When Jim Bolch took over as president and CEO of Exide Technologies last year, the 122-year-old battery company was doing well.
It had fallen on tough times in the first part of the last decade, but the previous CEO had remedied that and gotten the organization back on track.
“He did a lot of tough love, if you would, to put the company back on track and did a very good job of it,” Bolch says. “But what came away from that environment is the company became very risk-adverse. The people were very reluctant to take accountability for decisions and sort of step out.”
His initial gut-feel told him he was going to need to change the mindset of the organization in order for it to continue improving.
“My challenge is, as I’ve sort of coined it, moving the company from a ‘don’t lose’ mindset to ‘play to win,’” he says. “People were scared of making a mistake. With 10,000 people, [we had] to change their mind and say, ‘It’s OK; it’s time to grow this company and time to win the market,’ and we’ve spent a lot of time over the last year doing just that.”
Build your case
While Bolch initially suspected that the company needed to change its mindset, he wanted to test that theory before he moved on it.
“Early on, you develop some hypothesis, but you want to go out and test them, so a little bit of it was collecting data to test, but also it’s starting to build some consensus as you go along,” he says.
He spent only two weeks of his first three months on the job actually in the office. The rest of the time, he was out traveling to more than 20 countries, touring his factories and talking to different employees, customers and investors.
As he met with each of these different constituents, it was important for him to ask a lot of questions to make sure he was gathering as much information as possible.
“The questions vary depending on where you are and who you’re talking to,” Bolch says. “Typically, if I’m talking to employees, one of the first set of questions I start to ask is, ‘Who are your customers? How does what you do add value to your customers?’ … If people don’t really understand how they’re going to add value, then we have a problem.”
He also asks a lot of questions around how do they do their job, how do they know that’s the most efficient way to do their job, and if they had an idea on how to do that better, how do they implement it.
With customers, the questions are different and more focused on asking them how Exide can do better — what do they like about doing business with the company, what don’t they like, are they responsive, and are they innovative?
“Especially with a customer, asking more open-ended questions, you can learn a lot,” he says.
Then with investors, it’s yet another set of questions.
“With investors, it’s all about expectations — what would cause them to want to invest in our company, what would they expect to see back from that,” he says. “With them, a lot is results, a lot is transparency and understanding of the direction of the company and what we’re trying to do to improve.”
As he traveled and talked to people, he started to see evidence that supported his theory that the mindset had to change. For instance, he went to visit a plant in Kansas City, Kan., that made the company’s industrial products. One of the things he asked them about was how often they went to another plant two hours away in Salina, Kan., which is where he was headed next, to share best practices.
“The room was just silent,” Bolch says. “The simple fact was they had never been there. It wasn’t part of the culture to operate as a global company. It was just small local entities.”
Turn hunches into plans
As a result of his travels and conversations, Bolch thought he knew what needed to happen to start changing the company’s mindset, but he needed the right people in place. He made some changes to his team, and about three months after he started, he took the new senior management offsite for a week to put together a new plan and get their buy-in for it.
“It’s about getting them engaged in the process,” he says. … “We did a lot of prework of understanding where the business was and where it could go. A lot of that is really externally based. You have to look outside the company. You get too internally focused, and that’s a problem. Look outside the company. Look at how you deliver to your customers.”
They brought in both customers and investors to talk about plans.
“I don’t think they had had that as much in the past,” Bolch says. “We weighted the pros and cons. It wasn’t necessarily a smooth process. There was some disagreement along the way, but in that, you build understanding. At the end, we came out as one team that was committed to the plan.”
That formalized plan — no longer just a hunch — had three main components: one Exide, driving competitive operations and global growth through innovation.
The first part was necessary because the company was divided up in a lot of different ways both geographically and businesswise. It wasn’t just in the Midwest that people had very little knowledge of what happened in other areas — it was everywhere — so he wanted to knock down the walls. Going forward, a plant could make multiple products instead of just one and a salesperson could sell multiple products instead of just one. It also meant doing some restructuring. Senior leaders were supportive of this, even though it left their jobs in jeopardy.
“What tells you a lot about the people is the way they go about it — if they really engage and say, ‘Yep, we think this is the right thing for the company. I’m not sure what it ultimately means for me, but I want to be a part of it,’” he says.
The second big part about driving competitive operations centered on making the plants and processes more efficient and cost-effective as well as being a leader in the environmental field. They used objective measures to identify the five most important activities to work on — continuous improvement, environmental health and safety, preventative maintenance, energy efficiency, and equipment standardization and cost reduction. Bolch says he looked at the operating metrics for all the plants to make these determinations.
“You can look at who has the best quality measures in terms of defect rates or who has the most productive work force in dollars per part, those kinds of things,” he says. “Then there’s also the subjective version — when you go to visit a plant, you can say, ‘This is a well-run plant.’ Typically it’s the more objective measures to say if you’re getting good results. Chances are, all the other stuff is going to be good too, at least on a consistent basis. Random is never good when it comes to things like that.”
Then the third part about driving innovation was key to developing new technology based on what customers were telling them — they had to play to win.
“It’s time to grow this business, and it’s time to establish ourselves as what I like to refer to as a company of choice — first choice for suppliers and people who want to work here for employment, first choice for investors,” he says.
Communicate your plan
As he began to move forward, the next step was to communicate the company’s new plan to each different constituent group. He did this through various venues, such as an all-company webcast, internal newsletters, in-person and starting an annual meeting.
