Texas Consilium Breakfast – Board Room Discussion – October 27, 2020


Board Room Discussion

At our breakfast Tuesday, October 27, 2020 we hosted a panel discussion with a few selected leaders of our 2020-21 Texas Consilium Business Excellence Award nominees.  Building off our initial award nominee interviews, we explored further what these leaders have in common — inspiration, lessons learned and challenges.  Every business leader is sure to feel a connection with the issues we all encounter, while gaining insights from this sharing of journeys of excellence.

Enjoy our October 27th breakfast video with Moderator Craig Beck, and Award-Nominee Leaders and Panelists:

Clavis Capital Partners – Todd Dauphinais, Managing Partner

Kindred Healthcare – Brad Morgan, Division Vice President

Swypit – Kevin Hodes, Chairman of the Board, President & CEO

Texans Can Academies – Dr. James Ponce Ed.D, Superintendent

TRANSCRIPT FOLLOWS:

Jim Ratchford: Hey, as we get started I want to welcome all of you to the October 2020 Texas Consilium Monthly Breakfast. As we get started, I want to give a special call out to our naming sponsor for our 2020-21 event, Brint Ryan. Been a great supporter of us last year and this year. And a call out to our other sponsors, which is still a growing list. Special call out to Texans Can Academy. They not only are a Diamond Sponsor, but they’re one of our award nominees as well. E4D Technologies is a gold sponsor and also one of our nominees. E4D won’t be on our panel today, but Texans Can is represented, so we look forward to hearing more about them and what they do.

Just a few housekeeping items as we get started. This is a Zoom webinar, not a Zoom meeting. We have always been holding our breakfasts using Zoom meeting. This is a little bit different with webinar, so we’re all in a little bit of a learning process here, and that was part of my issue with getting things started. So I apologize again for that.

One of the differences between webinar and meeting is that only our panelists today are on video and audio. If you’re an attendee, you are muted and you will not be on video. But you can be interactive. We do have the chat function. Feel free to share your info and your thoughts on that. We’ll actually give you a few minutes in the program here to introduce yourselves on chat. We also have a Q&A button, and if you have questions you’d like to ask our panelists, use the Q&A to ask those. If you see someone post a question that’s of particular interest to you, you can “like” that and it will help move that question up to the top of the list.

I invite you to enjoy your breakfast and our time together, and this webinar will be recorded.

Our agenda for today: we’re going to have some welcome and introductions. It’ll be a little bit different than we normally do because you can’t speak to each other. At least, those of you who are remote can’t, but you’ll get to use chat. I’ll give you an overview of Texas Consilium and our Business Excellence Awards so that you all have some understanding for who we are and what we’re about. I know many of you attending today are new to Texas Consilium, so I want to give you some background, some framework for what it is that we’re doing.

There’s a brief audience poll of business issues. We’d like to get some insight from those of you attending remotely particularly, what business issues might you be encountering. Then we’ll move into our award nominee board room discussion, and then we’ll have some Q&A for our panelists, chance at the end for any other business or questions, and then make a note that we meet on the fourth Tuesday of each month except for December, and so our next meeting after this will be Tuesday, November 24th. As many of you know, we have moved our Business Excellence Awards event and Executive Summit from what was going to be yesterday, October 26th, out to May 3rd and 4th due to COVID.

Our breakfast today was not planned; we had cancelled it because of the expected awards event, but I appreciate everybody coming together and pulling things together here in the last two to three weeks so we could put the breakfast back on. It’s this basic format that we anticipate doing between now and our event in May, so it’ll give us a chance hopefully to get to know a little bit more about each of our award nominees over the next coming months.

At this point I would like to give you just five minutes or so – those of you who are remote, take a few minutes to introduce yourself using the chat function. And those of you who are there at the country club, you can just go around the room there however you’d like. Robert Gardner is our chairman and host there at the country club. Robert, if you want to lead that off, I’m going to step out here for just a few minutes and let you all get to know each other, and then I’ll come back in and we’ll carry on. See you in just a few minutes.

Perfect, all right. Let’s move through our agenda.

Just a little background on Texas Consilium, who we are – everything that we do derives from the message on our website: “What if your business could achieve its true potential?” Everything that we are about is focused on helping Texas companies do that, achieve their potential.

I’m not going to go through all the detail, but I’m going to step you through some key items on the website, but if you wanted to, you could explore in a little more depth. Under “About” on our website, there’s a section for frequently asked questions. If you wanted to select that, type in “what is” as a search item and it’ll bring up a whole list of possible questions, one of which is “What is Texas Consilium?” It’ll bring you to this, that describes us as the pursuit of excellence.

We’re about growing the Texas economy. We’re an economic development organization for the state of Texas, but unlike most economic development organizations who focus primarily on recruiting new businesses to the community, Texas Consilium instead works with existing Texas businesses to help them improve their performance, growth, and prosperity. And if we do that with enough Texas companies, we will also therefore improve the prosperity of the state of Texas. In short, we, Texas Consilium, work with Texas businesses to get them from where they are to where they want to be, could be, or should be, ultimately achieving their true potential.

That leads to ultimately the development of our Business Excellence Award. If the company is going to achieve its true potential, Step 1 in that process is to envision what could that potential be. We think a great way to help business leaders see that vision or expand, create their own vision, is to see what is possible. What is it that others are doing that they might emulate and learn from? If we can identify those businesses in Texas that we believe exemplify excellence and help tell their stories, then that gives other business leaders perhaps a chance to expand their view of the possible.

That’s the basic concept behind our Business Excellence Award. We inaugurated that award last year in May of 2019 with a special presentation to Gary Jones for his lifetime achievement as an entrepreneur and a business leader in Texas. Great event. In 2020 here, we’re taking that concept and instead of recognizing simply an individual entrepreneur, we really are focused on trying to find those Texas businesses that exemplify excellence, where we can tell the organizational story, the company story, and the leadership story that inspire and inform others.

We were honored last year to have great support from Governor Abbott. I’ll show a quick video here where he participated in our event last year recognizing Gary Jones and Texas Consilium. Just one minute here.

