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WRITTEN BY JOHN HARVEY

SALBERG CONCRETE PRODUCTS

0027 11 357 7600

WWW.SALBERG.CO.ZA

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

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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

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.”

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

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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

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.

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.