How Scott Rusch identifies problems to foster continuous improvement at Anomatic Corp. Featured

9:16pm EDT June 30, 2012
How Scott Rusch identifies problems to foster continuous improvement at Anomatic Corp.

Scott Rusch knows what it is like to be president and CEO of the family business, Anomatic Corp.; so does his brother William B. Rusch. They’ve steered it through the highs and lows of the business cycle. But the lows are not necessarily the largest challenge; rather, it is the highs, Scott Rusch says.

“The biggest leadership challenge typically comes when things are going well,” he says. “I think companies often think of the biggest challenge is when you lose a customer, the economic climate is difficult or conditions are bad. What I have found is truly just the reverse.

“When business has had serious challenges, when Anomatic’s business has had difficulty, whether it be from economic events like 9/11 or the recession of 2009, there is generally a kind of feeling within the organization that there is a challenge, that there is a burning platform that everyone has to respond to,” Rusch says. “So during those difficult times, I have found that people respond and they’re willing to change, they are willing to respond very quickly and do whatever is necessary to make sure that the business survives.”

If you allow your company to develop a feeling that you can be a little complacent and coast now, it will often do damage.

“I think the more difficult thing, frankly, is when business is doing well, and if you have had some success, it is very easy to kind of take your eye off the ball or do things in your business that may not be the right things for the long term,” Rusch says. “I think it’s easy to get a little careless sometimes, so it is really important that you don’t lose your discipline on costs, investments or accountability of your team to execute the plan. In some respects, you have to use constraint.”

It pays to understand the business cycle. The main thing is that there are going to be good times and bad times in any business.

“What you don’t want to do when things are going well is to expect that there is no way for the business to retract or go down,” Rusch says.

You want to always be aware that it doesn’t just always go straight up to the sky. So in those boom times, you may be tempted to expand, to do things that are more risky because you may be emboldened by your past success or you may feel like you really have a nothing-can-stop-you type of mentality.

“But you have to be careful because I think hubris can occur and can lead to problems down the road,” Rusch says. “Overexpansion, too much hiring, too much equipment brought on, new technologies, and new acquisitions — all those kinds of things when businesses are doing very well may not get a careful scrutiny than they would if the business were going through a bad economic cycle.

“I think it’s just that kind of discipline on whether it would be acquiring a piece of equipment or making a new hire that you want to make sure you are doing those things with the full support of your customers, that you know exactly where the business is going from one month to the next, one quarter to the next, one year to the next before you make those decisions.”

Anomatic Corp. has made a name for itself in the anodized aluminum field. Founded in 1966 by William C. Rusch, it is now one of the largest in the world in the category of anodized aluminum. It manufactures caps, covers and packaging components for the cosmetics industry. Scott Rusch has been president and CEO for the past one and half years, succeeding his brother.

Here’s how Scott Rusch assesses business problems in good times and bad times, and how he pursues solutions to them.

Stay within your competencies

Any assessment of a planned improvement in operation or expansion needs to show the multiple reasons for it to come to pass. But ultimately you should compare them to your core competencies to see if each is consistent with those proficiencies.

“I think it is important to stay within your core competencies, remembering what it was that really made you successful,” Rusch says. “They should be consistent, and complementary perhaps, but certainly something that you want to make sure that your customers really are looking for as far as additional value.

“As long as what you are adding is important to your customer, you are probably OK. But every company has core competencies, and if you get outside of them and just assume, ‘Well, I was good at this, and I’ll probably also be good at that,’ you may not be. You want to remember what was successful for you and stay true to that.”

While your company may have had many customers on a long-term basis, it is just as important to inquire regularly what kind of vendor they want as it is to ask all the others.

“Just ask them,” Rusch says. “They will tell you. They will tell you what kind of vendor they want you to be, what kind of services they want you to provide, how you can improve your service. My experience is that you ask, and then you listen. Don’t speak for a while and then let them just tell you and then respond based on what they are telling you they are really looking for.”

It often takes a lot of time and effort to make sure that you understand how their needs are changing, but it will be worth it.

“In our business, because of being in the personal care industry providing metal packaging in our market, it is very tied to what consumers want to buy in the stores,” Rusch says. “What most of our customers talk about today is speed to market and very short lead times. They want to collapse the cycle between what’s being sold in the store and what’s being manufactured in the plants.

“So when you think about that, what’s really is important is to become very good at planning, making sure that you eliminate any bottlenecks in the system so that you can shorten the cycle of replenishment.

“If you do it well, you’ve made that customer very happy because they don’t have to discount products in their stores, they are asking for production of things that are actually selling — and you won’t have extra inventory, you won’t have obsolescence. Those are things to really focus on as well as focusing on speed for current products to market and bringing new products to market much quicker.”

Use continuous assessment methods

Continuous improvement is a frequent goal that many companies seek in order to achieve a higher level of success. But under the surface of that goal is continuous identification and assessment of problems. It may be a little surprising, but past home runs can be definite problems and barriers for the company.

