Evaluating Leadership at Your Manufacturing Business

I think we all realize how crucial a company’s leadership is for success. As Acuity’s manufacturing consultant, I see a wide range of companies, and one common thread among the successful ones is a strong leader.

For simplicity's sake, this article will refer to the leader of a company as the CEO. We know this could be a founder, owner, president, etc., but we will stick with CEO.

The CEO is a major decision-maker who manages and directs resources, as well as a visionary thinker, strategist, and planner. CEOs are also responsible for maintaining the company culture and much more. The position includes a lot of roles and responsibilities.

There are quite a few traits that make a good CEO, but in my experience, here are some that are most important in manufacturing:

• Communication skills
• Vision
• Leadership
• Willingness to take calculated risks
• Curiosity
• Realistic optimism
• Ability to build relationships
• Ability to learn from mistakes
• Selecting the right people for jobs
• Being open-minded

If your CEO lacks any of these traits, he or she could be a drag on your company. Look at companies that were once household names, like Sears, Kodak, Blockbuster, and Compaq Computers. Kodak developed digital photography, but they didn’t shift their business model. Sears was a powerhouse in the catalog business, but they were put out of business by Amazon. Many of these failures can be at least partially attributed to a CEO.

In today’s manufacturing industry, one thing is for sure—change is constant. You need a CEO who understands the need for change. Lean manufacturing calls this "change for the better,” meaning changes should be made to improve things, not just for the sake of change. The key principle is to continually improve effectiveness of the operation, eliminate waste, and improve the perceived value from a customer’s point of view.  

If your CEO doesn’t understand and support change within your company, my experience tells me you may not be as successful as you could be. It will always be an uphill battle for the team.

If your CEO lacks:

• Communication skills, how can the CEO provide direction to staff?
• Vision, how can the CEO set goals for the company?
• Leadership, how can the CEO mentor, direct, and delegate?
• A willingness to take calculated risks, how can the CEO push for change, new technology, and continuous improvement?
• Curiosity, how likely is the CEO to create new ventures or push and support change for the better?
• Realistic optimism, and can't portray it to the team, why would they follow?
• The ability to build relationships, why would anyone want to work for or do business with the CEO?
• The ability to learn from mistakes, the same mistakes will be repeated, and the CEO will not be able to move the company forward.
• Selecting the right people for jobs, the vision, plans, and goals are not developed, disseminated, and implemented.
• Being open-minded, the CEO doesn’t listen to the team and is not willing to change plans or implement new technologies.

The question is, what can you do if you work for a CEO who lacks any of the above skills?

If the CEO is only lacking one or two of the skills, someone with the needed skills can coach or mentor the CEO. In some cases, you might have to ask for outside help from a consultant who can work with the CEO to develop the missing skills. In other cases, a CEO can attend seminars or classes to gain the skills. Another option is to utilize a leadership team member who possesses the missing skills to offset issues. In other words, if the CEO lacks communication skills, someone else should handle communication for the CEO. If the CEO lacks a lot of the needed skills—especially the open mindedness—it may be difficult to step in or coach the CEO. If the CEO is unaware of the problem and doesn’t listen, your options may be limited. You can try to do what is right, or you may want to move on to another company.

Most CEOs I have met possess many of the needed skills and have been able to surround themselves with people who complement any skills they are lacking. If that doesn’t happen, there is a chance the company will not be able to develop to the level it should. The skills of the person at the top can make or break a company’s future. I hope you have a great CEO—maybe even one like mine.