Arch Aluminum has a new CEO, Jeff Leone, who brings with
him an impressive international business pedigree. His 27-year professional
trajectory includes stints at BASF/Basell (where he helped establish its
automotive business in China), MAPEI (where he served as director of strategic
marketing) and, most recently, at Arch’s owner Sun Capital Partners Inc.
Despite the turbulence since Arch declared and then emerged from bankruptcy
a few months ago, Leone says that he’s very optimistic about the fabricator’s
future. “The more I look at the fundamentals, the more I see it’s a good
company,” he says. I caught up with Leone in late August to ask him about
his new role with Arch. The following are some excerpts from our conversation.
You can read the whole interview online on my August 30, 2010 blog at
Q—So how is the Arch make-over going so far?
A—Good. We are on track to hit the financial goals we outlined in the
acquisition and we’ve been able to do so even though demand is down by
Q—A lot of people were concerned that there’d be a “slash and cut”
strategy under Sun. How have you worked to allay those fears?
A—We said right at the beginning that we needed to “right-size,” not “down-size.”
And we’ve had to do a few things to make that happen. First, we had to
get everyone prepared mentally—our employees, our customers and our vendors.
Then we had to create a sensible cost structure. That did involve some
painful, but necessary, decisions … People have been giving us room to
improve. Now our goal is to create delighted customers. We truly want
to delight our customers with our products and our service.
Q—That’s quite a different philosophy than the “old Arch” often was
accused of having.
A—I know. I recently sent out a letter of introduction to more than 2,000
Arch customers and I said, candidly, that the company had lost its focus
but, believe me, we are focused now.
Q—Arch always had a very decentralized management style. Individual
plants were often considered fiefdoms. Do you see that degree of autonomy
A—First let me say that there are very good parts of that model. Having
branches accountable for their own P&Ls is a good thing. Secondly,
some of these branch managers are among the most talented and hardest-working
operators we have at Arch. So we don’t want to destroy that. We want to
stitch over it, if you will, with a light hand. That being said, we do
have centralized credit and we will centralize some other functions that
it makes sense to centralize. We are striving for a bit more consistency
and more professionalism than we had in the past.
Q—Arch was such a well-known family-owned company with lots of family
members employed. I would imagine making changes to that dynamic has been
A—The familial model can be a very strong one. I saw that during my time
at MAPEI. It has definite good parts and we want to keep those. What we
want to do, in addition, is create an atmosphere of trust for the employees
and an atmosphere with strong values that the employees want to emulate.
You have to build that over time.
We also need to become more consistent and professional. So we are putting
in things like HR policies, codes of conduct and standards. We want to
be as professional as a DuPont or a BASF. —Deb
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