AESSEAL Mechanical Seals

Engineering a service culture

Idleness can be tolerated, says Chris Rea – in some circumstances, at least. Some of his company’s machine tools stand unused for as much as 60 per cent of the time. They whir into action only when urgent orders come in that require vital parts to be manufactured on demand.

“The money I ‘waste’ on this sort of investment is worth paying to ensure we have satisfied customers,” says Rea, managing director of AESSEAL. The company was started by the 62-year-old former economist in 1981 in Rotherham, the south Yorkshire town where it is still based.

Rea’s business is the world’s fourth-biggest maker of mechanical seals – key parts of virtually all rotating machines involving fluids, and used in processes ranging from chocolate production to oil refineries. More than 80 per cent of its £143m sales last year were outside the UK.

The company stands out for having added – alongside its fundamental business of making things – a strong service culture aimed at ensuring customers’ requirements are met, even if this sometimes leads to higher costs.

Blending a service approach with manufacturing has wide appeal. It strengthens bonds with customers. It may also create barriers to competitors entering the same sector, while adding possibilities for new sources of revenue.

But the need for a service culture is particularly necessary in the seals business.

Mechanical seals are made from highly engineered pieces of metal, plastic and other materials. They stop fluids leaking out while machines such as pumps work at high speed. Even a tiny amount of leakage can compromise efficiency and lead to accidents.

The range of machines that seals go into – and the differences in the ways customers use their equipment – means that the demands on suppliers are extremely high.

Rea says: “We make 400 types of seal, each of them capable of being produced in up to 100 variations. We have to produce seals to fit an enormous number of possibilities.”

A large part of the company’s business comes from replacement parts. If a pump in a chemical plant needs a new seal, the operator does not want to wait too long for a replacement. Nor will it be happy if the substitute seal doesn’t fit.

While all this strengthens the need for service thinking, making it happen is not easy. Ensuring the right amount of liaison with customers – and installing the hardware that will translate their requirements into real products – requires commitment and money.

Rea sees a lot of value in the company’s team of 350 sales engineers – technically qualified people around the world who have the expertise to understand customers’ problems and work out with them how to create the products they need. Of its 1,700 employees, 350 are in Rotherham, a similar number elsewhere in Britain and 1,000 overseas.

To support the commitment to customer service, Rea’s company has invested in IT systems to ensure that orders can be transmitted quickly to production centres. Ninety per cent of its manufacturing is carried out in the UK, requiring machinery that is up-to-date and able to operate very flexibly.

The approach explains why AESSEAL’s spending on plant and equipment has been high, totalling more than £60m in the past seven years.

Summing up the past 35 years Rea says he has focused on three points that sound simple but are hard to get right: devising new products, achieving excellence in manufacturing and selling globally.

“A lot of businesses can innovate. But can they manufacture the products and can they sell them? I think you’ve got to be equally good at all three. If you aren’t, the customers will soon notice.” Whatever the other challenges, he reckons the business would not have been successful without good employees. “My approach is to take on smart people, spend six months evaluating them and then leave them largely alone. If I take all the decisions, it’s a poor way to encourage people to behave responsibly.”

Within this philosophy, he has the important responsibility of making sure the workforce consider the business a good one. “If [employees] believe in the brand and the technology – if they think there is a bit of magic about the company – they will do a lot.”