Leisa interviews Deborah Cannon, president & CEO of the Houston Zoo. Prior to joining the Zoo in February 2005, Cannon retired from an executive position with Bank of America. The leap from banking and finance to non-profit may sound formidable, but Cannon quickly adjusted to the new revenue model and quickly began to make progress in her new position. But then, finances were only a small part of what she had to learn.
Leisa: This is The BusinessMakers Show, heard on the radio and seen online at TheBusinessMakers.com. Today is a special edition; we're coming to you live from The Greater Houston Partnership's quarterly Business Leadership Council meeting. Our theme today is a - thank you everyone. Our theme today is a passion for leadership. We're going to have a conversation up close and personal with Deborah Cannon, the President and CEO of the Houston Zoo and former President of Bank of America and former Chairwoman of the Board of The Greater Houston Partnership, the only one that we know of. I know this is a big question Deborah, but tell me a little bit about yourself personally; about your history, how you got to be the President of Bank of America in the first place.
Deborah: Well, having been there for a long time. I started out at the bank in our credit training program and then went into the international department. I was sent overseas to Brazil back in 1978 and then after that I went into our Corporate Lending area and I managed w-a Midwest group. But back in about the mid to late seventies the large unit banks started buying up small banks in our holding companies. I felt like there was going to be a lot of opportunity there and so I actually asked to be transferred out to one of our small unit banks, um, in Dallas.
So I did that for a few years and then you may recall Texas banks ran into a lot of problems in the mid - mid eighties - mid to late eighties. I was with Republic Bank; Republic Bank and Interfirst merged on the thought that by merging they'd be strong enough to surv-to survive and that worked for about nine months and when we failed we were acquired by NCNB - which at that point in time, for those of you who remember, had people called no cash for no body (laughing) which truly was not true but under the terms of the agreement with the, uh, banking authorities, there were certain things that they could and could not do. Shortly after that branch banking became legal.
Then we started business banking and so I started that and we exported it to other states. I think then I went and moved it back over to the commercial bank, so and that's where I was when I moved to Houston in 1999 to be President of the region and about that time we acquired - Nations Bank acquired Bank of America and that led to a complete change in terms of how we manage things and so we went to running these huge divisions. So we had the East Coast, the West Coast and the Central Region. I went from running the Texas commercial bank - which frankly was my favorite job ever before the ZOO to running the business banking group for ten states.
So, I retired and but I got a call about three months after I retired - and so I got this call about running a zoo and my first comment was I don't know anything about running a zoo and my second was I'm not ready to go back to work but one thing led to another and I started looking at it and then we negotiated that I would start in February so we - I had a little bit more time to play, um, and then I joined the - the zoo in February of 2005 and absolutely have loved every second of it.
Leisa: You were a zoo lover to begin with though, am I correct?
Deborah: I was, yeah. I was but - and I actually had gone to the zoo within a couple months of moving to Houston, so that was in early '99 and I remember calling my husband and saying I'm never going back, it's a really crummy zoo - and it really was. And so what happened was the city formed a task force which led to the privatization of the zoo in July of 2002, so I was really fortunate in terms of it was two years after privatization, we had a great Board and a lot of plans to - to make it a really good zoo and so I would tell you, today we really have gone from being really a crummy zoo to being one of the best ones in the country. Well we've spent over eighty-five million dollars in the last ten years - primarily in the last eight years - upgrading the zoo and we have plans to spend a lot more than that over the next ten years so, um, our plan is to be the best zoo.
Leisa: Well I think this is really exciting. You've really run businesses of all sizes as you've grown through your career and you've definitely shown a passion for leadership, are there certain things that you practice that - that you do consistently that make you successful as a leader?
Deborah: Okay. Well I think when leaders do the right thing. I think leaders need to have good moral character and high integrity; I think you lead by example. You know, I don't think you ever ask somebody to do something that you're not willing to do. You know, I ask everyone of our staff members, regardless of what their job is, to pick up trash as you're walking across the zoo. I want our - our zoo to be absolutely immaculate and so I never walk across the zoo without picking up trash everywhere I go. So if you run into me in the zoo and I've been walking around, don't shake my hand. But, no seriously, I mean you - you have to demonstrate the behaviors that you want other people to follow, um, and - and obviously you have to treat people with respect.
Leisa: After thirty years in banking, you've entered non-profit; what was that transition like? I mean are there any easy tips for those of us - cause I think a lot of people in this audience could be considering a transition like you made, so tell us a little about it and…
Deborah: It's very different than the corporate world and again, I had served on a lot of non-profit boards, but you - with serving on a board you don't really understand what it takes to run that non-profit. So, you know, a couple attributes is typically the people that work in non-profits are mission driven and, you know, that's wonderful on the one hand, it's harder to incentivize them. So I had no idea, you know - having come from Bank of America, which at that point we, you know, we thought if - we were the leading edge of change; if we weren't changing something every week, something was wrong. And so to me that was just part of the whole, you know, here's how you run a business.
And when I got there, it was very obvious to me we were losing money. It was very obvious to me that what we had was a revenue problem. So we weren't going to cut expenses in - in terms of getting to profitability, that wasn't the way that it was gonna be - that it was gonna really works very short term. And so really the issue for us was we really had to figure out how to grow revenues and how to develop new sources of revenues and so I'm immediately talking about well, we've got to drive revenues. And not recognizing that in a non-profit it's not top down driven and you really have to build consensus; when you want to introduce anything new, you have to take a lot of time to build consensus and that was not the way I was - I was raised. As I say, I'm still talking about driving revenues and thinking about new things we can do and new ways we can drive revenue, people are saying - generally behind my back, but occasionally somebody would have the guts to say it to me - in - to my face - doesn't she know we're a non-profit?
