“You would think that if you know that you’ve got a seven-year backlog to build commercial airlines, you should be able to sit down and figure out how much material that’s going to require,” Oates says. “But it’s not as simple as it sounds on paper, or you wouldn’t have these constant inventory fluctuations.”
That’s why you also need to have a little plan in your desk drawer for what you’re going to do if the market should turn down, he says. Then you can execute and respond quickly.
Stabilizing your workforce
In order keep a stable workforce throughout industry ups and downs, it’s also important to keep a handle on your production requirements.
Oates suggests training people for different positions.
“You have to have people ready to jump into different spots that they may or may not be used to doing on a day-in and day-out basis,” he says. “You’ve got to make provisions for training them and getting them some experience prior to that actually happening.”
Training and experience is a continual challenge at Universal, where 57 percent of the employees have been hired in the past five years. Although a portion of those new hires is because of the North Jackson plant, it’s also part of the demographic shift as baby boomers retire.
“The average age at some of our plants has gone from the low 50s down to 40,” Oates says.
That’s why management is taking time to examine their training methods and understand exactly what the workforce is capable of doing, he says, as the company continues on its growth strategy to ensure it stays around for the long haul.
Takeaways:
- To build for future growth, determine where you can expand and diversify.
- Keep a close eye on customers to respond quickly to market challenges.
- Cross-train your people to help stabilize your workforce.
The Oates File:
Name: Dennis Oates
Title: Chairman, president and CEO
Company: Universal Stainless Alloy & Products Inc.
Born: Philadelphia. (Yes, I am a Flyers fan. I have a lot of fun working in Pittsburgh though, just to get everybody on their toes.)
Education: Bachelor’s degree in economics, The Wharton School of the University of Pennsylvania; MBA, Temple University.
What was your first job and what did you learn from it? I delivered the morning paper, The Philadelphia Inquirer, and on the weekends I would take the bus out and I was a caddy at Torresdale-Frankford Country Club.
I learned the value of the dollar and good work habits. I learned not to be afraid of a little hard work — as a 12-year-old carrying around two golf bags with a bunch of old men cursing at themselves because they can’t play golf. (And that’s where I learned to curse, not that I do a lot cursing.)
What is the best business advice you ever received? I’m trying to think how to put it — there was a very guttural piece of advice I got from the CEO of Lukens Steel Co. at one point in time.
His basic advice was don’t stay back. Get involved in everything you can and make things better. When you look back at something, you should always have in mind that it was better when you left than when you got there.
If you could tell people one thing about the steel industry, what would that be? I’ve got two things. One sounds flip — we are still here. Because honestly when I tell people that I’m CEO of a steel company, they look at me and say, “Really, we still make steel in this country?”
But seriously, I think one thing about our steel industry that people don’t appreciate is that it’s a technology industry. People have this image that it’s a dying, sunset industry, it’s a polluter and so forth.
You’re welcome to come down to our plant any time. You will never know that we are making steel in that valley. It’s a very clean operation. Virtually all of the steel industry companies have put in significant investments for environmental controls. And there’s a tremendous amount of technology that’s been brought to bear on the industry.
If you weren’t a CEO, what is something you have always wanted to do? High school football coach.
