Enclean: Malcolm Waddell's Story

EnClean: Malcolm Waddell's Story (A)

The end of this case is very interesting. A secret meeting, and a board decision that was against who I actually thought they would end up getting rid of. Getting rid of Tim doesn't really solve the problem, as a matter of fact I think it weakens the company. Malcolm's strong point is not running the everyday company, and that what Tim was fairly good at. Malcolm creating this new operating plan is going to be a strain on him, and possibly will not solve any of the problems currently facing the company, and more then likely he'll find himself out of a job, much like his friend Tim. But his greatest mistake probably is not bailing with Tim. Sometimes things simply do not work out, and it's time to move on to greener pastures. In this case, Malcolm worked well with Tim, because there was a level of trust, there was a level of dedication. Without Tim, I don't think Malcolm can drive the company out of it's current bad stretch. The operating plan is going to have to be a massive swing in direction, with many changes to the current structure of operating divisions, current sales departments, and integration of all acquisitions over time. Of course developing such a document is no easy task; lets see if I can piece together something, as well as point out some misstep's that the company made.

I find that there acquisitions were in all respects good buys, broadening the company's overall service reach, into new technologies and what not. But their lack of integration and push to get them to buy into the EnClean ideal wasn't very good; they simply focused too much on short term gains of the current people who were running the acquired companies instead of putting in management that would do the job right. What they ended up with was lost time, and money, which would have been better spent better getting the acquired company to better fit into the service aspect that EnClean had setup. I also think they started jumping the gun on certain buys, such as the AlphaChem acquisition. Why they did not realize or at least consider that they were not a distribution company, and that AlphaChem had no clear strategy is beyond me. AlphaChem simply did not seem like a good buy, and instead of saving the money and dealing with internal issues, Malcolm decided to buy it anyhow. I think this was simply a foolish move on his part. AlphaChem simply did not fit into the model that EnClean was trying to set.

The second problem I see as a major problem is the fact that they had a part time position called a weaver. You cannot expect great results when sending someone in to a company to try to integrate and deploy strategy in a newly acquired company on a part time basis, who has other work to do. You'll never get them to do the best possible job, simply because they have more to do. I mean for heaven's sake, they had the safety director working as a weaver. The fact that they were operating and trying to implement something that the acquired company had no intention of using was simply an exercise in wasted time and money. Then to develop something that is in their words good but simply doesn't work, means its not good, and that it was done wrong. If you try to create a process without the people that are going to be directly effected by that process, you are fighting an uphill battle. You simply cannot do it, with resistance to change being simply too high.

The last issue I'll bring up before hitting the operating plan, is the fact that they simply had too many different systems among the acquisitions, and too many loose ends to tie. They kept acquiring companies, and were were leaving them alone. They had five different accounting systems for one, and probably just as many MIS systems. Not to mention at about this time that they realize all this, they get a decent, but not spectacular (although I would have thought about taking it personally) buyout offer from Brand. When that happened, instead of going on the offensive and trying to change the company around, they just kept putting out fires. When you start doing that, you're in bad shape, because it allows people like Brand to come in and start taking your market share without much effort, becuase you're just trying to get the company through another day. After Brand started to take the offensive and started merging and buying companies, it was the beginning of a very bad thing for EnClean.

So lets talk operating strategy. Typically, you have specific areas that you usually try to identify that need to be done in a certain amount of time over the next year. I'm going to try to do that, but there are certain areas that need to be taken care of, that are not really part of an operating strategy, but directly related to what happens in the operating strategy. These things include the stopping of what has become an exodus of key people from the sales division, and key managers that were valuable knowledge workers. To stop these people from leaving, the company has