Inspiring Stories of ENTREPRENEURS - 1

Case studies form an important mechanism of management education to create real life situation for developing analytical ability to identify issues and learn the art of problem solving. The same objective is hidden in some of the stories narrated to children. History of kings, queens and events of the past also has similar objective at school level, unless teacher makes it interesting and brings forth the key element of learning.

In our endeavour to promote Entrepreneurship, it’s worthwhile to look at stories of some of the successful entrepreneurs. Instead of calling it HISTORY, it would be appropriate to term it as “HIS – STORY”. Some of these relate to the multi-national corporations of the day and have been mostly picked up from their websites. Each of them started as a small enterprise, faced constraints of resources, competition and still treaded the path of growth and diversification through strong R&D, mergers and acquisitions. They formed cartels to avoid competition, and had legal fights on patent rights too. But, the strength seems to have come from trust on professional management beyond blood relations, effective team building and control mechanism in the organisation.

The growth stories on lives of Leonard Parker Pool of Air Products (USA) and S L Kirloskar of Kirloskar Brothers (India) are available in book form. There are many others, but most of the stories cited here are drawn from the company websites. It was indeed a challenge to draft from websites that are mostly marketing oriented and lack an element of EDUCATION. There are only a few industries that give importance to education.

While some of the entrepreneurs like BOSCH, Linde and Siemen were innovators themselves, Amory Houghton, the promotor of CORNING Glass was a trader in building materials and Laxmanrao, the promotor of Kirloskar Brothers was a Drawing Teacher and started with trading in imported bicycles. These stories are expected to inspire anyone with Engineering or non-Engineering background to venture into areas that contribute to “Creation of WEALTH”.

1.    Leonard Parker Pool

Leonard Parker Pool was born in 1906 at Minneapolis in USA. His father worked as boilermaker and was later engaged in a railroad job in Pennsylvania. It was chance that Leonard also learnt locomotive repair in early childhood, handling oxy-acetylene gas cutting and welding tools.

Though a good student, he had to forgo higher education when his father’s health deteriorated. Upon father’s death in 1926, mother Emma relied heavily on Leonard’s income. This made him work for a while at a gas filling station and then take to sales job with Pillsbury. Since it was tiring to peddle bicycle to sell pancake flour, he moved to a company that sold welding equipment and accessories, where he combined his knack for salesmanship with the technical knowledge of welding that he gained in early childhood.

The industrial gases business in US was only a decade and a half old, when tonnage plants produced oxygen at a central place and distributed to the clients in cylinders. Maintaining his job at Compressed Industrial Gases, Leonard came up with an idea — why should it not be possible to generate the gas at the site of application? But, he was not an Engineer.

Moving on to his entrepreneurial mission, Leonard started planning while in the job. At the very young age of 22 he had the courage to recruit FRANK PAVLIS, an engineering undergraduate (BS) of Michigan College of Mining and Technology with MS in Chemical Engineering from the University of Michigan at Ann Arbor (USA). It is surprising to know how Pavlis with a job offer from SHELL Oil Company in his pocket got lured to work with Leonard.

The first task before the duo was to get specifications of a compressor suitable for 350 Cu Ft per hour oxygen gas plant. Pavlis had no idea of the air separation plant but he visited his college at Ann Arbor to gather details for the design. The two could get hold of a French technician with skill in soldering and brazing. The team of three worked hard with dilapidated tools, including a drill press and a grinder and it took almost a year to make the oxygen generator that produced 359 Cu Ft per hour of oxygen with 99.5 percent purity.

With this achievement, the Industrial Gas Equipment Company was incorporated on September 30, 1940 to “manufacture, produce, rent, lease, sell, and service equipment for the production of gases”. Since the name of the company applied was already in use, a different name was suggested as – “Pool Air Products” but Leonard demurred and liked only “Air Products”.

The point to ponder is the struggle that LEONARD Pool faced in the initial years of business. But he could convert every threat into an opportunity, competing with established players in the Industrial Gases segment. This was also the time when American economy was passing through a great depression. Finance was always a problem and marketing was not easy. Luckily the world war-II created a big demand for his portable oxygen generators for the armed forces.

Diversification & Growth

The initial diversification from oxygen led to addition of other gas products like Nitrogen, Helium and Hydrogen. This was followed by manufacturing of variety of gas handling devices and implements, like - welding tools, anesthesia set up and cryogenic systems to begin with.

In 1960s, the company purchased three specialty chemical companies with acquisition of the intermediates business of Britain's Imperial Chemical Industries, electronic chemicals business of Ashland Specialty Chemicals, Solkatronic Chemicals and a methylamines plant in Florida. This was followed by joint ventures with Nanotechnologies Inc. of Texas and Europe's Nanogate that facilitated development of materials with new properties. The relation was that the electronics industry was client for high-purity gases, materials and delivery systems which was instrumental in evolving a synergy for diversification from gases to new materials.

