A company ahead of its time: Insights from a 100% virtual business

A company ahead of its time: Insights from a 100% virtual business

In this podcast, Marc Zionts, executive chairman and board member of Precision Nutrition, a native 100% virtual business, discusses what it takes to successfully run a business with a remote workforce, both during the COVID-19 crisis and beyond.
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In this podcast, Heidrick & Struggles’ Jessica Gentile speaks with Marc Zionts, executive chairman and board member of Precision Nutrition, an online fitness and health platform with a unique business model: it is a native 100% virtual business. Zionts shares his experiences on the practices, processes, and benefits around running a fully remote company. Zionts has found that success lies in a combination of having people who are fit for remote work, a mission-based organization that people are connected to, and well-developed processes for remote working. He also stresses the importance of taking care of and staying connected to your people, which is vital in a remote work setting—advice that can help companies as they navigate remote working in the current crisis.

Some questions answered in this episode include the following:

  • (1:33) Precision Nutrition is a totally unique business model, a 100% native virtual approach. What are the structure and philosophy of the company?
  • (3:09) What have been some of the key learnings and challenges for you thus far, and anything we could apply to what we’re currently facing?
  • (6:52) What do you think works and what has been more difficult in a remote setting, especially given your experience as a multiple-time CEO in traditional environments?
  • (11:12) What skills or characteristics do you think are really necessary for people to thrive in a 100% remote organization?
  • (19:25) Do you have any advice or tips that you would like to share with other leaders, as they think about how to continue moving forward in this remote working environment?

Below is a full transcript of the episode, which has been edited for clarity.

Welcome to the Heidrick & Struggles Leadership Podcast, the premier provider of leadership consulting, culture shaping, and senior-level executive search services. Every day, we’re privileged to talk with fascinating people who are shaping the future through their leadership and vision. In each episode, you’ll hear a different perspective from thought leaders and innovators. Thanks for listening to the Heidrick & Struggles Leadership Podcast.

Jessica Gentile: Hi, I’m Jessica Gentile, a partner in Heidrick & Struggles’ Global Technology & Services Practice. In today’s podcast, I’m pleased to have Marc Zionts with us. Marc is the executive chairman and a board member of Precision Nutrition, a unique online fitness and health platform with the aim of transforming how people look, feel, and perform through education, technology, and expert coaching. Marc is a steeped technology executive, an avid cyclist and outdoorsman, and an entrepreneur at heart and has been leading businesses since 1987. He has held CEO roles in several companies, including Automated Insights, Aicent, and Dialogic. He serves as a board member at TEOCO and Friends of the Earth US, where he is the treasurer and head of the finance committee. Marc, welcome. We appreciate having you, and it’s great to speak with you again.

Marc Zionts: Thank you, Jessica, and I’m delighted to be here today.

Jessica Gentile: Marc, Precision Nutrition is a totally unique business model, a 100% native virtual approach. I think what would be really interesting is if you could please take a couple of minutes and explain the structure and philosophy to our listeners.

Marc Zionts: Precision Nutrition is over 15 years old, and from the day we were founded, we have operated as a fully remote and virtual company. Now let me just be very clear: that means we actually do not have a physical office anywhere, and we never have. So when we came upon the situation that we’re all living under now, this is something that we’ve trained for and we’ve been prepared for our entire business lives. Now of course there are many things that are different today, but in terms of our philosophy, it’s always been about how do you run a company and attract the best talent, retain the best talent, and help your team live by what you teach and what you believe in, in terms of core values? And for us, it’s always been about people having enough time to take care of themselves, their family, or to get the sleep they need, and to spend more time doing those things and having time to focus on work, rather than having to commute into an office. So it’s really been at the core of who we are as an organization and a core part of the philosophy we have in how people should live their lives.

Jessica Gentile: Can you talk a little bit about those key learnings and what some of the challenges for you have been thus far, and anything we could apply to what we’re currently facing?

