The Spreadsheet Manager Chapter One: …And I Thought Executives Didn't Fight

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“…The bottom line is that you aren’t going to be working for me any more.”

“I don’t understand. I am hitting all of my performance targets that you agreed to during my last review. The board approved my compensation package based on those targets.”

“Are you really coming at me with that? We are losing five-million dollars a month. What do you expect me to do?”

“What sort of severance package will I be getting?”

“The board will finalize my recommendation before the end of the week.”

A Few Days Earlier

Horatio Daniel Collins, who went by H.D. for obvious reasons, had been appointed the CEO of LiTek-Hawley Pharmaceuticals  almost three months ago now and Firing his VP of operations was the toughest decision he had made so far. He had no experience in manufacturing or operations in general. H.D. had worked at three different pharmaceutical companies and in many different roles, but they were all in either sales or marketing. In-fact, LiTek’s board specifically selected him to drive sales in the organization based on his track record in other companies. Many people will not make the decision that he made because he didn’t have a candidate identified to take over the operations function. Even worse, the VP of operations had convinced the board of directors that the problems were not related to operations. It was a clever ruse played on the board for many, many years.

H.D. admitted that R&D had been slipping and when the patents ran out on four key drugs that LiTek held, the profitability went into a death spiral. The intellectual property was masking the lack of operational effectiveness.

Pharmaceuticals is certainly not the business where you can miss customer expectations, so the VP of operations set up agreements with third party manufacturing and distribution centers to bridge the gaps and save money, so he stated.

“H.D., are you sure about this? Drake is well respected among the operations community.”

“Absolutely, I honestly don’t know what’s going on in the operations part of the organization yet, but in the two months that I’ve been here all I get from him are rosy stories while are profit continues to drop as sales increase and we continue to lose more and more margin due to the toll manufacturer picking up our slack.”

Another board member quipped, “It looks like to me that our losses are right in line with the downturn.”

A third board member said, “But our competitors are making more and more money. You all know that I used to be a consultant. The first question we would ask on an engagement is: Are the results unique to this company? Our industry is not suffering; this is absolutely an internal problem.

“So if you do let Drake go, what is your plan?”

“Well… I don’t exactly have one yet.” H.D. said begrudgingly.

“How are we supposed to make this decision then?” another one chimed in.

“I know what you are saying. I have been to all of the sites. There seem to be good people in place. I have used my intuition my entire career and its rarely let me down. I am definitely sure about this. I think we would be better off with no leader than a bad one. I will formulate a plan and get back to the board in two weeks after Drake’s termination is effective.”

“Are you worried about intellectual property or any best practices he could take with him to another firm?

“Not so much” H.D. quipped, “If we had best practices the company would be making money!”

The senior board member, Tom D’Agostino, said, “We hired you because we trusted your success and prior track record. I think this is a risky move, but not taking any action is also risky. We are losing too much money to try and nudge this in the right direction. Just remember, firing Drake isn’t going to fix the problem. It could, however, stop the bleeding. We also need you to formulate an aggressive strategy for recovery.

Leadership Learnings: If you chose not to decide, you still have made a choice.

~Rush                    

            

I have seen, first-hand, that delaying the decision as long as possible is a good strategy in most cases; however, not acting when a decision is necessary will alienate your team while causing your organization to fail simultaneously.

“I understand and agree.” H.D. responded.

The board meeting adjourned and H.D. couldn’t have been happier. He had his assistant, Staci, set up a meeting with Drake for later on that week. His brain started playing Ping-Pong with the decision he made to terminate an thirty-plus-year operations veteran with a previously stellar track record. After going back and forth in his head for about half an hour and through the entirety of the flight attendant’s safety lecture, H.D. kicked back in his chair for some much needed sleep.

I'm here... now what: New managers primer for developing culture from Day 1.

"You never get a second chance to make a first impression"

      

The old ad campaign slogan is absolutely valid when it comes to accepting a new role whether it is internal to your current organization or with a new organization. The first month you are there is of particular importance for site level jobs and the first three to six months carry the same weight for director or C-level positions. The larger circle of influence will increase this time simply based on quantity of interaction. This crucial time frame can either establish you as an effective leader or be the curse that could drive you to seek opportunities elsewhere. There are two key principals that can help a new manager thrive during this period of constant evaluation.

