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Newly appointed FMC Technologies chief executive officer John Gremp admits it’s lonely at the top.
Many companies and trade organizations have taken the lead in addressing the generation gap that plagues the oil and gas industry, and the Petroleum Equipment Suppliers Association is no exception -- its Emerging Leaders Committee puts together special events focused on young people just starting their careers.
But FMC Technologies chief executive officer (CEO) John Gremp drew a crowd that contained both younger employees and seasoned vets, an audience that was clearly interested in hearing Gremp’s take on his latest leadership role. (He became CEO in March 2011 and chairman of the board Oct. 31, 2011.) Gremp took advantage of the opportunity to address the perspectives of a new CEO.
When he took on his new role, he said, he was challenged to find ways to continue in the footsteps of his predecessors, who improved revenues by four times, profits by seven times, and stock price by 10 times in the past 10 years. Based on studies of great companies of the past, this is proving to be a tall order.
“Great companies don’t stay great,” he said, citing statistics indicating that of the companies that made up the Fortune 500 in 1955, only 71 remain.
Why were these companies unable to sustain their greatness? Gremp said that studies at Stanford indicate that internal rather than external forces are the key factor.
“These companies are insulated from market changes,” he said. “Their business models have blinded them to making the changes needed to survive.
“We need to challenge ourselves even when things are going well.”
During his tenure he has worked with his leadership team to identify the steps needed to make FMC not just a bigger company but a better company as well. First is to develop a strategy that’s clearly articulated to all constituents -- employees, shareholders, partners, suppliers, etc.
“This is helpful in telling them what we’re going to do, but it’s also helpful to tell them what we’re not going to do,” he said. “We need a vision for what the company will look like in 10 years, and we need to be prepared to become that vision.”
Once this vision is established, he added, the entire company can be aligned around it. “We do our best work when we’re focused.”
Another key ingredient is cultural change. “We have a wonderful culture,” he said. “But we want to improve it by being better, by delivering a higher level of quality.”
He added that changing the behavior of FMC’s 14,000 employees will require strong leadership from the top as well as diligence and commitment.
Finally, he said, the most important goal of a CEO and the leadership team is to clearly articulate the direction of the company. “Every employee has the right to know the future direction and to hear it from the top.”
Even FMC’s board of directors has admitted to feeling a little out of the loop in the past, and Gremp hopes to keep them better informed of the strategy moving forward.
Shifting gears, Gremp discussed his personal experience of becoming a CEO after a 37-year career, all of it spent at FMC. “I thought I knew the culture,” he said. “But it’s very different. There’s an ‘aloneness’ about the role. You’re on your own. This is the first time I don’t have a boss.
“The buck really does stop here.”
Additionally, he said, the decisions are much larger at the CEO level. “I didn’t really grasp that at first. But, I realized that the easy decisions are being made below me.”
Finally, he’s become aware of his role as the mouthpiece for the company. “The microphone is always on,” he said. “It’s my job to communicate the goals of the company.”
His advice to younger employees is simple: be open-minded about your career path, assess your performance on not only what you have accomplished but by what you have learned, and hone your leadership skills.
“You learn things from a technical and functional aspect, but the one thing you never completely learn is the ability to be a leader,” he said. “I’m still learning about leadership.”
Contact the author, Rhonda Duey, at firstname.lastname@example.org.