Governor Abbott: Hi, this is Governor Greg Abbott, and I want to say congratulations to my good friend Gary Jones on being the inaugural recipient of the Texas Consilium’s Lifetime Achievement Award for Business Excellence. Gary exemplifies what it means to be a leader in business as well as a leader in the community. Thank you for being an inspiration to aspiring entrepreneurs and business leaders everywhere. And also, I want to say thank you to the Texas Consilium for the support that you all provide to businesses across the entire state. Thanks in part to your hard work and dedication as well as collaboration, the Texas economy is stronger than it’s ever been. Working together to build a thriving business environment, we will continue to elevate the Texas economy to even greater heights.

Jim Ratchford: I couldn’t have said it better. We appreciate the support of Governor Abbott, and he’ll be involved in our 2020-21 event as well.

I want to share also those who attend the award event, they include our award nominee CEOs and guests. We’ve got 25 fantastic award nominees this year. You’ll get a brief introduction to four of them on our panel today. We’ve got 21 more that we’ll work our way through. In addition to them, our event includes 360 Peer Group members and leaders, our sponsors and their guests, our speakers, VIPs and luminaries, other business leaders and supporters of Texas business, and the media. Those are all of the folks that will be part of our stakeholders in our event and most of what we do.

We have a saying, and we’ve said this from the beginning: the event is not just about the event. It’s about the relationships we create and enhance because of the event that really matter. We really are looking to have relationships with each of you. How can we help you? How can you help others? How can we help each other? That’s really what it’s about. We were going to have the event yesterday and then build on that in developing relationship. We kind of flipped that model upside down. We’re taking advantage of that with events like today to establish some relationships, and then when we do all get together in person for the event out in May, we’ll be that much further along and it’ll be a great celebration of how we have hopefully come to get to know each other. We’ll be looking forward to that time to celebrate together.

Part of that relationship building involves the app that we have developed for our events. Cvent is probably the world’s largest event technology company, and they are one of our partners for this. They want to showcase their capabilities. We have an app. It’s available on your iPhone or your Android or also on your laptop, and it’s an opportunity where you can go in and anyone who’s registered for the Executive Summit can see who else is registered. I’ll step you through a little bit of this, but you can download it. The app is free.

You can select any of our award nominees and it will bring up links to their video interview, their website, and other information about each of our nominees. Same thing with any of our sponsors. Information about each of our sponsors is there on the website with links. And same thing for all of our speakers and luminaries and special VIPs that we’ll have there. And then you can track your schedule if you’ve registered for various workshops, dinners, receptions, and so on. You can build out your schedule, and you can also use that to schedule appointments with others who are attending and any other special schedule items that you want to set.

Through the app, you can also send messages to fellow attendees. You can schedule appointments and so on. Lots of ways to use the app and stay connected. You can click on “More” at the bottom of the app, navigate through the app, find event information, keep track of everything that’s going on and everyone involved. You can also build your attendee contacts. If you encounter someone who’s attending and you want to connect with them beyond the app, you can share contact information through the app. I would encourage each of you to download that app, get it on your phone or your laptop, and we can begin using that between now all the way up to the event and beyond.

Just a quick run-through of what we’ll be looking at come May. We will be flipping the schedule just a little bit. We’re starting on Monday evening, May 3rd, with our Reception and Awards Dinner event. We’ve got Senator John Cornyn, we’ve got Norm Miller, Chairman of Interstate Batteries, and we’ve got a number of other VIPs and folks that you might want to meet who will be at the reception and at the dinner. Then we’ve got the Awards Dinner itself where we’ll recognize those award recipients.

Our Executive Summit will start the next morning on Tuesday. We’ll have a whole variety of workshops geared towards CEOs and business leaders, invite all of our award nominees to participate in this. Couple of folks from each company will be our guests, and we hope you can join us.

We’ll move into some information, workshop about our 360 Pursuit of Excellence program. I’ll talk just a hair more about that in just a bit. On our website, there is a special tab for the 360 Peer Groups. For those of you who might be in a peer group or have experience with them, one thing we have found is that there’s a shortcoming with all of them. Not to take anything away from the value that they bring, but we have found that some of our largest projects helping companies improve their performance involve dealing with issues that the business owners and leaders didn’t know that they had. In a couple of cases, these business leaders had been members of CEO peer groups for a long time.

What we finally determined through a pattern that we saw was that there’s a problem with every peer group in that the members, when they come to their peer group meetings, can only share what they know about their business. They can’t share what they don’t know, and it’s those unknown issues that are the most critical to resolve. We had a client who had fraud and embezzlement going on and had no idea. They were underperforming but didn’t know why. The peer group couldn’t help them because the owner didn’t know to share. Likewise, we had another client with some weak internal controls and were losing money through unbilled services and weaknesses in their labor costs and inventory controls. Again, the business leader simply didn’t know what was going on.

We combine really the best of all words with Texas Consilium’s in-depth diagnostic and problem resolution process, along with the peer group concept. It’s pretty powerful. I’d be happy to get into more of this in detail with all of you. I think that those of you who are leaders of excellent businesses would be great mentors to help other Texas business leaders and even potentially help each other. So we look forward to having some discussions about more of that. That’s all on our website. I’m skipping through a lot of that.

We do have, for the 360 participants, a dashboard of the improvement process and tracking impact of improvements of businesses and members of a group as to how they’re doing overall. That’s in development, but we’re excited to see where that goes. We think it’ll be a tremendously useful tool.

Part of our Executive Summit includes a session on teambuilding. It involves NASCAR and a pit crew exercise, which will be hands-on. It’s going to be a lot of fun, and I think there are some great lessons that will come from that. It’s something very memorable that we’ll have during our luncheon program. We’ll get into some workshops in the afternoon on some really high level types of issues that are foundational and critical for businesses. I think many business leaders will find great value in these. I won’t get into the details of them here, but take a look on the website, and I think you’ll find there’s some pretty exciting options. We’re adding more currently. We’re taking this added time to make it even better. We’re wrapping up with Drew Pearson in the afternoon sessions.

Also on our website, we’ve got our Award Nominees Gallery for 2020. Again, we’ve got 25 award nominees, four here today. Information on our website about each of them. There’s a 30 second video for all 25 of them. We’ll share four of those with you today, and then on our website you’ll find links to the company’s website and our full interviews with each business leader.