Principal I: Do not make any changes for at least 30 days

This time needs to be considered sacred and untouchable. Communicate to your manager that this process will be occurring and that it is vital to establishing your self as an effective culturally-focused leader.

Firstly, a common misconception that line associates or non-degreed supervisors possess is that their managers think they are smarter than them. You must immediately establish the fact that you appreciate and respect your team, if you ever hope to win over their hearts and minds. It does not matter how many PhDs, engineering degrees or years of experience you possess, everyone that currently is at your new site has more organizational specific experience than you do. Some managers believe in that they need to shake things up from day one to gain respect; this is absolutely polar to what should actually happen. Think about it this way: no one would immediately go to a persons house who they just met and start rearranging their furniture. Making changes during this 30 day period is the occupational equivalent of that.

What you do want to be doing is spending a great deal of time where the value is added. Introduce your self to everyone, ask questions about their time away from work. I like to keep running conversations with every line associate that are not work related. With Henry the operator we have a conversation about driving Jeeps and rock-crawling. With Jaime the sales-person it could be about his kids soccer team. The point is that you want to develop some level of a relationship that exists beyond occupational requirements. The perception needs to be clear that you are a person that places value on human capital.

Concurrently with the meet-and-greet, you should be developing a knowledge of the current state of affairs. Make mental and written notes of how the processes exist. Try not to carry a clipboard with you. Carrying a clipboard makes it seem that this conversation is being recorded to be held against someone in a court of law. If you need to make notes, it is better to use your smart-phone or a pocket notebook. The appearance needs to be that you were not intending on recording every snippet of data and that you are getting to know the team not an external auditor

Principal II: Spend time with your new team... in a direct task

     Its time to get your hands dirty! I recommend that all managers, whether they are support managers or line managers, spend time actually doing the job that generates (or supports generating) the revenue.

• Take at least a day to work in each primary job that exists in your operation. This will serve two main purposes:
• You will get to assess the knowledge level of your staff. Does the operator just know that this button makes it turn on or do they have an intimate knowledge of the operational principles?
• You will be exposed to the real world problems that your team faces on a daily basis and prevents them from achieving goals.
• The cultural themes that you want to establish are:
• Perception by your team members that although you aren't doing their job on a daily basis, you are willing to.
• As a leader, you respect that the work associated with your team members is important to the success of the business.

Managing this "cooling off period" is not necessarily difficult. The bottom line is that you need to be communicating, "I'm here to make your roles easier, more effective and more rewarding." A great deal of new leaders are communicating, "I am here because you weren't getting the desired results and I have to fix this problem."

Cultural Kaizen Now Available in Paperback & Kindle

The definitive guide to using a lean transformation to elevate your team's engagement and improve the process rapidly while sustaining the results.

Paperback version available now via: Cultural Kaizen

Kindle version available now via: Cultural Kaizen Kindle

Need a preview? The first 3 chapters are located here!

Please contact me paul@culturalkaizen.com for any questions or comments. 

Cultural Kaizen is a business novel that focuses on the lean transformation of a process manufacturing site and subsequent cultural impact of the transformation on the people who work there.
The book's introductory chapters focus on an operations manager's personal struggle while working at a site that has a severely negative culture. The site is undergoing a 'fake lean' transformation (Focused on the tools; not the business process). The first two chapters demonstrate the effects of a negative culture on an employee.
The operations manager is offered a new position as the plant manager of a 'broken' chemical plant. This is a large step for the new plant manager, but he agrees because he will do anything to get out of the negative cultural situation he is currently experiencing.
The plant manager arrives on site and determines that a lean transformation is what the site needs to improve their performance. The plant manager uses his previous experiences as an example of "What not to do?" Above all else, he anchors the transformation with a respect for people. The respect for people was the keystone item missing in his previous role.
The book continues to document the trials and tribulations of the plant leading up through the conclusion of their first kaizen event and ending with a gemba walk one year later.

The major themes explored in the book are:

• A focus on the role of the front-line associate and a respect for their position
• The effects of a negative culture on team members vs. a positive culture
• The process of running a kaizen event, in a process manufacturing site, with a focus on the social and emotional effects that is above and beyond the mechanics of the kaizen process.
• Mass production systems vs. lean production systems and their effect on the organizational culture