Speaker A Personal reflections on Ro experience. I don't know whether that means I should cheer or cry, but just to confine most of my remarks to the current situation that I find myself in. But leading up to that, several years ago, a friend and consultant, Dr. Meltredder, as many of you know from People Fit, introduced me to Dr. Jax's work on levels. It took me a year to get over the first introduction and I didn't return to it. But I was assigned a major reorganization type project at a major facility. And I called on Dr. Meltreder again and we had many discussions and thoughts concerning levels of work, and I used that to reorganize the management team of that organization. And then we went on into some work in terms of talent pool assessments in order to really help the next level to fill out their organizational capabilities. I went on to another organization and we did similar work and reformed the strategy from manufacturing type strategy to actually developing manufacturing capabilities and systems for medical device companies. And then finally I had the privilege of coming to an organization that had had flat growth for seven years. No growth. I like taking on organizations where it's impossible to fail. The only way to go is up. And so I took on the role in Malincrop Baker, which my manager within Tyco Healthcare basically said, either grow it or decide how to spin it off. We had some exciting times in the beginning, and once again I started where I had left off in other organizations with looking at the talent at the leadership team level, I knew I wanted to change strategies and move away from what was not working in terms of growth. And as we evaluated the level, I was pleased to see that there was basically uncovered talent within the leadership team. And so we moved some folks around to break the resistance to change, but we put them in the ones that had higher capability in the transformational roles, and then that allowed us to begin to affect change within the organization. We did some talent pool assessment and continued to move toward a different strategy. And I began to attempt to, let's say, educate some of my leadership team members in levels levels theory and with the intent of eventually implementing as much Ro as I could within a conglomerate that doesn't want Ro and really had major dysfunctional type structures existing and were impacting me in those dysfunctions. One example of what took place and Marcy is here. Marcy took on a new assignment as quality director, our global quality director. And she was literally working twelve to 14 hours a day and basically expressed a concern about she's working 14 hours a day and not making very much progress in implementing some global systems that we badly needed within the organization. And I had her speak to Glenn because I don't feel like an expert in the field and she had engineers reporting to her. And if you think of her role as a level four role, she had level two engineers and she was assigning them tasks to implement global systems. There's many things wrong with that approach. And as she talked to Glenn, she immediately recognized those issues and reorganized to where her quality managers, she folded those engineers underneath her quality managers. And within two months she was coming to me and saying in 8 hours she had extra time. And it's a remarkable turnaround of that. And the implementation has been marvelous across the organization. So that's just one example of some of my folks taking to this. And as I saw that, I recognized that we could go to the next step and begin to look at a stronger implementation of Ro principles. And since Marcy had plenty of time to do other things, we made her the project manager of the full Ro implementation. And so she's here today in celebration of that assignment. Glenn passed this on to people fit in Australia. And Glenn and Barry and Sheila Dean have vast experience in experiencing ro from the CRA perspective. And quite frankly, we've learned some things together. So let me sort of describe the implementation now that we're in at present, where we're beginning to implement what I will describe as the requisite leadership behaviors that are needed to be successful in Ro. We started this process of implementation with a leadership scan. It basically is a scan that attempts to quantify managerial effectiveness and execution risk. And I might point out that our leadership team effectiveness, the managerial effectiveness at the time was about, I think it was 43%. And our risk, I don't recall, maybe 33%. So what that means is that we were about 43% effective in the behaviors needed in order to be effective as managers. And that if we wanted to implement something globally as a team, there was a 33% risk that we would fail. And in some cases I thought that's not bad for a start. So we used that as the beginning piece and gave us big insights. Not only that, recognized that this scan was done on me individually. So Barry and Sheila interviewed my direct report and asked them did they understand what tasks that they needed to do and what their role was? And the issue was, am I setting context on their roles? And they were looking for objective evidence that that was happening. And so we had individual feedback. I originally thought that my leadership team would rebel. They would say this is garbage. I'm a good manager. I'm not 40 something percent effective. I'm more effective than that. But basically their response was we have to do this. Our survival depends upon it. And so we set about an induction process. Now, I'm careful not to use the word training because that's not what we do. We do an induction. So I went away with my leadership group and with Barry and Sheila's help, basically explained what Ro was, what the various principles were. And we had already established a leadership framework for our business, 14 principles of leadership. And we basically went through those principles and trained or inducted one by one. An induction involves discussing the principle, finding examples within Malancrop Baker of where we were or were not doing it, and then taking that away and demonstrating the principle. And only after that had been demonstrated for our rule of thumb was about three months would we allow a manager then to induct that manager's direct reports. And so we used the process of induction workout and then leading an induction as the process that we used, I think Barry likes to call the process reform. We were driving reform within the Mallancrop Baker organization and we are continuing to roll that out. Our preference would be that every manager leads reform with their direct reports. Now, because I have some direct reports that are international and across oceans, we found it difficult to work out the logistics of it all. But we've really tried to stay as best we could along those principles. And then as we've done this, we've applied the current processes, such as our strategic planning processes within Malancrop Baker. We've tried to make them requisite processes, bringing those in alignment. And let me just give you the example of our strategic planning process. We call our strategic planning process, which is really designed for execution. What's funny about this is when we started this, our organization said we never finish anything, we've never done what we said we would do. And so we started a process called strategic deployment, which is really about developing what we want to do and then asking the organization in a cascading fashion, how do we do this, and getting feedback sometimes on what we want to do that we can't do it, or refining it, and continuing with developing strategies and tactics. The mistake we made early on was we sort of took strategies that we were developing at say, level four of the organization and trying to drive level four strategies for level threes and twos to do instead of translating them into level three tactics and then eventually into level two objectives. We've learned since then that we need to make our processes that we use requisite and we translate as we move through our organization. And we assign tasks using Cpqrts this year to assign each of our strategies to our direct reports and then allowing them to break those into tasks and assign those tasks to their direct reports so that we eventually have personal assignments throughout our organization. We're busy in driving those types of concepts, evaluating our structure and using performance management, requisite performance management to evaluate where we are not capable and what the issues are, and beginning to fix our processes. We are now in a position to begin to look at systems and install systems I do have a little bit of a problem in that as a part of a large conglomerate, I have some limitations as to what I can fix. It's interesting that the HR type functions, for example, within the conglomerate, would not understand how I would change the compensation systems within the company. But for now, we're excited about what has taken place. We're still trying to drive requisite behaviors, and we will work on the systems until something gives with the conglomerate. I just might mention that that company, that organization that we're a part of, which had seven years of zero growth, has now will, at the end of this year, experience its fifth consecutive year of double digit growth and is the top growing division this year within Tyco Healthcare, which is now called Covidian.

