Armstrong International, a privately-owned mid-sized manufacturing corporation in Michigan has been steadily growing even during the recession. In fact, in all their 109 years, they’ve never had a single layoff. What’s the secret to their success?
Fourth-generation CEO David Armstrong says it all starts with establishing a work culture based on respect. “People like to focus on quality and service, but I view that as a given. Those are basic principles you should follow and if you don’t already have those, you’re already in trouble.”
Armstrong believes the key to a successful manufacturing operation is one that focuses on building a culture based on core values, such as honesty and respect.
“There have been studies done why some companies only live to be 10, 20, or 40 years old before they go out of business. Companies that live longer than that—those that live to be 100 years—all have a culture that they believe in,” says Armstrong.
But establishing a culture—and keeping it—is no easy task. Armstrong advises manufacturers to start slow and stay consistent with their message.
Armstrong, a natural storyteller who has written several books on how to use storytelling as a way to motivate your workforce, believes that finding ways to recognize employees is a key part of establishing that culture.
“I’ve found storytelling works very well for me. I make it a point to find things people do in our company and make them into heroes by telling a story about them. The stories will always have a moral—the point I’m driving home as the leader of the company—something that says, ‘this is who we are, this what we stand for, this is what will get you promoted.’”
If someone has done something really unique, Armstrong makes sure employees in all of the company’s facilities can read about it. He posts the stories on the bulletin board, sends them via email and has “story ambassadors” in other facilities. Armstrong knows that being recognized by the CEO brings a sense of pride to the work employees do.
For instance, Armstrong stresses the importance of taking pride in the company by providing everyone with a clean, high-quality work environment. At one facility, a worker came in on a Saturday morning, off-hours, and planted flowers in front of the building.
“I noticed the flowers when I visited the factory and wrote a story about it. I made him a hero for doing something as simple as planting flowers. Word got out to other employees. They really noticed the respect we give, that we care what we do and how we treat our employees.”
Besides recognizing his employees with the positive stories he writes, Armstrong also finds ways to give back to them. He believes in a “giving to get” philosophy.
“It all goes back to the golden rule—‘Do unto others as you would do to you.’ Treat your employees with respect and courtesy, and communicate with them about what’s going on,” says Armstrong.
When the company purchased a business that had union workers, Armstrong employed this philosophy so well that the employees “gave back” by removing the union.
“We don’t have unions within our company except in countries where it is mandated. When we came in as new owners, we moved the employees into a new, clean building. We cleaned the machinery, the shelving, and we treated the people with respect and courtesy, which are core values in our company. We believe in not talking down to people, give them eye contact—no matter what job they have. I don’t care if they’re sweeping the floor or the CEO, everyone deserves the same amount of respect.”
Of course, the union didn’t always buy into what management was doing and Armstrong points out that it took three to four years of demonstrating the company’s philosophy and culture before employees removed the union.
Armstrong stresses that establishing a culture takes time—start simple and build on those changes little by little. “In the case of the union shop, we started with a simple bonus program at the union shop in which workers received more money if they met certain production quotas.”
The workers were skeptical at first, says Armstrong, but eventually came to appreciate the program for the rewards it offered in working hard.
The bonus program was only a starting point, and according to Armstrong, what really convinced the employees to start believing in their culture was when he removed the time clock.
By removing the time clock, Armstrong wanted to send them a message: Come to work on time, we trust you. Despite concerns from management, Armstrong’s tactic worked. In fact, employees started to come to work early.
“Because I did something for them, they started doing things for me, treating me the same way. Those are things that you can do that really make a company strong and establish culture. We all treat each other with respect,” says Armstrong.
However, for all the work you might put into establishing a culture, it only takes a little thing to destroy it. In fact, Armstrong says maintaining a culture is even more challenging than establishing one.
“It only takes one little thing to lose that respect you created. As a leader, you have to be on your guard. Never let it down. Because once you make a mistake, it’s not easy for someone to forget it, no matter how many times you’ve done the right thing. Make sure you don’t do something that sends a conflicting message. The same goes for your employees—you don’t want to let someone get away with something that’s not part of your culture. Otherwise, you end up condoning that behavior,” he advises.
Mistakes will happen, but Armstrong says communication is key. Apologize when it’s called for and avoid making those mistakes again. He also points out that one way to help keep your goals and culture in check is to emphasize to your employees that it’s everyone’s responsibility to enforce what you stand for as a company. They need to look to each other, not just their leader, to set examples.
David Armstrong is CEO of Armstrong International, a provider of energy systems solutions. He is also a motivational speaker and author of several books on management. For more information, visit www.armstronginternational.com.