A great CEO recognizes when it's time to pass the baton to someone who's more capable of taking a company to the next level. Injection molding specialist Proto Labs (NYSE:PRLB) recently experienced this, when former CEO Brad Cleveland, who helped grow the company's revenue more than 100-fold under his tenure, announced plans to resign after the right replacement was found. The search recently concluded and Proto Labs named Victoria Holt as the company's new CEO and president. Based on her impressive track record, Holt looks like a great candidate to bring the company to greater glory.
Why Holt fits the mold
Having served more than 30 years in various Global Fortune 500 leadership positions, Proto Labs certainly won't be Holt's first rodeo. Throughout her career, she's built up a reputation around improving efficiency, making customers happy, and delivering results that benefit stakeholders. In her most recent role as CEO of Spartech, Holt engineered a turnaround that resulted in a 73% increase in operating earnings in two years, which ultimately led to the specialty plastics company to being acquired for a 106% premium to PolyOne.
Hitting the ground running
On a high level, Proto Labs' long-term-growth strategy involves adding new customers, developing technologies that expand the breadth of its manufacturing services, and developing technologies that can handle a higher degree of complexity and range of materials offered in existing services. One of Holt's first orders of business will be seeing what else can be done to successfully execute this three-pronged strategy. Of the three, adding new customers will likely prove to be the most challenging because the company has a huge awareness issue.
Realizing that awareness is going to be a big challenge, Holt plans on attacking it from both the corporate and product developer level. The thinking here is that if Proto Labs can win over the business of major corporations with large groups of product developers, it can grow its product developer base more quickly and drive a higher degree of sustainability to its operating results. At the same time, Proto Labs will continue marketing its services to smaller product developers.
A smooth transition
Undoubtedly, it's going to take time for Proto Labs and investors to feel the impact of any changes that Holt implements. In the mean time, it's reassuring to know that Cleveland will be staying with the company throughout the entire transition period and founder Larry Lukis will remain as chairman of the board. Both have played instrumental roles in making Proto Labs the success it's become today and will help guide Holt's thinking.
At the end of the day, the time had come in Proto Labs' life to find a leader who's capable of transforming the business from a few hundred million a year in revenue into a billion-dollar-a-year enterprise. Based on everything we know so far, Vicky Holt seems like the leader who can deliver on this long-term goal.