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Magna International founder Frank Stronach: ‘If there is labour unrest within the division, if there is grumbling about unfairness or bad working conditions, then it’s a clear sign that the manager isn’t on top of things.’ (Fred Lum/The Globe and Mail)

Magna International founder Frank Stronach: ‘If there is labour unrest within the division, if there is grumbling about unfairness or bad working conditions, then it’s a clear sign that the manager isn’t on top of things.’

(Fred Lum/The Globe and Mail)

BOOK EXCERPT

Frank Stronach on what makes a great manager Add to ...

Excerpted from the book The Magna Man: My Road to Economic Freedom by Frank Stronach. Copyright © 2012 by Stronach Corp. Reprinted with permission of HarperCollins Publishers Ltd.

The Qualities of a Successful Manager

It’s up to management to prove to employees day in and day out that the company is a fair operator.

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At Magna, we let managers run their own shop. That has always been one of the hallmarks of our entrepreneurial culture. The managers call the shots on a number of production issues and run the factory as if it was their own business. But in return for that autonomy, the manager has to uphold a few basic but very important principles.

The first principle is to keep the workers happy. As chairman of Magna, I constantly preached to our managers about their responsibility to the workers. I told them their job was akin to being the captain of a ship, and as a captain you must look after your passengers. If there is labour unrest within the division, if there is grumbling about unfairness or bad working conditions, then it’s a clear sign that the manager isn’t on top of things. The workers on the shop floor are the beating heart of your organization. And if they’re unhappy, it means the manager doesn’t have a feel for the pulse of the workplace; he or she doesn’t spend enough time on the factory floor speaking with employees to find out their concerns.

I always used to say to my managers, “Don’t get holed up in your office. Get out on the shop floor. Have lunch with the workers. You have to be a leader, not a boss. If you’re open and honest with employees, and if you consult with them, they’ll walk through fire with you.”

The second basic principle is that the manager has to keep Magna’s shareholders happy by making a reasonable profit. In essence, it means ensuring that shareholders make a greater return on their investment than if they kept their money sitting in the bank or tied up in government bonds.

Third, the manager has to keep the customer happy by shipping quality products on time. Without satisfied customers, you haven’t got anything – you might as well close up the shop. A few days after opening my own tool and die shop, I landed my first customer. The fellow who gave me the order was an older man, and he was very hesitant to hand over the work. He said, “I don’t know if I should give you the job, because if you let me down I’ll look awfully silly.” He didn’t know me at all and I had no track record – I was just starting out. I could see he was uncertain, but he decided to go with his gut and gave me the job. So I said to him, “I won’t let you down.” To me, that promise was more ironclad than any warranty or contract. This older manager stuck out his neck to help a young guy trying to strike out on his own, and there was no way in the world that I was going to let him down. For me, it wasn’t even a question of not getting paid – it was a question of pride, of living up to my commitments. If I took an order, I always stuck with it. And if I gave my word, I always made good on that promise.

In those early years, I never missed a deadline. Sometimes we came very close, but we somehow always managed to deliver the parts on time. And over time, Magna gained a well-deserved reputation for customer service. We became known in the industry as the company that always got the job done – the company that always came through.

Managing means teaching, leading by example. As the manager, you’re the number one human resource guy, the number one finance guy, the number one technician. You’ve also got to be part psychiatrist, part lawyer. You’ve got to know marketing, accounting, engineering. It’s difficult to find all of those qualities in one person, but they can be learned over time.

Finally, you’ve got to know the business inside out. You’ve got to have a firm handle on all aspects of the operation, right down to knowing where the supplies are stored and when the garbage gets picked up. Because when managers start overlooking the smaller details, that’s when things begin to fall through the cracks and problems begin to snowball.

A lot of the attributes necessary to succeed in business are simple, commonsense principles such as identifying priorities, acting decisively and living a balanced life. They’re the key principles that I’ve followed throughout my career. …

When I opened my own business, one of the reasons I was successful very early on is that I had a talent for picking the right people – people who had the right qualities and dispositions needed for performing certain jobs. I believe it’s because I had acquired a keen sense for reading people earlier in life, for assessing their character and sizing them up. Of course, I wasn’t always right – I sometimes hired the wrong person, or I completely misjudged someone. On occasion, especially early in my career, I ran into a few bad apples that never paid me for the work I did. But I chalked all of it up to experience. In any aspect of life or in any field of human endeavour, you’ll always find good people and not-so-good people. But on the whole, I can honestly say that I’ve had the fortune of working alongside many good and decent people – people who were loyal and true to their word.

To be sure, I’ve made my share of mistakes over the years. Looking back, I think most of them were due to the fact that I sometimes trust people too much. It’s part of my nature, I guess, but I wouldn’t change it even if I could. The thing is, you have to trust people and you have to give them the freedom and space to act independently and to succeed on their own. This approach has paid more dividends than disappointments for me. At Magna, I always gave people who worked alongside me a lot of leeway and room to grow. If I had to spoon-feed everyone I hired, I never could have made Magna as large as it is.

I often hired people on the basis of their character as much as or more than on the contents of their résumés. And you can often glimpse a person’s true character in the way they treat people they consider to be below them, or the way they treat people who are serving them, like the big shot in a restaurant who tears a strip off a waitress because the meal he ordered wasn’t cooked perfectly or took a long time to arrive. When you start out in life at the very bottom, when you wash dishes or sweep floors or clean toilets, you’re a lot less likely to act that way toward someone serving you. You look at the people who do those jobs with a greater degree of sympathy, understanding and respect.

When hiring people, the one quality I prize above all others is attitude. I believe that having a positive outlook and attitude is critical. Attitude can spell the difference between success and failure, between overcoming what looks like an insurmountable problem and being overwhelmed by despair and defeat. With the right frame of mind, any problem can be solved. That approach to hiring has served me well over the years – and it’s one that I still rely on today.

Attitude – and character – trump every skill or talent, every educational degree or type of training, every kind of experience. Magna was built on the never-say-die, can-do attitude of its people.

Motivate

Great managers are great motivators. A manager has to motivate employees to think, and they will only think if their heart is in the business. In the end, it is the companies that are able to win the hearts and the minds of employees that will produce the best products for the best price.

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