“We have a lot of women in our workforce and we have a lot of women with children and families, so it’s very important for us to continue to employ them.”
The canteen at the Brisbane headquarters is subsidised. “The employees just pay food costs,’’ he says. “People will come in and take a roast dinner, have it boxed and take it home. We are quite happy to do that.”
Cook Medical also has a profit sharing scheme, right across the board. “If I get $400 each month, every employee gets $400. It’s not leveraged against your salary or who you are in the organisation. Everybody participates at the same level and we are totally transparent about that.”
That also sends a signal to the rest of staff that they are valued. And open communication with all staff is a premium. “We are very much transparent and open. Every month I go around the building into each of the area and update the staff on what we are doing and what we are on about, how the business is going in Australia, how it’s going in APAC and how it’s going in the world,’’ he says.
“Every Friday morning we have a meeting with the customer service staff and the functional staff in the office to give them an update about what’s going on. Our staff feel engaged in the business.”
“By and large most of the population know that times are tough. They are not living in a vacuum so there is nothing wrong keeping them up-to-date with what’s going on. We found that works for us.”
Much of it is the Cook ethos. Cook Medical, the world’s largest privately owned medical device manufacturing company, was established in the United States in 1963. Privately owned, it is still run as a family business. It was established in Australia in 1979.
In keeping with the business model, management structures through the company are kept flat. “I answer to one guy in the United States who answers sideways to the company chairman,’’ Thomas says.
“Under me, there’s a country manager for China, a country manager for Japan and a country manager for South Asia, a CFO for Asia-Pacific, an IT director for Asia-Pacific, an HR director for Asia-Pacific and then essentially local management.”
The beauty of that, he says, is that it speeds up decision-making and allows the company to be more responsive to markets. “You can rapidly get decisions done. There is not a lot of hierarchy in the way of doing things. You can communicate directly across the organisation and you are carrying a huge cost burden.”
Most of the time, he says, tough decisions – like the one about the company expanding into China during the global financial crisis – come down to very simple conversations.
Strategic decisions have been very much the mark of his management style. Thomas came to Cook Medical in 2001 and was sent to the United States in 2003 to lead the newly established Aortic Intervention business unit. He returned and became managing director in 2009.
His strategy was simple: expand in Asia. He recognised it as the big growth market. The company established new offices in Korea, Thailand and India, expanding offices in Beijing, Shanghai, Japan, Taiwan, Malaysia, Singapore, and Hong Kong and entering buy out agreements with the 10 distribution companies around Asia.
Significantly, it is Asia that’s driving the growth of Cook Medical’s Australian arm. While the dollar is having an impact, the company has hedged itself by importing inputs and products from the Cook companies. “We can naturally hedge what we’re exporting versus what we’re importing. That helps us out, no doubt. For long-term viability, companies might want to look at where they source their raw materials from and options to distribute as a way to combat issues with the dollar. The other thing is looking at all of your inputs in the manufacturing process and looking at ways to manage your cost side as best you can and looking to your efficiency side.”
He says one of the key features of the Cook strategy is the way it takes the long view, much like the Chinese and their five year plans.
“One of the disadvantages of public companies is that their whole planning process is so short, it’s the quarterly return to shareholders that driving every decision,’’ he says.
“We look at our business differently. We have a five year plan and we’re looking at that five year plan and we know we’re going to need these workers. I want to continue to manufacture in Australia and work on the market so I need my employees and I need those skills and I need my plant and equipment up-to-date to take advantage of that.”
“If you look at the Qantas model, they are going to close that maintenance down and outsource it offshore. They are never going to get it back. It’s lost forever. I believe that’s short-term thinking.”
This article first appeared on LeadingCompany.
Andrew Sadauskas is a former journalist at SmartCompany and a former editor of TechCompany.
