Chapter One:
Springfield
Remanufacturing
Company
Slides with notes
1
Jack Stack, CEO
Springfield
Remanufacturing
Company
It’s My Company Too!
2
The Background
Jack Stack, 29 transferred down to Springfield, Missouri by International Harvester
(IH) to generate more cash from the unit.
While he was a wonder-kind, he also believe the you get more out of the workforce
if you respect them and build trust.
• They asked for fans, they got fans
• They asked for refrigerators for their lunches, they got refrigerators
• The employees knew IH was wanting less expense, not more so they
developed a trust for Jack because he was addressing employee needs
IH wanted to sell or close the plant.
So Jack got together $100,000 dollars and went out to borrow the addition 8.9
million to buy the plant.
Banks laughed at him, except one that wanted the 115 jobs to stay in Springfield,
Mo. This was one of the highest leveraged purchases in U.S. history at that time.
It’s My Company Too!
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The Background
(continued)
Jack Stack went to the employees and explained any mistake or loss of cash could
kill the company and everyone’s job. He got their attention.
He started to get them to feel pride and ownership in the organization, let them
paint their areas, had an open house allowing families to come in, let employees
make some decisions and better understand the financial position of the
company.
Jack Stack knew he could get even further engagement from the workforce, so he
created the Great Game of
It’s My Company Too!
Business.
4
The Great Game
Principles
1. Teach all employees the financials (ratios, statement, cash flow),
budgeting; The YoYo company
2. Define responsibility areas
3. Have them create the numbers for their areas
4. Mini Games (easy wins, small bonus)
5. Huddles (group support, help, and social pressure
6. Set critical numbers for the whole organization to reach that the
numbers in 3 (above) can influence
7. They can earn 10% of the bonus 1st quarter; 20% -2nd; 30% -3rd; and
40% 4th
It’s My Company Too!
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Key Elements in the Great Game of Business
Trust in
Management
Bonus System to
Reinforce Results
Huddles to
Create the
Culture
It’s My Company Too!
Open Book
Management
Training in
Understanding
Financial Reports
6
The Huddle: An important Event to Sustain the Culture of Engagement
The Huddle
Reinforces that
we are in it
together
• The Structure to
support
engagement
Huddle
interactions
• Supports those on
target and helps
with ideas to help
those behind
expectations
Higher Levels of
Performance
It’s My Company Too!
• Through
Engagement
Discretionary
Thinking
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Each team works in their area of responsibility to meet the Critical Number
Team
3
Team
1
Team
4
Critical
Number
Team
5
Team
2
Team
6
They work to meet their own budget numbers that are aligned to
meeting the Critical Number
It’s My Company Too!
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Video overview of the Great Game of Business
http://www.youtube.com/watch?v=Do9zeFpBoPI&feature=related
http://www.youtube.com/watch?v=0Ep22uEVKbU
http://www.youtube.com/user/GreatGameofBusiness/videos?view=0
There are 24 different videos all on different aspects of the Great Game.
It’s My Company Too!
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Why does the Great Game Work?
• Mutual trust develops through open book management
• Gain Sharing (reinforcing and recognition for performance)
• Allowing input and discretionary thinking (huddles)
• Personal responsibility (specific accounts assigned)
__________________________________________________
• End result several 1000x increase in stock value
• Growth from 112 to 12,000 employees
• Now 11 different units as they grew based with employees
managing the units (also helps to focus accountability)
It’s My Company Too!
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Springfield Manufacturing Company – Stock Price Success
Stock Price
250
200
150
Stock Price
100
50
0
1983
It’s My Company Too!
1985
1990
1995
1999
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What We Learned from SRC
1.
2.
3.
4.
5.
6.
7.
8.
Listen
Communicate
Develop Leaders
Address Organizational Weaknesses
Practice the 4Ps of Success
Understand
Build Trust
Train the Fundamentals
It’s My Company Too!
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