Status Quo Is Not Company Policy

What You’ll Learn

David Naylor co-authored a book about Rayburn Electric Cooperative with a focus on how the cooperative realigned its core values to push for innovation throughout the organization.

The book is available on Amazon, https://a.co/d/dYuErZ0.

Guest Speaker

David Naylor

Show Notes

Transcripts have been lightly edited for clarity and readability.

Intro: A production of Pioneer Utility Resources. StoryConnect, helping communicators discover ideas to shape their stories and connect with their customers.

Andy Johns: What are some tools to fight the fight about doing the way things have always been? That’s what we’ll be talking about on this episode of The StoryConnect Podcast. My name is Andy Johns, your host with Pioneer, and I’m joined on this episode by David Naylor, who is in addition to being the CEO at Rayburn Electric Cooperative, he is also the author of “Status Quo Is Not Company Policy.” David, thanks so much for joining me.

David Naylor: Happy to be here. Thanks, Andy.

Andy Johns: So we have enjoyed working with the folks over at Rayburn for quite a while. And when I saw this book came out, I knew that I wanted to have David on an episode here because I know a lot of folks – status quo, sometimes David is just so dang comfortable, it’s hard to shake things up. But tell us a little bit about the idea of the book, “Status Quo Is Not Company Policy.”

David Naylor: Sure. So I will tell you my natural inclination for reading books is more like, you know, Calvin and Hobbes and [inaudible], but.

Andy Johns: All right.

David Naylor: This was one that, you know, when an opportunity presented itself, it was a great opportunity for Rayburn to help increase our profile and everything. But, you know, “Status Quo Is Not Company Policy,” the utility space is very much an industry where you ask a question of why are we doing things a certain way? And the response is because we’ve always done it that way.

Andy Johns: Right.

David Naylor: And, you know, when I first took over as CEO here at Rayburn, we had a lot of projects that had to get done, had tight deadlines. We’d had three employees who retired, representing 84 years of experience walking out the door. And we just had a lot of challenges that we faced. And again, we only had, at that time, about 25 employees. And so it was a phrase that really was born out of necessity. Just saying practically, guys, we can’t keep doing what we’ve been doing and meet these deadlines that we have to meet. And so “Status Quo Is Not Company Policy,” that’s where it was born. And then as Rayburn has continued to grow, it’s really expanded and really become part of one of our core values of innovation. You know, that just it anchors that. And as we continue to add new employees, I mean, that’s one of the things we encourage them to do is, hey, look at what we’re doing. Does it still make sense? And if not, then, hey, let’s improve the processes.

Andy Johns: Sure. And it was interesting to me, reading through the book, full disclosure, I have not finished it yet. I know that my boss Anne Harvey had just finished it this week. We were talking about it, but in reading through the book, I expected it to be a lot of kind of high minded ideas. You know, I’ve read a lot of leadership books before. What I thought was interesting about this book is this is really the story of Rayburn Electric Cooperative. You know, there are employees quoted in here. There are board members quoted in here. The examples you use, you know, you talk about that growth. You’ve got the chart in, I saw in one of the pages where it talks about the number of folks hired and the head count going up. I mean, this is really a lot more than just a bunch of ideas from the CEO. This is really the story of Rayburn Electric Cooperative.

David Naylor: Yeah. And that was really the, I mean, I think that’s who Rayburn is. I mean, yeah, I may be the CEO and the face as far as, you know, where we’ve been. But what makes Rayburn is the employees. And, you know, I think, well, I can certainly tell you some of my ideas and some of my thoughts. And, you know, I may have been instrumental in terms of helping chart the path, if you will.

Andy Johns: Sure.

David Naylor: It’s the employees who have to implement it, and they’re the ones who have to deal with it and have to figure things out. And, you know, so their successes are our successes and my successes are their successes. And that’s, you know, it’s a combination of who Rayburn is. I mean, look, at the end of the day, we’re here to serve our members. That’s our first and foremost priority. But the way that gets done is our employees. And so, you know, making sure that they were included in the process and included in, you know, like you said, a lot of quotes from them, a lot of quotes from our board. You know, this may have been, you know, my initial thought, but it’s got a lot of contributions from various folks here who have really helped to make Rayburn Rayburn.

