Achieving Class A Business Excellence: An Executive's Perspective: 20 (The Oliver Wight Companies) - Hardcover

Groves, Dennis; Herbert, Kevin; Correll, James G.

Hardcover

ISBN 10: 0470260343 ISBN 13: 9780470260340

Publisher: Wiley, 2008

Synopsis

A tough, challenging, and eventful journey is outlined in this cutting-edge business story. Greg, the company President, uses the latest edition of the trusted industry standard, The Oliver Wight Class A Checklist for Business Excellence, to transform his business from mediocrity to industry leading performance. What he learns about senior management responsibilities and behaviors drives him to achieve outstanding rewards and benefits, not the least of which is his company's survival.

About this title

About the Author

DENNIS GROVES is Chairman of Oliver Wight Americas and President of Oliver Wight International.

KEVIN HERBERT is a partner in Oliver Wight Europe, Africa, and Middle East, and is coauthor of the Wiley book Gaining Control.

JIM CORRELL is a former co-chairman of Oliver Wight International and chairman of Oliver Wight Americas. Jim is a Principal in Oliver Wight Americas, and is coauthor of the Wiley book Gaining Control.

From the Back Cover

Praise for Achieving Class A Business Excellence

"Achieving Class A Business Excellence is a shockingly realistic look at the personal tendencies, biases, and organizational inertia that leaders must overcome to truly transform their companies. Achieving business excellence requires two steps: attaining excellence and sustaining it through continuous improvement. Achieving Class A Business Excellence is the rare book that demonstrates a proven path to accomplishing both." ―Richard Burns, former global product supply director, Procter & Gamble, NA Class A Implementation Leader

"Global Operations are complex, and most companies plan and execute poorly because they address them functionally and rely on spot solutions to major issues. The authors take us back to the basics, show us operations in a comprehensive and integrated light, and do it in a story format that should appeal to most executives who want direction and are tired of buzz words. An excellent book." ―Christopher Gopal, Executive Vice President, Worldwide Operations, Open Energy Corporation

"This is a great book for any business leader looking for a path to better organizational performance. The dramatization depicted in Achieving Class A Business Excellence presents a clear option using the proven path for making dramatic organizational change. With all of the alternative approaches available, this book provides an outstanding methodology for reaching and sustaining business excellence." ―Don Allen, Senior Vice President, Operations, CorePharma, LLC

"An excellent depiction of the dedication and persistence required to deliver transformational change and the resultant improvement. This book doesn't sidestep the hard issues faced by executives trying to improve and sustain performance in today's rapidly evolving operational environment."
―Jason Thorne, Director, ABeam Consulting USA

"This book absolutely hits the bull's-eye on what it takes to dive into the issues plaguing underperforming companies and, most importantly, how to address those issues with a Class A–Best Industry Practice solution to turn any company into a top-performing profitable business. Excellent book!"
―Randy Gast, Vice President, Corporate Operations, 3PAR Inc.

From the Inside Flap

If your company is underperforming or needs to grow, then this is the book for you. Based on the definitive and most trusted industry standard for excellence in business today, Achieving Class A Business Excellence describes the journey to Class A business excellence from the perspective of Greg, a corporate executive facing poten-tially disastrous business problems.The authors allow us to look over Greg's shoulder as he confronts and overcomes realistic challenges, beginning with his entry into the company and following him through a series of tribulations to his ultimate success. Learn with Greg as he follows Oliver Wight's renowned Proven Path methodology. Learn how the Proven Path guides his strategic journey to excellence, from major initiatives through everyday improvement programs, and supports achievement of his strategic objectives and goals. Importantly, this realistic depiction shows you how to achieve a comprehensive state of excellence that will enable your company to deliver outstanding and sustainable business results.

An excellence program will unite your people, your customers, and your suppliers through a common set of goals and allow you to improve your results at a pace that will outperform your competition and differentiate your company in the marketplace.

While the characters in the book are fictional, the people, the businesses, the situations, the challenges, the conversations, the conflicts, and the outcomes are based upon the authors' experiences, the success of their remarkable clients, and the collective knowledge of their colleagues in The Oliver Wight Companies. Greg's journey changes the way he manages, and changes the way every employee operates within his company. Achieving Class A Business Excellence can do the same for you and your business.

All three authors have direct hands-on experience of making similar journeys in industry before joining Oliver Wight. Within Oliver Wight, they all are educators, coaches, and mentors in the concepts and principles of Class A.

