand the work of the business but do not necessarily understand how to run a company. Cypress Lawn was a lot like that it in that it focused on quality service but had marketing and the administrative systems to deal with the operating losses. Once the marketing system was developed, it was essential to focus on all areas of the business and establish the support systems to integrate the growth from the marketing systems. E-Myth Mastery was the road map to helping keep pace with the growth in all areas of the company. My old company hired experts with all those missing systems to try to perfect those properties we acquired. But, again, that's what's great about Mastery: It's all there.

Q: WHAT DO YOU DO TO MAKE IT POSSIBLE FOR THEM TO SUCCEED LIKE THAT?

A: All we can do is give people an opportunity. We explain the opportunity and train them in our systems. The guidelines under which they operate are very clearly defined and documented. We do a lot of role-playing. We train on presentations, how to handle objections, how to prospect, etc. We set them up with mentors -- so that they see what it looks like to be successful -- and then we find out who's going to work and who isn't. We do that every day. E-Myth Mastery supports this formula and has shown me how to capture the results.

Q: CAN YOU GIVE ME AN EXAMPLE OF A SPECIFIC EMYTH MASTERY PROCESS THAT STANDS OUT IN YOUR OPERATION?

A: The Employee Development Meetings, which are all about keeping employees productive. I've had situations that I would characterize as an employee problem. We meet regularly with the employee and ask the important questions: "What are your frustrations?" "What are your recommendations?" "Is there anything we need to clarify with respect to your position and accountabilities?" And it's not me the manager telling you what I want you to do, but it's me listening and allowing you to develop a relationship with the company through which you can be your best. I'll tell you something I really like about these meetings -- we've instituted a process of "Communications Memos." I don't take any notes in those meetings. I can really listen. Then, I will remind the employee that I have no obligation to remember anything that's been said unless he puts it in writing and sends it to me! He or she has to send this to me in a very simple communication memo that E-Myth helped me to develop. We've changed the expectations and leave nothing to chance. We have Personal Development Meeting Agendas and Actions Plans. I tell my managers that their job is to train people in our systems. If they have a problem, they need to put it in writing in a Communications Memo and deliver it to their manager. And remember that a key part of the communications process is that they also have to come up with a proposed solution.

Q: DOES THIS FREE YOU FROM BEING THE PRIMARY PROBLEM SOLVER?

A: If you let everybody else control your time -- then you're working for everybody else. These leadership systems, communications systems, meeting systems, and problem-solving systems that E-Myth Mastery teaches are essential to your productivity. Another E-Myth Mastery concept that I've brought to Cypress Lawn is that there are no people problems; there are system problems. I absolutely agree with my E-Myth Mastery coach, who says that 90% of my time as the president of this company should be spent on strategic work. E-Myth has taught me this, and now it's my task to clearly communicate that to my staff so that we can handle the growth. I've just hired a Chief Financial Officer. I'm spending time orientating him to our systems -- the way we do it here -- and how I expect he'll be spending his time. I'll be sending him up to the 2-Day E-Myth Leadership Intensive so that he is more familiar with the program.

Q: DOES YOUR BOARD OF DIRECTORS UNDERSTAND WHAT YOU'RE DOING?

A: Well, I'm trying to teach them too! I know that I have to instill the E-Myth Mastery philosophy in all areas of the company, including my directors. The two key things for me are how do we address our growth and how do I assure the continuation of our success? I know how to grow a company. I know the "secrets" to our success. But if I disappear, where's the company? That's why the systems have to be documented. That's why E-Myth Mastery has to be engrained into the staff -- for the continuation of our success and the successful management of the company. E-Myth has become my key to realizing both the leadership and management of our strategic objectives.

Q: ONE LAST QUESTION: HAS E-MYTH HELPED YOU MAKE THIS CEMETERY BUSINESS A VEHICLE FOR YOUR LIFE?

A: Well, the principals of E-Myth apply as well at home as they do in business. I'm a guy who works hard and long hours. The E-Myth Primary Aim process really put it in perspective for me. This is not about going to work everyday. Work is a part of your life -- but it's not your whole life. E-Myth Mastery has put my personal life and my business life into perspective.

Q: KEN, I HAVE TO TELL YOU THAT WHEN I FIRST CALLED YOUR OFFICE FOR THIS INTERVIEW, I SPOKE TO YOUR ASSISTANT, LENI. I INTRODUCED MYSELF, AND SHE SAID: "HE'S NOT HERE. HE'S DOING SUCH A GREAT JOB THAT HE'S GIVEN HIMSELF THREE DAYS OFF."

A: Did she really say that? Listen, the E-Myth Mastery program relieves stress. It really does. It allows you to know what you're doing. It allows you to build your people. It allows you to have more fun, because you're focused on the future of your business, but more importantly, of your life.