Class Presentations - Open Book Management

Today we presented final projects for the MgmtAcct course, which were focus on Open Book Management. The project was to look at where it made sense at the targeted companies, and how the implementation plan may work. Below are the highlights from the presentations.

VisionPoint Systems (Virginia): Privately held company (<20>How to begin implementing financial visibility into a company that is less formal in how financial and management information is shared today?

How to implement new techniques while the company is rapidly growing, in a way that doesn't effect productivity or the existing culture?

With many engineers in the company, how will they embrace the need to learn business-centric information and skills?

In a competitive market for talent, some concern about sharing financial information if conditions change (ie. visibility may scare people into leaving).

Timco Aviation (Greensboro, NC): (~200 employees) provides aviation services and interior components. In the highly competitive aviation industry, how do they try and drive greater innovation from all levels of the company? The focus of this presentation was the engineering division and ways they would become more innovative. They laid out how they created "critical numbers" for each group (hrs/job, productivity systems), and their plan for education and creating the rewards system. Interesting take on how they planned to leverage existing "competition" between sub-groups within engineering, especially how it would buffer the plans before direct bonus-sharing increases could be implemented.

Que Pasa Media Network: (Winston-Salem, NC - 100 employees)

Family owned media company focused on Hispanic communities in North Carolina. They are looking to increase overall company value; create less employee turnover (currently not an issue); create greater efficiencies of resources (people, assets, cashflow). The presentation focused on the roll-out plan and education of the various groups that would be involved, and the associated critical number. They face the challenges of a limited budget for education, limited management data (beyond upper-mgmt), and a leadership model that has been driven by the CEO for the lifetime of the company.

Mills Manufacturing (Asheville, NC; 100 employees) - Family owned manufacturer of military parachutes. The presentation focused on similar goals and concerns as Que Pasa. They face the challenges of information leaks (ie. union leaders), high turnover rates, multiple languages spoken in the plant, and many workers with no high-school education. The team laid a plan to identify "public" numbers for the workforce vs. "private" numbers for the management team. Interesting discussion about the challenges of communicating in a simple and visual manner to the various languages and education levels. With high turnover rates and absenteeism, it will be interesting to understand the education challenges they will face, as education will need to be more frequent.

General Parts International (GPI) - The largest privately owned company in North Carolina, they provide auto parts distribution to retail stores and service shops. GPI has two business units, WORLDPAC and Carquest. WORLDPAC had implemented a open-book management style in 1995 and grew the company until it was acquired by GPI. The presentation discussed a plan to take the OBM success at WORLDPAC and look at a plan to implement it in portion of Carquest and GPI. Monthly operating results are shared monthly with Directors and above. Month-end and Daily sales data is shared with all managers. "Critical Areas" were identified across all upper-management.

Overall this was a good mix of small and large companies, public and private. While not all of these plans may get put into place, it forced each of the teams to think about how they could focus each department of a company on their primary ability to effect the bottom-line and the health of the business.

"Google devalues everything it touches"

One of my classmates, Domingo Isasi, runs Que Pasa Media.  Que Pasa operates for hispanic customers in North Carolina.  Domingo and I have had several conversations about news media and how the Internet is changing its form and economics around the world.  One of the great things about the MBA program is getting first hand experience from classmates.

Charlie Rose recently hosted a discussion of online value for newspapers, which touches on a number of the challenges they are facing, including:

1. How to get people to pay for content once they can get similar content (or reblogged content) online for free.
2. The challenge of trying to convey value to customers that probably didn't truly think about value before, since there weren't easy alternative options to get news before the internet (that's simplified, I know).
3. How all of these news creating sources (newspapers, magazines, blogs, video-blogs, microblogs) will be able to survive with only advertising revenues, especially given how Google is driving down CPMs.
4. Is it a good thing that Google seems to be one of the few companies making money around news, while the newspapers fail?   Or is this just the next phase of Darwinian evolution and new models will emerge?
   
5. What role do local newspapers (or local media outlets) play in the bigger picture?  Are people willing to pay for that local content in order to feel connected with communities? (this is Que Pasa's business).

There are many more aspects of this, and it will be interesting to see how it plays out over the next 3-5 years.  While maybe not as economically impacting as the banking challenges, I think it's equally important to see some controlled survival.  I'm pulling for the local newspapers, both because of my past employment and for the experiences of my children, whom I hope enjoy reading for pleasure and knowledge just as much as I do.  

As an aside, maybe this is a good excuse to teach myself (and my children) Spanish, so we can follow the local news via Que Pasa, and I can help support a classmate!