Andy Johns: Yeah, clearly. This section here, you talk about, you know, some of the core values. You talk about the Rayburn DNA. You mentioned in here, it’s so easy to coast, and we know that’s true. There’s so much the temptation to just stay with the way things have always been. But you talk about Rayburn being a value focused organization rather than just a project focused organization. Tell me a little bit about what it means to be value focused rather than project focused.

David Naylor: Yeah. So like I mentioned, when I first took over, we had I mean, the situation that we had, we were about to become a transmission operator as defined by NERC. So we had a whole bunch of compliance obligations we had to meet. We had a power supply contract that was about to terminate and had a hard, fast deadline. And so in order to meet all these deadlines, we had to build about $40 million worth of projects between a substation, a couple of short transmission lines. And so we had all these things and projects that had to be done. And so what we ended up doing, I mean, we met the deadlines, but we were hiring employees because we needed to get things done. And so everything was geared towards those deadlines. And what we found was, that’s well and good while we’re all busy focused in on a common, you know, task and project. But when things started to slow down a bit, you start to realize, wait a minute, I’m not sure that this person really fits the culture of what Rayburn is trying to do. And you start heading into, well, all right now, I’m trying to manage – the management process becomes more prevalent, if you will. You know, when everybody’s looking towards towards a common goal, you kind of just the management stuff kind of gets, you know, shifted towards the back. And we recognized that, hey, this is not who we want to be. This is not really who we are. And we really need to shift our focus and let’s focus on these values. And that way the values drive everything that we do, not the projects. And that means, you know, again, our core values are pretty, you know, I mean, respect, integrity, excellence and innovation. Ironically, three out of those four were shared by Enron for what that’s worth.

Andy Johns: I don’t know that I would put it that way usually, but yeah.

David Naylor: Yeah, I mean. I didn’t realize that either, but I was brought to my attention not too long ago, and I thought, well, that’s interesting, but just.

Andy Johns: Turns out that that “integrity” one is a key one.

David Naylor: Ironically, innovation is the one that’s different. But that was, Enron’s fourth was communication, and ours is innovation. But, I mean, it just illustrates the point. You can have all the values you want; you better walk them, and you got to walk the walk and talk the talk. And so as we shifted from being project focused to value focused, you know, we wanted to make sure one we’re walking the walk. We’re doing, we’re exercising our core values. They’re not just words upon a wall or on a piece of paper somewhere. This is who we are. This is the Rayburn DNA. And as we hire people, you know, those are the core values that we’re looking for. Those are the traits that we’re wanting to make sure that, hey, we got somebody that, you know, what? If there is a questionable thing that pops up, I mean, to follow along with the Enron thing. Hey, they’re going to say something. Say, “Look, this doesn’t line up with who Rayburn is or who I am personally.” And then we say, “Yep, that’s absolutely right. Let’s fix it. Status quo is not company policy. Let’s take care of it, and stay true to who we are and those core values.”

Andy Johns: One of those things in here, especially if you’re going to be as innovative as having, you know, innovation in one of your core values there, it talks about mistakes being okay. And I like the line in here, “Failure avoidance is not a productive mindset if you believe in pushing the status quo.” And I think that’s the trap that so many folks fall into. The status quo is safe. You know, you’re not going to get called out for making a mistake by doing things the way they’ve always been. It’s easy to get called out and get in trouble for trying something that’s different. So I like that piece in there. But I’m sure it’s, you know, that’s got to be top down. And much easier said than done to make sure that everybody feels like it’s okay to make mistakes.

