Like anything in life, a moment can change everything. Suddenly, what you once thought was impossible, is happening. What you once thought you would never experience, you suddenly are.
It starts in the morning when you wake up, you find yourself all alone, and your partner left you. All your plans together have gone up in smoke.
As the day goes on, your pulse rate goes way up, as you are now considering what once seemed forbidden or impossible. You begin to hear rumblings of your basic instincts, and wonder what it would be like to live following your impulse. To do things you had never done before.
Do you dare?
Peter (named changed), the Plant Manager at a large forestry products plant ,woke up to find he had lost 30% of his market overnight to a price plummet in the Asian market in early spring.
Later that morning the Chairman of the Board of Directors called, and informed him if the plant didn’t finish at break- even at the end of the year, they would highly consider closing the plant down until further notice.
In a crisis, there are several options. One can think reactively short term and try and put out the fire…or leverage the crisis to drive in long term changes that increase performance.
The Plant Manager called me in the next day, and we began to discuss a possible strategy before the rest of the team was brought in. The consequences of not getting it right were obvious. The consensus was clear. Peter was adamant that we would do whatever necessary would meet the challenge from the Board. He refused to be a victim.
To do that, the team had to commit to do things that hadn’t been done before. It was all a gray area, as there was no precedent for the team. This was 1000 shades of gray, not 50. They just knew, on a gut level, they had to be bold. It would require open thinking without judgment, creativity, and complete ownership of any consequences unseen. It would require truly trusting each other
Here is what the senior team finally came up with to drive profitability , by taking away any constraints they had previously put on themselves:
- Link the front line to the business: No one could be on the sidelines as the recovery plan was developed. Everyone, through small group meetings, heard first-hand what the business environment was.
- Simplify the message and change the language: Management-speak wouldn’t work with the front line, many of whom had an 8th grade education. The plant manager met with the remaining team every week, and he changed the weekly revenue target to “number of logging trucks: as they all understood that. How many logging trucks did we generate this week?
- Work with contractors as full team members: any contractors left were included as full members of the team. There was no time to repeat communication or weekly business reviews.
- Have compassion: Any layoffs were handled with upmost care dignity and full support of the union, with family outreach. Assistance was set up for job hunting and additional financial support to help with the transition…no burned bridges.
- Open up communication: Communication went beyond the org chart and was very fluid to all stakeholders at all levels. Managers stayed out of their offices, and “lived” on the shop floor.
- All decisions and actions based on agreed to priorities: Focus and tough triage meant only the actions that would add value to the balance sheet were considered. Everything else was put on hold.
- Increased business review cycle: The combined team took the business pulse daily vs. the standard weekly and monthly which drove more effective decision making. This was made visible through crew talks to the front line.
- More fun, not less: While this is counter-intuitive, Peter actually made sure that there were more dinners, community events, and time together to de-stress.
They finished the year at 250,000 USD above break- even. The plant stayed open, and is a healthy business to this day. Many of the people laid off eventually rejoined the team. They had reached the Big O.
Did they drop the more open unrestrained strategy once they reached their objectives? No.
Most of the actions they took remained a part of their business strategy and culture going forward. The team realized they had the power to become a more responsive performance focused organization. The handcuffs have stayed off ever since.
You can be sure the Plant Team and Board of Directors collectively lit up a cigarette, blew a smoke ring, and sighed in satisfaction…