Editor's Page -- A Failure Of Leadership

Dec. 21, 2004
Simple lessons from stacks of data and years of reporting

One of the most important pieces of data to come out of this year's Census of Manufacturers is that many U.S. manufacturing executives -- the plant managers, vice presidents of manufacturing and, yes, the CEOs of manufacturing companies -- are failing to lead. The survey, conducted this year in conjunction with the Manufacturing Performance Institute, Shaker Heights, Ohio, finds that 46% of the companies that admit to having made no progress toward world-class manufacturing performance (and whose benchmark metrics verify their bleak assessment) do not have a manufacturing improvement methodology in place. They aren't even trying to improve. Of the 54% of plants that have made no progress to world-class performance but which do have a methodology in place, the majority (53%) have only some implementation and very few have fully implemented their improvement programs. Charitably, one could argue that perhaps the leaders of these plants have just embarked on their performance initiatives. Such an effort can take years. I've talked with CEOs and other executives who are strong leaders, who lead with integrity and are personally committed to the improvement efforts, but whose facilities have yet to achieve breakthrough performance. But I doubt that is true for all of them. More likely, some of the efforts are half-hearted and unfocused -- hamstrung by disinterested or incompetent leaders. The good news is that 95% of companies that have made significant progress toward or have fully achieved world-class performance (and benchmark metrics confirm their assessments) have an improvement methodology in place. Of those, 87% have significantly or completely implemented the methodology. These findings strongly suggest that mediocre plants could dramatically improve manufacturing performance just by implementing a performance improvement program. If they try hard and implement that plan with gusto, they can achieve world-class performance standards. But that takes leadership. How can I place blame on the leaders, and not, say, intransigent or lazy production employees? In decades of IW research and reporting, never once have we discovered a successful plant -- even a plant that's been turned around after years of miserable performance -- that attributed its success to an entirely new group of employees. Rather, more often than not, the story told is how a new or newly enlightened leader stepped forward, launched an improvement initiative and then personally made sure plant personnel at all levels stayed on course. This of course begs the question: Which methodology works best? In the Census results, lean manufacturing, which was implemented by 40% of the plants closest to world-class performance, far outpaced the others in terms of deployment. Total Quality Management, cited by 17%, was second. Only about 5% of the respondent companies managed to achieve near world-class performance with no formal methodology in place. Taken together with other survey results and years of reporting, three necessary, yet simple keys to achieving world-class manufacturing performance emerge: Implement an improvement methodology, invest in it and commit a sustaining level of effort toward executing it. That, in its simplest form, is leadership. The question you need to ask yourself is: Are you "leading" a company whose plants have not yet implemented an improvement methodology or, at the very least, a few of the other best practices employed by world-class manufacturing companies? If so, let this serve as your wake-up call and road map. For those of you who answer a hearty "no," congratulations and keep up the good work. We hope IndustryWeek's upcoming Census reports will stiffen your resolve and inspire you to continue to pursue world-class manufacturing performance. Editor's Note: On Dec. 17 IndustryWeek.com hosted a Web broadcast discussing the results of the 2003 Census of Manufacturers. Click here to view the archived event. Patricia Panchak is IW's editor-in-chief. She is based in Cleveland.

About the Author

Patricia Panchak | Patricia Panchak, Former Editor-in-Chief

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In her commentary and reporting for IndustryWeek, Editor-in-Chief Patricia Panchak covers world-class manufacturing industry strategies, best practices and public policy issues that affect manufacturers’ competitiveness. She delivers news and analysis—and reports the trends--in tax, trade and labor policy; federal, state and local government agencies and programs; and judicial, executive and legislative actions. As well, she shares case studies about how manufacturing executives can capitalize on the latest best practices to cut costs, boost productivity and increase profits.

As editor, she directs the strategic development of all IW editorial products, including the magazine, IndustryWeek.com, research and information products, and executive conferences.

An award-winning editor, Panchak received the 2004 Jesse H. Neal Business Journalism Award for Signed Commentary and helped her staff earn the 2004 Neal Award for Subject-Related Series. She also has earned the American Business Media’s Midwest Award for Editorial Courage and Integrity.

Patricia holds bachelor’s degrees in Journalism and English from Bowling Green State University and a master’s degree in Journalism from Ohio University’s E.W. Scripps School of Journalism. She lives in Cleveland Hts., Ohio, with her family.  

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