Three Things Industrial Manufacturing CEOs Can Do Today to Help Build Success Tomorrow
November 21, 2023
At the closing panel for Cherry Bekaert’s recent 2023 Modernizing Manufacturing Symposium, two leaders reflected on CEO success and shared practical, hands-on advice for mid-market manufacturing leaders looking to better manage talent, AI and macroeconomic factors. The interactive session featured Marshall Cooper, CEO of Chief Executive Group, and Bob Nardelli, founder of XLR-8. It was hosted by Kip Plowman, Partner of Strategic Growth at Cherry Bekaert.
Managing Talent for the Next Generation
Nardelli, the former CEO of Home Depot, has nurtured the careers of many executives at several Fortune 500 companies. He emphasized the importance of investing in people, which creates better customer service and better business outcomes. “On physical capital, when you invest in something, you immediately start to depreciate that asset,” Nardelli said. “In my experience, when you invest in a person, there’s a great appreciation from that person because they feel you have invested in their future. Second, their personal value appreciates.”
According to Marshall, the challenge for CEOs is to take the time they need to make that investment. He cited research from the Chief Executive Group that CEOs intend to spend about 35% of their time on people issues but actually end up spending a lot less—about 20%.
“A practical tip is just to look at your own schedule, and rethink and reorder your priorities,” Marshall said. He also emphasized that CEOs who expect their employees to be in the office need to make sure their time in the office will be well spent.
Building an AI-Ready Company
Both Nardelli and Marshall said they are energized by the possibilities around AI in manufacturing and more broadly in business, but they noted that most companies need to accelerate their use of AI so as not to be left behind.
“I would encourage you to dive in,” Marshall said. “You have to explicitly tell your functional leaders that this is a part of their job now, and that you’re going to be asking them – at least on a quarterly basis – about what they’ve discovered, their plans to implement, the vendors they’ve seen. It’s changing so fast, and we can’t do it ourselves.”
Planning for Economic Uncertainty
Nardelli also emphasized the need for CEOs to continue to keep a close watch on the economy, especially as it relates to inflation, rising transportation costs and increased difficulty accessing capital.
“I think we’re in a recession, and I think it could get worse. There’s a lot of fragility out there because of geopolitical factors,” he said.
On the plus side, Marshall said, for companies with cash on hand, the deal market is appealing. “This is a great time to acquire some of those fancy VC-backed businesses that entered with a bang a few years ago,” he said. “A lot of them are out of cash but they might have innovative technology. Same thing if you’ve got cash and can pay to acquire small tuck-in acquisitions.”
Let Cherry Bekaert Guide You Forward
At Cherry Bekaert, our professionals are well-versed in the current trends on the minds of manufacturing executives. They have extensive experience helping companies and their leadership identify both near and long-term opportunities across market cycles. With assistance from our industrial and manufacturing professionals, you can focus on your organization’s growth strategy, digital transformation, innovation, sustainability planning and supply chain changes, and more.