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A Case of
Leadership Instinct
In the early 1970s, a young technician at an automobile
assembly plant in Tennessee had been furloughed several times.
He spent several months out of work waiting for the company to
call him back as production volumes increased. He was a young
hard working man with a burning need to earn a good living.
This waiting was more than this young technician could stand.
With no formal education beyond high school, he believed his
options were limited. He knew he was a good worker with a lot
of common sense. He found a small metal works shop not far
from home and decided he could run it better.
Thirty-six years later, his products can be found in millions
of vehicles of leading automobile manufacturers. He is now a
key supplier to the industry, highly profitable, and growing.
The metal works shop’s business performance speaks for itself.
So many manufacturing related businesses are moving off-shore,
or they struggle to compete and become industry consolidation
targets. This shop continued to compete effectively and even
built and occupied a larger facility funded entirely from cash
from operations. In fact, refreshingly unlike many small
business owners, the CEO recognizes the importance of cash
flow: “Cash is the grease that keeps the cogs and gears of the
engine running smoothly”.
In addition to being a high quality and highly reliable
supplier to their customers, the metal works shop also seems
to be a great place to work. The CEO’s steady hand is still at
the helm of this company. His key team of managers
and supervisors has been with the business for between 10 and
15 years. Employee turnover at this company is practically
nonexistent. That is remarkable in an industry where shop
floor workers jump from job to job.
Companies struggle to hire reliable, skilled, and drug free
workers.
“My mom told me as a little boy that I must have a 10 year
plan, and write it down. If you don’t write it down, then your
brain comes up with lots of other ideas and thoughts to
distract you from your plan”, the CEO told me. He has stayed
true to this excellent advice throughout his business and his
personal life. How many small businesses develop long range
plans? How many large businesses are able to commit reliably
to a long term plan that does not change at least every
eighteen months? All too often they are driven by short term
goals or the need to drive shareholder returns higher faster.
I asked the CEO how much has changed over the years, since the
employees are so stable, and everything about his business
seems so rock steady. A few things have change: he has an
entirely new customer set; built and moved to a new facility;
new plant metal working technology and equipment; and new
operating processes several times. But wait – he’s doing it
all again! He recently opened another new facility nearby and
already that facility is
planned to expand.
This metal working shop and its CEO are shining examples of
how small (and large, for that matter) business leaders can be
very successful in the face of major challenges. As I listened
to the CEO tell his story, four key principles emerged:
1. Develop a long range plan and declare it to your employees.
A clear mission and purpose communicated plainly with every
employee on the direction of the company empowers them all to
reach for the same dream. Stay abreast of new developments in
the industry, with customers, and with suppliers. Proactively
build changes into your business. Your long range plan needs
to be updated each year and refreshed. Keep your eyes on the
horizon.
2. Live and work and lead by a clear set of values or
principles that set a good example for your employees. This
will guide their behavior as well. Communicate regularly in
both formal and informal ways to maintain a pulse and develop
trusted relationships with employees.
3. Maintain financial discipline. Determine the optimal
operating model for your business. Relentlessly focus on
ensuring every function of the business operates within those
parameters. Maintain careful control over spending, debt and
investments to expand and grow your business. Cash flow is
like grease.
4. Operate with quality. From the start, the CEO recognized
there was a better way to run a metal shop. His focus on
continuous improvement is as intense today as it was in the
beginning. His shop is ISO 9000 certified, and he continually
examines new technologies, supplier relationships, workflow
processes, customer operations and integration, and employee
productivity.
“The key to the ability to change is a changeless sense of who
you are, what you are about and what you value”, Stephen R.
Covey
What is the CEO’s dream for this business? In a very typical
altruistic fashion, he replied: “The business dream has
already happened. I’m doing this for them”. Who is “them”, you
ask? His family and his employees, and sometimes it may be
difficult to tell the difference. He talks about either with
equal pride and respect. His primary concern is to provide
long term prosperity for “them”. That caring attitude, along
with the instinctive leadership factors discussed above, are
the key ingredients that enabled this CEO to create and
maintain this impressive example of a successful small
business with a big heart.
Patrick Smyth is a leadership navigator and advisor to leaders
of high growth and emerging businesses. He creates compelling
visions and comprehensive strategic plans, and coaches on
effective leadership and management practices. He is a
recognized speaker, trainer, coach, and international business
strategist and author of the book Elephant Walk: Balancing
Business Performance and Brand Strategy for the Long Haul.
http://www.innovationhabitude.com |
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