Independents have grown and thrived on systems built to respond to customer requirements with speed and quality. When the product itself became a commodity, the primary differentiator in the industry became service. For many, the heroic effort to meet changing customer needs has become standard operating procedure. Without a doubt, responsiveness to customer needs is essential to survival. However, a culture of reactivity alone ensures that we have time to do little else but fight fires.
Culture is the official—and unofficial—way companies get things done. Over the past 12 years, I have measured culture in the industry through use of the Denison Cultural Survey. Based on research of common practices in profitable companies, the survey assesses effectiveness of organizational practices linked to profit. As seen on the following page, Figure 1 depicts the impossibly perfect culture where structure and flexibility are maximized and balanced, with promises kept both to the customers and employees. People at all levels of employment are surveyed and their responses paint a picture of the corporate culture. The result is a prescription targeting the areas of greatest strength and greatest need.
Reactive cultures, like the one depicted in Figure 2, focus almost exclusively on customer demands. These companies said this about themselves:
How adaptable are we?
- We spend most of our time on customer focus
- We do whatever it takes to make customers happy today, but fail to learn how to respond the next time the need occurs
- We do not anticipate—or better yet, create—change in the market
Are we on a shared mission?
- There is a mission for the company, but it is not tied to goals and objectives
- Individual and team performance is difficult to measure on a daily basis beyond the gross measurement of orders shipped
How consistent are we?
- We have the best of intentions but the tyranny of urgency leads to compromise of our quality and procedural standards
- Working with someone from another department is like working with someone from a different company
Are people fully engaged and involved?
- We do not work as a team, and are not encouraged to do so
- Information is not available at the level it is needed, so we do as we are told and then await instruction
Sadly, when companies like the one described above ignore the clear data, they suffer loss in the marketplace. It is worth noting, however, that a more hopeful study was done of an industry leader with very similar patterns. In this case, data’s revelations were attended to and a simple action plan was developed. Here is a summary of their plan:
- Do whatever it takes and follow each major innovation with a cross functional team assigned to learn and build shared best practices for future use
- Set goals and objectives for every department and machine center
- Provide timely data, and the training to understand it, to all personnel
- Focus on fire prevention as much as we do on fire fighting
- Build standard operating procedures for all critical processes
- Use the quality improvement process to communicate issues and solutions to all departments
- Create a cross-training matrix to build bench strength on key processes
- First train and test, then delegate decision making
With a focused effort over the course of 18 months, this same company produced the results depicted in Figure 3 with a more contented workforce and a greater market share. They did not alter their corporate DNA; they just made conscious and disciplined changes in their behavior. They are as responsive as ever, and are now more capable of keeping the promises made to the marketplace. Additionally, they have a more engaged and structured approach to the work at-hand. Capacity has actually increased, with use of the same equipment. Most noticeably, the general attitude is more confident and adrenaline is saved for real emergencies.
The nature of this business is to respond to customer needs with speed and ease of use. Making it easy for employees and your company to meet customer needs is a true leadership task. The first step, as exemplified above, is to tell ourselves the truth about the culture we have built. With consistent effort, that culture’s strengths may be leveraged and its bad habits addressed. Consider Ben Franklin’s advice about an ounce of prevention being worth a pound of cure. As we follow the data and invest in prevention, we can retain our best responsiveness, becoming more proactive and profitable in the way we get things done.
Scott Ellis, Ed.D., is a partner in AICC member company P-Squared (P2), and an expert in individual and organizational growth. The multidiscipline P2 team identifies and eliminates organization’s process and people constraints for sustained profitability. With deep experience in psychology and business leadership, and more than 18 years in the packaging industry, Ellis addresses the needs of the people side of the business. Ellis can be reached at (425) 985-8508 or firstname.lastname@example.org.