Critical Numbers™: Profit Before Taxes
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Critical Numbers™: Profit Before Taxes
Primarily manufactures and remanufactures heavy-duty diesel fuel injection systems and related components.
Despite a 100-year-history as a business, AMBAC, which is partly owned by an ESOP, was struggling both financially and with its culture. Not only was the company facing threats in the marketplace and from its creditors, it was also struggling to find ways to get its team working together toward a common future.
Implement the Great Game of Business® (GGOB) in August 2018 with the help of a coach, Kevin Walter, as a way to build a culture of ownership and engagement among the associates. CEO Robert Isherwood has also become a certified internal GGOB coach.
AMBAC turned to GGOB when it was on the brink of bankruptcy. The team then began an impressive turnaround. In 2019, AMBAC won the GGOB’s Rookie of the Year award. But Isherwood says the company’s comeback journey remains ongoing. “In a lot of ways, we are still in ‘survival mode’ as the company turns around,” he says. “The most impactful thing GGOB has done to our financials is the simple fact that our financials are now a daily conversation. We may not always like it, but we know where stand—and why.” Committing to that rhythm played a big role when sales took a hit because of the pandemic—but the team beat their Critical Number profitability goal by the end of the year.
“GGOB gives us a great outlook on the company finances and the future of where the business is headed when we see the forecast and build plan. It gives me confidence in my future outlook as far as having a job.”
~ Jackie Lane, Machine Operator
The worst of times can often bring out the best in people. That’s certainly true at AMBAC, where the associates stepped up in countless ways to keep their business open. From discontinuing the lawn service, to do it themselves, to calling suppliers to ask for discounts, the associates looked for every opportunity to cut costs and reshape their forecast. “While I would never recommend going through a crisis, it can be a fantastic experience in a lot of ways,” says Isherwood. “It reveals the true nature of your culture and your habits. What we experienced was the unique value of what it means to forecast from the shop floor—which is something unique to playing GGOB. Our people demonstrated that they had the authority and the ingenuity to act and react in the moment.”
While AMBAC’s Critical Number was focused on PBT in 2020, the team shifted its focus to cash as their primary driver after the pandemic hit—including playing a MiniGame called “Cash is King,” which was modified to encourage the team to improve their cash forecasts. “When we face a crunch or a thorny problem, launching MiniGames is how we react,” says Isherwood. “The ‘Cash is King’ challenge spontaneously formed as a game. Everyone knew what that meant, everyone was on board immediately, and everyone shared in the victory. It was as easy and as obvious as day follows night. And having a MiniGame, a plan, a team, a shared goal, having all that reduced fear, cultivated creativity, and drew out the best in each of us.”
“Having a stake in the outcome completely shifts the traditional decision-making process. Having transparency and a shared interest in the financial impact of decisions greatly influences engagement and cooperation.”
~ Justin Zapotocky, Quality & OpEx Manager
One of the ways the AMBAC team is Leveling Up is through their ongoing book clubs sponsored by their C.E.O.S. (Celebration, Education, Onboarding, Solutions) team, which organizes chapter-by-chapter study groups. The team is committed to additional financial literacy education both through training and weekly communication in Huddles. They are also committed to deepening and improving their approach to the High-Involvement Planning™ (HIP) process. “We have much to learn and much growth to come in this area, but it’s happening,” says Isherwood. “What really makes HIP special is the ‘I’, or involvement, and that’s where our focus will be.”
“Playing The Game really makes me feel as though my opinions matter. Anytime I have an idea or suggestion I know I am heard and considered. This makes me feel valued and therefore more loyal to the company.”
~ Lorien Murray, Marketing Manager
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