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Independent thinker

Acrylon Plastics CEO wants managers to act as owners

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Craig McIntosh readily admits that he doesn't accept no for an answer.

"No just means you haven't heard me clearly, so let me explain myself to you some more," says the president and CEO of Acrylon Plastics, a Winnipeg-based manufacturer of custom plastic parts for a wide range of applications including buses, farm equipment, windows and doors, fencing, commercial buildings and residential playgrounds.

McIntosh says his proclivity to positivity is a common trait of entrepreneurs. "That's just part of our nature. We don't regard boundaries as absolutes but rather as obstacles to be worked around whereas many others see boundaries as absolutes and are stopped by them."

Acrylon Plastics employs 240 employees in Manitoba and another 110 outside of the province at its six plants in Winnipeg, Winkler, Saskatoon and Minneapolis. Since taking the helm in 2005, McIntosh has broken the rules by deviating from a traditional, owner-centric business model for one that encourages all his managers to act as independent owners.

"For us to be successful at what we do, we have to have an entrepreneurial, growth-oriented culture and we need leaders that can handle the entrepreneurial nature of our organization."

Q: How can you be sure you're all working toward the same goal when your managers have so much freedom?

A: Because we've gone from one plant 10 years ago to having six plants today, we've had to build a structure that allows our plant managers to be like business owners. We don't have a top-down, deep central control system because it simply doesn't work for us. Instead, I expect my managers to make independent decisions every day. My role is to make sure they understand from the outset what the right and wrong decisions as they reflect our core values, then step back and allow them to make decisions on their own. We do have processes in place to guide them through those decisions. If a manager wants new equipment, they have an approval process they must go through in order to justify why they want to spend the money and if the purchase meets our goals and values. Because we are a profit-oriented business, we're driven by the knowledge that we can make money by making the right decisions.

Q: Do you have programs or incentives in place to support this culture?

A: Five years ago, we established an employee share ownership program (ESOP) giving managers and employees an ownership stake in Acrylon, and today, our people own 17 per cent of the business. Initially, we implemented the program for senior managers, but saw an amazing alignment in values within the first two weeks and I knew we had to expand the program so everyone had an opportunity to buy in. At first, they went from being concerned only about their plant to wanting to work more collaboratively because it's good for the company. When your people start on the ownership process, they start looking at things that can have an effect on the company, both good and bad. You definitely see the emotional side of their buying decision, especially because there are no guarantees. That's the nature of ownership. It's not a savings plan or a GIC with a guaranteed return; this is a long-term investment which each person can impact positively or negatively on a daily basis. Of course, ESOPs are not for business, especially if you have an owner-centric business model. You have to be willing to let people make decisions and make sure they understand the impact of those decisions.

We also try to do a number of fun activities throughout the year to promote and support a team environment. We have company picnics, adult and kids Christmas parties and plan fun outings, whether it's going to Grand Prix Amusements or having a "popcorn lunch" at the movie theatre on the opening day of a big blockbuster. Nothing over the top, but for a company our size, these aren't your typical team-building activities.

Q: What is a downside of having an independent type of business model?

A: Obviously, if someone doesn't get "it" right off the bat, that can really hurt you. By that I mean if you hire a plant manager that doesn't fit your organization's values, it can affect productivity and things can go off the rails within a relatively short period. The plant may be running well and suddenly it's not because the manager couldn't handle the role they were given. We are constantly looking for new ways to discern if a new leader just needs more time to get used to the job or if they are simply not ideal for the job. So far, we haven't found a sure "tell" to say if it's one or the other and that's a real challenge because making the wrong hiring decisions is something that has always bothered me.

Q: So what is Acrylon doing to improve its chances of hiring success?

A: I went to a seminar where Jack Welch was speaking and he said that even at the senior level, he only got the hiring right about half of the time. The management guru of the last century admitted that he only batted 50 per cent! That led me to think there must be a better way of doing things. So two years ago, we started using a trait assessment program with our staff and now everyone applying for salaried positions has to complete the assessment. The first part reveals who you are - introverted or extraverted, detail oriented or big picture, fast or slow paced. The second part is matching up the personal characteristics you possess with the characteristics needed for the job. We found that people who were performing well in their jobs were a great fit, while people who were struggling did not have a good match. We had one fellow whose personality was the exact opposite to the requirements of the job. He preferred a methodical, routine, structured world and we had him in a job that was dynamic, always changing, and required him to be responsive. As a result, he was stressed and we were stressed. But instead of showing him the door we were able to use his assessment to find him a more suitable position within the company. Today, he's doing great and is exceptionally happy. While doing these assessments, we've also discovered that the accuracy depends on how well we've defined job qualifications and the type of person we're looking for. That's something that is always evolving.

Q: Is it ever difficult to reach a group consensus when your managers operate independently?

A: I think that when you sit down as a group and talk about a problem, you'll always come up with a more optimal solution than by not having an open discussion. Email is wonderful, but you can watch a chain of 30 or more emails fly back and forth before someone says, "Hey, let's just get on the phone and chat." That's not to say that group collaboration is always easy, especially when you're an entrepreneur and used to making decisions on your own. In my case, this learned behaviour came from being involved with volunteer boards. You show up and suddenly, you're in a group dynamic where you have to talk about it and in the end, make things happen. There is a need for business people on volunteer boards because we think about things like achieving results and the bottom line. Not everyone has the same skill set. In my experience, the entrepreneurial-minded business owners are the drivers because they are able to break down the problems, figure out the steps and find the solutions. That's second nature for people like us.

Q: What business leaders inspire you?

A: For the past seven or eight years, I have been an avid disciple of Warren Buffett, who has spent 60 years not running businesses but owning and investing in businesses. Beyond the folksy sound bites he offers, there's a whole raft of common sense that can be applied to what you do. For instance, he says: "You don't know who's been swimming naked until the tide goes out." I relate that to buying a plant that's in turmoil with a lot of negative stuff happening. While the standard reaction may be to get in there and try to solve all the problems, whether it's because of financing or management structure, Warren's advice is to wait until things naturally settle down. Once the "tide" goes out again, you'll be able to tell where the real problems lie because then they'll really stand out.

-- With reporting by Barbara Chabai

Sue Kathler, BA, CHRP, is the vice-president, HR Consulting for People First HR Services. She can be contacted at skathler@peoplefirsthr.com.

Republished from the Winnipeg Free Press print edition January 26, 2013 H1

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