Hartwig Consulting

Kurt@hartwigconsulting.com

© 2019 by Kurt  H Hartwig

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Lead or Step Aside




The buying behaviors of consumers are shifting at a rapid pace and there are no signs of slowing. The old store hours of 9:00 am to midnight are now open 24/7 as products and services are easily accessible anywhere, anytime, online. Businesses that do not change to this trend will risk losing market share.


For example, as more consumers shop online, retail companies may be challenged with reduction of impulse buys at checkout-aisles, such as candy and drinks. As a result, they are creating tactics to optimize impulse buys in the e-commerce world.


Another example is an engineering design and machining manufacture that has developed a 3D tool simulation platform on their website that is accessible anytime, anywhere. Engineers can design a part prototype and watch a virtual machining process of the part being made—such preventive measures have proven valuable in eliminating tool damage, reducing design costs, and improving production takt-time and first-pass yields.


Resistance


With some companies, it’s unfortunate that they do not change and adapt—they perceive opportunities and threats as fads. Top leadership is risk adverse and will only invest when they have perfect information—clairvoyant thinking. These leaders have built an organizational culture of ‘let’s wait and see’ mindset and an environment where employees are settled in their jobs.


As you can imagine, any future change, however small, is met with resistance and opposition. Have you ever been in a company where managers perform their jobs the way they think it should be done, whether or not, what they do, is in the best interest of the company—they literally create their own process and they don’t want any structure.


This silo-thinking is a root-cause to change and has been created by the top leader—whether h/she knows it (or wants to take responsibility).


Resistance is evident when managers consistently blame each other and employees make excuses. For instance, they don’t want to retreat from a market they’ve been in for years. They don’t want to go into a new market that they are unfamiliar with. They don’t want to sell any assets. They don’t want to change the plant layout. They don’t want to upgrade any equipment. These attitudes, and many others, are liabilities and must be confronted if the company expects to return to growth and profitability.


Change Leadership


Most often, to change an organization requires a change in leadership—at the top. A new CEO is the person that sets the tone of the organization for how tasks are chosen, pursued, and completed. The ‘how’ refers to decision-making skills and the ‘tone’ refers to employee attitudes.


To fix a company, the new CEO expects employees to make quality decisions that are carried-out with the right attitudes—this is first and foremost. There are three steps in creating a new tone:


First Step - The CEO conducts a situational analysis of the internal and external environments by asking employees and customers the follow questions:


*Why are we in this situation?

*Where can we improve?

*What needs to be done?


By listening to each response, the CEO prioritizes and sets the top three financial objectives for the company, and then creates the vision, mission, and value statements that will guide the right attitudes and direct the right behaviors.


The CEO provides each manager a copy that includes the top objectives, the three statements, and the response list. With this information, each manager is required to develop an improvement plan by asking the question, “What can I do in my area to solve the problem?”


Through this exercise, the CEO sets a tone and expects managers to take responsibility, with attitudes of ownership and commitment.


Second Step - Rather than trying to get managers to do things they really don’t want to do, the CEO creates a culture of purpose and meaning—what they do, no matter how unglamorous, is very important to get the company where it needs to be. Strategically, the CEO builds excitement by showing videos of world-class manufacturing to all managers and employees—what it looks like and what if feels like to work in such an environment.


When an entire organization can visualize ‘what victory looks like’, managers and employees will be inspired to work together on common goals that they know are really significant and important to achieve. And, when they connect at this level, they will purposely and willingly go above and beyond what is normally expected. There are many benefits of having the entire organization in-tune with the big picture:


*They are aligned and laser-focused on the highest-impact actions that will drive the organization's most important outcomes.


*They know exactly how and where to contribute and engage their behaviors, and they know which attitudes produce the greatest results.


*They understand the results or outcome of their inputs and how it affects the financial statements.


Through this influencing exercise, the CEO sets a tone that inspires people to 'buy into' the priorities with unrelenting focus and passion on delivering business and financial results.


Third Step - To further encourage and motivate, the CEO designs compensation plans that reinforce the right attitudes and behaviors, and rewards quality decision-making and results achieved. The past leader did not like risk, change, or uncertainty and established a culture of indecisiveness, which almost ran the company into bankruptcy. The new CEO is very decisive and perceptive, delivering steady, predictable results year after year—the major reason for hire selection.


The CEO expects the same from managers and employees, and h/she does not compromise or waiver in order to be liked or popular.


The new CEO does not sit back and wait to see what the competition will do next, and then try to replicate the strategy. The CEO understands the importance of an organizational culture that perceives market ambiguity and unfamiliar technologies as a rich source for new opportunities.


As a result, the CEO creates a culture where managers and employees are consistently ready and prepared to respond earlier, faster, and with great conviction that they are doing the right things, the right way, at the right times. And, when an outside threat is exposed, they have the courage and know-how to turn a weakness into a company strength that adds greater customer value.


By deploying an aggressive comp plan, the CEO sets a tone that rewards dedication, innovation, and enthusiasm toward solving-problems and creating value for the customer.


Change is Rewarding


The new CEO created an Operational Excellence philosophy within the company by designing a culture that embraces change and learning—this transformation aligns the business strategy of long-term value creation. When properly deployed, the company can generate higher profits than its competitors, which positions the company to have available investment capital to fund future growth and expansion opportunities.