GKN OHS (OffHighway Systems) 2006
Organisational transformation through developing people
Background
In 2002 a new CEO, Martyn Vaughan, was appointed and asked to find a buyer for the OffHighway Systems Division which had been underperforming for some time.
The OffHighway Systems division had 3,042 employees (July 2003), producing wheels and cabs in what were effectively 6 separate businesses in Germany, Italy, Spain, Denmark, 2 US states and the UK. Only one of the German businesses attracted a buyer and Martyn's next brief was to make the remainder more successful.
The focus of the change initiative
The most urgent need was to give the business leaders, and their senior teams, the confidence to set far more ambitious targets, for both turnover and bottom line performance.
The initial plan was for The Pacific Institute to work with the group leadership and then with the management teams of each business, after which each operation would train their own facilitators and decide for themselves on the use of the Culture Survey and Leadership coaching options to compliment the benefits of Investment in Excellence (IIE).
The Change process
July '03 Presentation to the executive team and business leaders.
Nov '03 IIE Phase 1 for the Executive team.
Jan '04 Executive team's IIE Phase 2 followed by a vision/goal setting session. This led to a significantly stretched vision for the Division and for the individual businesses. (From a current reality of £279m turnover @7% ROS to a 5 year target of £500m @10% ROS - up 45% on the previous £343m goal).
Aug '05 Completion of Leadership IIEs on all sites (bar Italy).
Nov '05 The leadership's "Vision" shared with top 150 people in OHS - who promptly doubled it to £1,000m. Got agreement to train internal facilitators who would cascade IIE to the next 250 (or so) in all OHS businesses in the next year. As a result of progress already made since 2003, OHS was made a separate Division in its own right and was the only GKN Division allowed to make an acquisition in 2005. Martyn Vaughan was elevated to the GKN Executive team.
Costs and benefits
The cost of the implementation so far, for the leadership seminars and goal setting workshops, has been c£240k.
The progress made by the Division is reflected in the following interim report.
GKN plc Interim Report 2005 - OffHighway Systems:
Half year to 30 June 2004 | Year ended 31 December 2004 | |
Sales | £155m | £287m * (+29.28%) |
Operating Profit | £ 13m | £ 35m |
% Op. Profit | 8.38% | 12.19% (from 7%) |
* (having closed/sold 2 businesses) | ||
