The Art of Strategic Leadership. Mead Stephanie S.

goes to Melissa, PSI's CEO. Trained as a chemist, Melissa, who also holds an MBA, joined the company as senior vice president for marketing and was promoted to CEO five years later. One of her first initiatives was the construction of a new state-of-the-art manufacturing facility on land adjacent to the outdated plant in New Jersey. With Seattle already operating at near-peak capacity and new orders for standard and custom products multiplying, Melissa spearheaded a plan to establish a physical presence in markets where PSI saw opportunities to expand its customer base. PSI has amassed a sizeable war chest to spend on new facilities, and attracted the interest of several private-equity firms ready to invest in the company's expansion. In addition to doubling its manufacturing capacity, PSI intended to attract new customers and develop new products that make use of the latest polymer and composite materials and technologies.

      Initially, Melissa and the board believed the most strategic location would be the Middle East, bringing PSI closer to petrochemical producers, or Asia, where the company was gaining market share in the region's fast-growing economies. That game plan changed when two U.S. – based plants – owned by another company and complete with their own product lines, customer bases, and engineering and operations staff – unexpectedly came on the market. The sites, in Chicago and Dallas, were the polymer-products division of a midsized firm that had decided to focus operations on their core metals business instead of polymers and composites. PSI sent a team led by Victor, the COO, to visit both plants; they returned with some bold but risky ideas. Victor saw their potential immediately. “Their product lines are a bit behind the times, and the physical plants will need serious upgrades if they're to become value-added members of the PSI family and compete in the future,” Victor told Melissa on his return, “but the engineering and operations talent is good, especially when you consider their corporate management's been neglecting them for the past several years. They're hungry for new direction and new leadership.”

      Since the price was right for these assets, that was all Melissa and the board needed to hear to pull the trigger on the acquisition. Melissa is all about formulas. In her view, long-term success is less about cutting costs and more about recognizing investment opportunities and acting decisively. As soon as the deal was sealed, Melissa set to work scouring her in-house talent pool for potential plant managers for the two new plants.

      Whenever Melissa fills a key position – department or team leader, plant manager, sometimes even an individual contributor whose role is critical – she demands three abilities or traits:

      1. Delivery on short-term commitments and results.

      2. Strong team values: collaboration, transparency, open communication.

      3. A keen eye for the future: thinking long-term, seizing opportunities, closing the gap on personal strategic weak spots (Melissa's term is “the strategic Achilles heel”).

      No doubt these loomed large in her decision to put Alex in charge of the Dallas plant.

      Alex jumped at the chance to run the show in Dallas. He held an engineering degree as well as an MBA and had joined PSI at the manager level. He caught Melissa's eye when he conducted a study employing management tools and techniques to improve quality in his department. As part of her effort to turn quality into a competitive advantage, she invited him to head a small task force that shared the study's conclusions and methodology with other business units. The report and subsequent process, called Quality Without Borders, was a great success across the company.

      After that, Alex's reputation, qualities, and skills grew rapidly. Recently, however, although he'd completed PSI's 18-month Rising Leader development program, he didn't see an immediate opportunity for advancement. He and his current department head, the vice president of engineering, were close in age and experience, and the COO job held by Victor, his current boss, wasn't likely to come open for a long time. Dallas was an opportunity to make an end run around these obstacles and gain deep experience turning a plant around.

      Alex concurred with Victor's recommendation to retain the staffs at both of the newly acquired plants. Only he and his counterpart in Chicago, the other plant manager, would be transplanted from PSI. Alex shared his observations with Victor on the flight back from their second Dallas visit, saying, “There's bound to be some attrition, but if we bring in too many people from the mother ship, they'll think we don't believe they'll be able to come up to our standards and meet our expectations. And I think they can.”