Driving growth at Universal Stainless & Alloy Products Inc Featured

8:00pm EDT August 26, 2009

When Denny Oates was working his way up through the ranks, business was different.

Thirty years ago, it was much more command and control leadership where the management wasn’t very concerned with what the rank and file thought.

“Everyone had their org chart and everybody knew what box was what,” says Oates, a steel industry veteran who was president of Lukens Steel Co. and Connell Limited Partnership before becoming president and CEO of Universal Stainless & Alloy Products Inc. in January 2008.

Of course, over time, the business world changed, which resulted in a more engaged work force.

“I think what was happening is that management, senior management in particular, wanted more productivity out of the employees, more innovative thinking out of employees,” Oates says.

Universal Stainless has seen an increase in sales every year since 2004, and Oates is looking to continue that growth. But to do so will require the help of employees who are actively engaged in the organization and aren’t just punching in and punching out every day.

“People are looking for someone that they can trust in this day and age,” he says. “To build trust, I think you need to be accessible to people and be a good two-way communicator. I emphasize the two-way. It’s easy to talk and tell people what to do, but I think people today … are looking for somebody that’s going to listen to what they have going on, as well.”

Here’s how Oates is using his leadership strategies to form a trusting environment to drive growth at the $235 million steel manufacturer.

Be accessible

Oates doesn’t want to sound like he is complaining, but he expresses the truth when he talks about executive leaders being pulled in 100 different directions. Your time is needed for so many different things, you may lose track of a very important aspect of your job — visiting with your employees.

“I learn more about what’s going on in the company in the trenches, so to speak, by doing that than I do by reading any report,” he says.

Just like you schedule meetings with customers or make time to travel for business matters, you have to schedule a couple of hours to speak with employees.

“You have to be very disciplined about scheduling time to do nothing,” he says. “By nothing, I mean clear your calendar so you have time to walk around and talk to employees.”

While scheduling an appointment may be as easy as marking it in your calendar or entering it in your BlackBerry, you then have to follow through and actually make your rounds.

“You can get right down there and find out what’s going on,” he says. “Secondly, folks on the shop floor appreciate somebody who takes the time to come out and see how they are doing. That does give you a forum to speak directly, kind of eyeball to eyeball, with somebody about what’s going on in the business.”

When making the rounds, you also want to avoid doing it with a whole entourage. Instead, take a casual stroll around like Oates does when he just puts on his work boots and talks to the employees on the shop floor. You don’t need any tricks to break the ice. Just be yourself and listen to what they have to say.

“People are people and everybody is proud of what they do and like to talk about what they do,” he says. “If there is any trick, I don’t know if it’s a trick, it’s just common human interaction. ‘How are you doing today? What’s cooking? How are things working?’ That kind of stuff.

“Nine times out of 10, people will respond to that and after they realize you are not there to kick them in the tail — ‘Why aren’t you working harder?’ that kind of stuff, they tend to be very open.”

Oates also wants his middle managers to walk the floor more than he does, though he realizes they may run into the same time constraints as him.

“Sometimes, with all the changes in cost and all that, people who are responsible for manufacturing operations can let themselves get pulled into office duties, reporting production or doing payroll, that kind of stuff, and not spend enough time out in the shop floor,” he says.

At other companies Oates has been at, offices have been moved to the shop floor right in the middle of the action.

“Anything that you’re doing that’s putting a wall between you and employees is going to hurt you in the long run in my view,” he says. “It doesn’t do a lot of good if you are responsible for a manufacturing department on one side of the plant and your office is in the office with all the staff folks. That’s not a knock on staff folks; it’s just you should be out there, readily accessible and seeing what’s going on and knowing what’s going on in your department.”

When you are speaking with employees and they have a complaint or a suggestion, the worst thing in the world you could do is not follow up on it.

“It’s incumbent upon you, even though you may say it’s not part of your job, it’s incumbent upon you to make sure that it gets taken care of,” he says.

Oates was walking around a plant a few months ago when employees told him there was a quality problem with a product, which was causing more work for them. The workers knew what the problem was, showed it to Oates, and the problem was addressed.

