Case Study: Pinnacle Plastic Products Inc.
Pinnacle Plastic Products Inc., located in Bowling Green, OH is a 15-year-old manufacturer of blow-molded plastic products for industries including automotive, medical supplies, and consumer products. The company was founded by three owners that branched out from their corporate manufacturing positions to form the company in 2006.
The Challenge
While Pinnacle Plastic Products was a leading manufacturer of blow-molded plastics products in northwest Ohio with a solid customer base, the company experienced a number of operating challenges that involved processes and personnel. These challenges were impacting revenue growth, customer satisfaction, and employee turnover.
In addition, the company owners were seeking a succession plan, giving them an opportunity to release the value of their equity in the company.
The Solution
When CSI Founder Dan Pritt was looking for a supplier for a unique plastic product he had invented for the construction industry, he came across Pinnacle Plastic Products. Though the product never made it into mass production, the encounter led Pinnacle Plastics to contract with CSi to apply their Wellbeing Initiative to address the process and personnel challenges Pinnacle Plastic Products was wanted to address.
The program involved conducted 14 training cycles: 3 groups of managers, 11 frontline groups (people having 3 months or more working experience at Pinnacle Plastic Products). A total of 86 employees were trained; over 1/2 of the total workforce (157) at Pinnacle, at the time completed the learning lab series. Project management, leadership training systems, and Lean Manufacturing (Continuous Improvement) systems were developed.
In addition, the owners engaged Mr. Pritt and CSi to find a buyer for the company.
The Results
The goals of both personnel/productivity and the succession plans were realized. The retention rate for those trained reached 95% as compared to the general turnover rate of 82% (18%) for those employees who did not participate in the initiative. This alone saved Pinnacle $157,500.00 during the time period (The average cost per turnover at PPP was measured at $2,250.00 for each person who left). Ten percent of the employees who participated in the Well Being initiative received promotions and all attendees received above-average pay raises during the 25 months due to increased participation levels (engagement) and improved productivity.
After three lackluster years of no growth in annual revenue ($14.7 million per year in 2014, 15, and 16) Pinnacle improved its sales/production by 18% in 2017, 20% in 2018, and is on pace for 22% ($26 million) for 2019 over 2018. EBITDA increased from $1.5 million in 2017 to $2.1 million at the time of the ESOP and $2.3 million projected for 2019. The secession plan earned the owners $5.5 million each over a 5-6 year buyout period.
New Insights Revealed Through Actual Site Research:
Employees respond to positive and productive learning and training sessions (increased levels of engagement, productivity, and well-being) once they determined that you care.
Proper recruitment and hiring, with a solid strategy, helps to alleviate a lot of problems.
Moral was extremely low at the beginning (NPS-2.5) at Pinnacle and over time (18 months), improved by three + points; eventually scoring 6.5 (NPS on a Likert scale of 1-10 (low to high). Small incremental improvements provided hope and motivation to improve and do more.
Mood contagion and severe mental health patterns (NPD, ADHD, APD, & OCPD) exhibited by one owner’s impaired cognitive state/behavior, traumatized the entire company and its personnel. This was extremely difficult to overcome and directly contributed to the company’s high turnover rate and stagnate performance (2014,15, and 16) results.
Lack of trust, transparency, and accountability contributed to a predominantly disengaged and hostile workforce (greater than 67% initially). Pinnacle employees improved their overall engagement level by 12% once 5 hostile, non-performing managers were terminated.
Culture has an even greater impact upon the perception of people and the way individuals behave (react vs. respond) than what CSi had ever anticipated upon being contracted by Pinnacle. CSi needs to improve its corporate assessment tools and evaluation process!
Action learning is much more effective than content-based training. Retention is much higher up to 85% higher and when the training is practical and mandated it has a direct impact on personnel, morale, productivity, and the company’s bottom line.
It’s much easier to train and shape change with front-line people than it is with upper C-suite personnel types. This is based on CSi’s experience at Pinnacle to the closed-mindedness and arrogance of executives and judgmental approach in business management.
The blame game (betrayal and infighting) runs rampant in a poorly run organization and contributes directly to poor quality control and quality assurance performances.
Without vision (strategic planning) waste and issues of constraints cannot be properly addressed. The concept of leadership and teamwork when its intentional and properly demonstrated, people notice and are more open to change (solutions).
Stay/exit interviews, along with superior onboarding, directly shapes a good workforce.
New 360° were developed, tested, and implemented. They worked much better than the annual end-of-year reviews. Regardless of what’s done, it requires a sound strategy, Beta testing, ongoing reflection, and continuous improvement before any complete roll-out.
Scorecards for performance are a must at all levels of a business; w/o them: Poor results.
Project management and team development create huge ROI for organizations.
Measure, record, and document everything: In doing so CSi builds a database to draw from regarding organizational development and scaling new products/services.
Statements/Comments from Pinnacle’s Personnel:
Conflict Resolution: “Had I not gone through the well-being training sessions, I would have been fired for decking that idiot for what he said.” I’ve almost pointed out, but “Knowing how to respond rather than react, has actually saved my job and probably jail time; it has really improved my life here and at home.”
Well-being: “What I learned has improved my marriage and lowered my stress level.” “Whatever you do, don’t leave, Pinnacle needs this for it has given us hope and I’m finally like what I do here.”
Suicide Prevention: “The training allowed me to prevent that teenager from committing suicide.” Knowing the owners of Pinnacle would support such a learning initiative is something I’m so thankful for and will continue to appreciate for the rest of my life.” My wife loves all of the training stuff that I also bring home.”
Sobriety: “I used the information daily since attending the learning sessions and it has helped me stay sober. I have a new lease on life thanks to the guys (CSi) and the well-being training sessions.”