Marc Zionts: First of all, I admire what so many businesses have had to do by necessity, and that is to literally flip a switch and overnight have no choice but to figure out how to adapt to remote work, and that is so hard just to do. We’ve had time to work on this, and what’s made it work very well for us is, first and foremost, we are very much a mission-based organization. We help people live a healthier and happier life, and so our team really defines success as being able to help more and more people on a continual basis. So they could work anywhere; they’re talented people. They choose to work at Precision Nutrition. So to the extent that you have a strong mission and that your team connects with the mission, I think it really helps facilitate the dedication and the loyalty that makes remote work a bit more feasible.

The second thing is that we have developed processes and procedures around being remote. Precision Nutrition is one of these unique organizations that operates under the roles of a holacracy. I like to describe it as agile for the entire company, very much rooted in self-management. Now I think this works well when you combine it with a mission-based company, but it also works well in our case because we have more of a mature workforce. What I mean by that is that we don’t really hire entry-level team members; our people are more in intermediate and advanced stages of their career. So we’re not training on entry-level skills; we’re not having to listen in on calls or review code, sit with people, so it also makes things work a bit better.

So it’s a combination of having a mature team, having a mission-based organization that people are connected to, and having an operating system that really works well. And if you put those things all together, you build a culture around that, and so our people are very intentional and very aware of how they interact.

It’s rare that we’re ever on a phone call; it’s almost always video, because that eye contact still matters. We never start a meeting by jumping right into the meeting; all of our meetings begin with what we call a check-in round, where we go around and everyone just talks about how they’re doing and if they’re ready for the meeting, not unlike physically walking into a meeting room and everybody’s walking in and they’re doing that chitchat, that socialization. That’s how we start our meetings, and then we go into the actual meeting. We also end all meetings with what we call a check-out round, where everybody gets to say how they feel at the end of the meeting—Did they get something out of this? Was this a waste of time? Do they feel better? Do they feel worse? So again, connecting on those human levels and being intentional is really important.

Now what has changed for us is we do periodically get together. Once a year, the entire company gets together, and it’s mostly about building on relationships and socialization. So while we’ve had some interruption to how we work, the fact that we work remotely routinely makes getting through this period much easier.

Jessica Gentile: Can you tell us what you think works and what has been a little bit more difficult in a remote setting, especially given your experience as a multiple-time CEO in traditional environments?

Marc Zionts: I’ve run organizations that have been 100% brick and mortar and in person. I’ve run businesses that have been a mixture of remote teams and on-site teams. This is my first time running a company that’s 100% virtual, and what I’ve concluded is that being all together is great if you can do it. The human interaction, the comradery, is just a great thing. It rarely happens, though, because, unless you’re running a really small company, you always end up with multiple sites, so people are still distant and not always coming in for a meeting. So my conclusion is that working where some people are in different locations, or half your team is physical and half your team is remote, is really, really hard. I think that’s the hardest thing of all. To me, running an organization that’s 100% virtual is very similar to running a business where everybody’s together in the room, because you’re all in the same boat; you don’t overlook things. I can’t tell you, and I’m sure you can relate to this, Jessica, how many times I’ve been in an in-person meeting and a few people aren’t there, and you may forget to even dial them in, or you forget that they’re on the phone and you’re not incorporating their input into important points of the meeting. So [being 100% virtual] forces you to interact in ways that you might not if you had a mixed team. So that’s one thing that I have certainly learned.

The other thing is that we recruit specifically around people who are interested and are capable of working remotely, and the way we assess this is through testing. So in addition to structured interviews, we do pretty extensive testing for fit for role and for profile and to really tease out if people are up for working remotely. And the reason this is so important is it aspirationally sounds pretty great [to work remotely], but I’m sure a lot of people right now are sitting at home working, when they normally work in an office, and saying, “I can’t wait to get back to an office.” It may be tough having pets around, kids around, delivery people, interruptions; it sounded great until you had to do it. So we try to make sure that people really are up for that, and part of that is making sure that they have thought it through. Have they worked this way before? Do they get socialization in person elsewhere (in a normal world), so that they’re not missing out from those work relationships? So for us, the testing and the hiring have a lot to do with how we build a team.

