You could call Laurie Schultz a “turnaround” CEO, but she prefers “re-startup.” Brought in by ACL’s founder in 2011 to breathe new life into the stagnating software company, Schultz—a veteran leader with experience reviving foundering tech firms—was quick to diagnose what was needed: better employee engagement, greater profile among its global customers, higher sales. And the people part was non-negotiable: “One of my first mandates was around culture and employee engagement,” Schultz says. “That created the momentum behind a transformation of the customer experience. And that then fed our financial transformation.”
ACL’s roots trace to 1972, when University of British Columbia accounting professor Hartmut Will developed the audit command language that underpins its software. Will’s son, Harald, launched it as a commercial product in 1986. Today, ACL’s software helps global organizations including Sony, Wells Fargo and Toyota with governance, risk management and compliance.
ACL today has about 350 employees, and engagement is very high—but that took some doing. “When I joined, our culture was kind of flat,” Schultz recalls. Employees felt uninspired, reflected in tepid reviews on the online employer-rating site Glassdoor. So Schultz’s first year on the job was spent talking, in town halls and casual corridor conversations, with every person in the company—some 250 people at the time. “I was trying to find those people who wanted to do something that really mattered, who were prepared to take some high-integrity risks and to lead change,” she says.
Those conversations drew out what people believed in, what their values were and why they came to work in the first place, all of which coalesced into a new ACL strategic plan: a one-page document that sits on everyone’s desk and bears everyone’s authorship. Schultz and her team then took a hard look at some of ACL’s offerings, and if the products didn’t fit with the vision and mission of the plan, they turfed them. “Some of the things we de-focused on were large revenue lines for us,” Schultz says. “I can tell you, that’s really hard to do.”
Also hard? Flipping your payment model upside down. Four years ago, ACL transitioned from upfront remittance to a subscription model. Involving 7,000 customers in 140 countries, the change upended ACL’s profit-and-loss sheet for two straight years. “We just had to be patient,” Schultz says of the transition.
These changes positioned ACL for continued growth, as well as several recent acquisitions and its first round of outside investment. “If you continue to grow like ACL has, then you get looked upon way more favourably by investors for having a recurring revenue model,” says Fraser Liptrot, an audit partner at Deloitte who coached the company in its Canada’s Best Managed Companies application. Factor in very low client churn—ACL customers are loyal to the software—and it “does wonderful things for your valuations,” Liptrot adds. That matters, as ACL’s goal is an eventual IPO. (Yes, all employees have been issued stock options.)
In Schultz’s view, durable, long-term change is far better than the dramatic fixes (ugly takeovers, mass firings) of many turnaround bids. “If you take the longer route,” she says, “and drive things that are sticky—culture and customer experience—you’ll be rewarded perpetually on the financial side.”