Speaker A Ron has been a good friend of the society and who's going to tell us the complete project of his work at Malincroft Baker and his insight. So, Ron, it's over to you.

Speaker B Thank you, Ken, and thank all of you for allowing me to participate with you in our discussion of Ro. Yesterday was very exciting for me because since this project I've sort of gone on and gotten involved with entrepreneurs and startups and been mentoring startups. So yesterday's discussion was very exciting for me. I'm going to briefly describe the experience around a turnaround at Malincrop Baker. I'll give you more details as we go forward. And then I'm going to get into a few methodologies, if you will, or components of Ro that we've used. One that has to do with strategic planning and maybe more to do with implementation of a strategic plan. And then also that cross functional working that so many of us are talking about, which seems to be a major pain point for us across not only dysfunctional organizations, but even in Ro organizations, we seem to be struggling somewhat with cross functional management. If you are wondering what turnaround means, I recently, or not too long ago, had on my LinkedIn profile the term turnaround specialist to describe some of my past experience. And I had people come up to me and say, what's a turnaround? So if you're wondering what's a turnaround, a turnaround is simply a business that's struggling and making the attempt to cause that business to move into growth. And so Malancrot Baker was in that situation. Malincrot Baker was actually 2100 year old businesses that were formed in 1995 when Malincrot, a specialty chemical company at the time, purchased a unit of Proctor and Gamble called J. T. Baker. And so Malancrot Baker was formed, and the sales at the time was approximately 175,000,000 when you combined the two businesses, and then seven years later, after much work, the sales were 175,000,000. It was interesting that at the time of the acquisition, both businesses were struggling and somebody had the great idea that if you put two struggling businesses together, it would fix itself. And so I remember at the time making a statement, one dog added to another dog just makes a bigger dog. Seven years later, that statement came back to haunt me because I was put in charge of that business. And basically with the instructions, we don't know whether or not you can do anything. If not, figure out a way to break it up and sell it and just shut down pieces of it if you need to as we look forward. And I'm going to give you sort of the answer at the beginning so we can talk about Ro rather than Malancrop Baker. The reality is that as we began to make adjustments and move the business from a level four business and really in the end, moving it all the way to a level six business through some transitions that we took place. The business ended up being sold at sales of 450,000,000. So we went from 175,000,000 to 450,000,000. We had five consecutive years. The first five years were all double digit growth. Actually, they turned out to be 11% growth all of those years. And so this was the context with which we talk about this turnaround. If I put some perspective and insights as to what we did in order to make the turnaround. The reality is we started with strategy. In deference to George and Ron, I feel like you almost have to start with strategy. And we did, of course, you're keeping in mind and looking for, especially in a turnaround situation, those opportunities to grow the business, to change what's going on. I think someone has said if you continue to do the same old things, you'll continue to get the same old result. And of course, we can't continue to do the same old things if we expect to do that. Now, while you're doing this, you're evaluating and trying to leverage your core capabilities as a business. I've made the statement as a specialty chemical leader that we don't make Radios. And sometimes the business wants to drift, and you need to understand what's at the core of your business and understand the current capabilities and try to leverage those as you move forward. Another key component is just being open and frank with the employees. In this particular case, I heard one employee talk about being number one in their market. We have a great business. We're number one in our market. In fact, I think I got confronted early on when I started talking maybe too negative about the business and explaining to employees that we needed to make changes. And they said, Why would we make changes? We're number one in our market. And I heard someone say we had grown 700%. I think they had their own math somehow applied to it. But I figured out that they were taking the pre acquisition, so one of the individual units before the acquisition, and they were counting the acquisition as growth. Okay, so this was the mentality that you're dealing with in many of these situations, where you have a paternalistic culture, a culture that basically has fed upon itself, and that culture now is basically justifying its existence and trying to ignore the fact that the business is in trouble. And so those were some of the things. And so as you begin to figure out a use strategy that will give you growth, it's important that you be very specific about what direction we're going to move in. And if you've done a good job of communicating and being frank with people, they tend to buy into the fact that they really need to do something now. And then you get very specific about it, and you make sure that you put in metrics, especially in this case, where they had sort of distorted their metrics to claim that it was a good business. You put in metrics that are meaningful and there's always a temptation by employees to put in metrics that they can manipulate. And I think most of you understand that that's part of the dysfunction