Leadership Challenges for Today's Manufacturing Site Leaders

Sept. 19, 2008
The global economy has resulted in tremendous cost pressure, which has resulted in less autonomy and less training for plant managers.

Leaders reaching the level of plant manager in their careers are stepping into a position with a host of new challenges. I remember how ecstatic I was when I first walked through the plant after being promoted to plant manager. The feeling was almost overwhelming in a positive way. This is my plant, and these employees are counting on me to lead them in a way that ensures their safety, financial security, and quality of life at work. I was thrilled at the opportunity to demonstrate my leadership skills, to improve the competitive viability of the plant, and subsequently meet or exceed my company's financial expectations. That was 15 years ago, and the role of site leader was already changing.

Fifteen years ago, the global economy and a tidal wave triggered by the Toyota Production System were placing U.S. manufacturing facilities under tremendous pressure. Since then, pressure has only intensified. The constant threat of outsourcing looms over plant managers like a dark cloud that can burst at any time. Few companies operate outside the potential reality of losing jobs to low-labor-cost countries.

In an effort to remain competitive, many companies are embarking on their own lean journeys. Those that correctly implement lean tools and philosophies oftentimes mitigate the job migration, and, in many cases, grow their business and employment levels. Unfortunately, many organizations want Toyota-type results without investing in their people or infrastructure. An example is an organization that increased its hourly employee-to-supervisor ratio to 40:1 to cut costs but still expected first-line supervisors to be leading the charge for lean improvements (Toyota's ratio historically has been around 20:1). This disparity in inputs and expected outputs plays havoc on plant leadership.

Today's plant manager has to be adept at managing up as well as down. Obviously, this could result in a "career-limiting moment" if not handled correctly. Many factors have to be carefully considered when placed in an "unwinnable" situation by a superior. While data, logic, and a calm demeanor will work in many cases, the new plant manager must be prepared to deal with an illogical request similar to the above-mentioned example.

When I first entered into the manufacturing world as an engineer fresh out of college, the plant manager typically had total responsibility and authority at the site. With the current trend of centralization of functional areas such as IT, procurement, warehousing, and even in some cases HR and accounting, the new plant manager has to develop new relationship skills with on-site peers. These support roles are crucial to the success of the site, but the strategic direction tends to be skewed and in many cases inconsistent with plant goals.

The plant manager must have the necessary skills to enlist these functional leaders to help support his/her plant objectives without having much if any authority over those areas. There is not an easy answer to this problem. Ideally, the goals/metrics of the support functions will closely align with those of the site leader. The site manager must develop close relationships with the leaders of these support functions. These relationships have to be focused on identifying win/win opportunities and a clear understanding of what is most important to the overall business. Few training opportunities currently exist for developing these types of skills.

As cost pressures continue to force organizations into making tough decisions regarding training and development as well as the push for flatter organizational structures, the concept of having any meaningful, cross-functional training plan for potential plant managers is only a memory in most organizations. When my dad was running plants in the 1970s, there were management trainees who were being groomed for the top job through a series of cross-functional assignments. Few of these programs exist today. Subsequently, many new plant managers have exposure to only one or two functional silos (i.e. engineering, manufacturing, accounting, etc.) when they are promoted into a plant management role. The lack of cross-functional experience is a significant performance hurdle for today's plant managers.

Pairing a new controller or human resource manager with a new plant manager with little to no experience in these functional areas can lead to major problems. Conversely, a new plant manager with a receptive mindset can learn a tremendous amount from a seasoned functional direct report. The question becomes what to do when the former situation occurs or when the veteran functional leader brings more challenges than solutions. Organizations need to be cognizant of these senior management team dynamics while plant managers need to honestly assess their own capabilities and seek a mentor or training opportunities in their particular areas of concern.

The new plant manager faces a host of challenges that previous generations did not have to consider. The global economy has resulted in tremendous cost pressure, which has resulted in less autonomy and less training for these leaders. In an era when many organizations are simply trading poor management for low labor cost, a new perspective is solely needed for manufacturing leaders.

Chuck Parke is lead faculty member for Leadership Success for Manufacturing Site Leaders, a new course offered by the University of Tennessee's Center for Executive Education. He brings to the program over 25 years of manufacturing leadership experience, most recently as VP of operations for Whirlpool's Cooking Division.

For over 50 years, University of Tennessee (UT) faculty have played a major role in the supply chain/logistics arena -- conducting innovative research, publishing leading-edge findings, writing industry-standard textbooks, and creating benchmarks for successful corporate supply chain management. 2009 U.S. News and World Report ranked the University of Tennessee College of Business Administration a Top-25 school among top-tier public universities, up 12 positions from last year. The college's supply chain management/logistics program now ranks #5 among top-tier public universities. Certification is available. http://SupplyChain.utk.edu

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