In my last blog post, I stated that mid-level managers (managers who manage other managers but are below the company’s C-suite of officers) have a critical role to play in a company’s success. It’s a subject I cover in my forthcoming book, Winning Through Innovation: The Essential Guide for Frontline Managers. While C-suite officers can set an overall vision for the company, they must depend on the multitude of mid-level managers across the company to turn that vision into reality. One factor in a company’s success is whether those managers feel empowered to make important decisions without waiting for CEO approval.
Here’s a story I tell in the book. During the Great Recession of 2007-2008, I served as business general manager of Agilent’s digital sampling oscilloscope division. Business results throughout Agilent plummeted, and CEO Bill Sullivan took bold steps to curtail losses. One was an edict to “stop all travel.” I dutifully canceled several trips my marketing department had scheduled and stopped my own travel plans. But we soon got word from our sales team in Japan that several customers were unhappy with the performance of a product we had recently introduced. They were threatening to cancel all future orders.
Relationships are especially important to the Japanese, and I didn’t feel we could solve the problem through emails and phone calls. Previously, I would have sent two people—a marketing engineer and an R&D engineer—to visit the customers, understand the problem, and offer appropriate apologies. I still felt a live visit was essential, but given the travel restrictions I sent only one person, the senior R&D engineer who knew the product better than anyone. The trip was a success, and he solved the customers’ problems. The customers were impressed that I had considered them important enough to send an expert to visit them in person during a worldwide recession.
A few weeks later, Bill Sullivan came through on a routine visit and stopped by to see me. After giving him an update on the state of our business, I shared the story with him and apologized for sending an engineer to Japan in the face of a travel freeze. I explained I felt it was a critical step to save the business. Bill’s response was what I would expect from a good CEO. “No need to apologize. I have to make a firm black-and-white statement because the board would have my neck if our expenses didn’t show a substantial reduction from last quarter. But I expect my senior leaders be sensible enough to do what is right for their business while staying within the spirit of the objective.”
The higher you go in management, the more this kind of black-and-white thinking is necessary. You need to set a clear tone for expectations—stop all hiring; stop all travel; stop all purchasing. Then you have to depend on the managers of all the individual businesses to implement things sensibly.
I know not every CEO would have taken the same position as Bill did, and not every CEO would have let me remain in my position. But I’m convinced Bill’s philosophy is one reason why Agilent Technologies emerged from that recession in a strong position, with revenues that grew from $4.5 billion in 2008 to $7.0 billion in 2012.