Over dinner on Sunday some one asked me; “What new course have you got for the times?”
Ah! The downturn discussion! I thought about this and chimed “something on concentrating on your core business and market your way forward with strong selling points and customer service”.
Somewhere in the back of my mind a lamp flickered and lit up the remarkable story of Andrew Cook who in the late 1970s early 80s transformed William Cook, a well established family manufacturer of steel castings, into a market leader when all was against him.
At that time the economy was dismal, dark and uninviting. Output in the industry had been falling for a number of years. But Cook on taking over the company went completely against the trend an invested in increased efficiency, quality and capacity in the least value segment – all at a time when capacity was double the amount of industry sales. Rivals thought he was mad. Indeed conventional thinking would have dictated that Cook milk the business and leave the industry or go into a higher value and differentiated niche.
Remember too that Cook’s didn’t have the image of a Mercedes or an IBM amongst its customers. Neither was it a technological leader, nor did it possess some secret process to guarantee extra income. Nonetheless, Andrew Cook backed his intuition. In a few months his efforts began to yield results.
His investment in a hostile environment transformed the business. Within a few years sales had risen 10% against industry losses. He was the first to invest in BS5750. Within a couple of years he had acquired two of his major competitors and by the ‘90s he had become the market leader.
“What did he do?” you ask. It’s really quite straightforward. He understood his customers. He recognised the value they wanted. His improvements saved customers money which naturally increased demand for his product. Thus Cook generated a double advantage – higher value and lower cost.
When others saw what he had achieved they changed too. They sought to catch up and invoked intense battles … but that’s another story.
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