Organization Effectiveness Engagement Turns Around Performance

Challenge

“Amherst Building Products,” a $30 million family-owned manufacturer of residential building products, was struggling with breakeven business results, poor financial controls, misalignment among its management team and a lack of performance accountability throughout its 300 employee workforce. The company did not track on-time delivery of its products and on-time shipping was close to 50%. Grease was brought in to work with the COO and his management team to develop a clear roadmap to improved business performance through improved collaboration and accountability within the management team.

Approach

Business Strategy and Business Execution Planning. Grease worked with ABP through Strategyzer’s Business Model Canvas™ to quantify its addressable market, articulate its value proposition, and map its business model. This work presented a clear picture of ABP’s market participation and competitive positioning including its recent financial performance by product and channel, and provided the basis for establishing the company’s business objectives. These objectives were integrated into a one-page management scorecard of 19 outcomes across 4 perspectives to provide a clear description of what ABP will become to its owners, customers, managers, and employees.

Working with a pilot team selected by the COO, Grease established a monthly management scorecard review supported by a 15-slide business and KPI report. The monthly management scorecard and report have established ABP’s baseline business goals for management accountability and have created a clear business navigation system to run the company effectively and profitably.

Organization Effectiveness. Grease engaged the ABP management team during a two-day workshop to improve the team’s organization effectiveness. The objective was to gain competitive advantage by reducing friction and improving collaboration. Grease focused on three organizational skills: communications clarity through applying PSTS, a proven story-based communications structure that ensures clarity internally and externally; constructive conflict by using a sanctioned PINCH-model template for dealing uniformly and quickly with conflict to resolve the underlying issues; and collaborative candor by using a technique to minimize the tendency to “careerism” in group settings such that associates “speak for” and not “about” issues and others, meetings are truncated, and hallway conversations are minimized.

Grease conducted workshops to review the management scorecard along with each manager’s job description in order to ensure that managers were aligned on company objectives and to generate the commitment to action needed to meet those objectives. Follow-up from the workshops resulted in one-page job descriptions and performance contracts for each of the 16 ABP managers. This work clarified roles, responsibilities, and accountabilities for management in order to achieve ABP’s business objectives.

Grease assessed the managerial and leadership needs of each of the 16 managers and integrated its insights to assessments by the COO and CEO to create a one page performance review and personal development plan for each manager. The plan serves as a personal development commitment between the manager and COO with specific activities and outcomes.

Sales Execution. Using a proprietary technology framework, Grease conducted eight in-depth customer interviews, then used the findings to develop customer and distribution channel value propositions. Applying the technology, Grease made those value propositions more rigorous by stating them with the specific outcomes and metrics that drive business profitability for ABP’s customers. ABP has been able to use these rigorous value propositions to engage in deeper, more substantive business discussions with key customers including its largest distributor.

Grease introduced ABP to PSTS as the essence of successful proposals. The approach recognizes that customers are wired to listen to stories. Stories engage. Interesting stories all have a point of tension, which sustains our interest. All stories start with something in which the teller and listener agree. But, there is a hitch, some kind of problem, often a villain that must be overcome or neutralized. The denouement or story resolution satisfies the listener or customer, such that the customer accepts benefits of the storyteller’s differential value proposition animated by a story. ABP’s management team tackled storytelling homework after exposure to this technique. Each team member was encouraged to tell a story to demonstrate some facility with this storytelling skill.

Grease worked with ABP to create a 2014 monthly sales plan by customer, distribution channel, and sales channel matched with a monthly sales performance report.

Impact

ABP’s implementation of Grease’s organization effectiveness work has transformed the company’s business performance. R.O.S. increased to 8.8% for the current year (compared to under 1% over the prior 5 years). Annual revenue increased 23% over prior year driven by 17% increase in volume and 5.2% increase in net sales price. On-time shipping improved to 70% from 47% over the prior year while WIP and finished goods inventory declined. ABP now has the foundation to manage its business and organization in pursuit of the objectives that have been established by the COO and his working team. The one-page ABP scorecard clearly states what ABP wants to achieve for its owner, customers, managers and employees. The job descriptions and performance commitments clarify individual accountabilities and how each of the managers reporting to the COO contributes to achieving ABP’s objectives. The monthly management reports and simplified income statement provide transparency on ABP’s performance versus its objectives and provide the context for leadership of the company to be in service to its employees in achieving their objectives and creating a more rewarding and prosperous future. The performance and individual development review plans coupled with the performance conversation guide provides a framework for employee growth and development that instills and reinforces employee engagement in pursuit of excellence at ABP. The communications clarity, constructive conflict (Pinch Model), project management, proposal selling and customer value proposition training have imparted the necessary skills and building blocks to execute the COO’s vision of leading a collaborative management team that fulfills its commitments, captures the value of maximizing its customers’ experience with ABP, and generating great results for ABP’s owner and the employees’ future.