When Tim McCarthy came to Sioux Valley Energy as the new CEO in 2013, he kept “pretty quiet” for about six to eight months.

“I just wanted to observe.”

Soon after that, he began what he calls a “culture recharge” at the Colman, South Dakota-based co-op that continues to this day.

At its heart, McCarthy says, the initiative is a transformation from the traditional “command and control” management philosophy to a “relationship-based” workplace that empowers the staff and makes better use of their talents and ideas.

“Sioux Valley Energy had a very good and effective manager before I was here. We just had different styles,” says McCarthy, who started his career at an investor-owned utility and found the top-down management style there “demoralizing.”

He says in those first few months, he perceived an “organizational fear” at the co-op.

“[T]here was a lot of fear of stepping up and putting forth new ideas. I wanted to hear ideas from every employee in the organization and not just from the strategic leadership team. The employees that are closest to the work and our members usually have the best ideas.”

To begin reshaping the work environment, McCarthy and his management team took on the co-op’s safety culture first. In 2013, Sioux Valley Energy contracted with Caterpillar Safety Services to conduct an employee safety survey, which found that there was a reluctance to speak up about safety problems for fear of being blamed for them.

Caterpillar helped the co-op develop a safety steering committee made up of employees from different departments. From there, the group initiated “Speak Up, Listen Up” safety training, which empowers employees to come forward with any safety issues they see.

“You’re not going to get near miss (injury) reports if people are afraid,” McCarthy says. “We had to develop trust that, if you share those things with us, we’re going to make it better.

“One of the coolest things I’ve seen is we had a third-year apprentice lineman step up to head our committee,” he adds. “Typically for apprentice linemen, it’s ‘Shut up, and do whatever the journeyman says.’ Never in my years had I seen an apprentice lineman play that kind of leadership role.”

The new philosophy of tearing down walls between departments and individuals spread to other areas of the workplace. Traditional performance evaluations were thrown out as employees and their supervisors were encouraged to talk about career growth on a regular basis without a formal process. Bosses became “coaches” who focus on helping employees succeed.

“We’re a team; we’re working together,” says Debra Biever, vice president of human resources and member services. “We’re not any more successful than our employees.”

To develop leaders among the co-op’s 109-member staff, McCarthy asked Biever and her team to develop an employee training program, which resulted in the creation of LEAD, an acronym for Leadership, Empowerment and Development. Each LEAD class works to identify an issue, evaluate options and come up with a solution. One recent product of the program is Community Connections, which brings employees together to volunteer for community service projects.

“We’ve had about 15 employees go through the LEAD training so far, and we’ve already had five promotions from that group, and the 10 others are more engaged and displaying daily leadership in their current roles,” Biever says.

This year, the co-op is continuing its culture recharge by working with Minnesota-based Keystone Group International, a consulting firm that helps improve businesses. Keystone created a comprehensive employee survey, which inspired new co-op goals for this year and beyond, which include improving hiring and promotion criteria, reworking internal communication systems, creating internal customer service expectations, and advancing employee growth and development.

Co-ops looking to reset their own workplace cultures need to understand that not all employees will welcome the change, Biever says.

“It takes everyone to commit to these changes to make it work,” she says. “We did have employees who didn’t quite commit, and they went on to other positions or they retired. Now we’re trying to hire employees that fit into our culture.”

McCarthy says his best advice for co-op leaders interested in making similar changes is to realize that it takes time to build trust among employees. And it’s important for management to admit mistakes along the way.

“Everybody is out there looking for a magic bullet,” McCarthy says. “But this takes time, and it takes commitment once you go down this path. It’s not a program; it’s a mindset. It’s a philosophy that you’ve got to live, or you’re not going to be truly successful.”

Does your small or medium-sized co-op have an innovative program or unique solution to share? Send Thinking Big ideas to Erin Kelly at erin.kelly@nreca.coop.