Case Study: Viking Connectors Inc. : Robert Amter

Case Study: Viking Connectors Inc.

Viking Connectors Inc.

Fort Lauderdale, Florida

Situation & Problems

In 1969, I was a management consultant with George S. Armstrong & Co. in New York City. A Norwegian client owned Viking Connectors. Viking was a manufacturer of steel connector plates and design engineering services sold to builders of prefabricated roof trusses. The company had lost money for five years. I was appointed General Manager.

Ironically, Viking’s patented connector plates produced the strongest, most reliable plate in the industry with the lowest cost per roof truss. Their reliability was verified by a Federal Housing Administration test. This fact was not used by prior management in soliciting new customers and retaining current customers in the highly competitive marketplace.

Reasons Viking lost money:

Poor management.
Low sales volume.
Unsatisfactory customer service, including its unacceptable roof truss design engineering service.
Absence of cost accounting.
High expenses, unrelated to the company’s operation.

Actions Taken and Results Achieved:

Implemented a sales development program to get new customers. Focused on the FHA’s certification that Viking’s connector plates were superior in design and cost versus competitors.

As new and profitable sales were obtained, visited each existing customer to discuss that Viking was selling below cost and that prices were being increased. Did not lose a single customer.

Terminated the company employed design engineering staff. Hired an external and well-regarded engineering firm to provide quality, on-time roof truss designs.

Installed a cost accounting system. This resulted in cost reductions, accurate pricing by stock keeping unit, improvements in production planning, and lower inventories.

In six months, Viking was operating at break even with a positive cash flow. The client decided to sell the company, which we completed successfully.

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George S. Armstrong & Co. was a leading management consulting firm advising manufacturing and service corporations on strategic planning, operating problem diagnosis, acquisition due diligence, marketing, evaluated management’s profit performance for Boards of Directors. Clients: American Standard, Crown Zellerbach, Lone Star Cement.

Reason I wrote my book “Learn to Whisper”

Click on this link for a more complete description of “Learn to Whisper”

The reason I wrote “Learn to Whisper”:

My conclusion after operating as a Turnaround Chief Executive Officer for more than twenty-five years is that the majority of this country’s top management is far from first-rate. In fact top management, particularly at the chief executive officer level, is at best average with a large number that can be rated mediocre. This lack of management competence has seen this country’s market leaders lose sizeable market share to foreign manufacturers able to export better quality and lower cost products to the USA. It has seen manufacturing and service operations unnecessarily moved to foreign countries. All of which has negatively affected the economy, severely damaged former blue-chip corporations and seen quality jobs lost.

It is quite common to discover that companies struggling with this inability to compete with foreign companies have been simply mismanaged. The once successful business deteriorated because of an incompetent chief executive officer and weak senior management

Why doesn’t this nation have first-rate management? Inadequate training. Chief executive officers and vice presidents learn “on the job”. A number get promoted based on personality, political connections and drive – not merit. They are not carefully screened for the potential to become successful at managing. For some all that is needed is a well-written resume, the right interviewing style and the inability of a new employer to accurately assess skills, performance and potential.

Compare this to the process doctors go through. From medical school to internship to residency to a senior role after years of education, experience and continuous training their progress and capabilities are constantly monitored even after they become senior in the profession. Generals and Admirals go through a similar protocol. They must prove themselves in low-level assignments before they are judged qualified for senior positions. Unqualified applicants in both professions are culled out. What can be done to improve management competence? Education, on-the-job training and job performance monitoring. My book will educate people on the subject of managing. Its 101 management lessons are separated into the 17 subjects managers need to know.