that most manage companies live in is they manipulate things. And so we have to put in real definitive metrics that will mean something and then communicate, what are we going to do first? Because I've often heard of these vision statements that we're going to go to the moon but no one can believe it. And so it's important to communicate, what are we going to do first, be intentional about evaluating your managers, your current managers in the early days. So as you're trying to figure out this strategy, you're doing things, you're having meetings, you're asking your managers to explain things. You're evaluating about their judgments, which managers are going to be able to help you as you move forward, and which managers are not going to be of any help at all or maybe are over their head as you move forward. And so you're evaluating that using sound principles. As you begin to do things in terms of managing change and having the organization begin to buy into what you're trying to do. Once you do that, you're beginning to have an idea of what the structure is going to be. Of course you're beginning to design that structure and understand what the new business is. In our particular case we started with basically it was a single division as a single business. In our case it was lab chemicals, a lab chemical research. So we sold to research labs all over the world their specialty chemical needs, and we were turning it into a three divisional unit where we were going to have a microelectronics business, chemical business, a pharmaceutical excipients business, and a laboratory chemicals business. Now there were reasons for that because underneath that lab business we were in research institutes like biotech companies where we actually had some products that were good for them and all that needed to be done was scale up. And then on the microelectronic side, for some reason many years before, because of this company's capability to make highly pure chemicals, the microelectronic companies, companies like intel and Samsung had come and actually had asked them to do some things and they had a small segment of business that was doing that. And so those were part of this thing of populating to get those things going. So the design of the structure had to be changed and then you had to populate it. Now I was very fortunate as we evaluated our leadership group. On my management team, I found level fours and fives. And this was basically being run as a level four business originally. So I found level fours and fives and even underneath that layer I found the level fives. So I took those level fives and I made a judgment as to which were the most transformational issues that I faced, such as getting the microelectronics business started. So I moved a level five as the senior leader of the microelectronics business of the pharmaceutical business, and began transformational work in those areas. As some of you may recognize that when you're making major change, it's very helpful to be one level above what may end up being the final outcome of your levels. And so these level fires were instrumental in really making change quickly. And as you may have noted from the graph that I showed, in the first year, we grew 11%, a business that had not grown in seven years. Okay, in addition to that, you're going to continually run into resistance to change within an organization. And I found it very helpful since we as folks who understand human capability, I found it interesting to push managers that had been the same role for 1015, sometimes even 20 years, to push them to actually change roles. I've told the story before of a customer service person, a manager, a tremendous manager, and I had her come and speak to me and I asked her, I said, have you ever considered working in HR? I felt like that she had an aptitude to do that, and she was so well respected. Now, that conversation didn't go very well, scared her completely. And she went back and thought about it for approximately a year and eventually became the leader of our product management in our marketing group, became one of the influential leaders of transforming our product management across the global business. So she had basically expected to retire as leader of our customer service and ended up leading major change within the marketing side of the business. And so those were examples of ways of doing that I actually set in the early years. One of our priority goals was 10% of managers in new roles. And we ran that for about three years. So as you can imagine, we tended to exceed the number. And we had people expecting to take on new roles and get cross trained and learn new things and be capable, since they were capable in those roles in terms of a levels of work, we were able to just simply allow them to learn some of the basics of those roles and then move right into them. And it created an atmosphere that people were always interested in doing something new. And all of a sudden the culture now begins to change and we're interested in innovating and we're interested in being creative and those types of issues. So we began to work on work processes. I mentioned that in the first year we grew at 11%. An interesting note is that the manufacturing site had a way of their planting system, was actually, basically, I think I can summarize it as we make what we made last year. So you can imagine that what was going on there is that we went into backorder immediately, and they only worked on back orders when they had backorders. And so there was no proactive approach. And it was driving us crazy. And so there were many reasons why you have to work on the processes. And when you work on the processes, sometimes you have to adjust the structure in order to fit with those new processes. But the reality is, all of that has to take place during a time of dramatic change such as we were going through. If