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Interested in being a gap year student at Alco? Look at what one of our previous students got up to…

Alco prides itself on developing talent, and as part of this we run a gap year student development program. We have been running the program for just over 10 years with a number of the post graduates returning to Alco in full time roles. In late 2017, our Marketing & Media Development gap year student Chrysel Mendonsa had the opportunity to interview the CEO of Graco, Pat McHale just before returning for her final year at Huddersfield University. Here’s how the interview went…

 

Could you tell us about your role and responsibilities as Chief Executive Officer of Graco?

My role as CEO is to establish and execute our corporate strategies, build a high performing team, measure, monitor and drive performance, continually increase shareholder value, champion the customer experience, and create a positive environment for all Graco stakeholders including our distributor partners, employees, and the community.

 

What was your route into the industry?

The evolution of the company since I joined in 1989 has been quite significant. The decade of the 1990’s in particular, when a strong Graco leader named George Aristides re-engineered the entire company and established a deep culture of individual accountability, operational excellence, ROI decision making, and a robust system of measuring and improving financial performance. After that decade of hard work was largely complete, the organization has turned it’s focus to growth – but without losing all the good work that was done during the 1990’s. During my 10 plus years as CEO I have focused on encouraging our people to increase investments in pursuit of revenue growth, as well as driven a laser like focus on quality improvement and delivering an exceptional customer experience.
Having joined Graco in 1989, could you explain how the industry has evolved of the past 29 years?

I firmly believe that people enjoy being associated with a winning organization. Graco has a long history of success which sets a great foundation for being a Great Place to Work. Additionally, we are always eager to invest back into the business with new equipment, new products and new systems. This gives people the opportunity to keep their skills up to date, and to justify new projects that will help our customers reach their objectives.

 

Why has Graco chose to invest in Alco Valves Group?

We want a portion of our revenue to come from the energy industry. The world needs energy of all kinds and we want to participate. We currently sell equipment into green energy applications like solar and wind, but also believe there is a solid place for Oil and Gas for many decades to come. Within the Oil and Gas industry we identified some particular product categories that we felt were in critical applications where customers would appreciate high quality of manufacture and design. The Alco Valves Group products met this criteria, and this is the reason we acquired it.
The recent rebrand of Alco Valves and the new state of the art UK HQ was a major milestone in the company’s development. Are there future plans for further investment in Alco Valves product development and manufacturing facilities?

Investments in individual businesses are determined by the business unit itself. My role is to review requests for investment, and approve the funds if I am convinced there is likely a good return on the investment. The team at Alco is responsible for coming up with new ideas for new products, global expansion, new processes etc…. and bringing those requests forward. We are eager to invest in solid ideas.

 

Why do Graco see it important to invest in Research & Development (R&D)?
New products have been a key growth strategy for the company since our inception in 1926. We invest more in R&D than most industrial companies, and credit for this goes to our people. We are willing to fund good ideas, and our people have a lot of good ideas. We measure the financial returns from new products for a few years after we release them for sale, and our report card is solid. If we get more good ideas, we will continue to increase funding. It is a great use of shareholder money.

 

With the rise in manufacturers such as Volvo announcing a move to hybrid & electric cars from 2019. How will these alternative technologies have impacted on our industry?

Alternative energy sources, new automotive technologies, and social changes all are likely to have an impact on the Oil and Gas industry in the coming decades. However my view is that we will need many forms of energy into the foreseeable future including Oil and Gas. We are not an Oil and Gas equipment company. We are a diversified manufacturer of specialized fluid handling equipment. We are interested in having a presence in a wide variety of end markets where we can put our vast knowledge of fluid management design and manufacturing to good use for the benefit of the end user.
With both two Graco locations in China and a recent investment in Alco Valves, will both companies aim to support China’s new $900 billion Silk Road?

I’m looking for Alco and the Oil and Gas division to follow the Graco playbook. Grow the business, Improve profitability. Maximize value for our customers. Provide the best customer experience possible. Use our proven strategies of new products, new markets, new geographies and acquisitions. The opportunities remain significant, and like all Graco businesses I look for the people in the Alco business unit to drive success.
What are the future objectives for the relationship between Alco Valves & Graco?

Graco and Alco are one company. Alco is a business unit, equal to all the rest of Graco business units. Alco has access to all the resources of the Graco global organization, and may draw upon those resources as they see fit.

 

We also discussed with Pat the ever increasing internet marketplace and what makes Graco stand out over the competition on the web.
Customers today have many choices, and it is easier than ever for them to access a vast array of products just using the internet. If we are going to succeed selling premium products over the long term, we need to make sure that customers have a premium experience with Graco in every single way. Our A+ Service to Every Customer Every Time initiative is very broad. Every Graco employee has a role to play. Every touch point with the customer must be excellent if we want the customer to have a great experience and be loyal to Graco. Product design, product quality, shipping accuracy, customer support, web tools, technical support, fast delivery, excellent sales people, excellent distributors…. the list of touch points with our customers is extensive. We can be the best in the world, and that is what I’m driving this company to become.

 

We would like to thank Pat for his time and also thank Chrysel for her dedication and commitment to Alco during her placement.