A few weeks ago I spent an hour with Avi, the CEO of a $50 million manufacturer of industrial equipment. Sales were good, new product development was good, the staff was good, facilities were good – but he was not happy. Something was bothering him and even he was having a hard time expressing it. After asking a few questions, I think he was frustrated that things were just good and not great. Just like the rest of us, he is reading the news about the upcoming recession but his team is not energized to fight a problem they don’t yet see. Next week we meet again and here are some thoughts that might help him:
1. Productivity Improvement is a Cultural Challenge, not a Technical Challenge
Avi can hire the best lean manufacturing experts in the world, like the Lean Enterprise Institute, but if his top people are not committed to change, nothing significant will happen. During the 8 years I worked at GE, I was taught their “Change Acceleration Process” and later I taught others. We were fond of saying that 98% of all successful initiatives depended on shifting the culture or the organization. The first step for Avi would be to recognize the huge importance of culture.
2. Cultural Change is a Process That Can Be Learned
GE had a 7 step process for producing change in their organization. Toyota has their process for reinforcing and improving their change culture. Other experts have their process. My point is that Avi can pick a process, train his people and together they can implement it across their organization. Shareholders used to think that a charismatic leader was the key to successful cultural change and while it can be a factor, Jim Collins in Good to Great proved that wasn’t the case.
3. Systems and Structures Are Critical to Success
Too many times managers rally the troops to improve a process, only to see it die 3 months later. I think that sustaining the focus is the biggest challenge any leader faces in today’s instant gratification culture. Many of the mid-cap CEOs that I talk with have the great fortune of being privately held, but even still they can be pulled off of long term objectives to address short term deficiencies. Our employees see the us move on and the “project of the quarter” quietly dies. While GE has great tools to help, my personal favorite is Mike Rother’s interpretation of Toyota’s system called Kata.
So, there you have it. Avi, like many mid-cap CEOs, is tasked with leading his organization through another tough recession that they are not even thinking about yet. This is my challenge too. We each have a choice of muddling through it on our own or working together to maximize our return. None of us really want to travel for weeks at a time to source in a low cost country and deal remotely on trying to change their culture … only to do it again next year in a different low cost country. Why not take a stand, implement change locally and make our supply chain the best in our industries? It can be done. It has been done.
Call me if you want to learn more. Rob Olney 978-486-9050.
from ETM Manufacturing http://etmmfg.com/3571
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