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Originally published in Business People-Vermont in 2004.

Going Downhill Pays Off

As president of Mount Mansfield Co. since 1997, Barre native Hank Lunde has steered Stowe Mountain Resort out of choppy waters with a philosophy of civility, sensitivity and consideration he says he learned from his parents.

Hank Lunde has led Stowe's premiere mountain company back to prominence...and profit.

by Julia Lynam

A great deal is spoken and written about "corporate cul-ture" these days, so it's fascinating to encounter a man who has put the idea to work and transformed a company through the promotion and encouragement of a particular style of communication.

Asked if he follows the doctrines of any particular psychologists, Henry "Hank" Lunde, president of Stowe Mountain Resort, is quick to answer: "My mother and father."

When he joined "The Mountain Company" in 1997, Lunde entered a situation of financial crisis, staff unrest and adverse local relationships. His not-so-secret formula for turning around the situation was to inject large doses of civility, sensitivity and consideration along with business acumen honed over 28 years as general manager and president of Killington, the largest ski resort in the eastern United States, and its former parent company, SKI Ltd.

Born and raised in Barre, Lunde graduated from Norwich University with a degree in civil engineering. Working in New York City in the late 1960s, he happened to spot an advertisement from Killington for an engineer. An avid skier from childhood, Lunde reckoned that this was his ticket back to Vermont. He hasn't left since.

It was at Killington, in 1984, that David Dillon, current president of the Vermont Ski Areas Association, met Lunde. "Hank is a very good person to work with," he says. "Very dedicated, very goal oriented; he manages a real strong team, setting the agenda and making sure that the tools are available.

"At Killington, he, along with Preston Smith, was instrumental in bringing snow-making, high-speed lifts and steep-slope grooming to the East, and now, through a long, arduous and very expensive process, he has brought Stowe to the brink of becoming a major new destination."

Lunde's ski industry peers recognize him as a man who has made a special contribution to the growth of the industry.

"He has a phenomenal kind of hands-on administrative style," says David Cleary, consultant and former special counsel to the National Ski Areas Association, who has worked closely with Lunde over the last 26 years. "Hank is very innovative and not afraid of the challenge of the new. He's also a tough man to work for. He asks no quarter and gives no quarter and his employees love him."

Lunde spent 28 years building Killington before leaving to enter business on his own. In 1997 he was invited to join the financially ailing Mount Mansfield Co., which operates Vermont's Stowe Mountain Resort and is owned by insurance giant AIG (American International Group).

A collaboration of 27 groups spent 41/2 years putting together a master plan that let the company obtain an Act 250 permit in 2003 to upgrade mountain facilities and develop real estate to finance the project. David Norden is vice president of Spruce Peak Realty, a sister company of Mount Mansfield Co.

Under his leadership, employees at Stowe created a company philosophy called "Triple A," which defines and guides resort operations. Three principles Attitude, Awareness and Accountability have been adopted as core company values and are actively promoted to help guests and employees fully understand the resort-wide culture of respect, safety, goodwill and excellence.

"Triple A is a very important culture within the company that came about when we first thought about some of the challenges we had on the mountain," Lunde explains, saying that difficulties arose most often between younger and older users of the mountain because of the different ways that they think.

"We decided to try to define who we, the staff, were, and to define our expectations of each other so that the people we were inviting to come and enjoy our facilities would understand what we were expecting of them, because it would be no different from what we expected of ourselves. So it basically came down to attitude, awareness and accountability."

This approach has also brought down staff turnover substantially. "Because of our business we have to bring a lot of people on in the winter versus the summertime, and a huge amount of our winter people come back year after year after year," says Lunde.

The Triple A philosophy underpins Lunde's entire approach to the job, whether he's taking to the slopes, as he does daily in winter, to visit with guests and ask how they experience the resort; bringing his considerable expertise to bear on thorny financial problems; or organizing a major resort revitalization project.

Within five years of his arrival at Mount Mansfield, and working primarily with the existing staff, Lunde was able to bring the company into profit.

"I'm very proud of being able to change the financial results of the company quite dramatically," he says. "It wasn't by spending a lot of capital doing new things, but by paying attention to what we do and doing it better. I think the Triple A program had a significant part in that: We started working together, understanding each other's needs, developing relationships and teamwork.

"The vast majority of people who are here today were here when I arrived. They've changed the company themselves by the way they worked with each other."

The most difficult and publicly visible challenge Lunde faced was to bring the resort into conformity with state water use regulations or face reducing the size of the operation.

The resort was taking more water from the environment than state water quality regulations allowed, and it had an obligation to come into conformity to year 2000 standards.

"We started in 1997 to develop the plan," Lunde recalls. "We were able to take the time to do this because we're owned by a major company and they don't rely on us for their financial resources. We said if everybody wants us to downsize the company, if that's best for the community, then that's what we'll do, but if that isn't what you want us to do, then we've got to develop this plan together."

Lunde assembled a collaboration of 27 groups, including chambers of commerce, the state of Vermont, the University of Vermont and environmental groups They spent 41/2 years putting together a master plan that enabled the company to obtain in 2003 an Act 250 permit to significantly upgrade the mountain facilities and to develop real estate to finance the project.

"The community master plan for the mountain provides a means of creating the financial capacity to build the infrastructure so that we would pull less water out of the streams at certain times of year." Lunde explains.

Because the resort sits in a small watershed, the amount of water in the streams is limited. A critical element of the plan is the construction of two ponds to capture water when streams are high and store it for snowmaking.

"If we were not able to store water, we would have to reduce our capacity by 70 percent, and that would have a huge ripple effect on the economy of Lamoille County," says Lunde.

By 1992, five years after Lunde's arrival, the company was showing a profit. A program called "Triple A" for Attitude, Awareness and Accountability has helped guide operations. Barry Pius (left) is chief financial officer; Don Johnson is corporate office manager and Chris Veit is ticket and season pass sales manager.

"The master plan defines what the Mount Mansfield Co.'s physical assets will look like 10 years from now: trails, lodges, homes and condominiums. It also says that this is it; there won't be any phase two or phase three or phase four!"

In a virtual reversal of the normal process, Lunde obtained the input of all interested parties before applying for the permit. His efforts, welcomed by the community, have also been nationally recognized as trail-blazing achievement with the 2004 Ski magazine Golden Eagle award.

Along with his capacity to organize and inspire, one of Lunde's strengths has been his integration into the community of Stowe. Within weeks of taking on the job, he was becoming part of the town and turning around a previously difficult relationship between town and resort. The Mountain Company now participates actively in the community and supports local artistic programs.

Lunde is a member of the Stowe Area Association and the Vermont Business Roundtable, and serves on several health care boards, including Rutland Regional Medical Center, Fletcher Allen Health Care and the Vermont Health Plan.

Lunde's contribution to the ski industry was recently recognized when the National Ski Areas Association awarded him its 2004 Sherman Adams Award for achievements that have been significant in catapulting Vermont to the rank of third-largest ski state in the nation.

As Dillon says: "Hank Lunde was one of the pioneers of modern ski resorts in the United States and we're lucky he's a Vermonter!"

Originally published in August 2004 Business People-Vermont

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