The only problem with rapid growth is that you can outgrow your management and governance capabilities, so that inevitably you face the need for painful and challenging change.
In the early days of CFIB, the relationship between the Board and CFIB was awkward and difficult. We were a not-for-profit that was undercapitalized, we were engaged in selling political involvement to small firms which is a particular kind of sale, and we were involved in a dozen political and technical battles, all areas in which no one had any real expertise. Half the time I was flying by the “seat of my pants” and so was our Board.
The first step in becoming more professional and better organized was creating a Building and Finance Committee in 1977 to oversee the development and construction of our new building at 4141 Yonge Street. Bob Morrow, a founding Governor, was made the Chairman.
In 1978 we hired senior people with the capacity to take on major tasks and provide some succession. The first was Pat Johnston, who became our VP Legislative Affairs and in 1980, a member of our Board. In the photo from 1981, Pat and I are seen testifying before a Commons Committee.
Then we hired Brien Gray as a Director of Provincial Affairs and Jim Bennett as Director of National Affairs. There's more on these stories in later chapters, but they represented a serious upgrading of our legislative team.
But what created an internal crisis was a decision to restructure the Division Manager territories, which was handled without adequate discussion and internal debate. But this revolt was used by a Division Manager from Alberta to launch a separate organization. We lost two other Division Managers and for a couple of years, we had only four Divisions across Canada.
We went from 90 DMs to 70 DMs, and put everyone on renewals for 12 months. We dropped 9,000 members but increased our cash reserves by $500K because commissions on renewals are half that paid for new business. Four years later, our competitor went out of business and CFIB was bigger and stronger than ever.
The Board did some serious restructuring and replaced Ray Sherk, our VP and GM, with Al Rioux, who was a Board member on staff at the time as the Project Manager of our Building. Al was also a Governor from Atlantic Canada and is seen here in the photo with Gerald Regan, the Premier of Nova Scotia.
The Board created a Management Committee of Al Rioux, Pat Johnston and myself. They also created a Board Nominations Committee with six-year terms for Board members.
They put me on a salary and bonus structure and took me off straight commission. I was on commission during the 70s while building the field. It was a matter of strengthening links between myself and our District Managers, who developed our membership and revenue base.
Now, at CFIB, we began a new phase in our growth with a strong management team and stable governance.
It is challenging focusing on the short-term and the long-term at the same time when you are “up to your neck in alligators”. Strong organizations combine strong leadership with strong governance. A great deal of our strength today goes back to the outstanding work of our Board in 1979.