Now if the organization has no choice but to flip a switch and be remote, you have who you have, and [being able to work remotely] has never necessarily been a consideration. But the world won’t be the same after this crisis, and I think people are going to reevaluate remote working. A lot of people are going to say, “I never would have dreamed of working remotely. And you know what? It’s not so bad,” and maybe they go back to a world where half their people work remotely, because, frankly, they want to have social distancing in their office; they don’t want that density that they had before in the office. And maybe they’re going to decrease the density—keep the same space but have half the people work remotely, or people work every other week or a few days a week remotely. I think work is going to change, and this is going to become more important. People are going to have to set up processes, testing, methods of engagement that incorporate people that are both in an office and remote. And so I see this as accelerating the trend toward remote work in a pretty major way, even when we come out of this.

Jessica Gentile: In addition to some of that thinking and some of the rigorous assessment that you do, what skills or characteristics do you think are really necessary for people to thrive in a 100% remote organization?

Marc Zionts: I think it’s different for every personality type, but you have to have somebody that feels good about themselves, that they’re confident in their abilities, that they feel comfortable working in this manner, that they can build relationships, maintain relationships with their colleagues, that they can build trust with their colleagues, and that they are getting what they need from in-person socialization from other sources, be it family, friends. I think that’s really vital. So they’ve got to have that balance that they would be missing from the fact that most of their day they’re going to be engaged with a screen. And even though you build these relationships with your colleagues, in some way they’re this video avatar to you. So I do think you have to carve out time for people to get together face-to-face.

As I mentioned, we have an annual get-together; we call it “the gathering.” We allow a total of five days—Monday to travel in, Friday to travel out, and a three-day meeting, of which there’s probably anywhere around one and a half to two hours of content a day, and the rest of the time is reserved for people to spend time with each other and appreciate each other, have gratitude for each other, and spend time with people who they may see only once a year in person. And furthermore, when our teams are working on more strategic efforts, planning, other activities, you’ll have teams get together throughout the year. So I think you still need to make space for that. You’ve still got to allow those times for people to get together. You’ve got to make sure that your people, when they are signing up, not only feel good about working in this manner, but that they have been thoughtful about getting enough socialization from wherever else they need it.

Even though we’re remote, we recognize that people’s lives have changed and they’re not getting some of that socialization, because they can’t; they’re sheltered in place. We’ve tried to allow for more space at the company, so we’ve created additional channels on Slack: family resources, parental resources, just content where people can share as they’re trying to educate and entertain, be it young children, teenage children, elder parents. So that’s really a nice thing; we didn’t have that before. There was never a need, and now there’s a real need. We also have created permanent rooms in video, which are just left open at all times, where people can go if they just want to hang out and chitchat, whether it’s a coffee break during the day, wine after work, whatever. The only rules are that you’re not allowed to talk about business; that’s it. So we’ve created these extra places.

I’ve heard of a lot of companies doing this—happy hour, whatever you want to call it—but it’s important right now because people are missing a part of their life, and you have to be aware of that. And even for us, we were ready for working this way, this is how we work, but there’s a big difference now. Suddenly people have kids around, suddenly people have a partner around who may have worked in an office and suddenly they’re there. So even though you knew how to work remotely and it worked incredibly well for you, your world may have been turned upside down in terms of how you work. So we’ve also tried to be very sensitive and accommodating to the fact that people are having some challenges. It may not just be the kids who can’t wait to get back to school; it’s the parents who can’t wait for them to go back because they’re not used to having their day taken up with incredible juggling requirements.

Jessica Gentile: Are there other tips you can provide to those leaders in that transition, as they think about how they might screen or how they might prepare either new hires or existing hires for this kind of a shift?

