The outside consultant and the case of the unhappy CEO...

Specialty Medical Chemicals (SMC) have found themselves in the position that every company eventually does, they are at the zenith of their growth curve (or are very close) and must make changes to their pathway not just to maintain their current position but to advance the company to a more competitive position where growth, profitability, and innovation can be sustained for the long run. SMC was founded on the genius of one man, Dr. Winthrop, and the intellectual property and patents resulting from his creations, of various chemical compounds used in the pharmaceutical industry, have nourished SMC since its birth. Barry Tompkins was made CEO of SMC following the company’s first growth spurt in the early 1980’s, and his expertise was crucial for driving the company further up the growth curve, however still on the shoulder of Dr. Winthrop’s innovations. Tompkins made many improvements at SMC in “streamlining the organization, putting in place financial controls, upgrading manufacturing processes, and installing systematic personnel practices.” Though Tompkins’ initiatives were important and necessary it was coupled with no influx of new ideas and inventions, no spending in the research and development labs of SMC, which of course resulted in a lack of growth. Tompkins own background, and his “big company type of manage[ment]” style was crucial to his successes. He choose to be very process oriented, and to devote concentration and money toward process improvements, improving the ‘business’ side of SMC. By focusing his efforts in that direction Tompkins failed to notice the “maturing” of SMC product lines and the innovation that is crucial in their industry was nonexistent at SMC because Tompkins’ modeled behavior for his leadership team was that he didn’t consider product development important. In a sense, the leadership at SMC though they worked effectively in the beginning stages of the company’s life cycle had begun to “rest on their laurels”, and were allowed to do so by Tompkins, and rely on the long-standing products and pipelines and long-practiced behaviors of protecting and engaging only in their own realm of responsibilities. It was clear at the time of Tompkins’ departure that the company lacked direction and purpose along with the strong leadership to guide them in that direction and lead them to that destination. The desire for new leadership resulted in the hiring of Carl Burke who was brought in to “reignite the growth” at SMC. Burke learned quickly through his observations that the manufacturing was state of the art, the sales team was populated with capable and dynamic individuals, yet there was something seriously lacking in the leadership team and change was needed. It must have been daunting for Burke unexpectedly discovering that the he had now embarked on a more difficult journey than anticipated and that SMC’s failures to grow stemmed from the chair he now occupied. Burke and the Board brought in an outside expert, Dr. Wells, to consult not only on how to change the psychology of the organization but to also on what, or more precisely who, to change. I think that anytime an outside individual becomes the leader of an organization and amendments to the established norms are required along with a shakeup of the personnel involved, it would be prudent to bring in an additional outsider to observe and recommend changes. This would be effective at relieving the new leader of some of the heat which is sure to accompany personnel modifications. An outside consultant, Dr. Wells in this case, should present a more objective view of the situation as well, especially in the case of SMC as Burke felt betrayed by the headhunters who found him, and was already jaded in his view of the leadership team.
The assessment process went smoothly with the leadership team and Dr. Wells was able to give constructive feedback. She was especially skilled at the “poo sandwich”. Meaning that when she addresses Burke with her somewhat negative observations she always remember to say something positive first and last then sandwiches the negative (the poo) in the middle, which can be a very successful way to diffuse defensiveness. Dr. Wells’ assessments were quite accurate in the designation that the VPs were entrenched in “functional silos” and her statement of the “wait and see” attitude displayed by the leadership team was especially astute. Lacking that strong leader with a vision for the direction of SMC, and the skills to steer the company at all, the VPs had turned their focuses inward and occupied themselves with the success of their own division with no bearing on the company as a hole. The “wait and see” attitude was a reflection of the company as a whole “resting on its laurels”. The leadership team had become complacent in the absence of a charismatic General. The behaviors displayed in the team meetings, such as the lack of conversation when general SMC growth is the topic, coupled with other behaviors, such as the admirable quality to which the factories are organized, lead one to believe that the leadership team is truly engaged and sincerely cares about their work at SMC, they just need someone to focus that energy properly. Perceptively, Dr. Wells noticed this as well, recommending to Burke that he “hold them [the leadership team] to stand” meaning that they need to take ownership of the company as a whole instead of just their division, and that Burke himself must “manage by setting broad strategies” that he must become the SMC’s needed visionary.
Radical changes are needed to shock complacent people into action, and Burke’s plan to reorganize SMC is the catalyst through which the company will embark on its next phase of growth. Relative to similar organizations in the pharmaceutical industry I cannot say whether Burke’s new organizational structure will be effective, however the changes needed to meet the new structure will provide the serious first step needed to stimulate the employees at SMC to see and follow their leader’s vision. It is this leader’s vision that SMC has lacked since its founder left, and Burke must also recognize the changes he needs to make personally to become the strong leader SMC needs. Following the restructuring, along with the needed personnel changes to satisfy the restructuring, Burke must develop a clear, concise, mission that the new leadership team must buy into, both for business and for personal reasons. Some of the leadership team needs new challenges. Burke must be an inspiring presence for his company, not unlike its founder, because in a sense SMC is being born-again yet they must remember the genius of their history to fuel their desire for future success. SMC was spawned from the mind of Dr. Winthrop, protecting and honoring his legacy is a powerful stimulant that can be utilized and embodied by Burke therefore providing a vehicle that can be steered along the company’s new path that he developed, and the leadership team can get onboard for the ride.

SPECIFIC NOTES AND PERSONNEL RECOMMENDATIONS FOR CARL BURKE:
- Michael Everett – New Pharmaceuticals GM – with his background in chemistry and creative skills he can guide this important division, this would give him his needed recognition.
- Roger Engleford – New Generics GM – proven competent to understand science involved in Generics, his multitasking and leadership abilities will help him to grow this department. He should also be involved with choosing and mentoring the new sales managers as his input is needed and this will make him feel important.
- Craig Carlson – Marketing Mgr Generics – he appears to be most effective underneath a strong charismatic mentor therefore best to have Engleford managing him.
- Jack Francis, and Roberta Janis – should both continue running their current departments as they are proven effective, but Burke needs to be proactive at involving them in SMC issues not allowing them to just occupy their silos. The best way to do this with Francis would be to approach him with the demeanor of one asking an elder for wisdom, and Janis can be appealed to through her like of “experimentation and testing of new ideas” perhaps Burke can allow her to run some mock-up proposals of her own design.
- David Rice – this is the one individual that I would give the ax. It seems as if he fell into the position not through merit but through cronyism. Perhaps he expected to be SMC’s next CEO but Burke was chosen instead. When weighing the pros and cons of his continued employment one finds the pros lacking. Seems he can be easily replaced by his assistant George who Rice seems to send to do his job anyway.