Lynne Woodworth became CEO of Stone Construction Equipment in August 2004. While she may be new to the CEO’s seat, she is a veteran of nearly a quarter century with Stone and has seen dramatic changes at Stone, in manufacturing and in rental. RER sat down with her at the ARA show to hear her thoughts.
RER: You've been with Stone a long time. Did you ever expect to become CEO? How did your career evolve?
Woodworth: I've been with Stone Construction Equipment 24 years. When I started I had no aspirations to become president and CEO of any company. Bob Fien hired me in 1981 as his executive assistant. The company was just really forming and developing and transitioning from a very small single-product player to what you see today. He had a vision, a dream to take this company to the size that it currently is and he was looking for capable people. I came on board and very quickly he saw that I was probably better as a marketing or communications person than administrative assistant or executive assistant. He needed to put together a new team and I was the first to come on board.
There were really no structured departments, no organizational structure per se within the company, so I got to do a lot of everything and really know the business, learning how we manufacture and our engineering direction. The first few years, I really focused on corporate communications, developing our brand image. We had no marketing materials; we were right in the throes of more product development, so I got involved in a lot of those things. And then as we began to structure and organize the company more traditionally, I became marketing manager.
Early on in my career as marketing manager I did a lot of the product development work and I had a lot of fun with that. I'd get to come to the trade shows and talk to a lot of people. At that time there were very few women in the industry. It was interesting how much information I could find out because I could walk into a competitive booth and they didn't think this woman could be doing anything of any significance! So that was a really interesting and fun time and I was able to really help shape the product lines in terms of what the market was looking for and how we could incorporate some of those wants into our product line.
My responsibilities continued to grow as our company continued to grow. I became director of marketing, then vice president of marketing, then I took added responsibility for sales and managed our sales force for well over a year, which was really exciting. I became vice president of sales and marketing and then assumed responsibility for engineering as we were building our engineering team. I became general manager for two years and then president for four years and was made CEO in August.
So I learned from the ground floor every aspect of our business and had influence over every aspect of our business and so few people get to do that any more. So I guess I could say I've been training for this job for 20 years.
RER: You wore every hat in the company!
Exactly. So through the course of transition, we became an employee-owned company, and I've participated in helping to make all those things happen effectively. So it's been a wonderful journey, it really has, and I love this industry. It's an enriching industry. Things are changing all the time. Now there are several professional females running companies in this industry, which is great. But I came from the time when there were virtually none.
You obviously worked closely with Bob Fien for almost 25 years, and you called him a mentor. You must complement each other in terms of personalities.
I've always thought we've had a great partnership. We don't think alike, so we have always challenged each other's thinking and I think that's a great thing. We have conversations where we say, “What about this?” or “Have you thought about it this way?” and we do that back and forth. Bob is a big personality with a very strong presence. I would say I'm a good implementer through people. Our styles are different.
We've talked about it before, but share a bit about how being employee owned has changed the company. Does it give the employees more a sense of responsibility, of direct investment in the company?
Without a doubt. Early on, getting them to understand what ownership is all about was a challenge and that was a big portion of my job as director of corporate communications. And we spent a lot of time doing employee communication and training about what ownership really means within an employee-owned company.
We taught them how to read financial statements because, of course, we share our financials with them on a monthly basis and we do a little thing called walkie-talkies where we share our results and talk about anything that's going on in the company whether it be strategic or competitive. We meet with small groups of people through the course of a day, one day a month, and share all that information in 20- to 40-minute meetings. So every month they are apprised of our performance. They know what our obstacles are, they know what our challenges are, our business is real time because we are a just-in-time manufacturer and we build to order, and every day the profile of the factory shifts.
There is a stronger cooperation between management and employees because of our culture, which is based on trust, respect, communication and development. So they are very willing to go that extra mile to be responsive because it's their business. And our customers tell us all the time that we're more responsive and we take pride in that.
Since the rental market is a very important customer for you, how do you see the rental market changing?
I think rental will continue to grow. More and more people think of their use of a product in terms of paying for the time to get a project accomplished. I think the whole mentality of people — maybe it started with car leases — but there seems to be much more of an acceptance of acquiring product to do a job rather than owning a product to do the job. I think it can be a very effective way for contractors to minimize their investments as well as their cost structure. Why invest in product if you only have a specialty need? So rental has filled a very important need in the marketplace. I think it's going to continue to grow both on the heavy side and the light side. And more and more contractors recognize that rental is a good means to get the job done. So I think rental has a healthy future.
Do you see any particular technological developments that will be important in the coming years, for Stone and the industry as a whole?
I certainly see more usage of online technology to perform transactions whether it be order entry or online payments, I think we'll definitely see more of that. In parts and service, we'll see more online transactions. Whether or not it will be done through each manufacturer's Web presence or e-business site, or more of a networked site, I'm not sure, but you'll see more and more of the smaller rental stores getting involved in that. Of course the large ones are trying to do that now because it's a wonderful cost savings, it really reduces backend administrative costs.
Online sales sites that are not necessarily the manufacturers' — we're seeing a lot of those springing up. In the light equipment business, defined geographic territories don't really exist very well. So we see a lot of dealers trying to have the manufacturers' drop ship through a sale that came in on their e-business site. So that's expanded. And I see some manufacturers using e-Bay as a distribution channel.
Higher technology is being used on product to perform diagnostics more easily, to reduce downtime and maximize uptime. If you're in rental, that's just paramount to keep product out in the field and profitable. We've done a lot of that on our product categories as well.
You mentioned customer feedback. What do you do at Stone to keep in touch with customer needs?
Trade shows provide us with a tremendous opportunity to do that. We do something else which we call VIP visits where we will invite throughout the course of the year several different customers, new and existing customers, to come to our factory and we spend a day and a half with them, they come in for an evening, we have an informal get-together and a lot of that is to really understand what their basic needs are. And then we talk about how we can fill their needs. It's a lot of listening and a lot of learning and they get to see how we produce things. It's a good opportunity to have Q&A back and forth. We do a lot of that, we probably do 15 or 20 of those a year.
And our engineering and marketing folks and salespeople are always talking to customers. At any given time, we probably are in the process of a new product development because we have a very disciplined long-range product planning process, which is a five-year strategy. So at any given point in time we've got new product on the horizon at the different phases in development. We've got a pretty disciplined product introduction process, it starts with the pre-concept phase all the way through to the post-commercialization phase. On the front end, we're doing all kinds of market research, we're always in contact with customers and users. We'll do formal market research maybe in the form of questionnaires or we'll do interviews, we'll do jobsite visits, the full range of things.
We've done focus groups, we've done advisory boards. So depending on what it is we're trying to accomplish, we put our strategy in place to best meet that need.