We’re also putting together a Texcellence book. This is something we’re pretty excited about. We’re memorializing our award nominees this year in print. This is in production now. We’ve gathered much of the content from each of you – appreciate that. It’s in design layout now, getting ready for print. We’ll have a digital version fairly soon, within a few weeks, we believe. You can see some of the content. Each of our award nominees will be represented here with a selected quote or two. The idea is that this will essentially be a yearbook of our 2020-21 award nominees and our whole Year of Excellence, and then this will become a collectible series. We’ll have a 2022 version, 2023, and so on, all about the pursuit of excellence in Texas.

The objectives of the book: inspire, inform, recognize, connect, honor, celebrate, promote, and expand our reach and our message to have a greater impact on Texas.

Just a brief word about sponsorships. Sponsoring is not just about the event; it’s about relationships. We have a whole series of great benefits for those who are sponsoring. You can see that on our website, and also at the country club there, I believe we have some of our sponsor representatives – Jeff Stalker, Barbara Lynch, Doug Taeckens. Feel free to reach out to these folks. We’d be happy to help you and discuss all the benefits and the ways that we can help you get connected.

For those wanting to attend the event, attendance is open. I know we’re six, seven months away from May, but for those who want to go ahead and register, that option is open. You can begin using the app and begin connecting. It’s about relationships. We’ll ultimately have the event in May, but registration now lets you go ahead and begin connecting and building on those relationships and finding value between now and then. On our website there’s a series of registration options – everything from just the dinner and reception all the way up to an all-access bundle for everything, both days. Check that out.

I want to at this point get a little feedback from our attendees today – just a simple one question poll. Here’s the question. If we could help you resolve one issue in your business, what would you most like it to be? So if you would take just a moment and select the issue that might be most relevant to you, where would you most like the help in your business – let’s just see what we have in terms of those attending. [pause] Looks like we’ve got about half of your votes. Any more votes?

Here’s what we’re looking at. Looks like marketing and telling our story is the most desired issue for improvement. 55% chose that, followed by several other issues – efficiency and productivity improvement, innovation, profitability, risk control, and capital resources. Marketing and telling our story, over half. As we get into hearing from our award nominees today, any of you who might have a little bit of insight or experience in marketing and telling your story, it sounds like that might be of particular interest to our audience. There are the results.

At this point, with that stage set, Craig, I’m about ready to turn this over to you. Craig Beck is our moderator for the day at the country club there. Craig is one of our Texas Consilium Business Advocates. He is an engineer, he’s an attorney, he’s an MBA, and I have found that he is an experienced and wise advisor for Texas businesses. I’ve been in a peer group program with Craig for some time, and I have found that he is one of those gentlemen who listens, absorbs, understands, asks appropriate questions, and comes up with some wise advice. Delighted to have him as part of our Texas Consilium team. At this point, Craig, I’d like to turn the rest of the meeting over to you until we wrap it up at the end.

Craig Beck: Thanks, Jim. As Jim said, I’m Craig Beck. I’ll be hosting or introducing the panel today. I’ll introduce each panelist and their company, you’ll see a short video regarding the company, then each panelist will talk about application of the concepts of excellence within their own companies. There will be Q&A at the end after all the panelists speak. But please submit any questions you have that come to mind as they come to mind, and if you see a question that is something that you would like to elevate, as Jim said, you can click on the thumbs up in the Q&A box and it will elevate that question higher than others.

Without further ado, I’ll introduce the first panelist by way of a video about their company. It’ll be Todd Dauphinais of Clavis Capital Partners. Jim, you want to run the video?

Todd Dauphinais: What we’ve always found is what makes companies unique, what makes them valuable is their own uniqueness. And be different. Do it slightly different, and even if some of that is marketing message, it doesn’t matter. Just position yourself different. Whatever you do, do it good, but do it differently. Even if it’s a little different, just do it differently.

Craig Beck: Thanks, Jim. Todd, do you want to take it from there?

Todd Dauphinais: Sure. I realized I had my COVID beard going on then. I shaved nice for you guys today. But no, I appreciate it, and thank you guys for hosting this great event. It’s my first time here, and it’s great to learn more about your organization and some of the great things you guys are doing for Texas businesses. I’ll tell you a little bit about our story.

My journey, our company’s journey and our company’s story, really starts from a bad place, like many new companies do. In 2013, I had just moved back to Texas after being gone for about a dozen years or so. I had wrapped up some time as the CEO of a manufacturing firm, and I hooked on with a European venture capital firm as a partner, and I invested some money in the fund. After about three years, it was clear that that wasn’t a good fit for me, so I approached my partners at the time about transitioning out and finding a new opportunity.

They agreed with me, but their idea of transition out and mine were different. Mine was six months; theirs was by the end of the day. So all of a sudden at 43 years old with two kids, I find myself unemployed. I had just moved back to Texas; I didn’t have much of a network here, having been gone for so long. It was really a scary place. It was a scary place for me personally, it was a scary place for my family. But out of that was born Clavis Capital Partners, which is a private equity, private investment firm here in Dallas. I relied on some of my previous experience in manufacturing and wanted to invest in U.S.-based manufacturing firms, which is something I knew at least a little bit about.

As I went to go develop this firm and develop the concept way back then, the one thing that struck me was I wanted to do things differently. In my monologue there, that’s been a mantra for us – to do things differently. As I looked around the private equity landscape in Texas, and even beyond, there were so many firms that looked just like the other firms. Particularly in my business, a lot of the people in private equity come out of investment banking or financial services. I was determined to look differently and do things differently. I started to try to build a firm of people who had operational experience, who didn’t have that same resume as everyone else did, in an attempt to look differently.

What evolved over time was a culture that was different than a more typical private equity firm. As I mentioned in my video, some of that was marketing, some of that was just gut feel. And it doesn’t matter. The message that I have, the advice that I can give to people, is exactly that: find your uniqueness. Find what makes you and your organization different. Even if it’s just a little different, and even if it’s a little marketing spin, that resonates. It resonates with people who we approach, whose companies we want to invest in or companies we want to buy. Our approach allows us to say to a business owner across the table, “We’ve sat in your seat before. We’ve had your job before. I’ve been a CEO of a manufacturing firm before.” And that resonates. That matters in our business.

We’ve built a whole organization with resumes of people that are different than your typical PE firm. If it says “investment banking” on your CV when you come here, you can’t get hired here. We’ve held to that, and that’s become part of our culture. So find what’s different, find what’s unique, build a culture around that, and then market it. Because that’s what makes you different and unique. That’s my story, and thanks again for having us here.