David Naylor: Yeah, without a doubt. It’s a balance. I mean, look, I can’t sit here and tell you that there are certain mistakes that you’re like, look, I can’t, you know, that’s just it. You’re sorry, but that’s unavoidable. But the reality is, most of the things I mean, look, you reflect on your own career and how you came up. And you recognize that man, you know what? I made some mistakes along the way, but I was given the time and the opportunity to learn from those mistakes, and then improve. And so that’s really what we’re trying to do, what we want to do is say, “Look, yeah, we don’t want you to make mistakes, but we recognize that mistakes happen.” And really, this is where the excellence core value comes into play. Excellence is not perfection. So we’re not asking for perfection, but we’re asking you to do is do your best. And what we want to happen is your best tomorrow is better than your best today. And it was better than it was than your best was yesterday. And so it’s continued, you’re continuing to grow. You’re continuing to develop. And, you know, again, I mean, if every time you make a mistake, you know, you got a lot of consequences. Well, consequences, then also fear starts coming in and, you know, you’ve got to have that mentality of, you know, complacency just can’t. We’ve got to fight complacency. And, you know, I’d rather have folks who take that risk and take that step to try to make an improvement. And then we can help rein them in and give them some training if we need to from there. But, you know, again, you’ve wasted a lot of time, effort and frankly cost if, you know, just because you make a mistake, you’re gone. I mean, that’s just not the mentality that we want to have here.

Andy Johns: Right, right. Well said. I do want to get into here in just a minute, a little bit about the art of publishing a book and kind of how that process went for you, and even the reasoning why you felt like it was an important thing to do. But before we do that, just to stay a little bit more on the kind of organizational philosophy piece of it. You know, chapter seven of the book you’re talking about Winter Storm Uri, that is a an inflection point, a watershed moment. Not just for y’all, for utilities all over Texas and Oklahoma in particular, but really the whole southeast or the southern part of the United States. Tell us a little bit about how an event like that kind of brings things like this into razor sharp focus for you?

David Naylor: Well, I mean, I can tell you when you have an event like a Winter Storm Uri, and so in Rayburn’s case, we incurred three years of power cost in a five day period. And it was, I mean, it was, I mean, there’s plenty of articles and public information that’s out there on what all that happened. But for Rayburn’s case, you know, that was a very significant event. And it’s amazing how five days out of the year can impact not only that one year, but it continues to impact how we operate and think today. And you know, that was again, that was really, like you said, it was really a watershed moment. And of course, you know, one of the things that happened as we, you know, went through Winter Storm Uri here in Texas is, you know, the largest G&T in Texas filed bankruptcy. And, you know, that G&T was about three times the size of Rayburn. And, you know, so you don’t have the luxury of pulling out the CEO manual and say, “Well, okay, in the event of, you know, we got a winter storm. Okay, here’s what you do. Steps one, two and three.” That’s not there. And so, you know, you’re flying by the seat of your pants in a lot of ways.

David Naylor: You know, I’ve got to deal with my board who recognized that, oh my gosh, we got three years of power cost, cooperative. I don’t have an investor that can eat that. It’s going to have to go to the members in some form or fashion at some point. And so we’re trying to figure out, you know, have those conversations. So we immediately pivot to having, you know, we have our normal monthly board meetings, but also we’re having weekly calls. “Hey, here’s what’s an update.” You know, we also we brought in additional counselors or advisors, both financial advisors, legal advisors. You know, we even had some political and lobbyists that we brought in, again, trying to solve the problem of, first off, you know, let’s understand what happened. Second, let’s figure out, you know, how we’re going to meet this need. Not to mention we got, you know, folks saying, “Hey, we got, you got bills that are due. How are you going to pay for them?” That’s just the board side of the things, if you will. But in the meantime, I’ve got all these employees and, you know, we had hired several employees just a few months before this happened. And, you know, largest G&T in Texas files for bankruptcy. People see that in the news. And immediately we pivot and say, “Okay, guys, let’s company meeting. Here’s what’s going on.” And so –

Andy Johns: Right.

David Naylor: You know, we had those meetings about every week as well. And I’d just get in front of the group and say, “Guys, here’s what happened. Here’s what’s going on. Here’s how we’re trying to approach that. Yes –” you know, I was very up front. “We had a G&T that filed bankruptcy. I’ll be honest with you. I got a bankruptcy filing in front of me ready, if that’s the option that we end up deciding. And here’s what that would entail on the impact on the rest of you.” But, you know, again, I tell them that that’s our least objectionable. I mean, that’s the last resort. We don’t want to do that. And of course, ultimately we ended up being able to do securitization to meet the, you know, pay those bills. So everybody was paid that Rayburn owed. Nobody was, I mean, we weren’t a penny short anywhere. Anyway, that’s, I can probably talk more about Winter Storm Uri than anybody cares to. The bottom line is, we don’t want to ever go through that again.