Excerpt. © Reprinted by permission. All rights reserved.

Achieving Class A Business Excellence

An Executive's Perspective By Dennis Groves Kevin Herbert Jim Correll

John Wiley & Sons

Copyright © 2008 Dennis Groves
All right reserved.
ISBN: 978-0-470-26034-0

Chapter One

OPPORTUNITY

Be careful what you complain about; it just might become your responsibility.

"I want you to be the new President of Cosmetics Products."

Susan Barnett, Chairman and Chief Executive Officer of Amalgamated Consumer Products Corporation, had been eagerly looking forward to her 10:00 A.M. meeting with Greg Sanders. She had worked with Greg about 10 years earlier at Hillcliff Cosmetics, which owned a number of popular brands. She had held him in high regard then and had followed his career ever since. They still ran into each other at various management forums where they shared their career experiences during breaks. While at Hillcliff, Susan occasionally had dined with Greg and his wife Penny in their home. Susan and Penny had a natural rapport. Now Susan planned to offer Greg the position of President of Amalgamated's Cosmetics Products division and hoped he would consider the offer too good to refuse.

Despite the unusually blustery and gray March Monday morning in Atlanta, Greg arrived for his meeting on time. They chatted first about family, friends, former colleagues, and general economic conditions. "I appreciate your continuing interest, friendship, and support over the past 15 years. I can't tell you how much I enjoyed the time we worked together; I learned a lot from you, Susan. But I was really surprised by your call last week. Fortunately, I'm vacationing at home, so it was easy to make the trip downtown."

"I'm glad you could make it. Now, let's get down to business. I know I was a bit vague on the phone last week, and I appreciate your patience. At the time, I wasn't at liberty to tell you very much about why I asked you to visit. Now I am, and I want to come right to the point. As you know, we have a new Cosmetics Products division that didn't exist three years ago. I need to give you a little of its history first. Cosmetics Products is a small but viable division that we created through the acquisition of four companies and several additional spin-off brands. Product Categories acquired for the Cosmetics Products portfolio include Hair, Lips, Eyes, Face, Body, all for women; and Shaving, Grooming, Cleansing for men. We also have an Accessories category. Along with new brands, Amalgamated acquired the human and capital resources of the smaller companies. As often is the case, none of the individual companies used the same business language, procedures, or tools.

"After rationalizing the disparate manufacturing and distribution sites, Cosmetics Products has ended up with plants and distribution centers in Atlanta and Dallas, and additional distribution centers in Los Angeles and Lititz, Pennsylvania. In these cities, Cosmetics Products uses space in distribution centers already operated by Amalgamated's other divisions.

"Cosmetics Products represents $200M in sales; it's actually our smallest business unit, but it's the Amalgamated business with the greatest potential growth. The current President, Stu Tillman, is about to retire, and I want you, Greg, to be the new President."

After sitting in stunned silence for what felt like an eternity, Greg looked at Susan. "I see you've not lost your sense of timing or directness, but you just threw me a real curve. I'm not even sure how to react. I actually thought we'd be talking about improving the working relationship between your company and mine. You know that we've been complaining about Cosmetics Products' poor customer service for the past two years. I'm not exaggerating when I tell you that you've delivered less than half our orders complete and on time since we started buying from you.

"My very first boss must have been prophetic. He told me to be careful what I complained about, because it might just become my responsibility to fix it some day! Okay, I know you'd prefer a simple yes or no answer, but I have a million questions. How much time can you spend with me today?"

"I've cleared my agenda through lunch, Greg, and I would like you and Penny to join my staff for dinner tonight if you can manage it. Sorry for the short notice, but it would be good for both of you to meet some of the characters you might be working with. Greg, I'll be happy to answer all of the million questions you have, but first let me put all my cards on the table. I'm offering you the smallest operating division, granted, but it's also the hope for the future for Amalgamated. And, to be very clear, it's in a real mess. I created the division. For that reason alone, setting aside for the moment the business imperative, I want it to be successful. I know you've met Stu Tillman, the current division President, during our recent meeting with key customers. Stu has done a great job of pulling together the semblance of a unified division. More than once he's told me he feels as though he's herding cats, but he has built an operating division, and we're in business. Although his folks don't know it yet, he's very close to retirement and fully supportive of your becoming the new President. Quite frankly, the business isn't doing nearly as well as I'd hoped; the division's in serious trouble. As much as I like and respect Stu, I think this change at the top will do us a world of good. But before I get into the details, I want to influence your decision even more."