Craig Beck: Thanks, Todd. Appreciate that story. Again, if you have any questions, please submit them to the Q&A and we’ll address them after all the panelists. Next up is Brad Morgan of Kindred Healthcare. Jim, if you wouldn’t mind playing that video, I’d appreciate it.

Brad Morgan: The response to COVID-19 has pressured the healthcare industry all over the country, and we’ve learned a lot of lessons about how to be number one, how to change and how to react. I think that that is a good example of excellence: what we have done to respond to COVID-19.

Craig Beck: Thanks, Jim. Brad, you want to take it from there?

Brad Morgan: It struck me from watching the video that I didn’t really explain what Kindred is. I spent 16 years at Baylor Scott & White before I came to Kindred, and ashamedly I can tell you that I didn’t even really know what Kindred was, even though I was in the healthcare industry. Generally, I would say most people don’t know what Kindred Healthcare is. So I was going to start by explaining exactly what Kindred is and what we do because that might make the context of the video make a little bit more sense.

Everybody knows what a regular hospital is. If you live in Dallas, you know Baylor and THR and HCA and all the big hospital systems. Most people don’t know what we are because most people don’t need us. We only come into play for that really, really sick 2%. These are the individuals that go to a hospital, they get something done to them – surgery, whatever – and they have critical needs and unfortunately, they don’t get better, and they can’t go home. That’s how most people’s hospital experience happens.

We come into play when people need more, and they need to be in a hospital setting for a long period of time, or they need to have an extended period of critical care. Think of our hospitals as people on ventilators and people that need long-term recovery, a lot of rehab. That’s where our hospitals come into play. We are the largest post-acute healthcare provider in the country. Hopefully that makes a little bit more sense.

When you saw the COVID video there, what I was talking about in the video is COVID has been a double-edged sword, so to speak, for Kindred. It is a completely awful public health event, and I know that nobody is enjoying this pandemic experience and nobody wants to go through a pandemic experience. However, it has allowed our company to shine, and it really has I think helped to increase the knowledge of the value of our company and what we do. It has really strengthened our partnerships and our collaborations with the large healthcare providers.

They know who we are because they’ve used our services for a long time, but because of what we do, being a specialist in a hospital industry, we take care of ventilator patients. We have more respiratory therapists per patient than any hospital would ever have. We have more occupational therapists, more physical therapists, because we concentrate on rehabilitative services. So the COVID-19 patients that we have seen are the really, really sick ones. These are the ones that have been in the ICU. These are the ones that have been in the hospital for a month or two weeks or a long period of time. Most hospitals are not equipped to take care of people for extended periods of time. They’re equipped to take people for three to five days. After about Day 5, a regular hospital doesn’t specialize or understand what to do with people for that long period of time. They’re supposed to go home. But that’s what we do, and that’s what our medical staff does for all of our patients. So this has actually been an opportunity for us.

That being said, they often ask, “What makes your company special? Why does your company strive? Why are you the largest company?” It’s because we recognize that the value of our company stands with our people. I’m a Studer guy. I don’t know how many people are Studer people here, but I grew up in Baylor, so it was all about quality service, finance, and people. I brought that with me when I came over to Kindred, and I recognized that what sets us apart – and this is probably not shocking in healthcare – it’s got to be all about quality. We’re taking care of people’s lives. We have to prioritize quality and the quality of our product.

But I also recognize that we can’t deliver the quality and service that we need to deliver as a healthcare company if we don’t have the right people on board. That’s why we prioritize our people. Instead of process improvements and solutions being driven from top down, our processes and solutions are driven from the bottom up. We understand that the people that are at the beside, our nurses and our respiratory therapists, they’re the ones doing the job. I’m not a nurse. I’m not a respiratory therapist. Why in the hell would I try to tell a nurse how to take care of a patient? My job is to go and tell them, “I’m here to support you. What do you need? How can I help you to do your job better?” My job is just to be a facilitator and get them what they need.

And that is what we drive from the leadership level position. Your job is to listen, your job is to create culture, and your job is to facilitate. I think that that’s what makes us different as a company. We recognize the importance of our frontline staff and we really try harder to make sure that they know that. 2020 has been a tough year, and I know we’re all feeling 2020 being a tough year, but there’s certain parts about 2020 that made us better as a company.

Black Lives Matter is another thing that has made us better as a company. We recognized that the diversity of our frontline staff and the diversity of our caretakers is a strength, and it gave us an opportunity to really do listening sessions. We did over 150 listening sessions with our frontline and all of our employees, making sure that we are the kind of company that they feel comfortable working at and that values them. I think that sets us apart and makes us different. I don’t have a whole lot of time, but that’s a little bit about why Kindred is different and why we have been able to excel in this tough year.

Craig Beck: Thanks, Brad. It’s great to get a better understanding of Kindred Healthcare. I can’t imagine hardly any company that might’ve been affected by COVID as much as you guys. Next up is Kevin Hodes of Swypit. Jim, if you wouldn’t mind showing that video, I’d appreciate it. Thanks.

Kevin Hodes: Anybody will give somebody a cheap price, and there’s cheap, cheap, cheap everywhere. I never say the word “save” to anybody. We always make our clients more profitable, and I guarantee that no one can ever hold a candle to what we’re doing. And I find it’s incredible how other companies don’t take care of the way we take care of our clients.

Jim Ratchford: Craig, just one quick add here for Kevin. On their website, there’s a video that Kevin produced. In terms of marketing and telling your story, since the audience has an interest in that, I’d like to share this. I think it’ll be both informative and entertaining.

Craig Beck: Great idea.

Jim Ratchford: Give the audience a little bit of an insight about ??41;53.

At Swypit we’ve got great pricing and great service – super fast! When our customers need service, we drop everything – even me from a plane! If you process credit cards and are tired of switching from company to company only to be disappointed, start working with the professionals at Swypit, and we’ll help you become more profitable! You won’t be disappointed! Serving merchants since 1999.

Craig Beck: So when Kevin thinks about looking at stuff from 30,000 feet, he really means it. [laughter] Take it from there, Kevin.