you're doing ro, I think you understand the importance of personal commitment by the leader. And so I had the opportunity, working with the deans to help me understand Ro. But I had the opportunity to induct my leadership team personally and to allow them to cascade the induction into Ro through the organization in a manner which was befitting the trust between the manager and the employee. And then we constantly reviewed the status of systems and the system effectiveness as we went forward and found many times that even in the latter years, that we were continuing to make changes, continuing to refine our thinking around Ro. And one of those examples of how we refined our thinking is strategic deployment. Now, strategic deployment demonstrates its importance in the sense that there's some data that says that 14% of executives are satisfied with the strategy execution that they have. And considering that in most companies you have a strategic plan, that's a little shocking to be there. And you can imagine that in a struggling company that plays itself out very readily. But if you're trying to turn around a company, you can't afford for strategies not to be implemented. I had many people come to me and explain that. I think they called projects. Basically ships. And they said ships sail and they never come back to port. Somebody said you can get away with murder around here. So those were the comments from the early days. And so it was important that we have a clear strategy. Communicating and strategic deployment is more than strategic planning. It's a way to really implement and translate that strategic plan into action. I originally ran into this concept using a consulting firm called Quest Worldwide. But through this process, I've modified it in order to put Ro concepts into strategic deployment. I think most of us have many different ways of doing our strategic planning thinking. I think it's absolutely important that we do it. And we all know who is accountable for doing that thinking. And that would be the leader. My recommendation, really, is that once you have done your thinking and I don't care whether you use the Boston Consulting Group or McKinsey or some of the other consulting firms or you just do it yourself the reality is that you need to boil down your strategy into about four or five key strategies that you're going to implement over a five year period. If you would like, set a time frame on it and then boil that down into strategies that you're going to implement in the first year, this year. What am I going to do now? My recommendation is in order to have sort of a balanced scorecard approach, is that you find those four strategies in four particular areas. Customers, markets and products is an important area. Internal Effectiveness we always had systems that were major issues for us and needed to have the priority we often forget about in dysfunctional companies people culture and organization. So we need to have strategies around what are we doing to enhance our people, culture and organization and keep them relevant and effective and efficient. And then financial performance. Oftentimes our boards or whatever are not going to allow us not to have any goals in financial performance. But it's also important that we manage our balance sheets and we manage some of the things that we're trying to do, even strategically. Many times M A activity might fall into the financial performance area. There's many ways to get there and then trying to get these to be smart. In other words, measurable is an important aspect of building your strategies and boiling down these things into the priorities of four or five things that you're trying to achieve over time. In our process, I started the process. Oftentimes we use something that we called catch ball. Catch ball is simply that I would come up with concepts and ideas. Oftentimes I had input from my direct reports in terms of the thinking that we use to do strategic planning. And then with that input I would come up with strategies. I would hand those strategies to my direct reports and say this is what I think we ought to do. They would then give back to me how do we do it? And in that conversation that we had together, they were inputting, they were suggesting changes. Oftentimes if I can make a change or let them wordsmith a little bit of my strategy, they begin to own it all of a sudden and gain commitment from it all. And so in the part where the leader and the leadership team actually work on the five year directions, that for me happened over quarterly meetings, always off site, so we could get together and really have the right thinking in place. Oftentimes I was asking my manufacturing person to present to me best practices in supply chain or marketing present what the market share was or what the competitors were doing. So that we were all gaining our thinking together and understanding a marketplace broadly. Like I said, there's other opportunities for do these things using external resources. And then as we came down to the next level, my leadership team's direct reports always had an annual meeting that we called because we met in Bethlehem, Pennsylvania of all places. But that happens to at the time was my home and only about 10 miles from the office. So we would meet oftentimes in Bethlehem. We called it the Bethlehem Summit. I would bring in the 50 top managers worldwide. So people from Kuala Lumpur, people from Europe, people from South America would all fly in and we'd meet for three days. And in those three days, we would ask the question, did we get it right? Are these the right strategies? Now, let me explain to you, I'm not abdicating my responsibility. They never decided a strategy, but they always thought they decided a strategy. Okay? So that's an important thing to achieve, is for your employees to think that they're deciding the