CEO JOURNAL


What Would Custer Do? C


EOs need to go out and get their day. Being effective managers requires them to be


active and face-to-face rather than passive and solitary. Effective manag- ing is not contemplative data collec- tion and analysis; it’s taking action on meaningful data in a hands-on way to direct the allocation of resources, hold employees accountable for results, drive continuous improvement, and foster employee growth and organiza- tion development. At the highest level, my idea of


effective managing is the CEO’s relentless, day-in-and-day-out pursuit of a business that is “in control.” Te right tool for this job is a performance management system. Te set of metrics indicating success or failure is contained each month in the lines of a predicted profit and loss (P&L) statement. In my world, a business is “in control” when in- creasingly precise processes are in place to generate a detailed, predicted P&L at the beginning of each month and, more importantly, when increasingly robust processes are in place to make sure pre- dicted revenue, expense, and profit levels actually come to pass. When CEOs begin to control how profitable their businesses are, sustainable double-digit profitability becomes possible. Putting organization-wide processes


in place, working the performance management system, bringing the entire management team into the process, and continuously refining and perfecting the system is the essence of the CEO’s job and precisely what he or she should be working on throughout much of each day. I recently used the bold, young military leader General George Armstrong Custer to make this point – the CEO must get out in front and lead the charge, every single day, to get the business “in control” and set it on a path to double-digit profitability. He or she must actively lead from the front and pull the entire organization forward in his or her wake. Effective managing also means


creating commonality of purpose and driving continuous improvement along


40 | MODERN CASTING June 2012


DAN MARCUS, TDC CONSULTING INC., AMHERST, WISCONSIN


that common path. A vision statement is the indispensable foundation for commonality of purpose. And no, I don’t mean a meaningless paragraph gather- ing dust on a plaque somewhere, but a succinct two page document that is in front of every employee all of the time and has real specificity and utility. It defines the products to be manufactured and the customers to be served. It sets out competitive advantages and major strategic and functional direc- tives. It highlights important commit- ments and the ways in which business is to be conducted going forward. It describes the business’s current reality as well as the desired fu- ture state. In so doing, vision statements provide rallying points for each and every employee, catalyze commonality of purpose, and unleash a powerful force for waste reduction, productivity gains, improved customer satisfaction, and organization development. Every manager, from the CEO on


down, has two full-time jobs. Te first and more important one is the growth and development of his or her direct reports. Te second is whatever the manager’s functional responsibilities may entail. In this context, effective managing means driving continuous improvement and employee devel- opment through job descriptions, performance evaluations, and project and priority (P&P) plans. Te fact that many employees have no job description and many more have woefully inadequate and/or outdated ones is a costly and nearly universal top management failure. Tough few believe it when they hear me say this for the first time, non-existent or inad- equate job descriptions are a damaging source of waste and a major impedi- ment to sustainable success. Likewise, investing in good job descriptions, re-engineering work and resetting


Inadequate job descriptions are a source of waste and an impediment to sustainable success.


priorities in the process are necessary to hire the right people, retrain good employees, drive out waste, create com- monality of purpose, boost white collar productivity, and build a business that is “in control” and poised to generate double-digit monthly profits. Good job descriptions also give rise to produc- tive performance evaluations and two formal, devel- opment-oriented evaluations each year for every sala- ried and adminis- trative employee are recommended. As important are weekly, one-hour P&P confer-


ences between every manager and each of his or her direct reports. Te focal point of the P&P confer- ence is, naturally, the P&P plan. Tis one-page document is a simple list of prioritized personal and/or func- tional improvement activities that the employee should be working on in ad- dition to his or her regular job for the purpose of continuous improvement along lines suggested by the vision statement and his or her new job de- scription. P&P plans and the weekly conferences that accompany them are how the best organizations actually get results at the grass roots level to eliminate waste, drive continuous im- provement, nurture employee growth and development, boost productivity, and maximize the company’s return on its investment in human resources. I know many metalcasting firms


out there right now have never been busier yet are far from earning (much less, sustaining) double-digit profits. CEOs of these businesses would do well to consider how effectively they are managing and ask themselves what the young General Custer might do in similar circumstances. Charge!


Keep the conversation going. Reach the author at tdcmetal@wi-net.com to comment on this or any CEO Journal column or to suggest future topics.


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