Kevin Hodes: Thank you so much for playing my video. We had a whole bunch of fun. Took about six to eight hours to make that video, and I was just hanging from a green screen for hours. It was pretty crazy. It was a lot of fun. But I will say that the Texas Consilium has given me an opportunity to do another marketing extravaganza. When you surround yourself with real professionals and get things what you need to be doing, you need to find ways to make things work. But it’s really hard in any business to be marketing and get yourself out there.

I showed up here in Texas over 20 years ago and I knew one individual. I found that my marketing was going to have to be very different because I was from New York. I wasn’t a Texan. I hadn’t grown any Texans yet. Now I have two Texans. But of course, you have to be very different. Since I’m always the tallest guy in the room at 5’1”, I always have to make sure that people see me.

I’ve created a lot of unique things. For one, if anybody’s ever seen my business card, it is an actual credit card. I even put some things on my business card that are unique. One of the things that very few people in my industry have achieved is being an ETA Certified Payment Professional. There’s a whole bunch of people that offer what I call the slimy world of credit card processing, and I’ve been trying to bring honesty and integrity for over 20 years to this industry. We built a referral-based business, so you typically had to know someone to work with us. But over the years, we still even have the first customer we ever wrote. They’re right up the street here. We have thousands of clients all over the country that have never met me or met anybody in my staff, and we do a lot of different things that are very unique.

To the marketing side, if people do go to my YouTube page, you’ll see that I had a TV show, I’m a three-time bestselling author, I co-authored a book with Mr. Jack Canfield, if you ever heard of Chicken Soup for the Soul. I did a business book with him. The second book I was able to be with Richard Branson and Nido Qubein. Celebrities are great influencers out there, but being able to be taken – in this world of credit card processing, like I said in the video, it’s about cheap, cheap, cheap. Anybody can offer you a cheap, cheap price, but if they don’t actually give you service and they don’t perform, people figure that out pretty quickly.

So I’ve really figured out what this industry is missing. To make people more profitable in their business, you have to give them great service and great pricing. Those two things we’ve always achieved. I still have zero complaints with BBB. One day maybe we’ll have one. Maybe somebody will stand up and say, “I really don’t like that company.” Who knows? I find it hard to achieve that because we’ll never do anything to make our clients ever leave us.

Recently, just in the past few months, we received an Emmy for the last movie we did. We got two Emmys. I like to give back to the community, so three movies that we’ve done, the first movie I did with Brian Tracy. If anybody knows anything about marketing, Brian Tracy is a phenomenal individual who was lucky to be the executive producer of his life story, and I’ve been lucky enough to really talk about marketing – I mean, serious marketing – from Jay Abraham. Jay Abraham is a master marketer, and we did his life story as well.

Obviously, you can have Tellys, I could have all these awards, EXPYs, all that great stuff, but at the end of the day, the people that we take care of all over the country rely on us, and they don’t care about all that craziness that we do. It just so happens that we’ve fallen into the ability to help people through other avenues besides even just making them more profitable. If people stumble upon – a few years ago I did a radio show and I had a whole bunch of fun with that called the What the Heck Show. It was like what was going on in the world today. It was great. I’m really disappointed I’m not doing my What the Heck Show with all the crazy political stuff that’s going on. Man, I’d have a heyday. I miss it. Might have to get back in there. I’ve been looking at doing it with Sirius.

But when it comes to the world of credit card processing, you are in networking meetings, you run into these people, they usually get in and out of the business in two or three years, they’re on to the next venture – we all know somebody that’s been in the business. We think that everybody’s the same, and it’s really not true because you as an individual are not the same as your next door neighbor. Everybody’s different. When you really surround yourself with real true experts and people recognize that, like the Texas Consilium, it gives me the opportunity to really further the cause of trying to bring honesty and integrity to the slimy world of credit card processing.

It’s definitely an honor to be here today. I’m surrounded by great people. I’m looking forward to getting to know a lot of the people within the Texas Consilium. I do know Ryan through a good friend of mine, Maher Maso. I worked with the city of Frisco for a long time as a planning zoning commissioner and the Sister Cities program that Maher Maso created.

Everything and anything in terms of marketing – I want to go back to that really quickly. If you can be everywhere all the time, people will remember you. What people don’t know about the Visa, MasterCard, AmEx, and Discover logos is that if you walk into a business today – eventually when we get back to some sense of normalcy, we’ll be walking into a business – believe it or not, subconsciously, you don’t even realize when you’re looking at that door, you actually look for those logos because no one carries cash anymore. So you want to be able to pay for the items that you want to purchase at the time that you walk in.

Imagine subliminal marketing at an incredible level now. Now if your business is trying to take advantage of those subliminal kind of things, we’re talking a whole other level of marketing. And that’s what I’ve done with Swypit. I have 10-20 pages deep on Google, and it was all organic. It’s crazy how organically you can market yourself, but it’s constantly putting information out. It’s constantly being everywhere. It’s constantly reading. It’s constantly writing. If you follow through on an organic level, people remember you. They just won’t know where they remember you from.

Having an opportunity to be here today is very much appreciated. Everything I’ve always done is for other people. It’s never about us. It’s really about people. If we can make them more profitable, they’ll tell others, and then they’ll tell others and they’ll tell others, and that’s how we become successful in terms of marketing. Thank you so much for the opportunity.

Craig Beck: Great. Thanks, Kevin. It’s great to understand how Swypit distinguishes itself through the application of excellent concepts. Next up is Dr. James Ponce of Texans Can Academy. Jim, if you wouldn’t mind rolling that video?

Richard Marquez: I don’t think you ever arrive at excellence. I think you spend your entire life chasing it. The landscape always changes and there’s always something you can do to get better. I think we’ll forever be chasing what I would call excellence.

Video Narration: We’re offering programming at our high schools that isn’t being done anywhere else in the world, and the graduation rates prove it.

Craig Beck: Great. Thanks, Jim. Dr. Ponce, take it from there.

Dr. James Ponce: Thanks again today for allowing us to present today. Thank you to the Consilium and panelists for great work. You actually were hearing from our former CEO. He retired. That was our CEO, Richard Marquez, and he retired about a week ago. We were all set to be here, and I know I was excited to be in the audience, but I’m even more excited to be up here.