“Typically, when you talk to somebody in a plant, they are going to know more about what’s going on day in and day out in that area more than anybody else,” he says. “They are going to know more about the quality of product they are processing from their equipment than anybody else.”

You have to be careful not to become the complaint center, but again, you have to help solve the problem.

“In a case like that, I would normally ask, ‘Who have you told about this?’ Sometimes you’ll find out, for one reason or another, he didn’t,” Oates says. “In this case, he had and hadn’t gotten the response from us that he thought it should have.

“I just happened to be walking past when a particularly bad piece showed up. So, it may have been something that was in the process of being fixed. It just got fixed a little quicker.”

A situation like this can also cause your management team to become self-conscious that you are undermining them. There may be a reasonable explanation to why the problem was taking a long time to be solved or why it can’t be solved, and the middle manager has that answer. So, check with him or her before making a definite statement.

“There have been times where, quite frankly, I run into an employee who says, ‘I’ve been bitching about this for the last five years and nobody did anything about it,’” he says. “There may be a reason why nothing has been done about it. In that case, you take a look at it and you agree that you shouldn’t do something about it or that it’s going to cost $20 million to fix it.”

It’s critical though that you go back to the employee and explain to him or her why nothing can be done about it.

“If you ignore them, that’s what irritates people, because I’m sure I get irritated when I get ignored,” he says.

If there isn&#x2019

;t a reasonable explanation why something wasn’t fixed, you might have to revaluate if that manager is right for the job.

In addition, if a manager is uncomfortable with you making rounds, you should look into why.

“I think it’s pretty obvious what I am doing,” he says. “It’s not done what the intent of undercutting anybody’s ‘authority’ and all that good stuff. But, I don’t have a lot of patience for that, because I think they should understand what I am doing and they should understand the positive effect of that in their operations.”

If employees are worried about speaking up about an issue in fear of retaliation from the manager, you, again, may need to investigate if that manager fits in the company.

You have to address that issue with the manager, and make sure he or she understands why that type of thinking from employees is not acceptable and doesn’t help the business.

“Part of the reason why some folks fail and others don’t is the tendency to procrastinate on tough decisions,” he says.

“A lot of time people will shy away from confrontation like that. That’s the kiss of death.”

Delegate

A trusting environment doesn’t evolve from just interacting with employees and helping solve problems by communicating with managers. It also is a result of delegating.

When Oates arrived at Universal, he hired some new employees to complement some of the existing employees, and he didn’t want the two factions to become divided.

He avoided that problem by delegating and involving everyone in the process of running a business.

“In my mind, I look at it as, everything I do can be delegated except responsibility,” he says.

Oates can remember being pulled off his regular assignment as a 25-year-old up-and-comer and being given a special project with a six-person team.

After giving a report on the project, his boss walked in his office around 8 p.m. where Oates’ desk looked like a tornado hit it. After telling Oates he did a great job on the report, his boss told him he received an F from a leadership standpoint.

“He said, ‘I love the work you are doing, and there is no doubt in my mind you are going to deliver on this project that we gave you,’” Oates says. “‘But if someday you want to progress in your career, you better learn how to delegate better.’ He said, ‘By tomorrow, I would strongly urge you to take all this crap you’ve got on your desk and, when I come through here, I would hope that you would be smart enough to have all of this crap on somebody else’s desk.’”

While Oates wasn’t doing everything himself, he could have been more effective letting go of some tasks.

“When I’m doing something, I say, ‘Why am I doing this?’ I ask myself that all the time,” he says.

“Sometimes people are bright and have great work ethic, but it’s got to be their way. The only way they can ensure that is they do everything themselves. They never make the transition from good lower-level manager to a senior position in the company.”

The more you can delegate, the more time you have to be accessible to your employees.

“I look at delegation from a selfish, personal standpoint — that’s the way you leverage your time,” he says. “You can very easily get pulled into detail and never get your head above water. So, it’s critically important from a selfish, personal standpoint.

“From a productivity standpoint and from an organizational standpoint and an employee standpoint, it’s equally important because that’s how you get people involved in the process. So, the more I can delegate, the happier I am.”

How to reach: Universal Stainless & Alloy Products Inc. (412) 257-7600 or www.univstainless.com