Leading questions

When TM last profiled heavy engineering firm DavyMarkham in April 2010 the company had a truly inspirational story of transformation to tell. From a situation in 2006 where business was weak, morale low and an aging workforce was making crucial skills critically endangered, the company has undergone a dramatic reversal of prospects.

This turnaround was driven by the robust leadership of then managing director Kevin Parkin who proved beyond all doubt the power of charismatic leadership and the responsibility that needs to be borne by all company leaders to ensure the success of an organisation. In his time with DavyMarkham, Parkin initiated an intensive education and engagement programme for all employees which taught the principles of continuous improvement and empowered them to uphold quality and efficiency through the use of lean tools such as 5S.

Another outstanding outcome of Mr Parkin’s leadership at DavyMarkham was the establishment of its tailored apprenticeship programme, the striking success of which has caused it to be held up as an industry benchmark for training provision by institutions like the Institute of Mechanical Engineers and EEF. In addition to safeguarding the future of the company by creating skilled engineers to whom outgoing, experienced employees can pass the torch of industry, the programme has revitalised workforce enthusiasm with an injection of fresh blood, increasing productivity.

In March, however, Parkin moved on from DavyMarkham to take up a new position as chairman of a newly formed plastics recycling business, R3 Products. Creating continuity in the wake of such a departure can be difficult and many business consultancies thrive on helping companies understand leadership legacies in order to avoid a crisis of confidence. While DavyMarkham did not feel the need for external help in their recent transition of power, Gordon Scott, director of sales and marketing at DavyMarkham, admits that when Parkin left there was very real concern about what the future might now hold. Such fears were soon put to rest.

Stepping up

Stepping confidently into the legacy left by Parkin and showing their commitment to continuing DavyMarkham’s transformation the new management team immediately took steps to speak directly to employees and reassure them. Scott says: “Kevin’s initiative was founded in the idea of taking on the engagement issues we had here at DavyMarkham and the four of us now on the senior management team [John Watson, director of production; Mike Robotham, director of engineering and contracts; Andy Howard, financial controller and Gordon Scott director of sales and marketing] are absolutely committed to taking that forward. We did recognise the potential issues around Kevin’s departure however, and the week after he left we stood up in front of the work force and explained the future plans we had for this company. This was very well received as there had been some genuine concerns that, with Kevin leaving, there would be a big hole left in the organisation. What we were very keen to make clear, in person, was that this is not the case. All the initiatives in place have been fully committed to by the management team.”

The decisive statement from the new management team was that there would be no glitches in the company’s trajectory and that business as usual should continue without pause has allowed further improvements business wins to roll on without delay. The company is now about 50% of the way through applying 5S to all of the equipment on the shop floor and there are 13 active projects on the go. With regard to continuous improvement (CI) the company’s dedicated CI manager, Pete Cross, having worked with the machine shop staff to establish a CI culture, is now starting work with team in fabrication and fitting.

The apprenticeship programme is also going from strength to strength. There are currently around 20 apprentices enrolled with DavyMarkham, a figure which represents around 20% of the workforce on the shop floor. The first apprentices to graduate from DavyMarkham’s programme, which other manufacturers now come from far and wide to observe as a reference point for their own apprenticeship aspirations, are now in the workforce. Scott says: “They are working on the large machines in fabrication and in on suite fitting projects.

They are working with mentors now and taking on the kind of responsibility which might have taken them eight or ten years to achieve just a generation ago.”

Special relationships

Skills and people development at DavyMarkham is not, restricted to the engineering and production areas of the business. For a company that is renowned for its flexibility in being able to frequently undertake one off engineering projects, some of epic magnitude, the attention to detail which DavyMarkham applies in its sales and customer care truly differentiate it from competitors, according to Scott.

Since we last profiled DavyMarkham the sales staff has grown and Scott explains that the team’s strategy is to treat every customer as an account, despite the one off nature of most business. “We look after clients on an ongoing basis, even if we don’t have any live enquiries. With key clients, like Roll-Royce and Sheffield Forgemasters, this means keeping up regular contact on a weekly and monthly basis to hear what is happening now and what projects they are thinking about. This helps with production and capacity planning.”

DavyMarkham now has an active graduate programme for bringing graduates into sales and marketing, as well as engineering. Sales and marketing recruits are employed and trained to make the most of specialist knowledge of particular markets. Scott comments: “Because we have such a diverse number of markets it can be difficult for a small sales team to cope with. Each market has a different style of operating. Energy, mining, tunnelling and our civil engineering projects for bridges; they are all quite different. We are looking to develop people as specialists in each area.” Scott is confident this approach will help DavyMarkham in the up-front work which has to be done in bidding for projects before the quotation and proposal stage is even thought about and that it will put the company on a much stronger footing for winning new business.

In terms of DavyMarkham’s traditional market for mine hoisting equipment, finding new business means keeping a close weather-eye on emerging markets. Scott reflects: “In this traditional area of the business our home market has almost entirely disappeared. We have about five operating mines in the UK now.

“Exports however have been very successful. We initially exported to Africa and then North America for the nickel, gold and semi-precious mines located there. In the last eight years about half of our turnover has come from this mining equipment business.” A recently won contract in Peru will extend the work being done in North America. Scott says: “We took a close look at which countries are expanding their mining markets and Peru came first among those we identified. This will be the first time we have supplied new equipment to Latin America and we have just signed a contract worth £3.25m. We will be looking for further expansion in Peru and then, once we are well established there, we will be looking at Mexico, then Chile.”

These plans for expansion, alongside moves to secure more business in the renewable energy sector and sustain activity in the UK steel and bridge engineering industries speak for themselves of the dynamism and forward thinking culture at DavyMarkham. Stressing the point however, Scott says: “We are moving forward as a company. We want a secure workplace for our workforce; we want to bring in new people and new ideas in order to continue our successes so far.”