After a month of observing the status quo, I flew to corporate headquarters and told the CEO of GATX, “If you have inventory, quality or productivity problems, I’ll fix them. But the real problem is you have lost contact with the customer, and I’m going to fix that first. I’ll be doing a lot of international travel and I’ll be fixing problems here at the same time.”
Before I began my travels, I collected status reports on the state of the business I had just agreed to fix. I conducted both revenue reviews and project reviews with the responsible vice presidents. What I found was head-shakingly disheartening. The leaders most directly responsible for the performance of certain units and large projects were unaware of some of the essential information they needed to properly and successfully execute their responsibilities. This is the same situation I found at my two GE turnaround experiences. The vice presidents at Fuller did not understand what was really happening and a couple of them didn’t seem to care.
At Fuller, I found four things in common with all other failing organizations:
1. A culture of comfort
2. Little discipline
3. Poor execution throughout the company
4. The customer was an interruption, not an opportunity
Because I had seen this before, from the outset it was clear that the existing culture needed to be destroyed. I knew it was important to get it done quickly, and it was not important how I got it done. I just needed to disrupt the status quo now.
Retired CEO and business turnaround specialist Elmer David Gates takes the reader through a tour of his leadership experiences starting with the Korean War through increasing responsibilities at General Electric and finally turning around a failing global manufacturing plant in Pennsylvania. Young and developing leaders at all levels will learn valuable lessons as they walk through Elmer’s life with him.
About the Author
Elmer Gates retired from General Electric in 1982 to enter the turnaround business. He led an LBO of Fuller Company (Bethlehem, PA) in 1986 and, as President and CEO, took it to a global leadership position in 1990 when he sold Fuller to its most formidable competitor. Since then, he has been a mentor to many, from start-up entrepreneurs to CEOs of significance. He grew up in modest circumstances in a rural Adirondack mountain area of New York State and graduated from Clarkson University (NY) in 1950 with a degree in mechanical engineering. He served in the Korean War and spent his final army year in a series of military hospitals. He was married to his wife, Betty, for 55 years. She passed in 2008. He was honored with the Clarkson Golden Knight Award in 2010; was inducted into the Clarkson’s Entrepreneurial Hall of Fame in 2011; and was inducted into the Lehigh Valley (PA) Executive Hall of Fame in 2012. He has two daughters and four grandchildren.