Susan handed Greg a document approved by the Chairman of the Board detailing the proposed salary and benefits package for the new President. He studied the details at length and again sat silently for a moment. "Susan, I'm a sales and marketing guy, and take pride in never being speechless. Twice in the past half-hour you've left me speechless. This is far more than generous; I'd say it's astounding. It's well beyond my current salary and benefits package. Are you telling me that I get the ego satisfaction of having the title of President and all this, too?" Susan smiled.

"Okay, you've successfully influenced my decision, but the size of the offer leads me to believe that you either have some very big plans or some huge problems! Mother regularly told me that there's no such thing as a free lunch."

Over the next two hours, Susan described Amalgamated's structure, products, operating and financial results, strategic direction, key people, and key initiatives. She discussed her excitement about creating the Cosmetics Products division and her more recent disappointment in its operating results and contribution to the company.

"Look, I've said it several times already, but I want to reinforce it again. Stu did me a great favor in stepping out of his comfort zone in Personal Products to take the reins of this new business. He has extensive experience in marketing and is greatly respected there, but he has never really learned how to manage this business. He seems out of his element in trying to provide guidance to the supply side. Costs continue to rise; you know very well that our customer service track record is about the worst in the industry; profits are eroding quickly; our warehouses are bursting at the seams; and the only consistent aspect of our new product introductions is that they're unpredictable, and full of unwanted surprises.

"I need the person at the top to be a true business leader, to pay attention to and orchestrate all parts of the business. In his role as President of Personal Products, Stu knew enough about the industry to be successful, and he had an experienced leadership team and organization running pretty much on automatic. However his knowledge didn't translate to the Cosmetics Products business where we're facing different problems."

Greg interrupted, "Let me get this clear in my own mind. In addition to the sales and marketing responsibilities, you'd also hold me accountable for the performance of product development, finance, supply, and distribution operations? You know my background is sales and marketing, and, as with Stu, I know very little about the supply and the technical sides of the business. That feels like a real leap for me. On top of that, you've told me the business is 'in a real mess,' to use your words. I now understand the size of the compensation package a little better. Guess Mom was right after all. There really is no free lunch! Seriously, why do you think I'm the person for you, given the scope of what you want the new President to accomplish?"

Susan paused, and then she continued, "I've heard from others over at Blackstone that your management and problem-solving abilities are still alive and well. The skills and energy you bring to the table are exactly what we need to get this new business moving." She leaned forward and spoke in a measured voice, "I know you can succeed in this role. I need you to succeed in this role and will do everything possible to support you. I'm offering you complete control of the business." She leaned back in her chair and continued, "Clearly, what we are currently doing is moving us in the wrong direction. Do what you need to; go where you need to in order to learn; even change the staff, products, and services if you believe it will help. Just stay within your budget, which I think you'll find to be very generous. In fact, let me go a step beyond that. If you have any specific funding needs that would take you beyond your budget, come to me and I'll see what we can do. Bottom line, I view Cosmetics Products as my creation, and I need it to be successful. The Board sees Cosmetics Products as the key to Amalgamated's future, and they also need it to be successful ... but soon. We all have complete confidence in your ability to make it happen."

Greg thought for a moment before responding. "This looks to be an incredible challenge, and I'm confident I can meet your expectations ... if I accept the offer.

"The idea of a group dinner tonight is a good one. It'll be great to meet your staff, especially in a casual setting. That makes it easier to learn about the situation and the people behind the positions.

"Speaking of your staff, I'd appreciate your observations about the players, their roles, and how they operate with the business unit Presidents and Senior Vice Presidents. I'd also like your perspective on the Board of Directors and what they expect of you and the senior management staff."

Susan went on to describe how Amalgamated was organized.

She gave Greg an organization chart [Figure 1.1] and a thumbnail sketch of the people on the Board and on her staff. Amalgamated's Board was made up predominately of people outside the company, with Jim Richards III (grandson of the founder, James R Richards) as the Chairman Emeritus. The Board gave her and her Executive Committee plenty of room, but paid close attention to strategic plans, company image, shareholder and employee relations, government relations, product performance, and profitability. Susan told Greg that the Board was extremely supportive of branching out into the cosmetics industry, but was clear about its expectations for profitability and growth. Lately, she explained, Board members had been asking some unusually probing and uncomfortable questions about the future of Cosmetics Products and about the missed expectations. There was no question about their still being supportive, but they were looking for a return on their investment and were becoming impatient.

