Henry Bertolon, cofounder and CEO of NECX, the world's leading independent distributor of semiconductors and other computer products, knew he had a problem. His company, based in Peabody, Massachusetts, was experiencing the perils of success. It was growing fast; its workforce had vaulted from 100 to 250 in just a few years. But it was coming apart at the seams. "We'd have meetings that just melted down," Bertolon, 45, recalls. "Everyone would scream at each other and then leave."
That was two years ago. Bertolon's first instinct was to hire a management consultant. But the more consultants he talked to, the less he liked what they had to say: "They all wanted to tell us what our problems were. I didn't feel that we were being listened to." Enter Wil Calmas, a Boston psychologist with an MBA. Calmas had been coaching Larry Marshall, 43, NECX's chief operating officer, for several years. What if, Bertolon wondered, Calmas shifted from individual coaching to organizational analysis?
The psychologist's response: a one-day-a-week program that feels a lot like group therapy, minus the dream analysis and the primal screaming. NECX has an appointment with its shrink every Friday. At 8 AM Calmas and 10 of the company's top executives hold a 90-minute meeting. There's no formal agenda. Fear, hostility, frustration, secret wishes, acting out, owning up — they're all fair game.
"We focus on talking," Calmas says. "Most of us have come from homes where we're taught, Don't say anything if you can't say anything nice. We bring that attitude into the corporate world. But if you don't talk, you can't resolve anything."
These weekly meetings didn't get off to a fast start, says Marshall: "Some people would show up late, schedule other meetings, travel on Fridays." Two top managers left the company rather than participate in the program. Why the resistance? "People were afraid that if they said something we didn't like, we'd fire them," Marshall says. Once he and Bertolon emphasized that no one would be punished for being honest, the floodgates opened.
There was no holding back at one Friday session this past fall. The talk focused on a rebellion among NECX's Web developers. The company is enthusiastic about electronic commerce; the Net accounts for more than $40 million of its nearly $400 million in annual sales. But the company's MIS manager was fed up with all the time her Web developers spent playing games and surfing for fun. So she had cracked down — and the developers had rebelled. At the Friday meeting, she expressed her fear that if she didn't reinstate unfettered Web access, the developers would leave for other jobs.
The reactions were quick — and varied. Members of the group acknowledged their own desire to spank a few self-indulgent employees. Marshall promised that neither he nor Bertolon would hold the MIS manager responsible if a few developers jumped ship over a company policy that made sense. But did it make sense? When she expressed distaste for "babysitting" the Web team, another manager suggested, "Maybe they feel like babies." The group settled on a plan to give the Web developers more freedom — unless and until they abused it.
This early-morning meeting is just the first of a day-long series of encounters among NECX employees of all ranks. On this particular Friday, Calmas led meetings with several different departments. One exception: the sales department, which now meets on its own — so adept have its members become at using Calmas's techniques. Cofounders Bertolon and Jeff Filmore, 47, don't participate in these meetings. But they do often huddle with Marshall for their own agenda-free talkfest.
"It keeps everyone's temperature at 98.6," Bertolon says. "The three of us work on our relationship — and confront one another when we need to."
Bertolon says the sessions are having a measurable impact on NECX's people. Back in 1995, when Calmas began his work, he asked top managers to rate their performance: On a 1-to-10 scale, how much did they agree with statements like "All the managers help each other" and "My staff finds it easy to talk with me about everything"? The average score on the first test was 1.5. The most recent test yielded a score of 7.5.
And those results have driven more important numbers — such as revenues, which have increased from $62 million in 1992 to almost $400 million in 1996. Bertolon also credits Calmas's techniques with helping to reduce employee turnover from 42% to 20%. "Companies rarely commit to improving their people's emotional health," Bertolon says. "We want to be a billion-dollar company. But along the way, we're going to look out for our people."
Well-adjusted people also cope better with change, Bertolon argues - and that's a critical skill in his fast-changing business. NECX is now confronting major strategic challenges. Margins are shrinking; transactions are moving to the Web; everyone is trying to add value rather than merely to cut costs. "We want to create the company that puts our company out of business," Bertolon says. And the Friday sessions, he has found, help keep his troops loose, flexible, and open to new ideas.
"The biggest resistance of all is resistance to change," adds Calmas. "People love the status quo; they're afraid of anything that threatens it. Talking about resistance is the only way to resolve it."
Scott Kirsner email@example.com writes on business and technology from Boston.
A version of this article appeared in the December 1997/January 1998 issue of Fast Company magazine.