strategy. And so this process worked in that way where we handed to them. We did massive amounts of work in those three days and it looked something like this, where as we had the five year strategies and I would present them we would then present and we'd give them some do some work tables, breakout rooms, et cetera, and have them comment on what they thought of those things, how hard they were going to be, what things we had forgotten and those types of things. And give an input. Then we would move maybe in another session to one year strategies and have them comment about those. And then I would send them out into breakout rooms and they would build tactic tables. How do we implement every strategy? And then of those tactics oftentimes though, need an individual tactic, needed a table in order to how do we implement that? Because it's nice to say you're going to increase sales by 10%. It's another thing to know what you're going to do in order to achieve it. And so this was the type of accountability that we were doing and what we'd learned in the process. Over a couple or three years, we made the mistake of actually well, I was familiar enough with Ro to say, okay, we have to have a single owner for each one of these. And the high level strategies have owners that are generally my direct reports. And then as it goes down, there's other owners. I was smart enough to do the owners. But what we didn't pay attention to is we were mainly just trying to get somebody's name in the box. We didn't pay attention to what level is the strategy and is the owner matched to that level. And once we were able to do that, we probably enhanced our effectiveness in terms of doing these things, probably by another 1020, maybe even 30%. So that's the technique. That's basically what it looks like on paper. And this was communicated to all employees worldwide. We had metrics, we followed it. And those are sort of the very simplistic explanation of how a strategic deployment process worked. If you look at some of the keys to success here, the leadership team needs to inform and input on the needs to inform and input on the strategies. In other words, that's that part about getting commitment. We established an annual process. It takes about three years for people to get comfortable with the process so that they're actually living this every single day. I had an ISO 9000 audit at one of our facilities, and I got personally involved in the beginning interview and the exit interview. And in fact, one of the components, as you know, is management commitment. And so we rolled out to the auditor strategic deployment and said, this is how we manage quality. This is the way we do it. These are some of the goals that we have for improving quality. And they went out and did their audit, and as you know, oftentimes interview employees and say, do they really do this? And he came back in the exit interview and he said, look, I've been to hundreds and hundreds of audits, and I've never seen a company that had a strategic plan that every employee knew about and knew where you were going and what direction and what you were doing and knew how they individually impacted it. And so strategic deployment has been very powerful for us, and of course, that meant that we used it every day as a part of what we did. And if I wanted to change direction, it wasn't a matter of going out and trying to explain to people. It was a matter of just changing strategic deployment and cascading it through the management system. Once again, because management was accountable, we were able to track the tactics down at the lower level and keep up with those with a red, yellow, and green light system. And we could track yellows and reds. And I simply said, okay, a yellow is half off and a red is 100% off. But we were running by about 95% of implementation efficiency or effectiveness with strategic deployment in the last several years. And so I felt like that we could really actually change strategy on a dime if we needed to. And so this was a very effective process for us. Hopefully something that if you're interested in, I'll be glad to talk to you about it. Cross functional alignment is another area that seems to be a big pain point for lots of people. There's lots of different ideas about how to implement it. I think Ro has it right. I know that Jerry mentioned some, maybe some I'll call it nomenclature. I'm sure it's deeper than that, but I'm always interested in something that makes it simpler for the employees. But I think there's some things to be learned from cross functional alignment and how to do it the right way. If you look at at least one of the spreadsheets that we used and that Barry and Sheila Dean helped us with, I have a recommendation for this spreadsheet. If you look at it, there's seven role relationship areas there. You can immediately reduce that to five by just eliminating prescribe and collateral. I'm not suggesting eliminating and I'm just suggesting that you don't need to deal with it because it's sort of the 80 20 rule. You can deal with that outside of the norm of what you're doing. But this makes it very simple that when an employee can kind of gather a concept on one hand and five is one hand, they can remember that concept and it becomes less complicated than even six. Okay, I don't know if there's any psychological data to back that up, but let's just say that that's my personal view, that if you can get it to one hand and quite frankly, it fits very nicely together there. And then here's our process that we used for cross functional. Actually, it's not the process we use. I'm telling you, this is a learning for me to simplify it quite a bit. Start with the general manager or above. The general manager above focuses on the value chain and then begins to list the touch points that departments have with each other, whether that's the quality department