Up For The Challenge: Jackson Hewitt's New CEO Prepares for Takeoff
David Prokupek is not short on experience at the highest level. What's more, he loves a challenge. He has spent more than two decades as a CEO, investor, and board member helping build, finance, and advise high-growth businesses in the consumer, retailing, financial services, marketing services, and communications industries. He hasn't just done these things, he's done them well.
Today he is president and CEO of Jackson Hewitt Tax Service, a full-service tax preparation and related financial services company. He previously served as CEO of Smashburger, and was managing partner and chief investment officer of Consumer Capital Partners, which provided Smashburger with its initial $20 million-plus of funding.
Prokupek is an innovative and strategic thinker who can manage the business today while keeping his finger on the pulse of trends that will help him be successful tomorrow. He says he relishes being in the "challenger position" and knowing his brand must work harder and smarter than the competition does.
And that's exactly what he's been doing at Jackson Hewitt, and why he says there's change ahead for the brand--and he aims to be the driving force behind the company reaching its goals.
"You will see us re-launch the brand, jump-start our footprint growth, launch innovative products and services, including more mobile solutions, and we begin a refresh of our existing locations," he says of the brand's impending initiatives.
What is your role as CEO?
I view my role as setting the strategic direction and vision for the company and to build our talent bench to navigate the ever-changing landscape. I need to manage the business today, but spot the trends that will allow us to be successful tomorrow. A big part of my role is to be the "chief revenue officer" and "chief culture officer" of the company, helping inspire others to achieve greatness.
Describe your leadership style.
My style is to work from the big picture and create a strong vision of where we want to be as a company and our path to success. In my current role, I am using more of a pace-setter style as we position the company for growth and the re-launch of the brand and related products and services. I enjoy working at a fast pace and have the organization make decisions quickly. I am collaborative in style and encourage our senior leaders to have a firm grasp of the hard and soft sides of their businesses. I like to celebrate wins broadly and create a culture that works and plays hard.
What has inspired your leadership style?
I have worked with challenger brands most of my career, which has always inspired me. I am inspired by being in the challenger position and knowing we have to work harder and smarter than the competition does. I have been very fortunate in my career and have been inspired by a number of very successful leaders.
What is your biggest leadership challenge?
One of the biggest challenges in leading organizations--especially for companies in transition--is getting buy-in on the vision and alignment across the organization on key measures of success and encouraging the risk-taking to bring the vision to life. We will be pivoting from a pure seasonal "in store" tax preparation business to a company dedicated to the year-round tax, healthcare, and evolving daily financial needs of hardworking Americans. The new vision is exciting as we launch a broader suite of online, mobile, and storefront products and services, as well as reposition our footprint to be even more convenient to our customers. Getting everyone to pivot simultaneously will be a big challenge, but I am confident we will meet the challenge.
How do you transmit your culture from your office to front-line employees?
Culture starts with a vision and a purpose that is well communicated and has broad buy-in across the company. I use a variety of ways to transmit our culture that starts with energizing the team around our "true north," setting incentive systems that reward our values and regularly recognizing people, holding "town hall" style meetings to share ideas, giving people the freedom to express the culture in their own way, and personally modeling the attributes we care about as a company. As we grow, who we hire plays a big part in transmitting the culture and encouraging those who are not a good fit to leave. In retail, culture really starts at the front line with the customer, so I spend tremendous time with our field and store management around both consumer and business goals and what we want the experience to feel like for customers. I believe in being transparent with our results up and down the organization and trust good people to do the right thing every day. Culture cannot rest with a single person. If it is working right, a strong culture shows up in your customer engagement every day.
Where is the best place to prepare for leadership: an MBA school or OTJ?
I don't think there is one best place to prepare for a leadership role. Both OTJ and school are important. You certainly don't need an MBA to be a great leader, but a good MBA program teaches the importance of collaboration, analytics and trend-spotting, and communication. What an MBA misses, OTJ adversity and the school of hard knocks teaches in spades as valuable leadership lessons, especially around leading and managing a diverse set of people. In the end, I believe leadership is best learned from a solid mix of mentorship, education, and OTJ experience. I recommend that aspiring leaders prepare to be a leader at a young age by volunteering for leadership roles whenever and wherever they can and modeling the traits of great leaders they encounter in their life.
Are tough decisions best taken by one person? How do you make tough decisions?
Fundamentally, someone has to make the tough decisions, and the best leaders have the courage to make and communicate those tough decisions. However, as I said earlier, one of the biggest challenges is to ensure that everyone is working toward a common goal. Therefore, while leaders ultimately make the tough calls, the decisions need to be properly socialized with the senior team so that they understand how the decision was made and why it is important that everyone support the decisions.
Do you want to be liked or respected?
It's human nature to want to be liked, but real performance comes when a team respects its leadership for who they are and what they believe. I try to spend my time earning the respect of the team and integrating diverse ideas, which drives engagement and commitment throughout the organization. I find that with respect, the ability to be liked is much easier.
Advice to CEO wannabes:
The first thing I would advise a future CEO is to study other CEOs--find ones that you admire and model yourself after them. Second, I would suggest getting experience making tough decisions, whether balancing revenue opportunities and cost constraints or dealing with employee performance issues. None of this comes easy without practice. Last, I would say that a current leader who wants to be a CEO should think about the bigger implications of their decisions and factor in how any decisions may affect others in the organization. Start to act and conduct yourself as if you are a CEO, which means balancing decisions across all constituencies, not just your function or team.
