"Identifying and Developing Exceptional Managers" - part two

Where Exceptionals Fail -- or Succeed

Production Managers

Context. The distinction between a Project Manager and a Production Manager was marked. Project Managers normally had an increased depth or specialization in one area, and as a result had a restricted interest in dealing with more pragmatic issues. Production Managers had depth of practical experience but had often not acquired the depth of technical expertise or skill to tackle intricate areas of specialization in the business.

Focus. Production Managers focused on practical applications, like efficiency, rather than on innovation or new technical excellence. Satisfied with a pragmatic standard of "good enough," they achieved effectiveness at a reasonable cost. They minimized and controlled risks in order to optimize efficiency, and approached problem-solving from a planning and scheduling perspective.

Repetition was valued. It offered the opportunity to fine-tune the system, optimize profitability and efficiency, and refine the operational learning curve. System capacity was the main concern, and they evaluated performance on results, i.e., did the system work, and did it work well.

Organizational Niche. Typically, Production Managers thrived in positions such as production engineering, accounting, plant management and sales management (see Figure 8). Generally, such managers found their production-based niche and remained within that channel as long as their output generated sufficient rewards to make this investment worthwhile.

Project Managers may have starred during the start-up phases of a production function, but Production Managers were needed to step in to refine and maintain the established systems at an efficient, effective level. Production Managers thrived on refining profit-making technology or systems central to the corporation's success. Results were the primary focus. Such managers were most comfortable with functions that were quantifiable, concrete, measurable and therefore controllable.

Flatspots. Production Managers shone when a system or a function needed to be perfected. However, they tended to resist change when the organization refocused and needed to address creative expansion. They balked because the need for change was not readily apparent. Both the opportunity and need for continuous refinement and profit were still quite evident to them. In contrast to the Project profile, Production Managers always remembered to feed the "cash cows." They had one dream, to fine-tune the system, and they saw no need to build another.

Critical Leaders

Context. Only Critical Leaders both understood and stood up for the bigger picture. They were able to both build a guiding vision and then funnel money from the "cash cows" to fund this dream. Such managers had enough of an overview to effectively countermand the logical arguments of good people, who were correct at the moment but who could not conceptualize the long-term requirements. Critical Leaders were capable of envisioning and engendering those lasting systems which would provide long-range value to the corporation.

Most simply, the Critical Leader was the corporate advocate of the future. This was accomplished without either threatening survival or sacrificing the present. Decisions were grounded in fact but based on intuition. (While not consciously organized, intuition was undoubtedly based on experiential knowledge.)

Focus. Unlike the specialist orientation of the Project Manager and the generalist orientation of the Production Manager, Critical Leaders were multifaceted in outlook, breadth and depth. There was the specialist's commitment to innovation and growth, but it was accompanied by a diversity of experience and knowledge that also incorporated the practical need for stability and profit. These two poles were not blended. Rather, Critical Leaders leaned strongly toward one orientation and only borrowed the core traits of the other profiles. The polarized perspectives of the Production and Project orientation were thus sufficiently balanced to optimize excellence.

I think in the beginning I honestly did not think much of participative management. Here at the end, I have a better understanding of the pitfalls and the worth of participative management. People take one of those (management) styles and promote it through their lifetime or oppose it. Our process forced us to sift out the right things and reject the wrong things. You learn from it.

Hugh Brady, Sponsor

Contribution. Critical Leaders were characterized by the ability to create visions, and take risks. They had the capacity to take a stance against the institutional tradition of the moment. Often Critical Leaders could not easily express the logic to justify a decision or direction which they had envisioned, since it was based on a variety of factual and intuitive knowledge. Critical Leaders, therefore, had to take responsibility for the consequences of such decisions and have the strength to risk being proved wrong. The quality of their decisions and the ability to install systems of lasting value were direct measures of the Critical Leaders' capacity.

Balancing The Profiles

Corporate Need. Different combinations of managers were required during different phases of evolution. In a growth mode, a corporation (or major department or division) needed a predominance of Project Managers to conceive and design the essential technologies and expertise the company marketed. During periods of stabilization and maturity, they required fewer Project Managers and more Production Managers to maintain profit making technologies and systems.

In a mature company, division or department, the need for Production Managers initially increased. They competitively reduced costs, streamlined systems delivery, and maintained quality standards until a changing marketplace required new and innovative change. Those managers who were lucky enough to be matched in profile to the present needs of the organization found their stars shining. Those who weren't, found their prospects had dimmed, yet often they did not understand why.

Hazards. Organizations that left a Project Manager in a place too long suffered the pains of too much growth and change. Similarly, an organization that relied on production efficiency too long eventually lost a competitive edge to the new and better technology of their competition.

The inclination toward either the Project or Production profile was natural, innate and firmly entrenched long before the managers came to the business arena. The choices were limited but clear: the job could be tailored to fit the managers' inherent orientation or managers of the alternate orientation could be brought in to replace them. With few exceptions, such managers could not alter their natural focus effectively enough and for the essential duration to be able to succeed in the alien channel.

The Role of Critical Leaders

At each corporate stage of development, a Critical Leader was needed to integrate, guide, direct and plan for the corporate future (see Figure 10). Only two to five percent of all potential top managers needed to be Critical Leaders, but these few were essential. They insisted on a high degree of facts and detail but still understood the more non-tangible and difficult to measure factors which impacted the corporate environment. The Critical Leader alone had the broad perspective necessary to determine the proper blend of Project Managers and Production Managers within the corporate scheme.