“Although you have to craft the format differently, I believe you have to be very consistent with the communications, whether it’s your employees or customers or suppliers or investors,” Bolch says. “You can’t have different messages. You have to have a consistent strategy and talk to them and adopt it to their viewpoint a little bit. You can’t create different ones for different people — it doesn’t work.”
He says you have to start with a simple message.
“Making it a simple message is very hard,” he says. … “You have to be able to communicate not only to your senior people but also be able to reach somebody who is working on a factory floor who may not speak English, and translate it and be ruthless and streamline the message down.
“When you do that, it means you have to be very clear about what you have to do. If you use a lot of words, you don’t have to be so clear. If you use very few words, you have to be much more clear.”
That’s why he ultimately came back to just those three big ideas of one Exide, competitive operations and global growth through innovation.
“That seems to translate well and people understand it,” he says.
But he couldn’t simply leave it at just those three things. He also had to explain what those three things really meant to each constituency, and that meant tailoring that consistent message in different ways.
“It depends on their ability to understand, and what’s important to them,” Bolch says of how you do that. “If you’re talking to senior leaders in the company, you can be very explicit, and you can back it up with a lot of details.”
Then it’s different if you’re talking to a lower-level person in the company.
“They can be very intelligent, but they may not have all the knowledge to absorb it,” he says. “You tend to want to state it in more basic terms so they can appreciate it, and give them examples of how they can contribute because I believe that everybody at the beginning of the day, wants to come in and make the company a better place — I’m just optimistic that way.”
Then it’s a completely different approach when you go outside your company and talk to your customers.
“They don’t care as much how you pay your people,” he says. “What they want to know is how you’re going to run the company in a way that benefits them and how they run their business. Take those same messages and how that’s going to translate into better products or lower costs or higher quality.”
Then, lastly, Bolch had to take that same message and tailor it to his investors.
“If it’s a successful business and making customers happy and we’re engaged with employees, ultimately, there’s going to be better financial results for the company, which is what’s really of interest to them,” he says.
After he had effectively communicated the new plan to all the different stakeholders, he then went about moving the business forward. As he worked with people, he continued to reinforce the new plan.
For instance, Exide used to have one large sales force that went out and sold to car manufacturers, such as BMW and Toyota but then had a completely different sales force that sold batteries that go into forklifts. Once when he was out with a salesman in one of the car factories, he took the opportunity to further the plan.
“I would say, ‘It’s great that we’re selling them car batteries, but what kind of batteries are in those lift trucks running around?”
The salesman didn’t know, and when Bolch would ask why not and wouldn’t it be great if they were Exide, the salesman would respond that it would be nice but it wasn’t his job to know.
“It’s the classic, ‘Not my job,” so now we make it their job,” Bolch says. “As you start to unearth these opportunities, one is you change the incentives and objectives, but the other one is you really communicate where we had victories.”
After that conversation and several others like it, now Exide is seeing victories in cross-selling opportunities across the businesses.
He’s also starting to see the fruits of his labor in other areas. For instance, in the past, you could only build an industrial battery in an industrial plant or a transportation battery in a transportation plant.
“Now we’re breaking through that paradigm saying, ‘If we have the skills, and we have the capacity to build in this plant, why can’t we do that there?’” he says. “We’re doing that and generating a lot of productivity that way.”
And the numbers prove that things are changing, as net sales for fiscal 2011 improved to $2.8 billion from $2.6 billion in fiscal 2010.
He’s also seeing more engagement with employees when he communicates with them, which is a sign of success.
“The first time you do a webcast globally, it’s absolute silence because people aren’t sure what to make of the new guy,” he says. “But as time has gone on, you get more and more questions about, ‘Well, can you tell me about this? I’m really interested in this. Or I had this idea — what do you think about that?’”
He’s now getting more e-mails form employees, which is really exciting for him.
“It says to me that people are now starting to engage more and are starting to understand the business,” Bolch says. “When I go into a plant, people interact differently. It’s not just me. Our whole leadership team is reaching out like that. When you see them engage back, you know you’re making a change.”
How to reach: Exide Technologies, (678) 566-9000 or www.exide.com
The Bolch File
Born: Jackson, Miss., but I didn’t live there very long. I moved to Shreveport when I was about kindergarten age.
Education: Bachelor’s degree in mechanical engineering, Tulane University; Master’s degree in mechanical engineering, University of Florida
What was your first job and what did you learn that still applies?
Mowing lawns. I was probably 10. One [thing I learned] is you probably don’t want to mow lawns for a living. I think it’s just you have to take pride in what you do. If you’re going to commit to do a job, you do what you said you’re doing to do.
As a child, what did you want to be when you grew up?
I wanted to be an astronaut. I was born in 1957, so when President Kennedy wanted to go to the moon, I was like 5 years old so it was an impressionable age I suppose. I used to write letters to the people at NASA when I was a kid, and they would write me back. I had two problems. Once I was 12 years old, I was already over 6 feet tall. And at that time, you couldn’t be an astronaut if you were over 5 feet 10 inches, and also I didn’t have perfect vision. I was written out of the program early on. I had to go be an engineer instead.
What’s the best advice you’ve received?
‘Trust, but verify.’ I think I it is critically important to empower your team, but periodically you need to drill down to ensure that you are getting the whole story and you are comfortable with the direction.
What’s the best book you’ve read lately?
‘Unbroken.’ It’s a story of a WWII army aviator. It was a young man who went into the army at a young age, but he was ultimately shot down and stranded in the Pacific and was a prisoner of war, and it was an incredible story of someone’s personal story and how they survived and how they conquered incredible things. It was pretty inspirational.