Retiring WEC Energy Group CEO, Gale Klappa, is keen to ensure all employees have the company’s ethos and commitment to customer service embedded at the core of their roles. Here he explains how he achieves that:
The CEO of one of America’s largest power companies, WEC Energy Group Inc., will hand over the helm of the corporation to his successor this month following more than a decade in the post.
Gale Klappa won’t be leaving WEC though, instead he’ll remain to help steer the company through its ongoing acquisition period in his position as Non-Executive Chairman. WEC Energy Group is the leading provider of electric and natural gas services in the American Midwest, having last year spent $9 billion acquiring Integrys Energy Group (resulting in the largest ever non-banking sector takeover in Wisconsin’s history).
Today, around 4.4 million homes and businesses in areas of Wisconsin, Illinois, Michigan and Minnesota benefit from utility provision via Milwaukee-based WEC Energy Group (the eighth largest natural gas provider in the United States). The company’s assets are valued at $29 billion. The company has about 8,500 employees and around 55,000 stockholders of record, making it the 15th largest investor-owned utility company in the United States.
Maintaining and growing a company culture
With such a huge remit following the 2015 merger and expansion, it was more important than ever for Klappa, 65, to ensure his re-assembled managerial team were not only skilled in their new roles but also singing from the same company hymn sheet.
“Our existing culture and focus is at the heart of everything we do as a company,” said Klappa. “Even before concluding the merger with Integrys, we had chosen the leaders for the top 70 posts in the new company.
“As far as I was concerned, this was the best and most effective way to maintain our culture. I knew from the outset that every single one of those leaders had exactly the kind of focus we were looking for.”
Industry competitiveness with increased size and scope
The merger provided the new company with an increased geographical reach and technical depth. It resulted in 70,000 miles of electric distribution lines, 44,000 miles of natural gas distribution and transmission lines, and 8,800 megawatts of reliable power plant capacity. The expansion was essential in order for the company to remain dominant in what is undoubtedly becoming an increasingly consolidated sector.
The assimilation of both companies is also set to continue the impressive returns for shareholders, especially since capital spending has doubled to around $1.5 billion within the past 12 months.
Continued commitment to customer service
Residents and business owners meanwhile have been reassured that the same commitment to excellent customer service provided by Wisconsin Energy would also continue.
“Customer service is absolutely at the core of everything we do,” said Klappa. “In fact, I regard it as so important that I’ve told our staff I will personally take customer calls if there is a concern.
Really, all success in our business is local in the sense that it derives from customer satisfaction.
Take a look at the sector and you will find that the companies who are the most successful at satisfying customers also happen to be the companies with the strongest financial performance, most stable workforces, and those who contribute most to their community.”
Klappa suspected he was interviewing his successor in 2003
Klappa’s replacement is Allen Leverett – a man the outgoing CEO himself appointed as Chief Financial Officer in 2003. Leverett was, in fact, Klappa’s first ever-appointment after having taken the helm of Wisconsin Energy. And even then, Klappa had a hunch he was appointing the next CEO-in-waiting. Incidentally, when Leverett does take over, he will be the 14th person to hold the role of CEO.
Klappa has absolutely no doubts whatsoever that Leverett will make an excellent successor.
“Allen has been a key contributor to our success, first as Chief Financial Officer, then as the leader of our power generation group and most recently as President of the parent firm,” he said.
“I’ve known and worked with him for more than two decades now. The depth of his experience, his management skills and his focus on execution make him the ideal person to lead our company through a time of continuing change in the energy industry.”
Klappa: From CEO to corporate citizen
Klappa himself stepped into the role of President of his new firm — Wisconsin Energy — in 2003 from Southern Co. He was elected to the company’s Board of Directors later that year.
A 1972 graduate cum laude of the University of Wisconsin – Milwaukee (UWM), with a bachelor’s degree in Mass Communications, Klappa also has an honorary Doctor of Commercial Science degree from UWM. The latter is in recognition of his support for the university’s growth initiative and in helping to shape the economic future of the region via the launch of the Milwaukee 7 (a regional economic development initiative), in addition to his extensive community involvement. On his retirement, he will continue as Chair of the Milwaukee 7 and continue as “a pretty active corporate citizen.”
In 2013 Klappa received the title of Wisconsin Business Leader of the Year from the Harvard Business School Club of Wisconsin.
John Bergstrom, Chairman of WEC Group’s succession planning committee applauded Klappa for raising “the vitality, focus and performance” of the company. He added: “He has been an extraordinary leader, and we’re delighted that he will continue to help in his capacity as Non-Executive Chair.”
Klappa’s CEO style
As well as having their work performance assessed on a regular basis, Klappa has always insisted on every employee (including himself) being reviewed on the way he or she conducts themselves with colleagues and clients. He is also keen to see how they carry out the organisation’s core values on a daily basis. This ongoing assessment, he says, is the most effective way to embed corporate responsibility and the company’s values into its culture.
Another way he ensures his staff extol the virtues and directive of the company’s ethos is to conduct an employee engagement study every two to three years. The survey results allow senior management to gauge whether supervisors and managers have an “inclusive” and proactive management style with all staff who report to them. The success of this approach is measured – and assured – in terms of the low staff turnover that WEC Energy experiences.
