November 2007- Punctuation functions as a navigational device for the written word. It provides the reader a sense of direction. A period indicates a time to stop, while a comma's just a pause along the way. For Sapa, Stockholm, Sweden, the colon in its logo signals that there's more to come. It acts as a little nudge to keep going.
On June 8, 2007, the list of what follows that colon got a lot longer. Press releases heralded the creation of Sapa Extrusions Inc., Pittsburgh, the North American offspring of Sapa AB, the prevailing global leader in aluminum extruding. With the merging of Alcoa's multi-location soft-alloy profile division and Sapa AB's Portland, Ore., facility, North America's largest soft-alloy aluminum extrusion producer was formed.
The details of the deal help to demonstrate the long-term goals for all involved. Currently Sapa holds a majority interest in the joint venture. And as Sapa moved into a handpicked lot of 11 Alcoa facilities, it became clear that its extrusion-only focus would change the landscape of the North American soft-alloy profile market.
"When you look at Sapa's intentions, you discover that they believed the purchased plants would help them achieve their goals faster because of Alcoa's inherent position in the marketplace," says Jeff Henderson, vice president of marketing at Sapa Extrusions Inc. "Alcoa had market leadership in both the distribution and commercial transportation markets. They had established leadership in the United States with successful, strong operations that give Sapa a nice foothold to build upon."
Along with the established Alcoa reputation, the new Sapa is able to borrow from the expertise of its parent company. Jack Miller, president of Sapa Extrusions Inc., says that the relationship is integral to the company's success. "We have access to technology both in terms of extrusion processes and customer processes that we certainly didn't have beforehand in North America," he explains. "What excites me most is being part of a company that focuses on extrusions as its core business every day."
Points of exclamation
Unlike other mega-corporations that are dictated by a singular governing body, Sapa Extrusions Inc. has a decentralized structure, giving decision-making power to each location or division. The organization allows the company to be quick on its feet when answering to its diverse customer base.
"Sapa represents a list of businesses, including the industrial group, the heat exchanger group, fabricated products and general extruding," Henderson says. "Each of those businesses operates its own accountability to the bottom line and runs not by plant managers but by managing directors who operate that business with full accountability. This is key in the United States because, in many occasions, the large extrusions companies have been known to operate out of a central office."
In part, the company's different divisions are partitioned off by the products that they produce and the wide range of services that they offer, including coating and fabricating. In another sense, the corporate lines can be drawn by the manner in which they are individually governed. While they are all pieces of a greater whole, the separate divisions are able to work in an autonomous fashion.
Considering the extreme size of Sapa Extrusions Inc., the decentralized management structure should prove to be an efficient method. And considering the number of possessives that entail such a large entity, it's lucky for Sapa that apostrophes don't come with a price tag. Its 3,700 employees keep the company's 13 North American facilities humming. And the collective 41 presses help to produce Sapa Extrusion Inc.'s profiles that range in size from 21 inches all the way down to 3 inches. Add its finishing capabilities such as bright, anodized coatings and paint coupled with the company's fabricating and design resources and the customer's product possibilities are endless.
"If you look at our footprint, we have the widest range of presses in the North American market," Henderson says. "A lot of companies in the United States talk about offering solutions to businesses and being a leader in that capacity, but they've never backed it up with the resources that they needed to make that happen. We have the attitude plus the experience and capital through our parent company. It helps to go over and witness someone who's doing it right. If you know what good looks like, it's easier to imitate."
In text, dialogue is set off with quotation marks. At Sapa Extrusions Inc., dialogue with customers is critical. According to Miller, whether the demand is coming from an OEM or a service center, the company has a commitment to meet its customers' needs better than anyone else in the marketplace by applying world-class technology and by engaging 100 percent of its employees.
"What we want to do is to redefine what extrusion companies can do for the market," says Henderson. "It seems to have evolved into who has the lowest price for this bundle of metal that is perceived to be nothing more than a commodity. It's our ambition to become more connected to our customer supply chain so that they can understand what value we can bring to their customers."
From a service center customer perspective, the scale of what can be sourced through Sapa Extrusions Inc. makes the company quite attractive. More than 50 percent of the material coming out of its industrial division feeds straight into the distribution community. And the relationship between the two was long-since established from the days when Cressona Aluminum Co. was at the helm.
"The expansive depth and breadth of capabilities to service the distribution community includes not only product, alloy and temper capabilities that are first in class, but also the logistics and other supply chain functions required to be the best to service the distribution community," says Chuck Strong, distribution sales director at Sapa Industrial Extrusions. "Sapa is going to bring great value and service to the distribution marketplace through a single focus on soft-alloy extrusions, a rapid decision-making organizational structure and a company that will significantly invest in equipment capabilities."
At the Cressona facility in particular, customers can expect product that isn't available from any other North American producers. The large-press items include rod and bar that measure up to 111/4 inches in diameter, and the seamless pipe and tube, custom shapes and large circle sizes go far beyond what anyone else is currently producing. Low-lead alloys such as the company's 6042 and Acc-U-Plate, an extruded bar that can measure up to 18 inches wide to replace some typical plate applications are just two examples of products that further diversify the company from its competitors.
"I've seen a commitment to innovation and technology and to the decentralized structure that produces rapid responses and decision making along with accountability," says Strong. "I've also clearly heard from Sapa that the strategy is to put together organizations and processes and plans that won't change just for the sake of change. Sapa has a goal for consistency from a people and products perspective."
Henderson says that the connection made between Alcoa and Sapa has truly made an impact in the North American soft-alloy extrusion market. The announcement of their joint endeavor went far beyond the news of one company gobbling up another. Seven years ago, Sapa's presence in North America included just one small plant--one small, reputable plant in Portland. And today, by way of joint venture, Sapa has achieved the status of the largest extruder in North America.
"It's a win-win for both companies," Henderson says. "Sapa wins because we achieve our strategic goals and customers benefit from proven leadership in technology and service."
Using punctuation symbolically hints to a future that Sapa and its customers can expect ... for instance, the ellipses signifies a sense of anticipation and open-ended momentum. Sapa Extrusions Inc. is moving at a swift pace, and the experience and leadership that the company can offer the industry can only propel it further. MM
By Abbe Miller, from the November 2007 issue of Modern Metals.