Being accountable as leaders marks the road to change in industry and provides room for people to contribute to the best of their ability.
This refreshing message was delivered recently by CVRD Inco’s Chief Operating Officer Mark Cutifani as part of Laurentian University’s Engineering Seminar Series, “Driving Change in Industry.”
For Cutifani, people drive change because people make things happen.
“At the end of the day, we can talk about technology, research and development, and a whole lot of things, but it still comes down to the people.”
In order to create effective managerial leadership, leaders must be honest with themselves, admit mistakes and be accountable, Cutifani said.
“It is up to us as leaders to help people understand the situation we’re in, and if you start blaming everyone else, then you’ll never put yourself in a position to change the organization,” he said. “It is our job to create the climate, get the agreement, and make the change.”
With this philosophy, CVRD Inco’s Sudbury operations began the process of creating a high-performance team to raise the productivity value of each employee from 23.5 tons of nickel per person (1995) annually to a targeted 35 tons.
Prior to 2003, the company suffered a turbulent eight-year history of low productivity, layoffs, lack of reinvestment in mines and people, and rising operating costs. Following a three-month strike that same year, the company reconstructed its business plan to improve future performance.
The company turned to Canadian psychologist Elliot Jaques’ research on requisite organization, a whole-system model that focuses on fixing deficient structures using science-based methodologies to allow employees to work at their full potential.
Recognizing their shortfalls as leaders, Cutifani and his senior management team stressed the importance of getting back in touch with people through respect and dignity.
“Being respectful is understanding that every individual has something valuable to contribute in the business…Every idea deserves feedback and consideration…They know the job better than me. The day I stop listening to their feedback, and what the issues are in their workplace is the day I’m lost and the day we’re lost.”
In order to deliver results through people, Inco had to have a strategy. It had to have the right people in the right job doing the right work and
be clear about what each person is ac-countable for.
Cutifani defined three strategies: redesigning the way work is performed to get the highest value from the resource, whether human or material; developing an integrated planning process right down to the daily execution of tasks on the front lines; and reinvesting in the integrity of the asset base to improve capability.
He spoke about how integrated systems design ensures that various levels of work function proficiently under one framework with each level adding value to the next.
After three years, this longer-term solution is beginning to pay off. Third-quarter results from 2006 indicated productivity from the mines has increased 25 per cent and overall metal productivity has increased more than 16 per cent, a record high. In the next couple of years, the productivity value of each person will be more than 40 tons of nickel per person annually, approaching 45 tons, Cutifani said.
Mechanical availability in the smelter increased from 91 per cent to 97 per cent, which he described as approaching world-class performance. The disabling injury frequency rate decreased by 55 per cent, and operating costs have decreased by 56 cents a pound, just under a 20 per cent operating improvement.
Another important outcome was the successful negotiation of a labour agreement, paving the way for successful negotiations in 2009. It has also increased investor confidence and attracted new investment to Sudbury.
Understanding that people are sources of true and creative value is key to helping each individual realize not only their own potential, but also their potential in the context of the business.
“At the end of the day, we must be the change. To lead the change, we must be the how.”