Interim Executives: Filling Critical Gaps When It’s Most Necessary – Part 10
Interim General Manager: Growth Isn’t Always Positive
We have never heard a client complain about rapid growth, but we often hear about how rapid growth is negatively impacting the company’s performance, both operationally and financially.
A large (>$100 million) family-owned manufacturing company was experiencing this exact situation. In the past couple of years, sales had picked up significantly, and multiple manufacturing plants were unable to keep up with the growth. The backlog was increasing, and customer fill rates were down, leading to canceled orders. To try and keep up, they were utilizing an excessive amount of overtime and double-time, resulting in massive employee burnout. The various manufacturing plants began a game of finger-pointing; the cause of the issues was not clear.
To address the issues, the company created a new role: general manager. An initial attempt to fill the position internally failed and a second attempt to hire someone externally failed as well. Each time, there was a disconnect: the right individual with the leadership skills and experience, the ability to work within a fast-growing family-owned business, and the outcomes that were so desperately needed.
Hiring for the right role is key when hiring the right talent. After making a hiring mistake for the second time, the leadership team decided to bring in a manufacturing talent consultant who helped them put together the right job specs, background, and experience requirements for an executive to be successful in the role.
At the same time, a search firm was hired to work with human resources and the talent specialist. Unfortunately, the newly identified guidelines were not used, leading to a misalignment of submitted candidates compared to what the organization needed. The search firm was let go.
Hiring was taken back in-house. The talent acquisition team, in coordination with the talent consultant, began recruiting using the defined specifications.
In the meantime, the company still needed to operate. The issues were mounting—to the point of customer loss. HR also had a growing concern regarding the difficulty of recruiting someone into a dire situation. The talent specialist recommended they try an interim executive to assume the role temporarily while they took more time to find the right longer-term executive.
In less than one week, the team was reviewing two highly qualified candidates who met their exact needs. The leadership team selected one the following week.
In the first week, the interim executive, Javier, put together a situational analysis and presented recommendations to the leadership team. They spent the second week refining the final initiatives and the plan to execute. By the third week, Javier was working in the plants with teams to mitigate major bottlenecks that might prevent the plan from being successful.
Sixteen weeks after Javier started in the interim role, significant progress had been made on key initiatives, resulting in capacity increases of 25 percent and 70 percent in two of the plants. A major automation project was completed and fully operational.
The backlog that had led to lost customers was reduced by 49 percent saving them approximately $2 million in future business, and supporting shipments for work in progress was increased by over 47 percent for the quarter. Both the quality and accuracy of the finished goods had increased as well.
In the end, the plant managers also set their differences aside and came together to help complete several critical initiatives, and plant leadership teams no longer groan with each new purchase order that comes through.
Counterintuitively, a “rush” to fill an executive role the wrong way can lead to months (even years) of delays before the right person steps into a long-term vacancy. Take the time to clarify what is needed to address both the current situation and the future growth of the organization before commencing a full search for permanent, full-time talent. A little extra time up front can save a lot of headaches, time, and costly lessons learned.