Penny Has Good Thoughts

June 17, 2002
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GRAND RAPIDS — Matthew Penny’s career as founder and president of Arrow Building Maintenance actually was well underway before he got what he believes was his biggest career break.

The break came during a professional association seminar in which a consultant from the University of Michigan urged employers to do themselves a favor by giving more responsibility to their workers.

Generally, the response seemed to be, “Oh, boy, that’s a lot of the old rah-rah.”

But Penny was intrigued. In fact, he stayed after the session to meet the consultant who actually turned out not to be from U-M, but who was a consultant who helped U-M upgrade the work and morale of its maintenance crews.

“See, the problem you’ve got in this business,” Penny said, “is not that you’re washing windows and vacuuming carpet. You’re trying to help the owner extend a million-dollar investment — to keep it looking as good and as serviceable as it was when the first tenants moved in.”

But it’s hard to get across that kind of message to custodial workers whose morale usually has been at ground level and whose turnover rates are sky-high. And high turnover rates in turn mean a constant hassle for management, which should be out beating the bushes for new clients.

According to Penny, a condensation of the consultant’s message to U-M was to stop treating its washers of windows and sweepers of floors as if they were mere mindless automatons. “He said to give them respect, empower them, and they develop some confidence and a sense of participation.

“Well, we brought the consultant up here again, and again and he showed us how to do it; how to push authority down,” Penny said. “And I never would have believed it, but it worked.”

The thrust of the recommendations, Penny said, was for him to create teams within his workforce and to empower them in a three-stage process. They would start making decisions on the spot; they would be empowered to approve or reject proposed new hires. And, over time, the company’s hierarchy would become fuzzy.

“I’m the president and what I say goes,” he explained. “But if you get out of that mindset, then you become a co-worker.

“You’ve got to understand these folks don’t have much education — maybe some high school. They’re usually treated impolitely. But if you empower them, and treat them with respect, they start feeling like they’ve got a stake in things.”

They also tend not only to stay on the job, he said, but also to do the improved job that comes with experience.

In what he terms “the old days,” Penny said, he might have had a payroll of 250 part-timers with a constant bother about finding new people to replace workers who would just stop showing up for work.

Now, he said, “I have a 125-member staff, the majority of them full time, and virtually no turnover. And I’m trying to spike up their wages.” And when it comes to new hires, teams of existing employees not only become a source of leads, he said, but also accept or reject prospective candidates based on how it appears they will fit with co-workers-to-be.

Arrow, he said, probably maintains 5 million to 7 million square feet of office space in Grand Rapids, Holland, Grand Haven, Muskegon and some outlying areas.

“Except the way we count it,” he said, “is that we’ve been cleaning X-number of buildings a day for 261 days a year over 20 years. It works out to about 652,000 building-days since the firm was established.”

But that’s only Arrow’s maintenance division.

Penny also has created a new Arrow division that focuses on restoration of structures damaged by fire, flooding or other mishaps.

It’s in this area, which requires exacting and specialized training and entails varying degrees of danger, that high retention and improved morale have paid off.

With a workforce that knows how to use protective gear, how to isolate toxic molds, how to eradicate the stench of fire and to extract water-damaged materials, Arrow has a built-in appeal to property and casualty claims types.

“But believe me,” Penny said, “if an insurance company pays for restoration of a building and then discovers a year later that they’re getting water damage from materials that a restoration crew missed, they’re really unhappy.

“They’ll never use you again.”

Penny says getting into restoration and maintenance was something that intrigued him, starting in the ’70s when he worked with a firm that had a contract to clean airliners.

“It just interested me,” he said. “I always knew I was going to own a business. I guess I figured that out in high school when I bought and sold maybe 50 cars. There never was much question that I was going to be in business for myself.”

He founded Arrow in 1981. At first, he was pretty much the entire firm — cleaning at night and working a day job. At any given time, he still is out on the job in restoration projects.

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