THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Monday, February 26, 1996 TAG: 9602240238
SECTION: BUSINESS WEEKLY PAGE: 12 EDITION: FINAL
TYPE: Cover Story
SOURCE: BY COLLEEN BRUSH, SPECIAL TO BUSINESS WEEKLY
DATELINE: NEWPORT NEWS LENGTH: Long : 116 lines
``I have waited on the counter, driven trucks, pulled orders, taken orders, bought materials, quoted jobs. I've sort of done it all.''
Meet Charles A. Banks, president and chief executive officer of one of Hampton Roads' biggest companies: Ferguson Enterprises Inc.
He worked his way to the top, but now Banks is trying to push the entrepreneurial spirit into the ranks as the company grows ever larger.
How he's doing it is through a blend of training and decentralization at a company that does business in 30 states.
While Ferguson may not be a household word, many plumbers know the name. The Newport News wholesaler is the nation's largest distributor of faucets and other plumbing supplies, with 1995 sales in excess of $1.3 billion.
Hampton Roads boasts few $1 billion hometown companies of national scope. And those here are widely known - Newport News Shipbuilding, Norfolk Southern, Smithfield Foods.
``The real key is the people,'' Banks said. ``It's important that people believe you're a part of the organization and not above it. I listen to their input. I don't always accept it, but they question mine sometimes, too.''
Since the 1950s, the Hampton Roads wholesaler has doubled in size every five years, a trend Banks has maintained. Annual sales in 1989 when be became CEO were $600 million.
Acquisition has helped. The company recently bought Baltimore plumbing parts wholesaler Lyon Conklin & Co. Inc., and Walden Industrial, a Boston pipes and valves distributor.
``A lot of consolidation in our industry has occurred over the last 10 to 15 years,'' Banks said. ``With our growth direction, we've facilitated a lot of that consolidation because we have been a willing buyer when it fits our strategic objectives.''
But the growth hasn't diminished the entrepreneurial drive. For example, race cars have been popular with customers in the building trades - more than one plumber has walked into a Ferguson store wearing a baseball cap with a race car logo.
So the company acted on the suggestion of a branch manager. Ferguson sponsors stock car race drivers, including a recent pact with retired driver Richard Petty, a popular figure on the race circuit.
Ferguson employs 4,000 people and operates 75 wholesale outlets, 168 satellite stores, seven specialty warehouses and three primary warehouses in Dallas, Orlando and Richmond. About 400 people work in Newport News.
Wolseley PLC, a 15,000-employee building materials company based in Droitwich, England, bought Ferguson in 1983, but has given free reign to Banks and the previous CEO, David Peebles.
Charlie Banks got to the plumbing business indirectly. He holds an international relations degree from Brown University in Rhode Island.
After graduating, he worked in the mortgage business and came across Peebles, who became CEO in 1969 and enrolled Banks as the first candidate in Ferguson's management training program.
Banks worked in outside sales, managed a small branch and a large branch as regional manager, then returned to corporate headquarters as executive vice president.
After he was named CEO in 1989, Banks tried to make his approach differ from the autocratic management style he experienced.
Peebles, a Peninsula native, built the company. He joined in 1954, operating a store in Maryland. In those years, veteran managers could open their own supply stores with financial help from the headquarters.
In 1959, Peebles returned to Hampton Roads and established the Peebles' chain. A decade later he was president of Ferguson Enterprises.
``It was his (Peebles) idea, his drive and his direction,'' Banks said. ``A lot of hard work was done by a lot of people, but the direction was his. We got to be a very successful company doing that.
``What I've done is to get more people involved in where we're going. More of a team approach than a singular approach has allowed us to get into more geography and products, and to run a bigger organization,'' Banks said.
Besides being No. 1 in plumbing fixtures, Ferguson is second in the nation in pipe, valve and fitting distribution and No. 9 in wholesaling heating, ventilation and air-conditioning equipment.
Empowerment. Decentralization. Banks said they've enabled him to maintain the entrepreneurial drive.
Local branch managers are given the freedom and tools needed to run Ferguson's stores as if they were their own businesses.
``We don't make anything. We don't have any real secrets, secret formulas or patents. It's strictly how we perform in the marketplace,'' said Banks. ``Consequently, our success or failure is almost totally dependent on our people.''
With support from distribution centers - Ferguson stocks $170 million worth of inventory - managers can grow and expand their stores.
``We try to provide a lot of the things that can be done better centrally,'' said Banks. ``But in the day-to-day business in the market - dealing with customers, products, pricing and profitability'' the manager is in charge.''
Bonus incentives based on performance motivate managers. The company also relies on training.
``Our growth creates a certain amount of inexperience that we're constantly having to deal with, which makes training so important,'' Banks said. ILLUSTRATION: Color photos by Huy Nguyen
James Taylor, a management trainee, takes a phone call in Ferguson's
sales section.
[Ferguson employs 4,000 people an operates 75 wholesale
outlets,....]
Color photo by L. Todd Spencer
[Ferguson's new headqaurters building....]
Color photo by Richard Dunston\The Virginian-Pilot
[President and CEO of Ferguson Enterprises, Charles A. Banks]
by CNB