Communication: the key to winning in the 'great game.'.

A new management initiative based on the "higher laws of business" helped SRC survive a competitive marketplace, and foundrymen who play the "Game" can reap the same profitable rewards.

"The Great Game of Business is all about promoting clear, effective and open communications in a company," explains Jack Stack, president & CEO, Springfield Remanufacturing Corp. (SRC), Springfield, Missouri. "It's a different way of running a business that we've been practicing for 15 years."

Stack is referring to the way his company does business. What he's discovered during his career in manufacturing is that "the best, most efficient, most profitable way to operate a business is to give everybody in the company a voice in saying how the company is run and a stake in the financial outcome, good or bad."

Stack was the main speaker during the 1998 AFS Foundry Executive Management Conference, held October 1114 in Asheville, North Carolina. The conference, which normally includes a variety of speakers addressing a number of management topics, was comprised this year of a 2-day seminar on a single subject, "The Great Game of Business (GGB)." You see, GGB is not only a book written by Stack, but it also has become one of the 23 business units that today comprise SRC Holdings.

Development of the GGB concept came almost as an act of desperation, said Stack. "It's amazing what you can come up with when you have no money, zero outside resources and 119 people all depending on you for their jobs, their homes, even their prospects of dinner for the foreseeable future."

That was the situation that Stack and his 12 fellow managers faced in February 1983, their first month in business as an independent company. "We were supervisors and managers at a little factory in Springfield, Missouri, that, up until then, had been owned by International Harvester," he said. "At the time, Harvester was in big trouble, sinking faster than the Titanic, cutting loose operations like ours in a desperate attempt to stay afloat. When the company offered to sell us the factory, we jumped into a leaky life raft in the middle of a hurricane. Our new company was loaded down with so much debt that the smallest wave could capsize us."

The company specialized in remanufacturing diesel engines, and its only customer at the time was International Harvester. "We were scared," wrote Stack. "We couldn't rely on traditional ways of managing because they wouldn't produce the kind of results we needed in time to save us. So we grabbed for something new, based on what we thought of as the higher laws of business."

These "higher laws of business" include the following:

* you get what you give;

* it's easy to stop one guy, but it's pretty hard to stop 100;

* what goes around comes around;

* "you do what you gotta do;"

* you "gotta wanna;"

* you can sometimes fool the fans, but you can never fool the players;

* when you raise the bottom, the top rises;

* when people set their own targets, they usually hit them;

* if nobody pays attention, people stop caring;

* change begins at the top.

To these Stack added what he calls the ultimate higher law: "When you appeal to the highest level of thinking, you get the highest level of performance."

Know and Teach the Rules

"Most intelligent businessmen know that the marketplace dictates salaries and raises," explained Stack. "But most workers don't understand this concept. So you must know and teach the rules to them. You can't play the game without rules, a scorecard and an outcome." This simple concept, he said, creates a higher involvement in planning, but also requires business training and, above all, a "you gotta wanna" attitude.

At the same time, teaching the rules also calls for opening up the books, and this is what sends a lot of managers heading for the door. But Stack contends that telling employees the truth is the only way to succeed in today's business environment. "We've all heard how you have to be an S.O.B. to succeed in business. How you have to step on other people to get results. It's all a crock. We established credibility and you only build credibility by telling the truth. You simply can't operate unless people believe you and believe one another. That taught me an important lesson: lying and dishonesty are bad business."

Another important aspect of open-book management is establishing the financial (game) plan. "Give the sales plan to all associates," said Stack. "You must provide them with all costs and expenses necessary to support the plan. Your plan must be everyone's vision."

Stack acknowledges that open-book management can only work if top management believes in it. On the other hand, SRC's experience continues to demonstrate the effectiveness of the concept. Since the management team purchased the plant in 1983, the business has grown an average of 15% per year.

Does It Work?

Does GGB really work or is it just a bunch of hype? "I wish we had $1 for every time someone has asked that question," said Denise Bredfeldt, a former transmission rebuilder and now general manager of Bizlit, Inc., an operating unit of SRC. "Then I wish we had $5 for every answer we've given. If you are skeptical about the Great Game of Business, welcome to the club. I myself was one of the biggest disbelievers in the beginning. If you think SRC didn't have its hands full teaching me the 'game,' think again.

"Is it hype? As a converted disbeliever who has played the 'Game' from hourly to managerial ranks over the years, it is hype to the point to get you interested. After that, it really works. In fact, the 'Game' touches everyone in a different way. I can give you plenty of stories of how disbelievers were changed to believers one by one. The 'Game' has served to unite us as a corporation, sometimes against foes many times larger, allowing us to survive in this tough economy."

At the same time, Bredfeldt stresses that "the 'Game' gives us the means to challenge ourselves internally and create friendly competition between departments. Along the way, we even have fun.

"What does it take to play? You gotta wanna."

Three Individuals Lauded for Management Contributions

Among the highlights of this year's AFS Foundry Executive Management Conference was the presentation of management awards to three industry leaders. Pictured, Stanley Bass, Sr., owner of Fort Worth Aluminum Foundry, Inc., Fort Worth, Texas, received the Keating Founder's Freedom Award for the significant contributions made to this industry and dedicated, active participation in government affairs. In addition, receiving the 1998 AFS Management Service Citation was B.A. (Bernie) O'Hara, vice president and general manager, "A" Brass Foundry, Los Angeles, California, for his outstanding efforts in supporting and promoting the governmental affairs programs of the Society, the state of California and the industry. The William Grede Award was presented to John R. (Chip) Keough, CEO, Applied Process, Inc. Livonia, Michigan, for his contributions in management, marketing and education resulting in the effective use of metal castings.