There was not a single path to becoming a Critical Leader. Both Project and Production Managers could escape the restrictions of their channel with concerted effort and innate capacity. However, Project Managers were more likely to accomplish this transition, because they were inclined to be exposed to more functions within the corporation. This diversity of experience was an absolute prerequisite to Critical Leader capacity.

While all Critical Leaders exhibited a natural bent toward one focus over the other, this leaning was always balanced by an appreciation of the more significant traits of the other profile. This was a challenge not all managers, however exceptional, were willing or able to undertake. At most, only five out of every 100 exceptional managers conquered this challenge and became Critical Leaders.

Figure 10

Picking a Winning Team

Either consciously or unconsciously, most successful corporations have maintained a mix of the two basic exceptional manager profiles at top levels (see Figure 11). The exceptional manager who had evolved from a Project orientation tended to contribute the qualities of innovation and flexibility, plus a desire to explore new avenues of technology application and understanding. The exceptional manager who had evolved from a Production orientation tended to contribute consistency, reliability, a high degree of cost consciousness and a results focus.

Figure 11

As a working unit or team, these two profiles represented a powerful combination. The strengths of one offset the shortcomings of the other, and vice versa. Together they provided the essential balance of management motivations and capacities: innovation and growth, plus sustained efficiency and profits.

The obverse was also true. Where two exceptional managers of like orientation were matched at top levels, each manager exhibited similar strengths and similar flatspots. Companies led by such combinations excelled in either creating new products, services and goods, or in maintaining existing systems and profit return. They rarely excelled at both essential perspectives. As a result, the company often survived sufficiently during initial growth spurts, but it lacked the core resiliency to prosper during severe business fluctuations.

Production Profile

As vice president and general manager of TRW's Operations and Support Group, Hugh Brady managed an annual nine figure budget and a population of over 5000 people. In the vast TRW network, he was four rungs from the CEO level.

Brady clearly has a byword he lives and manages by: sustained quality results. The practical realities of this fastpaced, high-tech organization prohibit the slow, deliberate development of perfection and its accompanying stasis. But only the next best thing to perfection is acceptable. His subordinates have come to expect his characteristically blunt questions, and the equally blunt challenge to "Prove it. Show that it will work." On the front-end, he insatiably demands thorough detail and comprehensive approaches. Quality results are the only acceptable outcome.

His personal goal for the 80's has been to improve the quality and the productivity of OSG's internal operations. His specialty is juggling the difficult demands of short-term crises with long-term refinement of the OSG management system.

Brady expects to be evaluated on the tangible results he produces for TRW. This is also how he evaluates his subordinates. "A manager's primary purpose is to get things done. One good way to do this is to work your human assets effectively, in conjunction with sustaining your operating systems." Primary systems have been streamlined, vital groups have been reorganized. Brady has been something of a fast tracker himself. All these changes were prompted by his high drive for exceptional performance.

Project Profile

In 1972, John Folkerth revived a long defunct home woodworking tool manufacturing company and within ten years he built it into a $60 million corporation.

Out of a circumstance of fate (the purchase of a used saw without a replacement blade to be found anywhere) Folkerth discovered the perfect project challenge: a business of his own. He planned for growth from the moment Shopsmith materialized, and has encouraged growth and expanding capacity ever since. Satisfaction comes from several sources: the continuous opportunity, as CEO of a smaller but burgeoning business, to take personal and professional risks; the commitment to making Shopsmith, Inc. continue to grow; and the dedication to continue to get better at delivering a quality product while developing new product lines. His ultimate goal - a major international corporation.

Neither Folkerth nor Shopsmith matured overnight. Through the classic trial and error approach of a project manager, Folkerth nearly caused Shopsmith to fold. In the first year of production, a $220,000 deficit surfaced. Folkerth had been overestimating efficiency and underestimating production costs. Innovative financing and the personal wooing of both creditors and suppliers salvaged the situation.

For the future, Folkerth plans even more growth. New products are on the drawing board. Shopsmith will open a series of company owned retail stores across the country. His goal: creating a $150 million corporation by 1985. Why build Shopsmith into a $150 million corporation? "To see if I can," he says. "To see if I am good enough."

Critical Leader Profile

Folkerth and Brady grew up in different business environments and developed quite different approaches to management. Today, however, both are firmly evolving into true Critical Leader capacity and, for each, the metamorphosis occurred similarly. The need to develop successors - champions - became a driving force, as their goals and visions expanded.

In 1979, Folkerth recognized that if he continued to maintain primary control over everything that went on, Shopsmith would never be able to blossom to its full capacity, nor realize his long-term vision for it. A year later, he installed a comprehensive in-house training program for managers and supervisors. Each one was required to spend a specified 23 days a year in training devoted to development, productivity, employment practices and motivation. Folkerth expects to fill 70% of Shopsmith's management needs from in-house.

Brady, on the other hand, was a long-term supporter of internal development, a commitment he attributes to his earlier years at General Motors. Confronting the tough staffing decision to hire a key manager from outside TRW solidified this commitment for Brady. What was to eventually become a deliberate management development program emerged from that decision. Selected managers were oriented, nurtured and concertedly groomed for key slots in this major division of TRW. Since that pivotal move to hire from outside the organization, most other managerial slots have been filled with internal talent.

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