Q&A with the former CEO of Leyland Trucks, the largest UK Truck Manufacturer. Mr Oliver will be delivering a keynote presentation at the Manufacturer Director’s Conference (MDC) on November 9. Ahead of the MDC he talks to TM about his experiences in industry and his thoughts on the state of UK manufacturing today.
TM: What external pressures do you feel have been most challenging for manufacturers in 2011 ?
A: One of the key issues for manufacturers at the moment is the likely impact the current financial crisis could have on demand.
The first phase of the recession saw manufacturers descale and reduce their fixed cost exposure. Some have in many instances responded to the subsequent increase in demand by absorbing residual spare capacity and using temporary devices such as overtime, flexible working patterns and agency labour. Others have had to resort to restoring some of the fixed costs they had so painfully taken out.
However, the financial crisis could easily transform into an economic crisis and the whole cycle will start again. This iterative process is increasingly difficult so many will keep things lean,perhaps leading to supply chain difficulties downstream.
TM: You famously transformed Leyland’s performance with the Team Enterprise concept – is this a silver bullet? What individual characteristics of company/sector need to be taken into account by those emulating this approach?
A: Team Enterprise is not a silver bullet. It is merely a device for getting the best of the workforce and sweating the assets by eliminating all forms of waste on a broad front.
However, the fundamentals of the business have to be right: you need the right products for the right markets with a sound strategy to put them together.
Businesses need to take a hard look at themselves and gauge whether they are really maximising their productivity and efficiency. At a simple level this can be answered by determining whether your staff are really motivated, enjoy working for you and feel a natural affiliation for the company’s goals.
In the vast majority of organisations there will be a huge opportunity to improve all round by adopting the simple constructs of team enterprise. The Macleod report quotes average increases in productivity of 17-18% for very little effort and expenditure. However for those who go beyond the average, the outcome can be entirely transformational.
TM: What are the major barriers to creating manufacturing heroes like those you describe in your book Grow your own heroes, both from a company perspective and a UK cultural perspective?
A: All successful organisations need heroes. In any company probably 20% of their employees will fit naturally into this category: the self starters, those conscientious souls who innately get satisfaction from going the extra mile. The challenge is to get the majority of the remaining 80% into a similar mindset.
The problem is not one of persuasion, most people would love to work in an ambience which stimulated them to go a bit further. The key challenge is in changing the collective management paradigm into one based on motivation. Management are inevitably the problem and more often than not the ones at the top are the biggest obstacles. In many instances their egos and reluctance to personally change prove
TM: You are a past chairman of the Northern Leadership Academy – what is your impression of regional attitudes to and awareness of manufacturing in the UK?
A: My greatest frustration is the negative reputation that manufacturing has in the UK today in contrast to the esteem it has in say Germany, Holland and the USA. Most decision makers tend to dismiss it as peripheral and place more value on the professions and the financial/service sector. This is reflected in government policy. No core sustained strategy but instead sound bites coming from the political carpetbaggers who inhabit the top jobs in BIS – or whatever it calls itself today.
TM: What do you hope to give and gain through participating in MDC 2011?
A: : My hopes for the MDC are simple: to make more in the manufacturing sector aware of the powerful message of the Macleod report and to persuade a few to have a go! It costs nothing apart from a bit of time and could be life changing.
For more information about John Oliver OBE and his presentation at MDC please visit the event website.