So it really it took about a year and a half before we started making enough money, that we could do things for our staff and our animals; I mean we could get in some new exhibits, we could bring in some new animals, we could have new toys for the animals and then all of a sudden people started thinking well you know, this isn't such a bad thing after all. In fact, one of my, uh, most favorite memories is I had - the Curator for the children's zoo was in my office and we were talking about something and so I asked her how things were going and she said well, she was a little upset with her Keepers right then because they were - they just didn't like birthday parties; they just didn't like doing the birthday parties. And so she said, don't they understand it drives revenue? And I looked at her and said, oh Tinker, you've just made my year.
And what we do is, we do make a profit; it's not called a profit cause we're non-profit, but we take every cent we make and we plow it right back into the zoo and so a lot of that eighty-five million - or a good portion of that eighty-five million dollars that we have spent on capital improvements has come from money that we made. We have five general staff meeting a year and we talk about all the things that are going on and the first thing we start with is how we're doing visa vie our budget. And so they're excited when they see because they know that we're going to have a new Flamingo exhibit, we just opened a new water play area. I mean all the things that translates to is that, you know, we are - we make it a better zoo everyday, so…
Other things that we do, um, we're a huge conservation organization; people don't realize what zoos do in this country and all is there are two hundred and twenty-four accredited zoos in this country. Now, put that in perspective, there are like thirty-four hundred USDA approved animal facilities but there are two hundred and twenty-four accredited zoos because accreditation standards are very exacting and we all work together in terms of conservation, um, and so for instance, last year we worked on twenty-two projects around the globe. We spent, you know, 1.3 million dollars in terms of conservation work. And so, you know that's another thing, the more successful we are - because we allocate a percentage of our revenues to conservation activities and most of our - or a large number of our staff really are there because they love animals, because they want to conserve them, because they want to conserve their - their habitats and so, you know that's also been very helpful because they recognize that as we make money, we have more money to spend to help save some of these species.
Leisa: You've been talking already a little bit about the business of the zoo; what's sort of the total picture of the business of the zoo?
Deborah: It's really interesting, in - in all the years of banking I've probably looked at thousands of businesses and this is the most interesting business p-model I've ever seen. You don't just go out and buy animals anymore. You can't go to Africa and send some hunter out to get a new animal and yet we have this incredibly valuable population because animals are being slaughtered in the wild left and right. You know, today there are about a hundred - actually it's picked up from this number but over the last n-several years a hundred elephants a day have been killed in - in Africa and as I say, it's picked up this year; it's gotten much worse this year so I don't even know what it is right now. It's really important for us that one, we educate; our mission is to inspire people to care about the natural world and so to do that we have to - they have to see animals.
These two hundred and twenty-four accredited zoos have to manage our populations as a self-sustaining population since we can't refill it from the wild. We have the genetic information on everyone of our animals and so we make joint breeding decisions. There's something called a species survival plan - SSPs - and that's, eh, for endangered animals most of which - I mean most of ours are endangered. The zoos that hold that particular animal - for instance, there's sixty - six zoos that hold elephants - so we work together to make breeding decisions because we have to have - we can have no inbreeding because obviously that, you know, is very bad for the animals, it would have very bad, long term consequences - so we have to share animals. And so we do permanent loans, sometimes we do, you know, temporary loans so that we can breed animals and - and frankly there's a real problem because there's not enough space in zoos today to be able to maintain in perpetuity all the animals that we have today, so we are going to lose animals. But that's too - that's too depressing to talk about.
Leisa: When you say maintain - well I know, that's but it's curious to me, you mean there are going to be too many animals to keep or?
Deborah: There - there - there are too many - well we can't keep breeding them because there aren't places to put them; places where they can be well cared for. One of the things that was really interesting to me when I first got there, they kept talking about enrichment and I thought enrichment, what is that? A Keeper day starts at seven a.m. The first hour or so of the day is spent cleaning the exhibit, they rest of the day they spend working with the animals. In the wild no two days are alike for an animal, so we want no two days to be alike for an animal in the zoo. Either we have to keep them mentally stimulated or they will deteriorate, you know so it exactly; and then conservation. So I said we're large conservation organizations; the U.S. Fish and Wildlife came to us about five years ago and said there were - they thought - less than five hundred Houston Toads left in the wild. Now there are no Houston Toads in Houston but...
Leisa: What's a Houston Toad?
Deborah: Well it's a particular kind of toad and there used to be millions of them. And there used to be millions of them right in this area and so they felt like there were only about five hundred left and they were all around Bastrop State Park and so they asked us if we would help head start them. And what that meant was we would go out at night after a rain, um, when they would come out and we would - our staff would listen for them and then they would go out and find egg strands - and it was at certain times of the year - and then we brought those egg strands back and we raised those toads through tadpole stage. And we've been able over - over six - actually like, I guess it's six years now - we've been able to demonstrate that we have about a fifty-five percent, uh, survival rate if they're raised through the tadpole stage and it's less than ten percent if they're, you know, if they're just born in the wild. And so we have released fifty thousand toads in the last five years.
Leisa: The business of the zoo is extraordinary in that you're a bit of a Disney World for the consumer, but then you're kind of Baylor Research for the animals themselves. I mean you've got this huge research/medical institute going on, obviously you have conservation, you've got a donor business, I mean you have to do development, I know that, I mean it's…
Deborah: Well, housekeeping - jani-I mean, the grounds keepers, yeah.
Leisa: I think that you are demonstrating a passion for the zoo that's just extraordinary and the animals. Thank you Deborah.
Deborah: Thank you!
Leisa: I appreciate it. This has been The BusinessMakers Show, heard on the radio and seen online at TheBusinessMakers.com. We thank you for being with us today at The Greater Houston Partnership's Business Leadership Council; we'll be back again next week with another episode.