Oils Ain’t Olis

Mon October 2018

Over the past two months we have looked at the seven personal transformers. Refer to 7 PT’s for a summation of each one of these blogs.

One of the common pieces of feedback I received during the week was “love your focus on ‘personal transformation’ but can this really work in a big corporate. And don’t just provide a list of the usual suspects: Apple, Google, and Amazon” etal.

In 1953, a new start up set its sights on the Space Age. The Rocket Chemical Company had a small lab and just three people, but they could see a major opportunity in front of them. The aerospace industry was producing incredible new technology – missiles and rockets that could fly farther than any had before – but that technology had a major weakness: it was all made of meal, and metal rusts.

Norman Larsen, the chief chemist, had an idea. He thought he could come up with a chemical compound that keep the newly invented rockets and missiles from rusting. Norm and his two co-founders tried again and again to find a compound that would work. They tried ten times. They tried twenty times. They tried thirty times. Finally, on the fortieth try, Larsen and his team found a successful formula. They were soon producing the product for Convair, the maker of NASA’s missile.

Then something funny happened. The product worked so well that workers started sneaking it home to use around the house as a protectant, solvent and all-purpose lubricant. By 1955, Larsen realized he might have a market for his compound that was broader than the aerospace industry. He went back to the lab and started a new set of experiments aimed at finding a way to put his special formula into an aerosol can. In 1959, the first spray cans of the product hit the market, and the world met WD-40.

The product’s name comes from “water displacement, fortieth attempt.” Not a lot of fanfare or marketing spin behind that one; but forty years later, WD-40 had over 80% market share in the multipurpose lubrication market. Today it’s practically synonymous with that market, and while billion dollar companies like 3M have tried to unseat WD-40, none has been able to do so.

How does a company stay at the top of its game for over sixty years, making and selling a single product whose formula has only been tweaked once? (In the early 1960’s, they tried to improve the smell.) I’d argue they do it by taking a radical approach to managing their people.

Gallup states that only 33% of employees are engaged in their work. Worldwide, those numbers are even worse; just 15% of employees say they’re engaged. But at WD-40, a whopping 93% of employees consider themselves to be engaged in their work, and 97% say they are excited about the future of the company.

Why the difference?

Because WD-40 practices a human resources strategy that I call ‘personal transformation’. A strategy that is centred around learning: you start as a beginner, embracing the confusion that comes with being a novice; you experience a state of deep engagement as you learn, grow and gain traction; and you feel the joy of mastery once you get to the top of your learning curve. But then – crucially – you find a new challenge to tackle and the cycle starts over; human beings are wired to learn and change, not to stay in one place, doing the same thing over and over again.

At WD-40, this means that employees have an identifiable career path inside the company and that managers help their employees get from point A to points B, C, and D. They encourage employees to learn, leap to new roles, and learn and leap again. Because management encourages leaps to new learning curves, many people have been there for ten to twenty five years and longer. As CEO Garry Ridge said, “I get so much joy out of seeing people who are coming through the company and stepping into new roles. They’re standing on the edge and I say ‘Jump! Don’t worry. There’s a net…”

No wonder 60% of WD-40 employees believe they can satisfy their career objectives without ever leaving the company. Three senior leaders began their careers there in the role of receptionist. “Our brand manager for our key brand started in a part-time position as a receptionist, says Ridge. “We pushed her and pushed her and she jumped and jumped, and now she is a brand manager of WD-40. That is what we love.”

WD-40 exemplifies the practice of developing people through repeated transformations. Because people are challenged by and engaged in their work, they stay. This impacts the bottom line. WD-40’s market capitalization has grown from $250M to $1.6B over past eighteen years. Not bad for a company that sells a can of oil.