Posted: March 24th, 2021
Case Study: Closing a Plant
Aaron De Smet et al. (2012, pp. 4–5) describe the following example of a change manager faced with a particularly difficult challenge. What is your assessment of his approach? Could you use this open and “authentic” style in your own organization? Or would you consider this to be difficult and risky?
Pierre, as we’ll call him, was managing a plant in France during the darkest days of the global financial crisis. His plant was soon to close as demand from several of its core customers went into a massive and seemingly irreversible tailspin. The company was in a tricky spot: it needed the know-how of its French workers to help transfer operations to a new production location in another country, and despite its customers’ problems it still had €20 million worth of orders to fulfill before the plant closed. Meanwhile, tensions were running high in France: other companies’ plant closures had sparked protests that in some cases led to violent reactions from employees. Given the charged situation, most companies were not telling workers about plant closures until the last minute.
Pierre was understandably nervous as he went through leadership training, where he focused intently on topics such as finding the courage to use honesty when having difficult conversations, as well as the value of empathic engagement. After a lengthy debate among company executives, Pierre decided to approach the situation with those values in mind. He announced the plant closing nine months before it would take place and was open with employees about his own fears. Pierre’s authenticity struck a chord by giving voice to everyone’s thoughts and feelings. Moreover, throughout the process of closing the plant, Pierre recounts, he spent some 60 percent of his time on personal issues, most notably working with his subordinates to assist the displaced workers in finding new jobs and providing them with individual support and mentoring (something other companies weren’t doing). He spent only about 40 percent on business issues related to the closure.
This honest engagement worked: over the next nine months, the plant stayed open and fulfilled its orders, even as its workers ensured that their replacements in the new plant had the information they needed to carry on. It was the only plant in the industry to avoid violence and lockouts.
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