Jack Truong joined James Hardie Industries as CEO in early 2019 and restructured the building materials manufacturer over three years. Quarterly net sales jumped more than 50 percent from approximately $600 million to over $900 million. Adjusted quarterly net income more than doubled from around $75 million to $160 million. Market capitalization grew from $4.5 billion to $18.5 billion—an increase of more than $13 billion.
Then Truong departed in January 2022. Within three years, the company’s market value decreased significantly by August 2025.
The Starting Point
When Truong took over, James Hardie’s quarterly sales had plateaued between $500 million and $600 million, representing modest single-digit growth. Market capitalization hovered around $5 billion. The company operated primarily as a B2B supplier, selling building materials to contractors and distributors with minimal direct connection to end consumers.
Regional divisions functioned with their own procedures and priorities. The fragmented structure created inefficiencies and limited the organization’s ability to scale operations or respond quickly to market opportunities.
“I saw the opportunities of transforming a regional-based company into a global company with multiple engines for growth,” Truong told CEO Magazine. “It’s a company where I identified the potential to utilize my experience and skill set as a global business leader to build its potential from a regional company to become a global, sustainable, and profitable growth company. I saw it as an opportunity to create something amazing.”
Three Core Changes
Truong implemented an approach he had refined at 3M and Electrolux, built around three principles.
Unified lean manufacturing. Truong broke down the company’s regional power structures and implemented standardized lean manufacturing principles across all operations. Division heads who had operated with considerable autonomy found themselves working within standardized operating procedures designed for maximum efficiency.
The change met resistance. “Even though more than 99% of employees supported the transformational initiatives that I was leading, there were a few legacy employees who didn’t like all the big changes and new ways of doing things,” Truong told CEO Magazine.
The lean approach emphasized continuous improvement and waste elimination, allowing James Hardie to leverage effective practices across all facilities and respond more quickly to market demands.
Consumer focus. Rather than maintaining an exclusive focus on B2B relationships, Truong reoriented the company toward end consumers. James Hardie began investing heavily in direct-to-consumer marketing and brand building.
The shift required rethinking product development, pricing models, and manufacturing priorities. Understanding end-user needs allowed the company to design products that commanded premium pricing and build brand loyalty that transcended individual contractor relationships.
The 80/20 rule. Truong applied rigorous prioritization—identifying the critical 20 percent of activities that would drive 80 percent of results. Leadership teams were required to identify the most impactful opportunities across the enterprise and concentrate efforts accordingly.
“So first, you’ve got to get into the market and really understand what’s going right and what’s not going right for your company from different constituents—consumers, customers, employees, and owners,” Truong explained.
Marketing campaigns focused on the highest-potential customer segments. Production capacity was allocated to the highest-performing product lines. R&D investments targeted the innovations with the greatest commercial potential.
The Results
Quarterly net sales grew from the $600 million range in 2019 to over $900 million by early 2022. Quarterly adjusted net income more than doubled. The growth was organic, not driven by acquisitions.
James Hardie maintained strong performance despite COVID-19’s impact on construction markets. While many building materials companies struggled with supply chain disruptions and demand volatility, James Hardie’s North American operations continued delivering consistent double-digit volume growth in 2020 and 2021.
Share prices rose from around $11 in early 2019 to near $42 by the end of 2021, reflecting investor confidence in the company’s direction and execution.
After Truong’s Exit
Following Truong’s departure, the company experienced some shifts in its performance trajectory. While the company had maintained strong growth during his tenure, certain factors in the broader market and organizational adjustments led to a period of slower growth. Sales showed signs of plateauing, and the company’s operations faced new challenges in maintaining the same level of momentum.
Industry observers noted that some of the strategies implemented during Truong’s leadership appeared to face challenges in being maintained after his exit. The company seemed to show signs of returning to old dynamics.
This transition period also saw changes in market dynamics and competition, which affected performance across the industry.
Lessons on Transformation
The case demonstrates how quickly organizational culture can revert to previous patterns without consistent leadership reinforcement. Truong’s lean manufacturing principles and consumer-focused methods delivered results, but their sustainability depended on continued leadership commitment.
True transformation requires building capabilities that survive leadership changes, not just implementing new procedures.
The disciplined focus on high-impact priorities that characterized Truong’s tenure appears to have been difficult to maintain. Without strong leadership committed to making tough choices about resource allocation, organizations drift toward pursuing too many initiatives with insufficient focus.
“You can’t please everybody, and I think there are a lot of leaders out there that are afraid to make those tough decisions,” Truong said. “That’s when you create chaos and dissatisfaction among the employees, because they have no clear direction.”
The case also raises questions about board effectiveness in managing leadership transitions. The performance reversal suggests either inadequate succession planning and/or insufficient board oversight during the transition period.
The Broader Picture
James Hardie’s experience reflects broader challenges facing corporations attempting large-scale transformations. Many companies achieve impressive short-term results through leadership changes and new approaches, but sustaining those improvements over time requires deep cultural and organizational changes that go beyond individual leaders.
The building materials industry has seen numerous examples of companies struggling to maintain competitive advantages as markets mature and commoditization pressures increase. James Hardie’s period of exceptional performance under Truong demonstrated the potential for differentiation through operational excellence and consumer focus, but also highlighted the fragility of such advantages.
For investors, the case serves as a reminder that evaluating corporate transformations requires looking beyond immediate financial metrics to assess the sustainability of underlying changes. Impressive quarterly results can prove temporary if they depend too heavily on individual leadership rather than embedded organizational capabilities.
Corporate transformation demands more than vision and operational excellence—it requires building organizational capabilities and cultural changes that can endure beyond any single leader’s tenure. Companies that master this challenge will find themselves with sustainable competitive advantages, while those that don’t may discover that even impressive transformations can prove fragile.