that may be touching the manufacturing department. There's various things, places where they touch, including maybe in process control testing or maybe customer complaints. Well, at least in many companies that I've been in, the quality group sort of manages and does triage on the customer complaints and decides where in the organization it goes, whether it goes the shipping, or whether it goes to manufacturing or even stays within quality. And all of those points are areas that are likely to be tension areas in cross function or misalignment, let's just say, across the organization. So you work with the selected department managers that apply. Try not to get more than two ideally or three in the room in order to have a good frank conversation about what the role relationship should be and what area. Use the lowest authority level. When you get into this conversation, they're going to remember how it didn't work and doesn't work. So what they're looking for is prescribe. I need to tell the other department to do what I need. Okay? So remember that that's the attitude that you're bringing into the room. And what you have to do is calm those fears that say, I'm accountable now, you don't have to worry about it. I will be accountable for making sure the other department does their job. So all you need is, let's just say advise or monitor those types of things and you default to the lowest authority whenever you do these things. And it'll work. Promise you it won't work the other way if you take it up to a higher authority in those situations. And then of course, you're going to have to recycle. You're going to get it wrong. So my recommendation is don't try to go and be perfect, just get it done. Because what we did was we delayed and delayed and didn't do it and didn't do it and pretty soon when I really almost had a fight break out, I decided I had to do it. Okay? So don't delay, move forward and get this thing done. And so the keys success to here is get rid of the old baggage in the first conversation and try to calm everybody's fears. Let the general manager make those decisions and don't abdicate, don't go and say you guys go work it out. It cannot happen effectively if you do that and then do the meeting with a small group, you can have three departments. Oftentimes three departments are interplaying quite a bit. I know in my situation I had regional geographical issues. So I had folks that are in charge of certain things in Mexico but I had certain global accountabilities as well. And so I had to go with some of those global people to Mexico for the general manager there to actually sit down altogether and thus work these things out. And of course, the whole issue here is accountability equals authority. Let me give one thing as I begin to close down. The issue of inventory is often managed by manufacturing. In our organization, our Sales group would sell things. But big customers oftentimes make mistakes and they order too much or they order it and it's old and they want to send it back. And that salesperson is mainly interested in that relationship. So guess what? They accept it back. Well, guess who pays whose budget? It comes out of manufacturing. So guess when manufacturing is trying to meet their budget, what they're interested in is why is sales reporting back? So things such as creating a budget for sales to be accountable for that area and having Sales pay for the rework or whatever else has to do is an important issue. And so when I say accountability equals authority, you may have to change the way you do some things in order to make sure accountability equals authorities if you're going to allow some of these types of things to take place. Okay, with that I'm going to get to my conundrum. I have an issue, maybe you can help me with it. But I got to where I got by achieving outstanding results in spite of dysfunctional systems. In fact, that was my definition of good management. Okay? I was good at it. If you look in Lominger at what is it, political savvy, I could have written the book on that. I could make my competitors within the organization, those other departments that were interfering with my work, I could make them cry. So that to me. And now as I have young managers calling me on the phone wanting me to mentor them, I see the same dysfunction that they're trying to get around. And the reason they're calling me is they know that they can get around it. They know they're hard chargers. Those are the high potentials in these companies and they want to achieve and they're. Calling somebody like me to say give me your advice. And I have this conundrum. Do I tell them to get around the system or do I tell them the right system and how the system should work? And so we have this interesting change that we're trying to get to Ro based definition which is that fix the system and then maintain it and you will be more effective. Now, having said that, I'm still struggling with that conundrum because these young managers, if they just go and tell their boss they need to fix the system, they're going to get fired. But the reality is that there's a balancing act here and you have a responsibility to mentor these young managers as well as they call you to be their mentor. And it is going to be a challenge for us and we just need to recognize that we can explain the right way. My daughter is a young manager and her friend called me and she called me and we've had several meetings together. And I feel a little guilty because they're walking around now feeling upset that their organization is dysfunctional and I feel like I contaminated them somehow. I brainwashed them into believing that there's a better way and now they're walking around believing there's a better way. Hopefully one day that will turn into a better system for their organization. So, thank you very much and I'll take questions if there are any.