Andy Johns: Yeah, right. Definitely. Well, let me shift gears away from the kind of the content of the book and the Rayburn story and get into a little bit about about writing the book. So that’s something I’ve never done. I’m assuming this is the first time that you had written one. What all kind of surprised you about the process of, you know, it’s kind of intimidating, just all that, those blank pages in front of you, finding something to say. What surprised you about the book writing process?

David Naylor: Yeah. So I’ll give a lot of props here to Heidi Scott, the coauthor. And, you know, I will tell you, this was originally going to be, she was originally going to ghostwrite the book. And typical Rayburn fashion, “Status Quo Is Not Company Policy,” as we were working through it, I said, “Look, I don’t think ghostwriting is going to be the right way to do this. Let’s put your name out there and take the credit that you really, frankly, that you deserve.” So, you know, this was not on my bucket list, not on something I was looking to do it. Frankly, I think it was a result of Winter Storm Uri. I think that’s probably where Forbes kind of came across Rayburn, and ultimately they reached out. And, you know, from Rayburn standpoint, this was, again, how do we increase our profile? That was one of the challenges we faced during Uri was nobody knew who Rayburn was. And prior to Uri, frankly, we were comfortable being the best kept secret in Texas or even the nation. But that was you know, that’s not the case now.

David Naylor: But no, Heidi came in and, you know, the initial process, it was actually really good. We just talked. She’d ask questions and, you know, she had everything recorded, and we talked and just. And then she talked to the employees and the board members and, you know, then they saw all the stories kind of started coming together. We had a couple of other folks here from, you know, Gentry Ewing and Chris Anderson from Rayburn, who kind of helped part of the team, if you will. And, you know, so Heidi came one day, and we kind of put some big old not whiteboards, but sheets of paper on the board, or all around our board room. Here’s a story. And then you just start putting pieces together, and then you start refining the process and go from there. I mean, you know, it probably took a little over a year, all told. There’s some times there’s certainly more fun than others, but, you know, you work through that. And it was very interesting. It was definitely a learning experience for me.

Andy Johns: Well, you talked about there being a, you know, a hypothetical CEO’s manual, you know, to have a book like this with your name on it, kind of telling that Rayburn story to have so many folks from the co-op involved and quoted in the text, it certainly helps. I know when we’ve talked, you know, your goal, like you said, to step out from the background and really be one of the preeminent G&Ts around the country. So I mean, it’s a great opportunity in terms of positioning Rayburn, you know, to have the CEO with a book out talking about status quo in terms of communications strategy and position. I know it sounds like kind of the opportunity kind of fell your way, but couldn’t have asked for a better opportunity to kind of help position Rayburn and yourself as thought leaders in this space.

David Naylor: Yeah. No, it was great. I mean, that was definitely a, when I first got the call from Forbes about doing this, I’m like, I got to talk to my board about this. And so that was something that again, you know in your CEO manual, you know, talking to your board about a book is, that’s a little not something that is very common, I would think, or at least not that I found. And certainly it wasn’t in my CEO manual, but, you know, to the point we talked about earlier, you know, I told them, I said, “Guys, look, this is a, I mean, we’re talking about a way to increase Rayburn’s profile. While this may not have been on the list of options we had considered, here’s an opportunity that presents itself.” And frankly, that’s one of the things about Rayburn, we like to be opportunistic. And so we took advantage of it. And, you know, I guess I’d probably be remiss to say all the proceeds of the book actually reduce our member rates.

Andy Johns: And we talk a lot about storytelling. Obviously, the podcast is called StoryConnect. The book seems from the sections of it that I’ve read, I mean, it seems like a pretty authentic account, especially getting into the, you know, the Winter Storm Uri. You know, any time that you tell those stories, and you’re going to publish it, and you don’t know who all is going to read the book. Was some of that uncomfortable sharing some of those stories or, you know, is it the kind of thing that just comes natural and that was a decision to make to go ahead and tell those stories, get that out there?

