When Bill Lambert assumed the role of president and chief executive officer at industrial safety giant MSA, he quickly got a lesson in trial by fire.
His ascension to the top spot in the C-suite just happened to coincide with the worst economic recession of his lifetime. In 18 months, 7.2 million people lost their jobs. And since MSA is in the business of selling safety equipment for working people, the impact of that recession came in full force.
Fortunately, Lambert (MSIA ’90) was equipped with the education that helped him shepherd his company through its rough patch.
“Unquestionably, this school is shaping every one of you,” he told an audience of MBA candidates as part of the W.L. Mellon Speaker Series. “I don’t know if you sense it, but you’re all changing, absolutely.”
Working through the school’s FlexTime program for three years, Lambert said he learned to become a problem solver.
“It changed me dramatically from being an R&D guy to somebody who not only believes in himself, but also has the tool kit to address some of these very difficult business problems going forward,” he said.
The first hard decision was to cut his own pay by 20 percent. The next level of management beneath him took a 10 percent cut; two levels below got a 5 percent cut. But in MSA’s factories, workers were given raises.
Analytics drove the company’s investment decisions. MSA restructured its finance and accounting groups and created a decision support group to test assumptions about where they were and were not creating value. For example, the company decided to make new investments by putting plants in Mexico, China and Brazil and grow through the acquisition of General Monitors, which makes flame and gas detection systems.
But the company also sold its ballistic body armor division. Having spent $40 million getting into the business and another $30 to $40 million chasing success, the decision to let it go was difficult, yet necessary, Lambert said.
“We were in too many areas, honestly,” he said. “Extending your markets has some value destruction risks.”
The number-crunching paid off: In 2011, MSA’s sales were up 20 percent from the previous year, while earnings per share were up 80 percent.
“I’m not declaring victory yet, but we’re off to a solid start,” Lambert said.
Creating that success took focus and communication, he stressed – communicating the strategy around the globe, relentlessly, in 14 languages.
“Saying the same thing over and over, and getting energized before you say it each time, that’s hard,” he added. He credited one of his Tepper School professors, Millie Meyers – now teaching professor of business management communication emeritus – with helping him understand the importance of authenticity.
“Millie was relentless on us, but she was really great,” he said.
He encouraged students in the audience to expand their horizons by broadening their exposure to new experiences and cultural backgrounds, challenging themselves beyond their comfort zones.
In the end, as business leaders, he also emphasized the importance of focusing on the company’s core values.
“Trying to find those is elusive,” he said. “Everybody has a very strong opinion. But you’ve got to somehow separate the wheat from the chaff.”