When a factory gets sold, the new owner generally brings a new general manager (GM) in.

And what does the GM do? He evaluates the top managers and seeks to replace the under-performers. This is expected in a typical factory turnaround.

He typically finds the replacements among his former team — at his former employer. It allows for quick hires of proven managers and engineers.

However, as Kim Pen from Chinese Manufacturing Consultants tells me, it can backfire violently.

Why?

First, the new GM, and the people he brings in, can get in conflict with the old team. That’s a disaster. And it often happens in China, where the staff is often tied to their managers more than they are to the company.

That risk is even stronger in a small factory of 200 or 300 workers because relationships are more personal than in large structures.

Second, bringing in a new manager kills the harmony that was established among the managers. The whole team gets less stable, and needs to find a new way of working together.

What the GM should do

A new general manager who needs to turn a factory around should follow these steps:

• Try to maintain the harmony in the current managerial team. Do not make big changes immediately.
• Focus on coaching the current managers in the right way, and on instilling a sense of discipline. Some managers that have mediocre performance right now might thrive under better management!
• Avoid rivalries or conflicts between departments. For example, make the factory’s performance (actual vs. target, day by day) obvious to all employees, and set up a common bonus plan. If properly introduced, it pushes all departments to work hand in hand.
• In 3 or 4 months, the current managers will better understand what is expected of them. It will be easy to see which ones can adapt, and which ones should be fired (and there will be no surprise when a firing takes place).

How to drive improvement projects

The tendency is often to hire some support staff — maybe a project manager — to drive continuous improvement.

But using the current managers and supervisors can be much more effective:

• The GM should set priorities for each of them: they should have a few improvement projects under way, in addition to dealing with their day-to-day jobs.
• Every day, the GM can walk around, observe problems, and explain his view to the supervisors & managers of that area.
• Every week, he can have a short review of the progress of the projects. A lot of pressure might be necessary!
• As effective action plans get implemented, managers and supervisors will have less fires to put out… and more time to devote to improvement projects!

Now, what if the GM doesn’t have the capability or the time to drive these projects? Good manufacturing consultants can help. It would generally take this form:

• A senior consultant helps set the priorities;
• More junior consultants come in — maybe once a week — to make status updates and to provide engineering support.

Again, the consultants don’t replace the managers and supervisors. They set priorities for them, they give “homework to do”, and they come back to check what was done.

Unfortunately, a project manager seldom has the experience to set good priorities, and even more seldom has the authority to push managers hard when they are not delivering.

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If some readers have related experiences, it would be great to read about them!