The chemical solution

Originally part of a German company known as Metallgesellschaft, founded in the late 1800s, the business now known as Chemetall branched out in 1982 and has since been a leading global player in the surface-treatment sector. Chemetall, a global business unit of Abermale, innovates, develops and manufactures best-in-class speciality chemicals. Its customised products and technologies are designed to protect metals from corrosion, facilitate forming and machining, prepare parts for painting, and ensure proper coating adhesion. Its product offering is used in a variety of industries including the automotive and aerospace sectors. With approximately 2,500 employees globally, and operating 21 production sites across more than 20 countries, as well as 10 R&D locations and 24 sales offices, the business is well positioned for growth. Even with his busy travel schedule, filled with meetings and conference calls, Chemetall’s Managing Director of Asia–Pacific operations, Mike Watson, found time to chat to The CEO Magazine about his history with the chemical product powerhouse and what’s next for the business.

The CEO Magazine: Could you provide an overview of your professional background with Chemetall?

Mike: I have been with Chemetall for a long time — more than 30 years in fact, and 11 years based in Asia. I joined the business straight from university after I completed my chemical engineering studies. I started off in a technical sales role, based in our lithium and polymers division. The business thrived with a very good team, and I was fortunate to become the managing director for the UK business while still in my twenties.In building Chemetall UK in the late 90s, we were able to do some acquisition work, which enabled us to develop the surface-treatment department, as well as branching into aerospace technology after we acquired a company called Brent PLC in 1999.

We wanted to combine the existing offerings with aircraft sealants that Chemetall was developing — to combine the two product strands and make a really strong offering to the aerospace business, both at a manufacturing level and at repair and maintenance where these products are used by all companies overhauling their aircraft on a regular basis throughout the world.

Following the acquisition of Chemetall by Rockwood Industries in 2004, we implemented a regional structure across Europe, the Middle East, Africa, North America and, of course, Asia–Pacific, which saw me move to Hong Kong as managing director in 2006. Since then, that has been my leadership role in the Asia–Pacific region. I am currently based in Singapore to manage our investments in South East Asia, but I also hold regional responsibility for APAC business. In Singapore now, we operate a business called Chemetall Asia, and basically from Singapore we take care of the ASEAN and South East Asian markets.

What initial opportunities did you see when you first came into your current role heading up the Asia–Pacific operations?

We knew that there would be some pretty good business opportunities for us in APAC. It’s a vast region, spanning from India and China through to New Zealand, so it’s been a challenge to see whether we could take our small businesses forward and help them to grow quickly, which they have. Our goal is to further develop a highly successful business that is not too big, around US$150 million, by diversifying into segments in order to create and add value. For us, those segments have been across the electronics industry where we have become a significant supplier to the hard disc industries centred in South East Asia. On the back of that, we increased our activity in aluminium finishing to make sure that we could leverage our technology into companies that are producing aluminium sections, especially for architectural purposes. Because we have invested in production for all electronics chemicals, we needed to make sure that we got the planning right to get a solid return on our investment, while at the same time ensuring the optimisation of our supply chain and technical support service offering to our customers.

How does Chemetall utilise new technologies for innovation and developing new products?

We are highly committed to being as innovative as we can. Because we are a relatively large group, our business within Asia–Pacific is to take forward innovative technologies from our central R&D function in Frankfurt, because we are historically a German company. We have been working within Asia to tap into the talents of our people throughout the region, and we are in the process of creating competence centres in Chemetall India and Chemetall Shanghai to expand our global R&D network, while enhancing innovation diversity. Once we move into a new technology, then we get the opportunity to see if we can develop it and roll it out initially into areas where we believe we could give our clients a benefit in overall operating cost, quality, environmental advantage, and ease of use.

How important is social responsibility to Chemetall?

We take both our social responsibility and our operational responsibility very seriously. It’s of the highest importance to us. Starting at home, we have been extremely committed to our responsibility as a manufacturer to keep our people safe. We measure everything with constantly improving metrics and systems to ensure we follow the highest safety standards. That then also translates into the operations of our customers and making sure that they are all fully trained in how to use our products and utilise our technologies safely. When it comes to our corporate social responsibility, we support local community groups and associations such as chemical associations, trade associations, et cetera.

In India, we also have a school program where we contribute to and promote education in the field of chemistry. In Pune, schools in the area have access to our laboratories. We’re also putting safe water systems into the schools to give access to clean water.

We work with the community, have open communication and are committed to creating value.

How important is culture to the business, and how do you instil this in your employees?

I never would have imagined that I, along with quite a few of my colleagues, would have stayed with one company for so long, but I think one reason for that is the culture. German business culture generally involves finding a company to spend your whole career with, as I have done, and we’ve tried to instil that in our people, fairly successfully, I think.

We have a low turnover of staff; down to about 4% now. We recently completed a global employee feedback questionnaire and found that 96% of our people were extremely happy to work for us, which is fantastic.

Above all, I think that’s because we try to have a high-trust culture. We aren’t hierarchical. I don’t see many egos around our business — we don’t have room for that, anyway. It means that people have a voice and we do something about things that might bother them.

An example would be in Singapore: we had some feedback coming from several of the office-based people here around a need for flexible working hours because some of them have young kids at home, so we have just introduced a flexi-hour system. That gives them the ability to select their working hours on a random basis, or with a new set roster around their needs going forward.

What we have also tried to do with our various tiers of management is to introduce leadership training through independent schools, so that our colleagues can get the chance to become leaders in their field.

To me, building a business also means that you have to be able to give people room to breathe, and you must continually motivate them.