Going ahead, it acquired 50-50 interest in DuPont Nano Materials LLC, to serve semiconductor and wafer polishing industry; EPCO Carbon Dioxide Products Inc. for catering to the food, beverage, chemicals, pharma, oil fields and metals fabrication markets; and controlling stake in INDURA, one of the largest industrial gas company in South America.

Oil embargo by OPEC in later years accelerated investment and joint ventures in synthetic fuels; methane recovery plant; garbage to steam and electricity; refuse - fired “cogeneration” technology; flue gas “desulfurization” systems; methane gas reclamation business for landfills; vehicle tyre recycling technology etc. The tyre recycling contributed to reduced environment pollution and health hazards and the tyre recycling also offered cost saving for the production of rubberized asphalt, shoe soles, carpet underlays and many other products.

Air Products acquired the home respiratory business of German rival Messer Griesheim and the American Homecare Supply (AHS) in the year 2002 and renamed it as Air Products Healthcare, which ultimately became leading private supplier of home medical equipment, supplying homecare services to more than 275,000 patients from over 200 sites in 14 countries.

Space Age & Leadership in Hydrogen

Leonard Pool profited in the late 1950s from the supply of liquid Hydrogen for the launch of the first Soviet Sputnik. This resulted in a 12-year, $281 million contract to supply liquid hydrogen for the space shuttle program of NASA. As a leader in HYDROGEN production, Air Products has set up more than 160 hydrogen fuelling stations for cars, trucks, vans, buses, scooters, planes, cell towers, material handling equipment and even submarines. Continuous innovation in technology and materials through a strong R&D set up, and leadership with a vision, the Company has grown to the present stature.

Human Resource Development – Air Products established three golden rules of hiring professionals that could be relevant to many present day employers:

1.     Hiring delegated to line managers, considered to be the better judge of applicant's potential rather than depending on services of recruitment agencies.

2.     The applicants selected are made to spend long periods in departments of their choice to decide, where their skills would be best employed.

3.     As a policy measure, engineers and chemists working in Air Products are exposed to managerial positions to facilitate career growth and make them capable for future success of the organisation.

21st Century – the Company has strengthened its leadership in natural gas liquefaction; added expertize in surface science; acquired Tomah3 Products; became leading industrial gas supplier in Central Europe; secured largest ASU orders of 10 to12,000 TPD oxygen in China.

In India, BPCL Kochi Refinery engaged Air Products for outsourcing the entire industrial gas utility scope covering hydrogen, syngas (mixture of hydrogen and CO), nitrogen and oxygen with the vendor providing for its own power requirement. First phase of the project was scheduled to start in 2015. On completion, and it is be the largest outsourced hydrogen project in India.

Early Business

It was in 1930’s — Leonard Pool was part owner of an automobile junkyard; sold welding equipment; incorporated a business “Acetylene Gas and Supply Company” that was bought out by the Compressed Industrial Gases, Inc. (GIC), giving Leonard $140,000 in compensation and an offer to become manager for railroad sales.

There are numerous stories of RAGS to RICHES across the world, but why is it that only a few like AIR Products get converted to Multi-National Corporation (MNC)? Leonard personally steered the Company till the death of his wife but thereafter or even earlier, it was the team of professional managers and Engineers that made it grow to the present stature. The approach needs to be dissected by the future Creators of WEALTH.

Leonard Pool: The Person

Based on observations of his colleagues and co-workers, Leonard Pool was - decisive, mercurial, farsighted, articulate, bombastic, builder, born salesman, hard taskmaster, strong-willed, impulsive, visionary, dynamic, thoughtful, and demanding. A few of his notable characteristics could be summarised as follows:

·        He read voraciously - economics, history, biographies. He was an insomniac, so much so that he “frequently read and dozed all night on the couch in the living room”

·        He was motivational; did not like public speaking, but could convince anyone in person of being one of the closest friends, sharing a lot together, and fit to join him in his mission. That perhaps was the reason, he could attract Pavlis.

·        There are people who can run things and there are people who can build. If he wanted to build something, he would go all out to get the best people to do it.

·        He was incredibly demanding, looked at the financial numbers for the week or month …and fired 200 or odd people on Friday afternoon. He had terrible temper, but at the same time he was a kind man too.

·        He would take food to or give money to employees having bad times; sent limousines or arranged airplanes to take sick people to the hospitals.

·        He had vision of what was possible and knew what direction to take. He was inspiring. “When he walked into a room, everyone knew there was a bundle of energy present.”

·        He was fascinated to talk about education. It was impossible to keep him on schedule, if he was talking to someone he liked, and it kept others waiting.

He created the Lehigh Valley Hospital in memory of his wife and the couple had decided much earlier to establish a Foundation for the philanthropy after their death.

Company Profile – 

The company website is very educative in the sense that it tells how they are associated with thousands of consumer products like - running shoes, flat-screen TVs, shrimp cocktail, bone scans, sports cars, and clean air. A glimpse of the range of products and services could be had from the following links on the website of the company–

·                    Products Overview, ·                    Gases, ·                    Chemicals

·                    Equipment, ·                    Services and Solutions