What sets us apart – there’s over 5.5 million students in the state of Texas. There’s about 27,000 that we know of in the dropout, recovery, and prevention school districts, of which we serve 20% of those students across the state of Texas. We are in Dallas, Fort Worth, San Antonio, Austin, and Houston – most of the major urban markets. What sets us apart, when I was listening to everyone else about being unique, the critical care, you said the honesty, the integrity, and the people – that’s what Texans Can is. We serve a very unique group of students, and they’re almost in that critical care area. What is in common with our students is that they’ve experienced a lifetime of failure. It’s not anything to do with anything other than that’s the way life has gone for them.

What we do is we create hope. First and foremost, we sell hope. When you’ve experienced that much failure and life has gotten in the way – that’s what I always say. Life, for whatever reason, has gotten in the way of our students. When you have that much, you have to create first and foremost hope. And that’s what we create. We create an environment where students now see hope. I used to teach second grade, and I remember I used to tell the students, “What do you want to be when you grow up?” No one ever drew four quadrants and said “I’m going to drop out.” No one ever told me that.

We now ask that same thing of the organization. Where is that child, and what happened? And what are we going to do to get them back into their dream? So that’s what we do, and that’s what sets us apart. It’s been very tough, again, during this COVID time, and we feel the pressure of getting students to engage. When you talk about people and what we do, our staff is above and beyond, and now, in this COVID era, one of the very best. Because they have to be. We know that a student that comes to Can cannot afford another year or year and a half being unengaged. Their life is just not there. Most of our students come to us overage. What we mean in that is they’re about 17. When they’re about 17, we know that they’re not going to hang around for three or four more years. It’s just not going to happen.

So from our perspective, what sets us apart is all that everyone has mentioned. It’s a unique group of students that we attract. We’re specifically set for the students. We don’t compete with the ISDs. The students that we’re after, we compete mainly with the streets. They’re the students that are going to knock on your door at some point, or that you want to employ at some point. So we have a value-add model that says, here’s a student who, if you do a graph, it would show them in the negative. But we take them, we give them hope, we allow them to dream again, and then we start talking to them about a license, a certificate, college hours, or the military.

Because remember, here’s someone who walked in not even really knowing how many credits they had, but they know that if they walk into Texas Can, they have a chance to graduate. Once they know they have that chance, we then explore all the other options for them. We’ve done a lot of work here recently about beyond high school. We know ourselves as an organization that the high school diploma will not be sufficient. So we begin now having the conversations with that child about “What is going to happen to you beyond high school?”

When you talk about what is our business, usually the product that they think about is the child. Our product is not the child. Our product is also education. What sets us apart from everyone else who’s trying to do this? What sets us apart is that we go back to the core, as you spoke on here today. We go back to the core of what that child needs, and what we need to do with staff to allow them to get the needs of the child met. And it’s bigger than that. It’s bigger than just the education. We have to talk about mental health. We have to talk about the basic needs. Our organization creates an umbrella around the child that knows that if we can remove those barriers, education becomes something that’s not so abstract and becomes very concrete.

We utilize a lot of the other strategies that everyone else uses, but we know that at the end of the day, our educational process has to change the life and trajectory of not only that child, but hopefully their family and the generations of their family after that. We know it’s an important piece of the economy in every market that we’re in. Every time that we can take a child who was not going to graduate and we graduate them – I think everyone here knows the statistics associated with a child who has graduated. And then if we can get them into a license, a certificate, college hours, or the military, we’ve just exponentially exploded what could happen for that individual, what could happen for that family, and what could happen for each of our communities.

That’s what we apply, and that’s our niche, and when we talk about what we do – my peers, we talk about it as a vocation. You get to a certain point in your career that you’re really chasing a vocation. You’re not just chasing an occupation. Texans Can is a vocation. It’s a vocation I think all across the board for the corporate staff and every other staff member through the campuses. I think they find that there’s a place where you can fill your heart, and every day you know that you’re changing a life and hopefully you’re changing a community. And if we put it all together, we change the state of Texas. Thank you.

Craig Beck: Great. Thanks for sharing that. It’s wonderful what you do for each child as well as the impact on the community overall. Thank you for that.

Jim, I think I saw a couple of questions. The first question is for Kevin. “Do you process hemp/cannabis products?”

Kevin Hodes: Yes, actually. It’s a tough market to be in for those individuals. We currently have merchants all across America that have worked with another organization that actually gave them 30 days’ notice and they were stuck with nothing. The industry was in an influx. But we can take care of those clients at the price of moment. I do work with all of the merchant service providers out there, so it’s not like I’m stuck working with one organization like all of my competition. I don’t know if they’re listening or watching, but probably one of my biggest secrets is having relationships in multiple areas. Even if I tell people our secrets of how we do stuff, they still can’t figure out what we’re doing. So I don’t mind throwing it out there. [laughter] But yes, we can actually do that. We would love the opportunity to talk to anybody and see how we can make it happen.

Craig Beck: Thanks. The next question is for Todd. “Do you invest in startups?”

Todd Dauphinais: We do not. We’re not really set up for that. It’s an unfortunate thing. There is not a robust enough capital sourcing business here in Dallas that does support startups. It’s something that we in North Texas need to further develop. There just aren’t as many firms that do that. It is a different skillset, and it really is a different process. We’re not good at that. We would love to, but we’re just not good at it. So unfortunately, we do not.

Craig Beck: Thanks, Todd. One additional question is “If each of you could go back 5 or 10 years and do something different that would make you and your company even more successful, what would it be?” Brad, do you want to maybe try to tackle that one first?

Brad Morgan: Yeah, sure. The last 5 to 10 years has been really good for Kendrick Healthcare. The LTAC industry changed fundamentally in about the 2014-2015 timeframe. Unfortunately, there were some unscrupulous players in the LTAC industry and some companies that took advantage of some of the loopholes, if you will. They were taking care of patients that they shouldn’t have been taking care of, and they were collecting the big rewards for that.

Fortunately, the government regulators recognized that and they made a lot of changes. They really narrowed down what kinds of patients should be coming to an LTAC and really set some criteria. Kendrick, fortunately, was already doing the right thing and taking the right kinds of patients. So it didn’t hurt us as a company. A lot of our competitors have thankfully gone out of business because they weren’t doing the right thing.