Marc Zionts: You need to have processes and procedures for how you run a meeting, to be more inclusive. Go video whenever you can, and then consider the equity of the on-premises/off-premises workers.

And I think people need to be really aware of the health and wellness of their employees. We’re going through something phenomenal here. I saw a study from the American Psychological Association, from 2012, and I can’t imagine what it’s like now, but it said that 22% percent of adults, 13 and older, suffer from some form of anxiety. First of all, even before this crisis broke out, my guess is that number has increased a lot since then. And, with this crisis, if you had an anxiety disorder, it’s been magnified now, and if you didn’t, you might have one now. So we can’t underestimate the need to make sure your team’s OK, that they’re giving themselves that space, the self-care they need to feel better. Are they getting enough sleep, are they managing the stress, are they getting enough movement, are they taking care of whatever their nutritional requirements are, their family, their social interaction? These things are important, because we can be cold-hearted about business and say, “I want productivity; I need results now more than ever to come out of this thing,” but if you don’t have a team, it’s not going to get you there. Our view is that this is a golden opportunity to show what you’re really made of as a company. How you take care of your people, how you take care of your clients, over the next three to five years, is going to determine who comes out on top and who doesn’t. And I think a large part of that is going to be about how you treat your team and how you treat your clients.

Jessica Gentile: What recommendations do you have to help employees find the right balance, any additional to those you’ve already shared with us?

Marc Zionts: One of the things I’ve been doing is just making the rounds and setting up one-on-ones or just spontaneously reaching out to people on video in my company and just talking about how they’re doing—what’s their situation like, do they have the support they need, are they taking the time for themselves, have they thought about how they have to do things differently? So again, not talking about deliverables or the work but about them, and I think if that’s authentically a concern you have, it will be appreciated.

Some people will respond to the situation by rising up and being really engaged in taking care of themselves, and then there are people who will go the other direction. Real divides are showing up, and you have to think about that in your workforce, between perhaps people that are entry level or less skilled and higher-skilled people, who may be experiencing things very differently. We’re not robots; we’re humans. And if your people are not taking care of themselves, they’re not going to be very helpful to you for very long. So be super aware of this and make time to reach out and have those conversations, direct your managers to do the same, and then have ways of providing solutions to help people. This is going to be really important.

Jessica Gentile: Marc, any other advice that you have or tips you would like to share with other leaders, as they think about how to continue moving forward in this environment?

Marc Zionts: I would just encourage everybody to think about how they can work remotely, when they have to or if they choose to, for some or all of their workers, over time, because I think that this is something that we’re not going to be over with overnight, and it may be back again. So how do you have a process where if you do need to hit the circuit breaker and go remote that you can, whether your office is closed for some natural disaster or there’s another health issue?

I also think you have to think right now that even if you said, “Hey everything’s good; let’s all get back to work,” you have now trained people on a new habit. It takes—I think there are books written about this—21 days to develop a new habit, some people say about four weeks, but there’s been enough time now that we’ve trained people to work differently and have a different kind of life. How many people are going to look at you and say, “I don’t want to come back to the office.” What are you going to do? Are you going to say OK? Or what if they say, “I’m just not comfortable coming to the office today, or this month; I want to see how this thing plays out a bit more.” Or, “I take public transportation. I don’t want to get on a bus; I don’t want to get in the subway.” Or, “I’m not comfortable going into the office. I’m not comfortable that there’s good screening.” So even if “business is open” and your state has lifted restrictions, what is your policy? Beyond your policy, how are you going to accommodate exceptions? For us, it’s much easier. When partners go back to work or kids go back to school, life goes back to normal, Zoom becomes a little less crowded from all the newcomers, so our lives only get better. But for businesses that went remote during the crisis, they have really big things to think about here, what their policies and actions are to take care of their team but be able to get back to work.

Jessica Gentile: Marc, I want to thank you so much. I have enjoyed learning more about Precision Nutrition, your approach, and the tips and advice that you’ve shared have been invaluable.

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