Speaker C It's Sheila Dean here. Ron, of all those interventions, which would you say had the most leverage for your organization?

Speaker B Well, I think in reality because we hadn't done some of the behavioral work in the early stages and yet you can see that the growth kickoff was immediate. That was because we leveled the organization. We revamped the strategies and then restructured the organization. So we put basically the levels concept in. So I think that probably had the most results oriented impact. But the biggest thing that I think managers feel is the accountability, the role clarity and all of that. And I guess my view was that when we started going to behaviors, the levels created the opportunity for growth. The behaviors and leadership practices that we implemented were the sustainable piece for growth. And as you saw, we did five consecutive years of double digit growth. I only say that because the 6th year we only had 6% growth. And then we went into the financial crisis and we went down actually by about 6%. The following year we came all the way back to the previous high level mark for ourselves. So the Ro system allowed us to deal with whatever issues we faced, even the external issues out in the marketplace. Anybody else?

Speaker D An observation and a comment? This is the clearest explanation of Ro I've ever heard from a non consultant.

Speaker B Thanks George. Thanks.

Speaker D About your dilemma. When I first started my own practice of psychiatry, patient told me about a poster which I went out and bought and put on the wall. And it was old fashioned Raggedy Ann Dowel being rung through an old fashioned washing machine wringer. And at the top it said, the truth will set you free. And at the bottom it said, but first it'll make you miserable. So I think you're doing the right thing by telling them what is real and not what is fantasy.

Speaker B I think there's no question that they're miserable. And it's funny because having some personal interest in one of those mentoring roles, it gets quite interesting. But as a follow on and an encouragement to you consultants and I almost don't consider myself a consultant, but some of these conversations now, a friend who I had talked to in the same light several years ago called me a couple of weeks ago and said, you must come to my site and help me. And I said, well, I don't charge for anything. And he said, you need to charge. So I've set up an account and I'm going to charge him for some advice on his management and leadership. Anybody else? Yes, Michelle, this is the last one. Make it a good one.

Speaker C I don't know if you can do this, Succinctly, so if not, we might have to skip it.

Speaker B It's one of my faults, not being able to do it.

Speaker C Everybody's waiting on a break, so I may be in dangerous territory here. One time I was meeting with you. We were talking about cross functional working relationships and you were talking about your own journey of doing this. And there was a particular role, and I can't remember what it was. I think it was in Mexico, possibly a plant manager. And you were thinking about because I think this is a huge mistake we make in organizations is giving people accountabilities for which they don't have full authority even though we think they have full authority. And you talk through how you suddenly had to keep pulling things away from that. You had given this person as accountabilities when you realized they were really your own. And then what you ended up with was much more pared down. So I don't know if you know.

