ABB repositions for international success
In an exclusive interview with Rudi Leitner, publisher of Smart Energy International, Richard Harpum, managing director of ABB Metering, spoke about ABB's restructuring and his vision for the company's future.
Richard Harpum looked relaxed and decidedly purposeful when I met him at Johannesburg International Airport. He had stopped over in South Africa on one of his regular visits to ABB offices all over the world. Responsible for 47 businesses in 32 countries with 4200 employees, he is open, approachable and friendly. The more we spoke, the more it became clear that this is a central part of his management style and vision. Richard Harpum is clearly a man fully embracing the new business age and business models.
"Although I have been out of the industry for some ten years, my roots are firmly in metering," says Harpum. "I was managing director of GEC Meters (now ABB Metering Ltd) in the UK from 1984 to 1988, before I moved to the US as managing director of Stone International, a leading rail equipment company. I also worked for a while as a business consultant in the US.
"After returning to the UK, I joined ABB about a year ago and took over the responsibility for their gas metering activities. During the restructuring of ABB in September 1998, all utility metering (that is water, electricity, gas and energy metering, along with metering systems) was combined into a single business unit, and I was appointed MD."
Harpum has developed a new organisational structure and has redefined core processes in line with customer requirements. He acknowledges that communicating these changes and this new vision to all employees is a high priority over the next few months. It’s one of the main reasons why he is travelling the world, meeting the different international ABB Metering operations and sharing his ideas.
The ABB Group serves customers worldwide in power generation, transmission, and distribution; auto-mation; oil, gas, and petro-chemicals; industrial products and contracting, and in financial services. The Group, which reported orders in 1998 of US$31.5 billion, employs about 200 000 people in more than 100 countries.
To put ABB Metering in context, the company is a world leader in water metering, number one in ANSI electricity meters (US style) and number three overall in electricity meters. It is also a major player in energy (heat) meters and has significant resources in automatic meter reading (AMR), especially in North America and Europe. The previously separate metering divisions have now been combined into a single business unit – a decision which Harpum believes provides significant potential synergies and will dramatically improve the business performance. The metering division falls under ABB’s Instrumentation and Control Products Business Area (a $2.5 billion business) which in turn is part of the Automation Segment (a $10 billion business).
"When we looked at what we do from a global perspective, we identified four core processes, and we have designed the new metering organisation structure around these," says Harpum.
A key part of the structure is a global strategic management team, comprising 27 people who meet every quarter under Harpum’s direction. The purpose of this team is to define business strategies, review performance and share best practices.
"The new structure is designed to promote communication within the organisation and to use it to gain competitive advantage, to reduce bureaucracy and to speed everything up. We want to eliminate internal politics and parochial thinking, so as to avoid the possibility of internally self-destructing."
To achieve superb internal and external communications, ABB is leveraging all available communications infrastructure (Lotus Notes, the mobile office, e-mail and so on) as part of the drive to encourage people to talk to one another and work together.
Sales and marketing and new product and systems development are also being co-ordinated globally, again using a team concept. In addition, world class manufacturing is a key part of ABB’s strategy, with the focus on quality and fast deliveries. Another thing Harpum feels strongly about is the need to eliminate non-value added activities, not only in manufacturing but in all areas of the business.
In addition, he wants to create an open, co-operative culture, based on total integrity and trust and a ‘no surprises’ mindset. As an aid to changing its culture ABB is overhauling its measurement and rewards systems. "What gets measured gets done," says Harpum. This will encourage everyone to work together to achieve the overall ABB Metering objectives, as well as local goals.
People involved in metering will be watching with interest as ABB Metering repositions itself to make even more impact on the industry world-wide.