Describe your management style:
I would describe it as results-driven, a "best ideas, best team" approach to winning at business. Personally, I start with the big picture in mind and use a healthy mix of wisdom, data, and courage to make decisions. Like a coach who wants the best athletes on the field, I want to have the best, highest-caliber leaders on our team. I look for high-impact people and reward and recognize their accomplishments.
What does your management team look like?
I joined Jackson Hewitt earlier this year and continue to build out our management team with high-impact "A" players. Our managers, depending on their particular function, will have a mix of people and critical reasoning skills with the ability to roll up their sleeves and drive results. Our field managers have a heavy mix of operation and execution in their DNA, think regularly about what is right for the customer, and understand their numbers. I look to put high-caliber people in stretch roles, and am comfortable with many managers being in a role for the first time.
How does your management team help you lead?
They help in carrying out our vision and reinforcing where we are heading as a company, and in driving the team toward our key goals. My managers are also an important sounding board for me and a great source of feedback on the mood of the organization, which provides me with insight and helps me adjust where we are heading, if necessary.
Favorite management gurus: Do you read management books?
I read more books earlier in my career. Today I spend time reading about leading thinking and theories on strategy, execution, and marketing in the Harvard Business Review and McKinsey Quarterly. I enjoy reading books by respected people who have made real transformations or built great things, like Howard Schultz's Onward: How Starbucks Fought for Its Life without Losing Its Soul.
What makes you say, "Yes, now that's why I do what I do!"?
I would say winning and taking on complicated problems. I enjoy cracking the code on complicated issues like innovation or driving the organization to be disruptive. I enjoy change and new challenges because they provide the greatest opportunity to make a difference. I also enjoy teaching people. I have a number of young managers and I help them achieve by putting them in stretch positions.
What time do you like to be at your desk?
Between 7 and 7:30 every morning.
Exercise in the morning? Wine with lunch? I am an early riser. I am awake between 4 and 4:30 a.m. because I exercise for 60 to 90 minutes every day. I then catch up on emails before leaving for the office. Lunch is usually around a conference room table, so I save the wine for dinner.
Do you socialize with your team after work/outside the office? I am a firm believer that regularly breaking bread is an important aspect of business. I look to get together outside the office either as a team or on a one-on-one basis with my direct reports. I also try to do things they like to do as well.
What technology do you take on the road? I am a gadget guy. My two devices of choice right now are my iPad mini with a Zagg keyboard and a Microsoft Surface Pro 3 tablet. I also just switched from a BlackBerry to an iPhone 5.
How do you relax/balance life and work? Daily exercise is a big part of how I relax. I really enjoy cycling and love to cook and collect wine. Spending my weekends with family and friends helps me find a balance of work and my personal life. However, I have been a big owner in the businesses I work in, so I find that work and personal life do meld together.
Favorite vacation destinations: I am a big skier, so Vail and Aspen are favorites. When not skiing, I enjoy spending time in Costa Rica and Napa Valley. I also love visiting big cities, including London, Paris, and New York.
Favorite occasions to send employees notes: I send handwritten notes regularly. I send a note to new employees when they join the company. I also spend a fair amount of time in the field, and following those visits I send employees notes to highlight great things I see and learn.
Favorite company product/service: I am proud of all our products and proud of the service we provide our customers every day.
What are your long-term goals for the company?
We are a challenger brand in a competitive industry. Our main goal is to grow our #2 position in the tax preparation industry, as well as extend the brand into an important part of our customers' lives on a year-round basis in financial services, healthcare, and related tax services. Over the next few tax seasons look for us to jump-start our footprint growth in a variety of venues including Walmart, traditional storefronts, and mobile/temporary locations. We are developing an innovation pipeline of products and services that will allow us to be more mobile and digitally enabled. Most important, we are becoming more central to our clients, hardworking average Americans, through our financial services focused on our prepaid Visa card, which allows customers to spend and earn, save for the future, repair and build credit, and protect their families. The growth opportunities in front of us are quite exciting for our corporate and franchise partners.
How has the economy changed your goals for your company?
We want to be competitive in all economies, and since taxes are required we are less economically sensitive. However, the rapid change in the economy to a mobile and digital one is affecting our business model. Our customers want the expertise of in-person tax preparation with the convenience of doing their taxes whenever and wherever they want. We need to rise to that challenge and move to the cloud and a mobile-enabled approach to business. Our current plan is exciting as we embark to be everything our customers want us to be.
Where can capital be found these days?
Capital is abundant today. You can argue there is even too much capital looking for good ideas. We are fortunate to have a great partner in H.I.G. Capital and the support of strong bank partners. However, we generate approximately $500 million in system-wide sales, we are profitable, and we have a capital-light business and growth plan with approximately 80 percent of our locations franchisee-owned.
How do you measure success?
Success in an organization comes in a lot of flavors, so there are a number of ways to measure it. We use balanced scorecards to balance our financial success, our consumer success, and our execution of key initiatives. How our customers feel about us and engage is an import indicator of our current and future success. I focus on execution and alignment of goals. Our ability to execute on our plans is a good barometer of our success. I believe it is important to reward people for a job well done.
What has been your greatest success?
I am fortunate to have had a number of great accomplishments in my career, and I am proud of them all. If I had to name one, I am proud of the startup and successful growth achieved at Smashburger. It has been a big commercial and consumer success, of which I am very proud.
I've had a great career, so I am very happy with where I am in life. The only regret may be that there is not enough time. There are so many things to do and experience, and I regret there is not more time to do them all.
What can we expect from your company in the next 12 to 18 months?
In the coming months and years you will see us re-launch the brand, jump-start our footprint growth, launch innovative products and services, including more mobile solutions, and we will begin a refresh of our existing locations. I am excited about all the great opportunities and challenges that are ahead.
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