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 / Autumn 2007 / Issue 48(originally published by Booz & Company)


My Unfashionable Legacy

We also elevated everyone’s thinking about quality. “If the work coming to your station is not of sufficient quality,” we told assembly line workers, “you can either refuse to accept it (and let us know) or even stop the production machine, and you will not get fired.”

Eventually, someone tried it, and we kept our word. After that, other changes followed more quickly, including pay reforms that re­warded employees for learning new skills. The improvements added to the company’s profitability, and that in turn meant added job opportunities. In time, the operators were not only willing but eager to try experiments that might help the plant beat the competition. They would bring competitors’ products on the floor and help us reverse engineer them.

As the CPFilms managers and employees grew more comfortable talking together freely, I knew it was time for us to come up with principles as a group. A principle is just a commonly held guide for thinking, behaving, and making decisions. You can manage a process or machine with regulations, rules, and procedures, but if you want the best chance to capture people’s latent potential, then you start with principles that people “own” and help create. One of ours read: “We will enable each other to be the best at what we do and we will integrate the excellence of individuals, teams, and functions in a way that satisfies our customers and stakeholders.” No boss could impose that from the top; when we crafted it together, however, we could live by it.

Being a People Person
We then created three informal business units within manufac­turing, each with its own P&L accountability. This was important because employees want to be a vital part of a self-contained team to which they can have allegiance. We moved the quality control lab equipment onto the shop floor, and provided training so the operators could conduct their own tests. This did not make us popular with the corporate staff, of course, but it dramatically improved our results. In another bold move, we stopped the traditional practice of selling substandard products to our second-class customers; this had made us some quick money, but had gradually eroded our image in the market. The hardest part was avoiding the implication that the previous ap­proach had been wrong, in a company where everyone had colluded with those outmoded methods by simply following procedure.

We then brought together quality, manufacturing, and research managers, deliberately picking the people who argued with one another most vehemently, and sent them out in groups to visit our customers’ factories — something some of them had never done before. The sales departments protested that this would interfere with their relationships, and the manufacturing managers protested that they didn’t have time. But we sent them anyway, and what they encountered was unhappy customers. Our managers re­turned from these trips to customer sites with a great deal more respect for one another, and resolved to fix our company’s qual­ity problems. The shift in attitude was both immediate and lasting.

Within the first year, we made a 35 percent performance improvement. It worked so well that our division head promoted me to global vice president of human resources for CPFilms. “You seem to like people,” he said. “You spend so much time with them.” In other words, he didn’t get the point that people were the key to performance. I resolved to redefine HR, taking it from an administrative function to a driver of business results by helping people reach their potential. I placed a world map on my office wall, and marked all our plants and distribution sites with flags. Every spot with a flag was a location ripe for changing our thinking.

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