Another thing that we did is we went from a publicly traded company to a private company in 2018. Now, what that has done for us is it’s freed up a lot of capital. it’s made us be in a position from a capital perspective that none of our competitors are at. We’ve been able to reinvest in our company and do things that were not even thought of that could be done in the LTACs, like replacing all of our beds. We’re creating a new EMR system. We’re replacing all of our ventilators throughout our company. None of our competitors are even thinking about doing that. But we know that it’s the right thing to do because it improves our quality, and it’ll increase the delta between us and all of our competitors even more. We’re thinking long term, not short term.

I guess the thing that we would do different is always keep your eye on the ball long term rather than short term. Maybe we would’ve gone private a little bit sooner.

Craig Beck: Thanks, Brad. Dr. Ponce, do you have any thoughts on that?

Dr. James Ponce: Personally, I made that switch. I was in ISD in Dallas and in McAllen, and we always were focusing on that group of students who were the most disenfranchised. Coming to Texans Can gave us that opportunity. But when we talk about Texans Can, I think the things we would do differently is notice that license, certificate, college hour, or military needed to be a bigger player sooner. We should’ve recognized that yes, while we want a child to graduate, we need to do a service to the child to have something beyond high school. That’s I think the shift now that we realized. It’s not so much about getting the student out; it’s more about talking to the student and giving them a pathway for them to see that there’s bigger things and better things beyond high school, and that should not be their apex.

Craig Beck: Thank you very much. I don’t see any more questions, so at this point I want to thank all the panel members, thank all of the attendees, and I’ll turn it back to you, Jim.

Jim Ratchford: All right, thanks, Craig. Great job. Let me throw out one more question for each of our panelists. Thinking toward the future a little bit, if we had a magic wand and could change anything about your business going forward, what would you most hope it would be? Dr. Ponce, you want to start with that?

Dr. James Ponce: The thing going forward for us is, one, quality – the quality of data and the quality and integrity of everything that we say we do with our data. But bigger is, how do we figure out what education is given COVID? We know that COVID has changed the face of what education is going to be. We cannot think that we’re going to go back to the way it was because we’re learning so much about what it would take to educate a child. There’s some things that need to change in there that I think will benefit children, knowing that there really aren’t any days that they can be out.

We’re learning now that if you’re at home, you can still be learning. We are setting up a system that will allow for continuous learning that the child will be able to take advantage of, knowing that their learning now is 24/7. We didn’t use to really have that. A lot of our students work and they’re primary caretakers, so we have to give them other flexibility and opportunities beyond what we used to think was the school day. I think that will be the future of us figuring out how we can take advantage of all this learning and make it a better platform for our students to have opportunities to be more successful on their time versus what we used to think was the school day.

Jim Ratchford: That’s a little bit in line with what your 30-second video promoted: that you’re always pursuing excellence and that you’re looking to learn and do better. Kevin, do you want to take that? How would you use this magic wand to make your business better if we had one?

Kevin Hodes: I want to combine that question with what you had asked earlier and the other panelists mentioned. Over the past five years, I’ve realized that there’s been some individuals within our infrastructure that we needed to push out. I say it not in a negative way, but it was to make the company so much more profitable, so much more resilient. When you get rid of individuals that are creating such negativity, you don’t even realize until they’re gone how they were stifling the future of your company.

Of course, over the past few years, we’ve really made some strides, and I’ve made substantial changes that people would never even know about. I lost friends and I’ve lost maybe a few clients over it, but at the end of the day for me, it was looking from the inside out and making actual changes that were needed, that you forget. When you’re in the moment, you sometimes aren’t paying attention to certain things. But we all make mistakes, and I’m really happy to make mistakes because then I can really learn from those mistakes and move forward. You just don’t want to keep making the same exact mistakes over and over and over again because that’s the definition of insanity, expecting different results. Of course, when I realized that, we made these changes. People couldn’t believe that I was implementing these changes.

But the future is bright. Things have been great. We still continue to have 15-18% year over year growth even during a pandemic, which is unbelievable with the amount of things that have been going through the world today. Unfortunately, commerce is a part of the world that needs to continue to move forward, so we weren’t in a position – like if I was a bookstore, unfortunately bookstores maybe didn’t have enough people walking in and out of them. We’re not a retail shop. So it worked out for us in the pandemic that we’re continuing to move forward at an aggressive pace. And even in that process of this pandemic, we were able to implement and finally get people to start doing contactless payments. Contactless payments really is the future of how the world is going to be. Even this little credit card won’t be around anymore. I think it’s going to be so much more contactless.

But paying attention to making mistakes is probably something I really would want everybody to do. We’ve made tons of mistakes in our lives, and it’s what’s made us the people we are today. That’s what we’re learning even from the pandemic. Being surrounded by people that have the knowledge to say, “Have you ever thought of doing this?” – those are things that really can help you grow your business. If you’re eager to learn and eager to make mistakes, you’ll thrive in any economy.

Jim Ratchford: As you started your story, it brought to mind a saying that we often use here: everything inside a business tends to look normal to those who are doing it. Seeing how you can be better is sometimes a challenge, and as you’ve found, it was a bit of an epiphany, perhaps, or a surprise, but you found it.

Kevin Hodes: No one wants to admit when they make mistakes. I will be the first to say I’ve made mistakes.

Jim Ratchford: That’s how we learn.

Kevin Hodes: Definitely so.

Jim Ratchford: Todd, same question to you. How would you use this magic wand for your business if we had one?

Todd Dauphinais: What Kevin said, and what you said, Jim, really resonated with me. I wouldn’t change a thing. Every bad decision, every good decision, every circumstance – everything has led us to this point. You can’t replace the learning that comes from bad decisions. You can’t replace the learning that comes from experience. I wouldn’t change anything for our business.

The two things I would say – one is we’re just now starting to get into some more impact investing and looking at supporting other organizations that are doing great work like Texans Can Academy and other things like that. I wish we would’ve done that earlier. I think having a little bit more of that impact mindset earlier is good for the soul. That’s something I wish we would’ve started earlier.

The only thing, if you had a magic wand – we are living through an unprecedented time of turbulence, and I think everybody has done a good job of managing through that. But if you step back and look at all of the things, from coronavirus to political strife to societal strife and everything like that, it is an amazing amount of turbulence that we are all going through right now. So if you had the magic wand, I would say let’s get back to some kind of sense of normalcy in life, and I think that would do everybody a little bit of good.

Jim Ratchford: Very good. Thanks, Todd. Brad, wrap it up here. How would you use that magic wand at Kindred?

