Q&A: Planning for Success

Flexibility, planning and continual education are keys to a successful business, accoring to Laurie Harbour and Jeff Mengel, two speakers at the MAPP Benchmarking and Best Practices Conference last October.

During a town hall-style discussion, moderated by MAPP Executive Director Troy Nix, Mengel, a partner at Plante Moran, and Harbour, president and CEO of Harbour Results, Inc., talked about what the best leaders are doing to advance their businesses in an ever-changing business climate.

Here are a few of the highlights:

Question: Do you see one or two things that outstanding executives have in common?

Harbour: There are a couple of things. It is challenging norms – asking why, what can we do differently. The best leaders know they don’t have all the answers. They work hard to put people around them to make the organization better. What we’ve seen lately, though, is a real effort in the art of listening. Understanding what the challenges are. It’s knowing you have to lead decisively, but need that balance of collaboration.

Mengel: A lot of the leaders in this room, got started by being a great technician. You knew what to do and you were technical in nature. As you evolved, you had to change to be a great teacher. It’s a transition that isn’t easy to do. But the ones who are successful are able to step back from the day to day grind.

Question: What do you see as benchmarks for successful companies and what are their strategies?

Harbour: It’s about flexibility in your strategy. Instead of just having this strategic document, (ask)how are we taking it and being flexible with it? (Are we) gathering the data and allowing that to be what drives our business? Not just having it be lip service, but be truly what makes us better. Flexibility is the key.

Question: What are the things, other than automation, that companies can do to reduce labor costs?

Mengel: Our competitive advantage is innovation. It doesn’t have to be breakthrough innovation. In the manufacturing environment, continuous process improvement is innovation in an incramental scale. We have to look at innovation in our structure as well. How are we designed to compete? Then choose how to compete.

Harbour: Innovate on process. Challenge the old way of doing business. A lot of innovation can come from rethinking your own systems and processes.

Question: In terms of increasing costs, what will the health care situation be in the next 12 months?

Mengel: Confusion. Confusion about what our options are. Health care in the plastics industry has been moderated by having our employees contribute more. We’ve had some reductions in the benefits offered, but we’ve also asked our employees to pony up a little more. But there’s only so much someone who is making $12/hour can pony up.

One one hand, I look at what we had been doing and extending it out in the future … it wasn’t going to work. What will work in the future? I don’t know.

To be honest with you, the set of benefits that we currently offer as an industry tends to exceed the minimum required for Obamacare. So we’d be safe from that standpoint. But there has to be a way for, hopefully, health care costs to come down. It’s too early to say where that’s going to go – whether it’s Obamacare or any-other-kind-of-care.

Harbour: Those companies that have tracked each employee and expected retirement dates, had been expecting employees to stay until their mid-60s because of the need for health care. They’re finding now that employees can retire early because they can go online and get Obamacare. A lot of companies are struggling to figure out how to plan because they might be losing employees before it was expected. Planning, from that perspective, is very important for each company.

Question: What are others doing for succession planning in preparing for the next generation of management?

Harbour: Frankly, it is conferences like this. Are you bringing your team and your people to hear from experts? Or, are you staying within your four walls? Are you taking advantage of MAPP plant tours or exchanges, like the ones here, to learn from each other?

Mengel: The average career span (at a company) for someone under 30 is three years or less. They move. (Each job) is a stepping stone. We have to be adaptable and be able to get what they can give us while they’re with us. It’s very different from how we’re used to operating.