Until November 2014, Lee Schram, CEO of Shoreview-based Deluxe Corp., had never served on a public company board other than his own. But Minnetonka-based G&K Services CEO Douglas Milroy, who knew Schram well, wanted a sitting CEO on the board, says Schram.
G&K had built its business supplying branded uniforms and facility services to a variety of industries, including food processing and health care. But to keep growing, it needed to become more efficient. G&K was in the midst of a multiyear initiative to incorporate more digital technology into its business as a way of differentiating itself in the uniform services industry.
Besides being a public company CEO himself, Schram had made a career of technological improvement and business transformation. As Deluxe’s CEO since 2006, Schram has led its transformation from check printing to a digital services provider for small businesses, financial institutions and consumers. Those services now include website design and management, print marketing and fraud protection. (That said, Deluxe still prints checks.)
Before joining Deluxe, Schram held a variety of positions with Georgia-based NCR Corp., including group CFO and senior vice president of retail solutions. At NCR, he helped shift the retail business from its legacy cash-register business into a profitable point-of-sale and self-service technology business.
“My digital and cybersecurity background has allowed me to give support to [G&K’s technology] initiative,” Schram says. He has suggested ways that G&K can manage IT projects and track their progress. “Management knows that I understand what they are going through because we are going through and experiencing it here,” Schram adds. “We are just further ahead in our transformation at Deluxe.”
G&K’s IT initiative comprises ongoing multiyear programs. One recent example is equipping sales reps with iPads and route managers with logistics technology to speed up deliveries.
Other Board Service
As a member of G&K’s audit committee, Schram also helps management think through issues related to investor relations and quarterly earnings calls. He recently encouraged the audit committee and management to elevate the issue of cybersecurity to the board level. Schram invited several key G&K staff members to visit Deluxe to learn about the layers of cybersecurity defense it has in place.
“Lee has a terrifically well-rounded background, and he has significant financial experience,” says Ernie Mrozek, G&K’s lead director and former vice chair/CFO for ServiceMaster Global Holdings, a Tennessee-based residential and commercial services company. “Lee is very collaborative. Highly credentialed people can be better talkers than listeners. He is willing to both hear and be heard. His experience with technology, his financial background, his ability to prioritize strategies, and the decision making he has demonstrated have all helped him make significant, valuable, consistent and quality contributions.”
The benefits Schram has received as a director have been numerous as well. Besides inviting G&K managers to see its operations, Deluxe leaders have visited G&K facilities, and Schram has taken ideas that fellow board members provided G&K back to Deluxe.
“One reason my board wanted me to join the G&K board is to experience being a director from the other side of the lens,” Schram says. With that experience under his belt, it’s likely that Schram will be a hot commodity among boards seeking his brand of insight. —Gene Rebeck
G&K Accepts Cintas Buyout
In August, Cincinnati-based Cintas Corp., a longtime G&K competitor, agreed to acquire G&K for $2.2 billion, a deal expected to close by year’s end. A Delaware law firm promptly announced that it was “investigating potential legal claims against the board of directors of G&K Services, Inc. . . . regarding possible breaches of fiduciary duties and other violations of law” relating to the agreement. Neither Schram nor G&K had any comment.