CEO Bob Patterson, 42, thinks of himself as a “servant leader” for PolyOne Corp. customers and associates seeking solutions from specialty materials offered by the Avon Lake, Ohio-based company.
Over at MGS Manufacturing Group Inc. in Germantown, Wis., CEO Mark Sellers, 61, has had the title since starting the company 33 years ago but his mindset is “I work with people; people don't work for me.”
And Bill Gray, 50, president of Uponor North America, talks about the benefits of “inverted pyramid leadership” at the Apple Valley, Minn.-based company that employs 600. In the relatively flat organization, there are just a few levels between line operators making cross-linked polyethylene pipe and the C-suites. That suits Gray just fine.
“I wouldn't have any young people work for me if they couldn't knock on my door or talk to me at the coffee machine,” he said. “I came up in sales, and to me sales is about relationships and helping everybody win.”
Like many industries, the corporate mentality and hierarchy at most plastics businesses has changed. Ivory towers for executives are disappearing fast and an emphasis on collaboration is replacing the notion of top-down management. Compared to their predecessors, today's executives need to be team-oriented leaders.
Expectations have changed, too. CEOs and presidents have to be more approachable, available and able to juggle priorities related to finance, operations, diversifying the customer base, marketing and meeting regulations while keeping to tight schedules.
“Certainly being accessible in today's world is easier and you have more information at your fingertips anytime you want,” said Veka Inc. President and CEO Joe Peilert, 47. “The challenge, to me, is to identify what's relevant in terms of time management.”
He's not alone.
“I practice this every day,” Edward Trueman, president and CEO of Sintex-Wausaukee Composites, said of time management, which he cited as one of his first goals when he became CEO in 2006.
Peilert was named CEO of the vinyl fenestration system extruder in 2010 — a year when Plastics News' “People Watch” announcements for CEOs increased more than 50 percent to a total of 47 compared to 31 announcements in 2009.
Turnover at the top of plastics companies notched up again to 48 announcements in 2011 before settling back down to 23 in 2012. Companies introduced 31 new CEOs and presidents so far this year.
Plastics News conducted a survey of CEOs and presidents to learn more about the positions. Of the 230 respondents, 42.6 percent are plastics processors. Most of these top execs — 42.1 percent — are age 50-59. The same percent have bachelor's degrees; 28.1 percent have master's degrees.
Financial performance topped the list of critical challenges for 23.4 percent of survey takers while driving innovation and skilled labor issues tied for second at 16.9 percent each. The results did not surprise Dennis Gros, founder of Gros Executive Recruiters in 1989.
“Cash management is a challenge every day,” he said. “Where is the market going and who will be my next customer, not only next month but three and five years from now.”
And, who will be producing the goods and materials?
“Our workforce has aged and there aren't significant numbers of contenders for those jobs,” Gros said. “Manufacturing is working its way through, I hope, what had been a bad rap, a negative connotation of manufacturing as being old-fashioned, crude and dirty, which is certainly not descriptive of today's manufacturing environment at all. We're not considered cool yet but I think it's coming. I really do.”
Most survey respondents — 64.9 percent — expect their firm's sales to increase in the next 12 months while 31.2 percent anticipate it to remain the same. Profitability expectations are similar with 53.2 percent of CEOs/presidents projecting it will improve and 35.1 percent expecting no change.
Growth strategies are moderate (48.3 percent) to very (13.8 percent) aggressive, according to survey takers, compared to “moderately conservative” for 27.6 percent. The majority (84.1 percent) are looking for organic growth. Mergers and acquisitions account for 4.8 percent of growth strategies.
Workforces will grow, too, at many companies. Almost 52 percent of the survey takers expect to hire in the next 12 months compared to no change for 42.5 percent and a reduction for 5.8 percent. Most executives (36.1 percent) foresee a headcount increase of 6 to 10 percent.
Almost 73 percent of the respondents agree (40.6 percent) or strongly agree (32.3 percent) that their companies will change more in the next three years than the last three years.
Just over 25 percent of plastics executives are personally concerned about the relevance of their company's products and services in the next three years and almost 21 percent get some heartburn over keeping up with the rapid pace of technological change.
Formidable competition can pop up from virtually anywhere at any time in the digital world. That weighs on the mind of executives like Gray. Although he isn't too worried about a wireless solution coming along to get water from Point A to B, he doesn't feel immune from potentially unsettling developments either from a new technology, product or material.
“Challenges change on a yearly basis. Competition comes from different angles,” Gray said. “Look at Honeywell. I can't imagine what their marketing meeting was like the day Nest Labs rolled out their thermostat. And 5 years later sells it to Google for $3.2 billion. It's disruption coming from places you don't expect it. Nobody expected a startup to walk into the thermostat space and create a significant amount of value and take on the incumbents so quickly.”
The big constant for plastics executives, like many industries, has been providing quality, service and competitive pricing in the ever-evolving business world.
“There's always a temptation to point to all the changes,” Peilert said. “The speed has changed. The complexity has changed but a lot of the fundamental that make a company successful haven't changed.”
Greg Botner, president and CEO of Wilbert Plastic Services, an injection molding and thermoforming business in Belmont, N.C., agreed. He's been in the industry since quitting college and taking a job as “hopper boy,” scooping buckets of material from gaylords and manually loading machines.
“Business is about fundamentals,” Botner, 59, advises. “Learn them, stay focused on them, and do not let trends and fads distract you. Customer service, good quality and conservative fiscal management are time-tested business principles that never get old.”