Sensemaking: “Now that I understand the whole is greater than the sum of its parts, I can apply it in building my team. This will really help us in the plant to change Pinnacle’s performance and culture.”
Benevolence: “I was going to quit, however, with those who have gone through the well-being classes, and now that I have, it has changed my life. Since CSi figured out a way to cover my court fees/fines (over $2K), I’ve gotten my driver's license back, and just bought a car so I can take my daughter back and forth to daycare. I’ve been clean for 18 months. The time invested by you, Joel, and Don has helped me so much; it’s given me purpose and confidence that I never had before in my life. I’m looking to do more things for my coworkers and supervisor at Pinnacle now that I’ve been promoted in becoming a QC auditor.”
Gratitude: “Thank you! I now have a better understanding of and new language when talking and listening to people. The exercises are so practical. The learning labs and seminars helped me to make the right decision to change position internally here at Pinnacle; I’m happy now for it was the right thing to do!”
Engagement: “Why should I wait for someone else to take the initiative when I’m the one that can improve the situation?” “I want to be the one grain of sand to stabilize the pile instead of creating the chaos.”
Direction: “I’m more motivated now to get things done; when can I begin serving on a project team?”
Outreach: “Can we possibly have family members take the well-being training to help them?” “Every time I attend my wife tells me that she can see a real difference in me, she wants to learn too.”
Bereavement and Retention: “My grandfather who I lived with and raised me, has recently died and I need this time to grieve and bounce back from being an empty shell. I’ve not been engaged and found myself just marking time. If the remaining learning labs are anything like the first two, they are going to help me and I’ll stay at Pinnacle,”
Learning: “After being a part of the well-being initiative, work has gotten so much better and I now have found my voice. We are finally working together.” “We are starting to gel/learn as a team like Dane and Matt have told us that we should and could do. This is a totally different experience than I’m used to!” Learning is fun!
Leadership: “We are not where we need to be yet, however, I and those I work with continue to apply what we have learned for improvement, just be patience; continue to work with us and we’ll get it right.”
Encouragement: “My co-workers need help, they could use some encouragement, would you be willing to speak with them today?” They were afraid to say anything due to being threatened, put down, and bullied by a few other individuals who finally left.” I’m glad they are gone, now we can work as a team.”
Spiritual Counseling: I’m now in big trouble and my life is just falling apart; would you be willing to pray for me? I need answers and help!
Mental Health: “I was losing my mind and didn’t have anyone else to call; I knew you cared enough and would be there for me!”
Anger Management: “I’m beginning to see people differently and how to properly approach them (poking the bear). Without this class and learning to control my anger (rage), I wouldn’t be allowed to see my daughter (restraining order). Thank you for caring and showing me how to be a better person as I try to treat others as I want to be treated.”
Discovery/Insight: “I can “see,” “hear,” “say,” and “do” a lot better since going through the training lab sessions.” Here at Pinnacle, we now have the tools and know-how to make it happen and make the plant a better place to work.”
Communication: “When enough people have attended the well-being training sessions, this place will really improve and become a company that people would want to work at and be proud of in the future!” “We need to begin changing the culture (the way things are done) and improve it.”
Restoration: “We were within hours of being thrown out of our rented location and what CSi did for us and the things we learned in that class showed us to never give up.” We are now in a home that could not have been possible without developing the relationships that the well-being classes taught us to do; I could kiss you along with my family, we had no place to go; we were totally out of options. I didn’t believe in God or miracles before, but I’m now considering it for there is no other explanation. Thank you so much for your help and prayers and thank Pinnacle!” Do you want to see pictures of my family’s first-ever new home?”
Motivation/Engagement: “Learning all of this new stuff motivates me to do a better job in the department that I’m in. I now have the tools and understanding to influence and lead without having any authority.” I’m finally contributing and making a difference here in the plant!” “I really like that about it!”
Appreciative Inquiry: “Hey Dan, I’ve got several people that I want you and Joel to talk to, who would benefit from CSi working with them; when can they get into the awareness training labs being held?”
Abuse: “I’ve been abused by both of my parents growing up and these classes are allowing me to deal with it so that I can become a better version of myself. I’m no longer a victim, anymore!”
Leadership: “The well-being sessions have changed my life and I’m a better leader/manager today for it. I now listen and extend solutions rather than barking orders, demanding, and focusing on just the bottom line.”
Accountability/Inclusion: I no longer do I call people out or assign blame to someone else. I’ve recently noticed, people are more willing to talk to me and try to get things done as a team rather than excluding me and doing themselves like before.”
Strategy/Execution: “We need to come together and practice what we now know to do on a regular basis if we hope to create a new culture and rebrand Pinnacle.” If we put into play what we have learned, Pinnacle will be a better place to work and we’ll start attracting better quality applicants who value a good opportunity when they see it rather than taking anybody off the street.”
Teamwork/Continuous Improvement: “Using the tools/apps that we learned about and the “SMART GOALS” have helped us (3rd shift material handlers during a soft intervention Matt, Marissa, Brian, and Nick). We are getting better and finally working as a team and it feels great; let’s keep it going for the last few weeks have been fantastic.” “If we continue to improve, maybe 1st and 2nd shifts will see what they are capable of doing.”
Consulting/Session Planning: “The overall company improvements and numbers could not have been realized, had it not been for CSi. In retrospect, we are so glad we hired CSi when we did. Your organization and approach to training helped us to become the company we had always dreamed about being. We received the value we envisioned and had always hoped for in the past. Had you and your team not done what you did, we could have died at our desks without retiring and preserving an honorable legacy. Thank you for all that you have done for us personally, our people, and as a company. We will never forget the effort, results, and events that were finally were achieved (from the 3 previous owners [G.H.T.] of Pinnacle Plastic Products, Inc.).”