Leadership in a Changing Environment

The automotive industry is in an unprecedented change. The shift from the traditional combustion engine to pure electric drivetrains represents a challenge not only for OEMs but for automotive suppliers as well. Dynamic supply chain situations add another layer to this challenging environment.

Plant managers in such an environment are fully exposed to this. They are supposed to manage all these challenges, keep customers supplied, deliver results and keep the plant in a healthy state at the same time. On top, there’s an additional dimension to manage, coming from inside the own organisation. Employees notice all the challenges, threatening their personal as well as their professional lives. The management gets challenged with probing questions: How long will the plant still exist? What’s the long-term plan to secure workplaces? What does all that mean for me?

What should leadership look like in such an environment? How can managers ensure the productivity and morale of their workforce in these ever-changing and challenging times?

There are Two Key Elements to Successfully Lead a Production Plant in such an Environment:

1. A leadership strategy that embraces uncertainty.

2. Communication and empowerment.

A proven leadership strategy is to focus the energy of employees on what is known while at the same time accepting uncertainty as the new normal. Strive to deliver the best results possible despite the uncertainty. Influence what can be influenced and accept what comes from the outside. The idea behind this is to position the plant in the best way possible for performance and to make it more resilient in this environment. Show your capabilities regarding health and safety, quality, productivity or problem-solving. This is even more important for facilities located in high-cost environments competing with sister plants in low-cost regions. The goal is to ensure positive visibility when it comes to footprint decisions.

 

A proven leadership strategy is to focus employees' energy on what is known while at the same time accepting uncertainty as the new normal.

The strategy needs to be supported by the second key element, which plays an even more important role in plant success: communication and empowerment.

Communication with the workforce needs to be clear and transparent. Supported by clear metrics and targets. These shall not only be presented, but their importance also needs to be thoroughly explained. A proven concept is to not hide information, show reality, and not paint a super-optimistic picture where there is none. People want to know the truth and appreciate openness and honesty. It also helps to compare with other plants to see what the benchmark is and what needs to be achieved.

It is paramount that people understand that their destiny is not God-given but is largely in their own hands. Therefore, the concept of empowerment is crucial. Employees on all levels need to understand how their work is supporting the strategy. They can influence the success of a plant to a much greater extent than they might be aware of. Continuous work by all leaders is needed to showcase this connection between their own daily work and the results visible in the KPIs.

Lastly, it is important to give people the trust that they are entitled to make decisions by themselves. In most cases, people at the working level know best what helps to improve. The role of management is to coach their employees within a framework of trust and psychological safety, where people are allowed to try new ideas, make decisions, and learn from mistakes. Managers need to ensure that employees understand to what extent it is OK to make decisions and when it is time to escalate or delegate. By doing so, employees take control over their own destiny and develop resilience despite all uncertainty. The strategy is intrinsically supported by the workforce.