WRITTEN BY JOHN HARVEY

Following a sea of change in the wake of economic hardship, Salberg is enjoying record levels of success in a booming era for the company.

TIME FOR A TURNAROUND

SALBERG EMBRACES CHANGE TO REAP REWARDS

month on month, to date. “It’s been an impressive four quarters

and the outstanding performance is continuing. May has once again

broken all sales records and we are currently managing our biggest

back order book ever”.

Absil attributes successful turn-arounds to five key elements:

• Appointment of competent business leaders

• Effective cost and cash flow management (Rightsizing )

• KPI based performance management and clear role definition

• Culture of learning

• Effective and efficient communication channels

Implementing the five key drivers “When I arrived the key executives had already been removed and

mind-set of change introduced but it was a long way from a sustainable

turn around”.

“The first order of the day was to surround myself with competent

decision makers in all the key business areas, namely Operations,

Engineering, Finance and Human Resources”.

“Secondly, we had to rightsize – as oppose to downsize, the staff

and in so doing we were able to streamline processes and develop

more effective and efficient channels of communication”.

Thirdly, we had to develop a culture of continued competency. This

was achieved through, among others, the introduction of participative

performance management, targeted training and ongoing process

analysis and improvement by both managers and workers.

“Creating visual indications of how the business is doing to make

staff constantly aware of performance has been critical. Performance

targets all for divisions are monitored at all levels throughout the

organisations at meeting and/or forums daily, weekly and monthly.”

“We applied a lot of the consultancy principles including short

interval controls, visual measurement and balanced scorecards so

people can see where we are, how much we make, how much we sell,

the cost of production and cost of maintenance, among others, on a

daily basis. Making people aware of how they’re doing makes it easier

to improve performance.”

SALBERG CONCRETE PRODUCTS

Established over 40 years ago, Salberg has been a precast concrete industry stalwart with a wide range of specialist products and a diverse customer base. However, since founder Dave Salberg passed away seven years ago, the company struggled in the face of the global economic crisis and desperately needed a new and innovative approach to business in the 21st century.

To this end Dr Rudy Absil, one of the country’s top turnaround

specialist, was brought in as CEO by the newly appointed

Chairman of the Salberg Group, Barbara Parker. Twelve

months later Salberg is closing its financial year with the best results

in recent years.

According to Absil the new team broke company records in the

first six months and has subsequently broken their own records

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Company cultureIn addition to developments relating to operations and production,

Absil also identified the need to change the company culture and

reward employees for good performance.

“Prior to the change problems were handling through aggressive

and counterproductive warnings and dismissals. A culture of low

team work, covering-ones-back and grapevine gossip emerged in an

environment where an average of 120-150 warnings were issued a

month. In a medium size company this is excessive”.

“Pivotal to change”, suggested Absil, “was the shift to recognition

and reward”. “Giving the workforce incentives and providing

opportunities for further training has been crucial in the company’s

success. A competent, motivated and enthusiastic staff are central to

a thriving business.”

“We have a monthly incentive for the best employee and a

quarterly incentive for the best production team. Every 2 nd week we

select the best performing team and on a Friday afternoon they have

a BBQ. The sales team now work on commission and we are seeing

the obvious results.”

“We have developed extensive training, not only on-the-job

and technical, but teaching supervisors the principals of business

management and the all-important leadership and management

of people. We achieve this through regular formal and informal

educational sessions during lunch breaks, after work and Saturdays.

The staff are beginning to experience the tangibly value of knowledge

and skills”.

“Living in a country where people have no had little or no access to

this makes a great change. We found many supervisors, irrespective

of race or gender, had technical knowledge and understood the finer

details of the job. But there was a big gap in business and leadership

knowledge especially around the management, motivation and

coaching of people.”

Recent developmentsWith banks and borrowers reluctant to lend money in today’s

climate, Absil admits Salberg’s biggest challenge relates to

recapitalisation. “To date we have financed our own recapitalization

and, despite the pressure, evidence of capacity through the

performance of the past 12 months is a keen indicator of our future

growth potential,” states Absil.

“We have revived two key value propositions over the past 12

months. ‘Seize-the-Moment’ in Sales and ‘No-Compromise’ in product

quality and reliable delivery. We are winning over customers from our

rivals because of our ability to live our commitments”.

According to Absil electronic are always ditched in favour of a face-

to-face engagement where necessary. “Our sales team are trained to

not only sell but to service our clients. The complexity of our industry

demands a heightened awareness and understanding of the client’s

requirements, project to project. We specialise in delivering efficient

and cost saving solutions to our clients and in return our client’s retain

a deep and abiding appreciation of us. We are winning market share

one satisfied customer at a time”.

Absil has also revived the

company’s unique and original

Innovations Division which up

until the loss of its founder, had

been core to the company’s

brand. As a very proud CEO,

Absil highlighted the recent

winning of the 2012 Concrete

Manufacturer Association’s

(CMA) Innovation Category

Award for the company’s ATM

blast proof housing unit.

“Providing cost effective and

innovation pre-cast concrete

solutions is central to our growth

plan for both our local and

international clients who find our

services and the rand favourable

to their current business

requirements”.

With global economies in

recession and international

companies reeling from the

punch of their domestic

recessions, Salberg is capitalising

on the strength of their product

& services market and the

wins from the turn-around to

generate turnover.

Looking aheadThere are no plans to slow

down in the next five years with

Salberg keen to continue and

build on recent successes.

“We have quite an aggressive

development plan,” states Absil. “The first step is to make the current

business highly profitable and the second is to expand our production

capacity with modern technology”.

“We have recently returned from a trip to Europe where we

investigated new technologies and necessary contacts made to

manage the planned road to long term profits. We are excited about

the possibilities new technologies open up for us and we intend

capitalising on it in the next financial year”.

“I’m excited to find that we’ve evolved a team that is forward

looking while being able to deliver in the moment. Business and

markets are more sophisticated and it’s our business to stay focus and

stay in front”, concluded Absil.

SALBERG CONCRETE PRODUCTS

SETALA ENGINEERING CCHeavy Duty Lid Grids // Extra Heavy Duty Lid Grids // Medium Duty Lid Grids // Female Metal Inserts //

Lockable Lid Grids

P.O. Box 7754, Halfway House 168516 Blue Hills Agricultural Holdings, Midrand, Gauteng

Tel: (011) 0224486 // Cell: 082 576 8228 // Fax: 0866 086 032Email: setala@webmail.co.za

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SALBERG CONCRETE PRODUCTS

0027 11 357 7600

WWW.SALBERG.CO.ZA

TIME FOR A TURNAROUND

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