Michael Traub | Crain's Washington D.C.

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Michael Traub

Background:  

Michael Traub became CEO of Serta Simmons Bedding in 2016, overseeing the company’s operations in the United States, Puerto Rico and Canada, as well as Tomorrow Sleep, SSB’s online brand. Traub joined SSB as president of Serta in 2014. Before that, Traub served as president and CEO of BSH Home Appliances Corporation, where he managed the Bosch, Thermador and Gaggenau home appliance brands for North America. Born and raised in Germany, Traub began his career with BSH abroad and worked for the company’s divisions in Latin America, Germany and Asia Pacific.

The Mistake:

The mistake we made was that we totally ignored the culture of a company we took over.

When I look back at my career, I had the opportunity and pleasure to work in many different cultures and different continents: I was born and raised in Germany, and I started with Bosch. I moved to Asia at 24. I lived in Asia for seven years and moved back to Europe. At 35, I moved to Brazil. In 2008, I came to the United States.

You can imagine it’s not only a matter of language that’s tricky between different cultures; it’s also accepted behaviors. After 25 years with Bosch, I joined Serta Simmons in 2014. The key task ahead was to bring the two companies together. Serta and Simmons were two separate companies until 2012. We had two CEOs and two headquarters and two sales teams —everything two, two, two. How do you make one company out of that?

In Latin America, I was challenged with a difficult business environment. We bought a company that was hugely underwater and had problems. What we typically had done in the past was steamroll over everyone and bring in a set culture that was accepted by headquarters. The mistake we made was that we didn’t understand the local market well enough, so we came in with a preconceived notion of what would be successful. We thought whatever was successful in Europe and Asia would work in Latin America, as well.

The CEO doesn’t dictate the culture; it’s lived and breathed by the employees.

The Lesson:

I learned in Latin America that you cannot assume anything when you bring two companies together. Setting a culture is a deliberate act. At the end of the day, culture is a set of accepted behaviors, and if you’re not aware of that, whatever you preach won’t work well. The CEO doesn’t dictate the culture; it’s lived and breathed by the employees. If they don’t feel accepted, you won’t get what you wanted to achieve out of the merger.

I joined Serta Simmons with that mistake in mind. We had to bring two companies together. With that mistake in Brazil, it was important to create a strategic vision for the company and give everyone a sense of belonging. Everyone needs to understand what the vision is and why the companies are merging. You need to create a set of values. If you just go into a merger and see which culture is going to work out, it’s really kind of pulling the wagon and letting it happen by accident. These are the worst mergers you see. So many mergers fail because of a lack of vision for the company.

We came up with a mantra and rally cry for our merged company. We made everyone aware that they’ll have a chance to contribute. A culture change takes double the time people think it will take. Everyone needs to understand why the merger is happening.

You’re paying respect to the history of both companies. Both mattress companies had been successful independently of each other, but both had come to that success in different ways. It’s a very deliberate act of defining strategy and creating a new set of values.

We still have a headquarters in Chicago and the corporate headquarters in Atlanta. A key initiative we’ve started is to bring them physically together. We’re building a new headquarters in Doraville (Georgia); all employees will be in the same building. If you want to break down walls, you have to bring together people. It doesn’t happen by accident.

 Serta Simmons Bedding is on Twitter: @SertaSimmonsBed.

Photo courtesy of Serta Simmons Bedding

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