Speaker B Exactly what I don't remember that exact situation. But I'll make a comment about that because I guess it's one of the pet peeves that I hope that I've overcome because it's a pet peeve that I see in myself. There's a tendency by executives, leaders to delegate, and we often delegate. For example, I wouldn't be surprised in the consulting world that you run into. You go into an organization and the chief executive said, yeah, we want to do something like that and Sally's going to lead it for up. The chief executive really is not totally committed. And I'm sure I ran into those situations where I basically said, okay, you're the owner of this process. Well, in reality, over time, number one, I sort of knew going in that what we called the Leadership Framework, which was Ro. That was our name for the project. The leadership framework was mine. And I knew that I wasn't going to give it up because it was my job. Okay? But things like the R and D process for new product, the new product development process, I naively assigned that to R and D. Well, guess who owns that process? So I made sure that my R and D vice president understood that he was only the caretaker for that. He was only the custodian on my behalf, and that he and I were going to be I was going to be accountable. He was just basically there to help me do my job. Okay, so those are the type things. We began to have role descriptions that began that had a little matrix as to who was accountable for what within a process and within a role, who are your touch points and defining those systems, and you know how to document those things and begin to clarify some of these things. So when you don't do the documentation, you fall in those when you start doing the documentation, it becomes clear that you've handed off something that really is your accountability. So managers do that. We did the same thing with strategic deployment. We'd cascade it down. And all my managers delegated strategic, let's just say five year tasks to a level two. And one final story, and then I'm over. The reality is that when I came into the business, new product development had been assigned to product managers. Level two. You know, the biggest new product we had now remember, we made, like, acids, sulfuric acid, nitric acid, acetone, methanol, those types of solvents. So there were bottles, four liter bottles. And the biggest new product was a different color bottle cap so that the customers could see the difference. And I said, how many sales we got? Well, you saw what the sales were doing. Nothing. Okay, so that was a new product. When you put new product development in the hands of a level two, that's what happens. So then we revamped the gate review system, and we had a world class gate review system, and I was promptly put at the end where you'd launch. I decided whether to launch or not. And that's the first time I get to see the projects. And every time a project would come, I was wondering, why are we working on this? And so we finally figured it out that I go to the front end of the process. I decide what we're going to work on, and I also decide whether that product is going to be just another me too. Product in our line or whether or not I'm going to make it a division to itself or create a new supply chain for it or those types of things. So those high level thinkers that Mark Van Cleef talks about a lot, you don't get the opportunity unless you're in the right place in the and so those were important. So I hope I got close to that question. Thank you a lot. I'll be at lunch, I guess, with a table. And thank you so much.

Speaker A As Novus has set precedence by really donating and sharing with other companies their e, learning, some communications, their white papers, their manuals. I mean, it's amazing. You have been the second company to formally join this Ro user organization collaborative. And you said you would donate some of the forms, templates, various things you have that we would put with your presentation on the website. And Ron has agreed to do a host a table at lunch for we know these presentations are limited. I'm glad you came back. You gave us the first three years, what? It was 2007, and came back for the whole story. And Jerry acknowledged this was an amazing story. So there's the table. The other thing you've agreed to do is come to the evening optional session where CEOs share on a more personal basis off camera, and that now I want to just acknowledge you've told me that you now work coaching startups.

Speaker B Yeah, that's correct.

Speaker A And then you have your own. And I just wonder.

Speaker B There'S one of our startups that recognized that he was not capable, so he asked me to be an interim CEO.

Speaker A Yeah.

Speaker B So I'm an interim CEO for one startup.

Speaker A And I'm just asking, now that you've done this Ro, as you work with these much smaller ideas, could you say something about how these ideas are infusing, how you would coach these people?

Speaker B Well, I work most of the time with very early stage, so we're talking about two or three employees at most. Most of them work for free, if you will, or out of their own pocket, and they haven't gotten to funding. And so part of our objective, I'm working under a nonprofit entrepreneurial support group, the largest nonprofit entrepreneurial support group in North Carolina. And they have a venture mentoring service. So we have volunteers that will go in normally about three per entrepreneur, and we try to coach them up to the point of getting funded. And so that's what I'm involved in. And of course, these Ro concepts, as we discussed yesterday, are very important in terms of, number one, allowing as the management team begins to get billed out and as they get close to funding, they need to build it out at least enough for the investor to be interested in them. And it's important that they get the right skills and the right capability put into place. And that capability tends to be the number one thing that many of the investors are looking for. And so it comes into play very readily. Thank you.

Speaker A Thank you very much again for telling your story.