David Naylor: Well, I mean, I think, you know, at the end of the day, all we can do is be who we are. And, you know, so that’s kind of the approach that we took is guys, look this is our story. People may like it. People may not like it, but that’s who we are. And I’m not trying to sugarcoat anything. I’m not trying to, you know, bad mouth, anything. It’s just this is who we are. And this is what’s worked for us. And, you know, I think that’s the, our day to day. It’s how we live things here at Rayburn and what we really want to accomplish. That’s not to say that we’re perfect, not to say we still don’t have challenges, but, you know, it’s a process. And I think that’s really what, you know, that’s the whole point of the book is status quo is not company policy. You’re always trying to improve and always trying to get better. And so hopefully, you know, folks who read it, I mean, maybe can take a few things from that book and, you know, make it applicable to what they’ve got, whether they’re a cooperative, whether they’re somebody else, whether they’re in the electric utility industry or not. That’s, you know, I think some of these principles, I think are applicable regardless, but I think it’s certainly been successful for us here. And, you know, honestly, I look forward to seeing where we’re going to continue to go.

Andy Johns: Yeah. Have you gotten any feedback or have there been any members or board members or employees or folks around the industry that have read it and had any feedback for you or anything?

David Naylor: Yeah, I mean, I think it’s been pretty well received. It’s certainly been doing well on Amazon in terms of, I mean, best sellers in several categories. I know several of my managers around my board members, I guess you’d say, general managers, you know, they bought several of them, and they’re passing them out to some of their folks. I was just at the Texas Electric Cooperatives statewide, their managers meeting, and they asked me to speak on it. And then they also want me to speak on it at their director’s conference. Of course, I’m doing a podcast here, and I know we’ve got some others that I’ve got lined up as well, but so, you know, it seems to be pretty well received. You know, I guess the proof’s in the pudding. And, you know, hopefully we’ll actually see folks who say, “Look, I took this and implemented it. And, man, here’s what how it took off.” I mean, that’s really what you want, right?

Andy Johns: Yeah. Yeah. If there’s a little less status quo around the around the electric co-op space, I think that a lot of folks that might benefit from that. I highlighted a couple of sections that I mentioned earlier about, you know, mistakes being okay and some of that Rayburn DNA. Was there anything else that I missed or that you wanted to share some any big other takeaways from the book that that you want to be sure folks don’t miss?

David Naylor: You know, I can’t necessarily think of any. you know, well, I guess the only other thing that I probably kind of mentioned is, you know, at the end of the day, when it comes to what we’re trying to do with “Status Quo Is Not Company Policy” and developing our employees, you know, it really takes a commitment. And you’re not going to I mean, if you’re looking for a quick fix, I don’t think this is a quick fix. I mean, I think the what we saw was a culmination of events, culmination of time. It’s people who are willing to step up and take responsibility, take accountability. And be willing to, you know, essentially leave a legacy here and say, “Hey, I want to make a difference.” And, you know, so it’s giving them that opportunity, and then being committed to that process. And not just saying, “Man, you know what? I tried this for a couple of weeks. It’s just not working out.” That’s not going to work. You’ve got to give it the time. You know people go through training. You’re trying to get them better and better. You’re expanding their comfort zones, right? I mean, what we’re comfortable today is great, but I need to be, if I’m going to grow, my comfort zone has to continue to get better or get bigger.

Andy Johns: Sure, I think those are wise words. Well, David, congratulations. I had the book right before this call. I had it back between Patrick Lencioni and Simon Sinek on my bookshelf here. So that’s not bad company. Congratulations for coming out with the book. And it is available on Amazon if anybody wants to check it out. It’s “Status Quo Is Not Company Policy.” And I think folks will enjoy it. So congratulations on coming out with the book and thanks for joining me.

David Naylor: I appreciate it. Thank you.

Andy Johns: He is David Naylor, CEO at Rayburn Electric Cooperative in Texas. I’m your host Andy Johns with Pioneer. And until we talk again, keep telling your story.

Outro: StoryConnect is produced by Pioneer Utility Resources, a communications cooperative that is built to share your story.