There is an old Bulgarian saying, ‘nishto ne e vechno’ meaning ‘nothing is forever’. It is the motto of Terex Lifting president Fil Filipov. And it applies as much to the Iron Curtain of Eastern Europe, through which he escaped in his youth, as to his outlook on business. Filipov has now written a book, part biography, part business polemic, and part tributes from others.
The book charts Filipov’s early hardship in communist Bulgaria, where he would take a heated brick to bed to keep warm. Aged 17, after a run-in with the police for voicing criticism of the government and inspired by the film Room at the top, Filipov escaped to Greece with three friends. After several months in a refugee camp he arrived in New York in January 1965, unable to speak English. He washed dishes and had other menial jobs before arriving at International Harvester in 1966. He began as a floor sweeper and rose up into management.
There is no secret to Filipov’s success. He has worked for it. Work hard, keep things tidy and minimise waste is the essence of his philosophy. Even as a floor sweeper he was reprimanded by a union steward for working too hard and exposing the laziness of others. “I told him right away I wasn’t going to change. I was coming from the biggest Union there was – the Soviet Union – and he was not going to tell me what to do.” Filipov is puritanical in his work ethic and expects others to work hard too: “I expect my top people to come in on Saturday and at least do some thinking on Sunday, so the rest of the employees will have a job.” He made his name turning around ailing companies. He sets out his 100 day action plan, ‘pain for gain’, for companies he takes over. His first step is to sack all lazy or dispassionate employees. A few weeks later those incensed by the harsh style of the new management will walk out to new jobs elsewhere, he says. Then he promotes those who are working hard and performing.
Filipov likens himself to a surgeon. Cut once, he says, cut deep, and remove all the cancer of excess bureaucracy, poor morale, laziness and complacency.
Focus on customers, he says. Construction machinery has become more expensive and complex only because of competition between manufacturers, and not because of the needs of the end-user. The telecoms and computer industries have reduced costs and prices (although the forever upgrading software industry is ‘a scam’), so it can happen in the lifting equipment business too, he says. At Terex overheads have been cut by 60% in the past four years, productivity has risen by 35%, and inventory cut by 40%. The result is total costs are down 15% and there have been no price rises in the past eight years.
Filipov does not believe in the value of empowerment, teamwork, or being friends with colleagues. He sees himself as a ‘benevolent dictator’ and likes to ‘tell it how it is’. It is not an attractive picture that he paints, but so far it has worked for him.
Published by KHL Ltd (ISBN: 0-9530219-8-X)
