Glen Tellock is just 41 years old, looks significantly younger, and – though Fil Filipov may disagree – he has probably the biggest job in crane manufacturing. As president and general manager of Manitowoc Crane Group, a job he took up in June this year, he heads up not just Manitowoc Cranes but also Potain, Grove and National. And then there are the Liftlux and Manlift aerial work platform businesses. As far as crane buyers are concerned, this guy came from nowhere straight to the top. How did it happen? Well, he actually came from Manitowoc Company Inc’s corporate back office where he was clearly regarded as a star to have been rewarded with such responsibility. An accountant by profession, he joined Manitowoc in 1991 as director of accounting when the whole group was just a $250m company. He has been through a corporate restructuring in 1993/94 and on his way up had the job titles corporate controller, vice president finance, chief financial officer (1999) and senior vice president (2000). Before joining Manitowoc he was in public accounting at Ernst & Whinney and than in financial control at the Denver Post newspaper.
The three previous heads of Manitowoc’s crane division – Rob Giebel, Ron Schad, Jeff Bust – were people whose expertise lay in manufacturing, engineering, and/or sales & marketing.
Manitowoc Company Inc president and CEO Terry Growcock explained in June why an accountant was now needed in the job: ‘We assessed the organisational needs required to run a billion-dollar crane segment. Glen’s solid financial experience will be a tremendous asset in managing our crane business, which has tripled in size in the last 14 months. As senior vice president and CFO, Glen was intimately involved in setting the strategic direction for the company, and played an instrumental role in the successful acquisition of Potain and our [then] pending acquisition of Grove Worldwide. The relationships Glen has built with both of these organisations will be vital to their future success. Furthermore, Glen’s in-depth knowledge and understanding of the management principles of EVA will help our crane group realise its full potential.’
EVA – economic value added – is a financial tool that drives Manitowoc. If something fails to add value, is not EVA positive, it is almost certain to be shut down, as we have seen in recent years with some of the company stores. As the former CFO, no one understands EVA better than Tellock. EVA is a popular and useful tool for big corporations, but critics point out that a whole bag of golf clubs is a better option that the mightiest of drivers.
Certainly Manitowoc Crane Group is now a big business. Annual sales in the region of $1.2bn are expected. With the recent Grove and Potain acquisitions, this is a very different Manitowoc from the one that three years ago, at the top of the market, had annual sales of $390m. That was the year that CEO Growcock set a target of $1.3bn in sales by 2002 for the whole group (which includes food service equipment and shipbuilding as well as cranes). But it is absolutely not Tellock’s intention to remain a backroom accountant, concerned only with sorting out a balance sheet that has been knocked sideways by massive acquisitions, and then making way for ‘a crane guy’ to step in. The departure last month of Jeff Bust [see News], the crane guy most likely to have stepped in, gives Tellock’s appointment a sense of permanence.
Although Grove and Potain are both currently EVA negative and must be turned around, Tellock denies that he got the job just because they need an EVA-ngelist to tidy up the acquisitions. He was appointed, he says, to provide ‘a fresh perspective’.
Tellock says: ‘In the back of my mind I know what expectations the shareholders have, but my number one customer is the crane buyer. Will I become a crane person? Absolutely.’
Besides, the finances aren’t that bad at the moment, he insists. ‘Debt to capital within the whole company is 60-65%, which is fine. Within 36 months we’ll be at the 40-45% level.’
He says that the best piece of advice he received after taking his new job was: ‘Get in front of the customers. Don’t sit back and run the business from the office.’ Seeing him mixing at the Specialised Carriers & Rigging Association’s crane and rigging workshop in Denver in September, with his ‘First Timer’ ribbon on his name badge, he looked like he was enjoying his new environment.
It is at the SC&RA workshop that Cranes Today meets him to discuss his plans for the company. He explains that by the end of this year the integration of Grove with Manitowoc and Potain will be complete in North America and Europe. The cost cutting – ‘we do need to take costs out of the business,’ he says – will be complete and the business will be the size and shape that he thinks it needs to be for a distinctly shrivelled market.
Just as number one rival Terex has abandoned an organisational structure based on geography, Manitowoc Crane Group has adopted one. One rung beneath Tellock in the structure is not a tower crane boss, crawler crane boss and a wheeled mobile crane boss, but an Americas boss (Marty Lakes), a Europe boss (Jean-Yves Bouffault) and an Asia boss (Eric Etchart). Tellock justifies this structure because the crane market is distinct in each region. Besides, if he maintained the previous shape of a crawler business, a wheeled mobile business and a tower business it might be hard to get much added value from the takeovers.
He says that Manitowoc has enormous leverage. ‘Working capital is a huge, huge advantage for us,’ he says. As an example of the opportunities now before the company, he cites the possibility of manufacturing crawler cranes in Europe, though recognises there is strong competition from Germany. ‘We need to be more competitive in some regions,’ he acknowledges, giving as an example the need for Manitowoc to offer a smaller crawler crane for Europe.
The threat of Terex holds no fear for him, however.
‘We differentiate ourselves from Terex by quality and product support. There’s always going to be a low price [business] model in every market. Our business model is different from their’s. We are the market leader in North America.’
He knows that he has taken over leadership of the Manitowoc Crane Group at a tough time. Maximising the value of the Potain and Grove acquisitions is not just about organisational structures and leveraging size. The greater challenge is the political one, maintaining a happy ship, squeezing the talents, ambitions and egos of three companies into one.
On top of all this, he knows that the crane market is pointing in the wrong direction. ‘I think the crawler crane market will be off again next year in North America,’ Tellock says. ‘I think some of that, from our standpoint, can be mitigated by new product. I think the mobile market is flat, at best, worldwide. The tower crane market, I think, is also flat. Some markets are down, some are up. Our business will be down next year but we will manage it on that basis.’
His only disappointment, it seems, is that the Department of Justice has instructed Manitowoc to sell one of the boom truck businesses by February. It was a ruling that he said ‘absolutely’ surprised him. He does not agree that bringing together National and Manitowoc Boom Trucks together in alliance against Terex was anti-competitive. ‘So many people could get into this business if they wanted, he says, ‘I could name five companies that could get into this business tomorrow if they wanted to.’
He has no choice but to comply with the ruling and Manitowoc’s own boom truck division is up for sale. ‘We have chosen to keep National because it is the number one brand,’ Tellock says. ‘Manitowoc Boom Trucks’ bread and butter is 25 tons and higher, but the majority of trucks being sold are 14 ton to 17 ton. The management team at Manitowoc Boom Trucks in my opinion is the best in the industry. They have done a lot of work in the last couple of years. It is a pity that we won’t benefit from it.’
This last comment reveals a talent either for people management or for sales. A cynic would suggest that it is sales, since he has no need to care about the people that are moving on and every reason to talk up the prospects of a business that is for sale. However, it seems more likely that Tellock just prefers to speak well of people. He seems at ease with himself. It is easy to imagine someone of his youthful appearance causing resentment among ambitious executives across the crane group, but he gives the impression of having the skills and personality to carry those that matter with him.
Having risen so high so fast will he be content to stay put in the biggest job in the crane business? Or has he further to travel, perhaps onto the very top job at Manitowoc Company Inc before very long, or to even bigger challenges beyond? Either way, he is sure to make his mark on the crane manufacturing industry.