In terms of her Executive Committee, Susan explained that the Senior Vice Presidents (SVPs) gave her guidance and support, and also provided guidance and support to operating division functional leaders. One of their primary functions was to ensure uniformity across all operating businesses. Her organization was much like a matrix in which, for example, a business unit's Human Resources (HR) Vice President reports directly to the business unit President, but also has a dotted-line relationship to Senior VP of Human Resources, Keely Horton.

"On the one hand, Greg, you'd provide direction to your VPs and call all the shots for Cosmetics Products. You'd conduct the performance reviews and make salary and career decisions for your staff. On the other hand, I'd expect the Senior VPs to be a resource for you and your staff. I look to them to deploy strategic priorities uniformly, develop and deploy common key performance indicators across all businesses, calibrate salaries, and make sure Amalgamated is taking advantage of leading-edge thinking. That's the role of the Senior VP's, but they know that Karen Morton runs Personal Products, Roger Winchester runs Home Products, Ian MacGregor runs Food Products and, hopefully, Greg Sanders runs Cosmetics Products."

"That sort of structure worked pretty well for us at Hillcliff, Susan. But remember all the major turf issues that erupted when a manager got caught between his or her line VP and the staff VP? Any of those problems here?"

"I think we're well past the start-up problems that surfaced when we implemented this structure three years ago, Greg. At first I saw many of the same problems that we saw at Hillcliff, but we solved them quickly. The new roles and responsibilities took some getting used to. But now I think you'll find the Senior VPs to be very supportive of this way of operating as well as of change in general, providing there's a compelling business case for making a change. Don't let your VPs blame the Senior VPs for getting in the way of change. If they do, just sit down with the appropriate Senior VP and explain what Cosmetics Products wants to do and why. I'll get involved if I need to, but that should be a pretty rare event. In fact, that's an excellent topic to discuss with the Senior VPs at dinner tonight. Test their openness to change; ask them what changes they've made recently. Ask them what types of change in Cosmetics Products they'd want to know about in advance. I think you'll be very pleased; I know I am. It may be that Stu spent too much time trying to reconcile detailed differences in the ways his people did things in their old companies prior to acquisition. In fact, even now you might be hard pressed to identify the 'Amalgamated way' of doing things among his staff. Each acquisition company brought its own way of working. Some procedures were better than the Amalgamated way, others worse, but there's still little consistency. People tend to rely on what they already know and resist anything that's 'not invented here.' All that is well and good, but in the Cosmetics Products division it seems almost pathological. It's as if we've lost sight of the fact we are supposed to be saving the ship, not rearranging the deck chairs.

"Let me remind you that one of the reasons you have the offer in front of you is because of your success at looking at businesses differently and improving results. Every one of the Senior VPs has heard that from me. They've seen the evidence from your career themselves and are eagerly looking forward to the energy and improvement you will bring. After all, part of their compensation is based on growth and profitability, so you'll definitely find them supportive of changes that help the bottom line!"

"Sounds excellent, Susan. I'll be testing your perceptions this evening, but it sounds as if you have a first-rate group of executives. Now, let's turn to the people a bit closer to my potential new home. I'd value your thoughts about the performance of the Cosmetics Products division and the people who make up the senior staff. What keeps you awake at night when you think about that business? What are the problems you'll expect me to attack and solve, again, if I accept the offer? By the way, if I don't accept the offer, you can count on me to keep all the information you are sharing in absolute confidence."

"I appreciate that, Greg, and never have had any concern about your keeping all of this in confidence. Let's turn to the hard stuff closer to home, as you put it. I won't put these in any order of priority except for the first one. It's the one you've already experienced, and it's the one that could conceivably sink us. Customer service is completely unacceptable. We receive complaints about incomplete orders and missed delivery dates on about 40 percent of our shipments."

(Continues...)

Excerpted from Achieving Class A Business Excellenceby Dennis Groves Kevin Herbert Jim Correll Copyright © 2008 by Dennis Groves. Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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Edition details

• Publisher: Wiley
• Publication date: 2008
• Language: English
• ISBN 10: 0470260343
• ISBN 13: 9780470260340
• Binding: Hardcover
• Edition number: 1
• Number of pages: 400