Want to turn a company that is suffering from poor performance? Try the swan method: position the right people right by focusing on smart, work ethics, ambitious and lovely things.
This is what David Barrow did as CEO of GSC Technologies, a manufacturer of plastic products such as storage totes, chairs, tables, shelves and trash cans.
The strategy paid off. Since Barrow joined in 2021, GSC's top line has improved in double digits through customer diversification, new product development and expanding its core portfolio.
In the interview, Barrow shares how he precisely separated the GSC turnaround and the insights he gained.
Tell us about your efforts.
Everything for me starts with people. To tackle the challenges in front of me at GSC, I had to build the right team first. The framework I use to select the best teammates is what I call Swan, a tool I've taken from a great organization I've done business with before. It represents something smart, work ethic, ambitious and lovely.
Using the Swan framework I was able to choose a great leadership team consisting of one-down teams made up of great swans from my past work, current GSC teams that met the standards, and some new faces I have adopted.
The next priority was to create a shared vision and value to determine how we made progress and how to achieve results. I started by having my team look at the past. I asked them to retain the best part of the founder's values and actions, and I asked them what values and actions they needed to add or change.
This exercise provided a strong list of values that can build new work teams, and gave us a shared common language about how to effectively achieve results.
I worked with the new team to lay out four clear strategies and promote the effort in a vision-focused way to improve people's strategies, revenue strategies, improve margin strategies, and business excellence strategies. To encourage the necessary investments behind each strategy, we launched a full enterprise focused on cutting working capital so that these funds can be reinvested behind key initiatives.
For people's strategies, we declared that we wanted to achieve a great place to work with the designation. To support this goal, we introduced a company-wide performance bonus program that increments into basic salary, leading to 80% and 20% of company performance to individual objective achievement.
For Grow Revenue Strategy, I invested myself in creating a new product pipeline so that I could improve category transformations and margins for existing retail customers and improve open relationships with new retailers.
Creating products like The Organize-It! Intelligent tags were rooted in consumer insights. The product addresses issues such as “I can't find my own” and “I hate writing on labels of bottles that fade and fall off.” We partnered with great external companies to create simple apps that use encoded NFC tags or QR codes to allow homeowners to convert from storage totes to stupid totes.
Since my arrival, my Swans team has advanced four strategies using fuels generated from cost reductions and working capital optimization. This has allowed the top and bottom lines to increase double digits over the past three years, while lowering costs and improving employee engagement.
I have Speyside fairness as a new financial partner, so we can accelerate and grow our ambitions much greater and faster.
GSC has significantly improved its total margin and EBITDA since its arrival. What are the strategies to achieve this?
We investigated green solutions and replaced materials that addressed the quality control needs of resin specifications, but it was a problem for the environment and ended up in landfills. Using academic partners, external converters, government agencies and technical experts, we have successfully recycled some of these alternative resin materials from environmental liabilities into useful circular economy materials.
The cost of reusing these materials through additional technical processing was offset by improved basic material costs, which helps to improve GSC revenues while supporting the environment.
The second initiative to improve margins focused on upgrading the mold fleet with the latest technology to optimize performance. Our product portfolio was ranked for the first time from the largest volume and highest margin to the lowest volume and lowest margin. We then partnered with external engineering companies to redesign the molds for our top products to maximize speed and design.
We ran multiple simulations in a virtual environment and proved that engineered changes had positive results, and that the quality of the product was the same or better. He then invested more than $2 million in new mold tools with technology optimized for all of the fleet's top-selling products.
The results were very promising and allowed the GSC to improve its capacity and margin as a result. Both reformulation and mold optimization had a major impact on gross profit and EBITDA improvements.
Your company is certified as the best place to work. Tell us how you and your team achieved that.
We started with a focus on safety. When I arrived, the plant safety records were inadequate and morale was generally low. The first step was to establish an open environment for everyone to report safety incidents, and we spent a lot of time and effort convincing people that no one was struggling to report issues.
The next step was to meet monthly with cross-working teams, review metrics together, and implement actions to address the most common safety issues first. Two years later, the team was rewarded with safety classification rebates and upgrades as they reduced actual cases by more than 50% per year.
Another action we did to create a great place to work was porting a performance bonus system that allowed everyone to personally connect to the results. We also held monthly employee communication meetings.
At each meeting, I shared corporate sales, total margins, EBITDA performance, shared updates on key projects, and discussed through two or three key focus areas to improve, celebrated long service awards, or called for important individual actions in line with GSC values.
This was followed by an open mic session where anyone could ask the senior leadership team anything. It promoted trust and conveyed expectations and progress to the entire team.
We encourage you to participate in the community where we work, including joining the Royal Military College's obstacle course team every year. We are participating in Charity Evers in Champlain, New York, and St. Jean-sle Richelieu, Canada, to help our employees give back to our community.
In my view, all of these actions and thoughts help us contribute to the certification of our work.
What advice would you give aspiring young professionals?
Learn to make things uncomfortable and comfortable. Accept all challenges. While academic training and collaboration with mentors are key tools to supplement development, none moves the needle faster for personal growth than embracing new challenges and tackling them yourself.
Finally, experience without analysis is not experience at all. I've learned some great things from great bosses and colleagues. And I learned some great things from terrible bosses and colleagues. I always have something there to learn I like to remember that “great seafarers are not made in the calm seas.”
