Saturday, August 11, 2007

A True Loyalty Story - a PVC Plant in Trouble

I worked in industry for about 20 years and during that time had some wonderful and exciting experiences with customers. This is one of the most memorable.

In the late 1970's I was the head of service for Taylor Instrument Company, a company located in Rochester, New york, that manufactured and sold process control systems and equipment. We had a complete process control system installed in a large PVC plant in Texas. This plant ran 24x7x365 and the plant manager (I still remeber his name) had a significant portion of his salary linked to plant output which meant he was ALWAYS very concerned about keeping his plant running. I had personally visited the plant and met the plant manager and was well aware of these circumstances.

A few facts are important. PVC is a plastic that is made in a liquid and then a catalyst is added. Once the catalyst is added there is only a short time before the PVC "sets" (hardens). If the PVC is in the plant piping, values, etc. when the time to set occurs, the plant must be re-piped at considerable expense. (At least this is the story I was told). In order to prevent this occurence, the plant used a dual computer system with a shared memory so that if there was a computer failure, the other computer would continue to control the operation. Just to make things a little more complicated, I was told that PVC in its liquid state is carcenogenic. All the more reason to make sure nothing happens.

Now, the story. I was at home in Rochester when I receive a call from the plant manager at 11:00pm on a Saturday evening. I knew this was not a social call! He explained that his plant had been shut down since 2:00pm that afternoon. His technician had thought he solved the problem but when the system was turned on the parts that had been replaced also failed. Now they called our technician who lives in Houston to come and help. The technician from Houston, a well-qualified technician, came and after several hours of diagnosis installed his spare parts into the system and turned it on, only to have the system fail again. This was the situation described to me. The plant manager then said something that really started my heart beating at an elevated pace. He had rented a private jet to come to Rochester to pick up three parts which they were sure would solve the problem. The jet had left Texas and should be arriving in about two hours. YIKES!

Two very important points are that even though he gave me the part numbers, I had no idea what they were. Secondly, our plant in Rochester was only open Monday through Friday and this was Saturday night. Soooooo, after I had a short but severe panic attack, I started tracking down people on my staff that would know the parts and how to check them out to be sure they were functional. (The last thing I wanted to have happen was to send parts that were DOA - "dead-on-arrival") The next step was to get my staff authorization to get through security and into the plant in the middle of the night. I found some of them at parties and others at a local bowling alley where they were in a late Saturday night league. I finally got a cadre of people to go to the plant. Since the service organization did not have inventory, I instructed them to rob from the systems in manufacturing and check out 2 of each parts that were ordered. I did not get into trouble once the circumstances were known.

The good news was that we were successful. They met the plane and sent 2 of each part number to the plant in Texas. To say that the plant manager was a happy man when I called him on Monday, is an understatement. He became a VERY loyal customer. That Saturday episode yielded a loyal customer AND the following financial benefits to Taylor:
1. He paid for the overtime o the people to get the parts to the plane and the list price for the parts.
2. He and I agreed they should keep more parts at his site. So we sold him $100,000 in additional parts at list price (70% gross margin).
3. We never had to negotiate the annual service contract.
4. He became an advocate for Taylor and was partially responsible for selling several more of those systems to other companies (usually for about $2,000,000+).

While there are several lessons that one can take away from this story; the greatest lesson that I learned was that the more critical the need, the greater the impression on the customer (good or bad). Of course, another lesson I learned was the value to have in place a system whereby I would NEVER be surprised by a customer call. The regional service manager in Texas also learned this lesson.

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