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Component Manufacturing dverti$er
May 2018 #10226 Page #30
Adverti$er
Don’t Forget! You Saw it in the
A Tale of Two Dealers, and Why One Far Surpasses the Other How bad leaders can create a toxic culture By Todd Drummond
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ost think lack of time is their biggest barrier to achieving their goals, but they are mistaken. “Culture eats strategy for breakfast.” This quote by Peter Drucker is one of my favorites. While providing consulting services for over one hundred companies, I have witnessed and heard all the reasons for resistance to change within companies. If you truly want to improve, then it starts at the top and works its way down to the bottom. Here are two examples based on actual well-known large, multi-location lumberyard companies within our industry. Both make a profit, but one seems to always grow in spurts with many contractions. The other has steady linear growth and has yet to contract. My descriptions are from my own experiences working with these companies. One would challenge, embrace and apply better ideas and practices while the other, if I’m completely honest, was a waste of my services because they would only give lip service to new ideas.
Company A
Company B
Decentralized structure and decisionmaking. General managers have autonomy to make key decisions, such as setting employee wages in their market.
Top-down structure and decision-making. All decisions have to be cleared by upper management prior to implementation from upper management. GMs lack autonomy to make key decisions, such as setting wages. Goals are clear and realistic, and the data provides Goals are unclear and insightful data is weak insights. All goals are shown with multiple examples or MIA. Most of the time no data was given, just of how others within the company achieved them. Data opinions and directives. That lack of data on markets showed regional challenges and variations between and regional challenges meant there were few markets, so local differences in results were allowed. variations allowed for hitting expected goals. Lots of new, young, inexperienced as well as older, Only new, young, inexperienced people were experienced people were hired. The abundance hired. And with growth and mentoring opportunities of growth potential resulted in abundant growth limited after a while, they leave. One result: high opportunities and low turnover. turnover. There’s a well-developed process of adopting lean There’s a poorly-developed process of adopting manufacturing principles that are shared openly lean manufacturing principles. The principles and that spark new ideas. Current practices and ideas are discussed, but leaders pick and choose which are regularly challenged in an open forum by both principles fit their given mood. Upper management management and staff. Management gives structure doesn’t let workers challenge established practices. and direction for goals, but how everyone achieves the Management gives lip service to appreciating workers, stated goals is openly discussed and debated. but ultimately they are viewed as a threat to leaders’ authority. Continued next page
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