Manufacturing jobs return under leadership of alumnus Doug Grimm

Grimm '87

In a slowly growing economy, Doug Grimm '87 MBA, has good news. "On a macro scale, manufacturing in the United States is back. We (Grede Holdings LLC) are the classic case of American transformation. We've more than doubled employment of the company (to 5,100) in the past three years and customers love us."

Grimm has made a name for himself as a turn-around wiz – transforming the firm from two legacy foundries in trouble to a holding company with 21 plants in North America and sales of more than $1 billion. He co-founded Grede Holdings LLC when he combined the former Citation Corporation (Birmingham, Ala.) with Grede Foundries, Inc. (Milwaukee, Wisc.) and moved the headquarters to Southfield, Mich.   The legacy companies had been in bankruptcy three times since 2004.

In 2008, the business of iron castings was almost a dinosaur, similar to the steel industry 15 years ago. By dealing with legacy costs and right-sizing the capacity by closing or selling unproductive plants, Grimm began to restore profitability. As CEO, he made seven acquisitions in just three years. He also formed global strategic alliances and gained many Fortune 100 customers, keeping each under nine percent of sales.

In 2011, Crain's Detroit Business recognized Grede as "the deal of the year."

"We integrated the best-of-the-best in people, assets and technology," he notes. "We gave the managers a playbook and said 'Make the changes in 90 days. Take a process and move it forward.' This quick action allowed us to begin making money during the recession."

Today, Grede is a leading designer, developer and manufacturer of cast, machined and assembled components for the transportation and industrial markets. The company plans to expand further in North America and overseas.

Grimm makes decisions based on 80 percent logic, facts and data, and a 20 percent gut feeling. "If you over analyze it," he notes, "you miss out on the opportunity."

It's a formula that has worked well for him during 25 years as an executive at Chrysler and at suppliers Dana, Visteon and Metaldyne. He has vast experience in global purchasing. At Grede, he has raised capital, run operations, negotiated for properties, restructured balance sheets and merged company cultures.

Of utmost importance to Grimm is how a company makes money – knowledge that he also wants his team to have. "It's good to make products but companies must make money," he says.

"Business needs to reinvest, develop people and sustain economic cycles to do well over time," he adds. "Otherwise, investors, banks, suppliers and customers will stop doing business with you."

He relies on the fundamentals that he learned when studying finance and international business at U of D, combined with logic and rigor. Over the years, he's learned to make swift and decisive business moves – in part by witnessing what happens when companies fail to act or when they make sales forecasts that aren't aligned with demand.

Grimm's management philosophy is focused largely on strong customer relations, disciplined cash management and a rigid operating cadence. One of the ways he does this is by getting a daily report on each plant's production and cash position (net cash vs. debt). He manages it closely, ensuring that customers pay on time.

Every Tuesday, he and his executive team analyze the income reports from the 21 plant managers. Then, they make projections for the quarter and "pull the levers to make changes based on customers and the macro-economic indicators." It might mean reducing or adding a shift, moving a tool to another plant for greater productivity or meeting with customers to understand their end-markets better.

Based on this approach, changes can be made in five days rather than the standard 90 days practiced in many companies.

Additionally, the leadership team relies on PACE boards positioned at every machine to keep track of hourly and daily production vs. targets. The executive team at Grede forecasts each plant's profitability each week with a 90-day forecast.

Grimm says, "Our customers, bankers and shareholders tell us that we have a best-in-class process."

Grimm has an inclusive leadership style and welcomes the opinions of others. His executive team and diverse employees have a say on major decisions in the company. It's part of their culture. Yet, he takes full responsibility for key decisions, noting, "The buck stops here."

Grimm lives in Grosse Pointe Farms with his wife and two teenage children.