MANAGEMENT
Corporate Viewpoint
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Battling Goliath: small paint cos
create value |
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| Reprinted from The Coatings Agenda, America 2000 | ||
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question most frequently overheard at industry trade shows and events is:
'What does your company do?'. In the case of my own company, Seagrave
Coatings, the answer is simple enough: we manufacture specialty paints
and coatings. In our company's internal discussions, however, we have
realized that this answer alone does not sufficiently explain our
company. The answer does not explain why we thrive in an environment
dominated by industry giants whose experience curve position and
relative market share implies that we should have perished long ago It
does not explain either why we have consistently grown and achieved
superior returns year after year. In short, such a restrained answer
fails to tell the listener who we are and what our purpose is as a
company.
Mission Statement As our executive team discussed these ideas more fully we came to understand that our ability to win in the marketplace depends far less on 'what we do' that it does on 'what makes us different'. Our mission statement, printed on the back of each employee's business card, is the embodiment of this idea. It reads, 'We are an old company with new ideas. We formulate the finest finishes to fit the fashion and functional needs of our customers. This approach enables our customers to offer something new or different to their customers'. This statement articulates our firm's bedrock values and aspirations. We believe it offers a summary of the rationale for our firm's performance to date and that it suggests an exacting framework within which each employee can evaluate and measure his or her actions. Driving Force We are an old company with new ideas. We trace our lineage back to one of the original varnish companies in the United States, Cloverleaf, which was founded in 1846. We are keenly aware, however, that being established does not guarantee longevity in
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this
day
and age. Only through a constant stream of new ideas and innovations can
we keep our firm young.
Peter Tepperman New coatings or finishing processes that fit the changing fashion and functional needs of our customers is the driving force of our business. What we mean by driving force is that we have made a conscious decision to focus on only those products that we can produce and those markets that we can serve better than our competitors. Seagrave's niches are middle market companies selling decorative accessories, customized wood finished products, and difficult to coat substrates, such as plastics and glass. We will continue to succeed in the marketplace only if we offer new coatings and services that enable our customers to offer to their customers something of value that is new and different. To be effective, our offering must add greater value to our customers' products than that provided by best available alternatives, many of which are substitutes for paints. The implication of these notions can be startling, but it is real: we must provide superior value not just for our customer, but for our customer's customers as well. 'We are an old company with new ideas. We formulate the finest finishes to fit the fashion and functional needs of our customers. This approach enables our customers to offer something new or different to their customers' Generating results through insight Many paint companies claim to be customer-focused and to manufacture unique products for their customers. Certainly, few would claim to be unfocused on their customers. This homogeneity of purpose, in itself, suggests the rationale for thinking about what makes our firm different. We believe our strategic differentiation is evidenced by the way which we embrace the research and development function. Seagrave commits 5% of its sales to R&D, while the average |
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