Brad Morgan: The biggest headwind in the healthcare industry is the cost of healthcare. We have to do something about the cost of healthcare. That’s part of the reason the Affordable Care Act was created. There’s two things that we need to do, and we will do, in the healthcare industry. Number one is we have to improve collaboration within the healthcare industry. There are best practices that help to cut costs, but we don’t talk about them internally very much because we’re all competing with each other. We need to collaborate better and make sure that physicians are talking, make sure that healthcare administrators are talking, and make sure we’re doing the right thing for the public.

The other thing we have to do is work to put ourselves out of business. The thing that’s going to cut the cost of healthcare the most is when people utilize healthcare less. That has to do with getting everyday people, the public, involved in their own healthcare and involved in living healthier lifestyles and doing preventative care. Going to the doctor, eating better, exercising more. I guess my magic wand would be helping people realize that they’re the best hope for lowering the cost of healthcare and really getting them responsible and a part of educating them about what they need to do.

Jim Ratchford: Very good. Thanks, Brad. One more quick round, just in case anyone has something that they would like to add. An inspiring note about the pursuit of excellence. Each panelist, maybe leave our audience with one more closing thought on the pursuit of excellence, a word of advice. Whatever you care to share here as we wrap this up. Dr. Ponce?

Dr. James Ponce: For us, the pursuit of excellence is very critical, as we talked about, for the state of Texas and for families. We have to find a way that what we do is actually incentivized across the state so that more people get into the business that we’re in. Right now there are communities that don’t have a Texans Can or a Texans Can-like organization. However, there are students that need that service, and we know that in those communities, the business and the economy needs something for those students to engage in.

For me, that’s the pursuit: to show that we are a valuable solution not only to the educational system, but to the economic systems. It has to go across the state of Texas so that we can begin to flourish in the areas that we know are pulling away from that that would cause the economy to grow.

Jim Ratchford: Very good. We had one question asked that’s directed to you. Let me share that with you real quickly. That is: “Do you partner with other organizations, like Big Brothers Big Sisters? Or if an organization would want to partner with you, how would they do it?”

Dr. James Ponce: We do have partnerships. A big part we realized, given our structure, is that we partner with all the infrastructures within every community that we have, whether it’s the mental health, the social services, the medical. Whatever it may be, we do partner with those individuals. So we’re open to any partnership that allows us to leverage the systems that already exist so that our students and their families will benefit from that idea. And knowing that we can grow and connect ourselves, since we are across the state, and make it a statewide network instead of just a community network. But we’re open to any collaboration or any communication that people want to have with us.

Jim Ratchford: Very good. Thank you. Kevin, on the question of the pursuit of excellence, any closing thoughts?

Kevin Hodes: Yes. Actually, I’m going to tell everybody to just remember this. Never let anyone tell you that you can’t do anything. I have had that mantra for my entire life. People have been telling me I can’t do something, and I just go out and do it. They go, “How’d you do that?” I say, “Because I just stepped out the door and I did it.” What happens is when you get all the stifling, all the negativity, drive the negativity away. And find new friends if you have so much negativity around you, because they’re only stifling you. If you want to be a drug dealer, hang with drug dealers. If you want to be successful, you’re going to be hanging with successful people and you will be successful.

I have had my electricity turned off. I have been homeless. I’ve lived in my car. I have been at the lowest of lows you could ever be, but I never once ever said I was going to crawl up in a corner and not be able to do anything. I just had to find the resources. I had to find the people that would support me. I had to find the reason to keep going, knowing that somehow, some way, I was going to get where I needed to go. If you surround yourself with the right people, you can be there.

Of all the stuff that I do, I do a lot with military. I’ve been Donnie Nelson’s Military Appreciation Sponsor coming up for 10 years now, and I have counseled free of charge to military professionals all over the country. The Emmy that we just won for the movie is called Freedom Isn’t Free. It was done on Lieutenant-Colonel Dan Rooney of Folds of Honor. We did his life story. Again, it’s helping people. If I can get the word out, if I can give them one nugget of information, it’s to know that people are there to help you. Just surround yourself with the right people and never give up.

Jim Ratchford: Great advice. Thank you, Kevin. Brad, your final thoughts here on the pursuit of excellence?

Brad Morgan: I’d go back to the way I started the presentation. I am extraordinarily lucky to work in the healthcare industry. We have extraordinarily smart people in our industry. I don’t think anyone will argue that doctors and nurses are really smart people. Because I have that benefit, it behooves me to listen to them. The pursuit of excellence is allowing people to strive, allowing people to be a part of the solution. My job is to set the expectation for excellence and set the goals, but it’s not to come up with the solutions. I feel very comfortable that I can rely on some very capable people to help me come up with the solutions for our industry.

Jim Ratchford: Very good, Brad. I’m delighted that we’re recording this. I think we’re getting some words of wisdom here that we might turn into another video. Todd, one more, wrap it up here. Pursuit of excellence, your final thoughts.

Todd Dauphinais: Sure. Thanks again. Great to be on this panel with all of these folks. I’m pretty humbled, myself. I think the last piece of advice I would say is fear is powerful. Fear is very powerful, and it can be powerful in a good way. It can motivate you. The trick is – the fear of failure, the fear of not stepping through that door, as Kevin mentioned, and the fear of not doing something is what most successful people have figured out how to overcome, one way or another. Everybody’s got fear of failure, fear of looking stupid or whatever. But figuring out ways to harness that fear and making it a propellant to push you forward is probably my best piece of advice. If you can overcome that, use it for good, you’ll do great things with it.

Jim Ratchford: Very good. Thank you, Todd. With that, we’re going to wrap it up. Just a few closing thoughts here.

Going back to the opening about what Texas Consilium is all about, I would encourage you to explore our website, reach out to us to find your role in working with us. I’d be happy to take your calls, questions, or emails at any time. Those of you who are there at the country club, you have a number of our Texas Consilium representatives who can answer questions and get you directed to whatever would be helpful to you. We are all about helping Texas businesses and in turn helping build and grow the Texas economy and making it stronger for everyone.

That wraps it up for today. I look forward to continuing to build on the relationships that we have expanded today. Questions, suggestions, and any other business, reach out to us any time. Go forth and prosper, and make it a great rest of the week. Take care, all. Bye.

ExecDir

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