Culligan Water Case Study

Topgrading Boosts Company and Career Success

"Topgrading has definitely made two companies I’ve run more profitable. Nothing has been more important for my career success. Really – at least half my career success is attributable to Topgrading and Brad Smart’s counsel."

- Scott Clawson, CEO

No. of Employees: 10,000+
Industry: Consumer Water Services and Solutions

Highlights:

  • Percent high performers in all corporate jobs improved to 85%
  • Enterprise Value has gone up from $400 million to $9 billion
  • 2024 sales are expected to be $3.4 billion
Scott Clawson, CEO, Culligan Water
Scott Clawson, CEO, Culligan Water

The Company

Culligan was established in 1936 as a provider of water softening solutions for residences and has since grown to become the worldwide leader in consumer water solutions and services in residential, office, and commercial markets. Culligan improves people’s lives by providing safe,healthy water to consumers at home, at work, and on-the-go. Culligan does so in a sustainable way, helping improve our planet by eliminating the need for single service plastic. Based in Chicago, Culligan has manufacturing operations in 18 countries and over 600 dealers in 85 countries.

Culligan CEO Scott Clawson’s first Profit and Loss position was with Danaher, a top performing company that embraced Topgrading. “My job was to re-tool the division, set it up for greater organic growth and do M & A,” says Clawson, “and at Danaher P&L leaders are expected to perform. I credit Danaher with vetting all possible hiring methods and concluding that Topgrading was the best.” Clawson’s division was so successful, he quickly earned a promotion after completing a big acquisition.

Challenge

Later in his career, Clawson was hired as CEO, by a private equity company, to turn Culligan around after buying it out of a re-structuring. The PE company used Topgrading to assess senior managers. From the assessments, Clawson knew that, like his first Danaher P&L position, the Culligan management team would require extensive re-tooling.

“Topgrading has been key to my career success. I don’t know many HR professionals who have achieved anything close to the percent high performers hired that we’ve achieved at Culligan.”

- Gary Parkinson, SVP, CHRO

Solutions

Clawson was very familiar with Topgrading from his experience at Danaher and from being coached by his brother Curt, CEO of several companies that embrace Topgrading. Scott used Topgrading to replace five out of eight executives, and all replacements turned out to be high performers. Says Clawson, “We Topgraded senior management quickly and better operating results were so fast in coming, I knew Topgrading was working.

Even before showing up for his first day at Culligan, Clawson hired an HR Executive and got all managers to read Topgrading: 3rd Edition. He brought in Topgrading Professionals to train all the managers and then implemented train-the-trainer. All new managers have been trained internally since then. HR is fully involved in Topgrading at Culligan. The CEO is the only one who can enforce the necessary disciplines, but HR does most of the heavy lifting to help hiring managers.

Clawson requires that Topgrading hiring methods be used for all management hires. Clients and vendors are also encouraged to use Topgrading to become more successful - and Culligan benefits by working with mostly A Players inside and outside of the company. Clawson notes the Tandem Topgrading Interview has been a game changer for Culligan.

"Our only limiting factor to continue to achieve such growth and success is people, and with Topgrading we have been able to hire, retain, and develop A Player talent."

- Scott Clawson, CEO

Topgrading Results

Out of 75 corporate hires, 78% have proven to be A Players. We track how our hires are doing and rate them through the performance management system and by using job scorecards. To hire someone, the Topgrading process must be followed, including a job scorecard to get the job approved to be hired, the Tandem Interview and other key steps in the process.

Since Topgrading, the percent of high performers hired and promoted in all corporate jobs at Culligan has improved to 85%. The company has made over 100 acquisitions and achieved 25%+ annual growth. Organic growth has averaged over 8%, EBITDA margins have increased, and Culligan has become the leader in their industry.

“Initially, we trained all on Topgrading and Tandem Interviews, however, we let managers interview how they wanted and didn’t force them to conduct tandem interviews. Over the last several years, we mandated that the Topgrading Tandem Interview must be done when hiring someone. Mis-hires went down as A Player recruits skyrocketed. It takes time but it’s well worth it. Talent and leadership is our differentiator and Topgrading’s hiring methodology is the way to obtain and retain it.”

- Scott Clawson, CEO

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