“I think that part of your past success can be a hurdle in terms in trying to really identify problems,” Rusch says. “Organizations often will say, ‘Well, this worked before for us, so let’s do it again,’ but the reality is that it may not work for you in the future.

“I think that you need to stay nimble and react to market changes, and you have to always try to reassess your business, understand where the problems are today and where future problems may exist,” Rusch says. “So stay very focused on where, for instance, technology is going.”

Once you identify a current or future problem, there are actions that can be taken. The first involves obtaining a commitment from your employees.

“What we try to do here as a team when we have identified a problem is that in order to get input from everyone and get people galvanized around making improvements, we first want to try to create a sense of urgency,” Rusch says.

“To do that, you have to communicate to everyone very effectively what the problem is: why it is a problem, why change is needed, and how it would best serve the business, the company itself and also the customer to make those changes.”

When you try to create a sense of urgency, you should avoid the trap of using panic methods that are ineffective.

“People don’t respond to screaming and yelling, ‘Hey everybody, get on board,’ big flowery rallies and that kind of thing,” Rusch says. “What people respond to is when you communicate why it is important to your customer, where your customer is headed, why certain activities that may be going on in the company are detrimental to servicing that customer, and if we lose a customer, what the impact would be on the company.”

If your company has a sense of urgency, it avoids the slower pace of business as usual.

“I think that as long as you communicate very clearly and connect the dots between activities or deficiencies that you have as an organization and how that is affecting the customer and the relationship that you have with the customer, it is pretty easy to create that sense of urgency,” he says.

“You have to really act in a way that makes your customers believe that you have their best interests at heart and that you are doing everything that you can to make them successful as an organization.”

Communicate

Communication problems are at the heart of almost all conflicts involving people. People can build up resentment if they don’t know what is going on around them. That’s why it is important to clearly communicate why you need to make changes or improvements — the second step after creating a sense of urgency.

“I think for the most part, you can handle it is just through meetings that you have, manager meetings, where you talk very openly about the challenges of the business,” Rusch says. “That’s primarily how we do it.”

If you keep an eye on the ebb and flow of the conversation, you will be able to tell if you are building consensus.

“At the end of each meeting, you will pretty much reach a consensus or if you don’t, you can reconvene, but my feeling is that you always want at every meeting, and especially when you are talking about major items, to be able to assign some actionable items,” Rusch says.

You can set up the ground rules for your meetings so that there is a strict discipline to leave those gatherings with action items that everyone has to do — and with necessary reviews for more action. For the follow-ups, a manager or leader who is very results-oriented should get involved. This is someone who knows you can’t control everything that goes on in the business but is accountable for staying focused on the results.

“I think in that way, you tend to not get bogged down with things that lead you astray from your goal, and I think it’s very important for the leader to say, ‘I am very results-oriented,’” Rusch says.

To measure if you are getting results, you should use a variety of metrics. Develop your own to keep meaningful tabs on what you want to follow. “We have a yearly plan,” he says.

“We set goals for the company, whether for growth or profitability or any of the other metrics that we look at, and we review those every month and track and share information with all the managers.”

If an initiative toward those goals is falling apart, it needs to be identified and dealt with promptly. In most cases, there are reasons for the problem and these deserve to be explored.

“Those reasons help you to reassess where priorities have to be for the organization,” he says. “And take immediate action on them. You can’t wait. You have to address things as they come up immediately, and put together corrective actions.”

How to reach: Anomatic Corp., (740) 522-2203 or www.anomatic.com

The Rusch File

Scott Rusch

President and CEO Anomatic Corp.

Born: Chicago. I was born and raised in the Chicago area. I moved to Columbus after finishing school in 1975 so Columbus has been home since then.

Education: Texas Christian University, Ft. Worth. I earned a bachelor of science degree in business administration from the M.J. Neeley School of Business.

What was your first job? My first job was working in a grocery store, stocking shelves. I did that when I probably was in seventh grade, in Round Lake, Ill., north of Chicago. My brother and I both worked for the family business when we were teenagers and through college. We were brought up in the business.

What was the best business advice you ever received? My dad, William C. Rusch, said to have a good, strong process behind you, and go sell on that. That’s really what he did because he invented our core technology of the Anomatic system for anodizing. We are one of the largest in the world in the category of anodized aluminum packaging.

Whom do you admire in business? I always had a great amount of admiration for my dad. He has since passed, but he was an innovator and a born salesman always very confident of being successful.

What’s your definition of business success? We define success as making the business stronger, financially, and I think that financial success is key to any business. We also make sure that we talk and think a lot about sustainability in many different ways, sustainability in terms of environmentally making sure that our business is doing the right thing for the environment. Anodizing is an electrochemical process so there are things that have to be controlled in that part of the business but also sustainable in terms of reinvestment in the business.

We need to make sure that our technology is kept current, our machines are in very good working order, our employees have the ability to improve themselves through education or advancement within the business. All those things are really critical to us. That’s how we really look at our business as a success.