BUILDING: How NMC Weathers The Storm
Recent Western Cape Business News
Few construction companies came away unscathed from the events of the last 12 months. The industry depends on growth and when that comes to a halt, things can get ugly. Chief Executive Officer of NMC, Shaun Webber, summed up the situation with the sort of clarity and no-nonsense approach that characterises his management style. “There were three aspects that affected construction companies globally. One was finding new work; the second was delivery; and the third was cash—clients stopped paying. We were no different. NMC lost a lot of confirmed business.”
The 30-year-old, privately owned construction company, NMC put in place a diverse construction portfolio that strengthened its core activity—construction—and helped weather the storm. It moved from being a niche industrial contractor to being a construction company whose portfolio embraced civil engineering, fenestration, flooring, construction and, significantly, enterprise development.
Most companies faced with such a scenario would dig in and just try to push through. NMC took the decision to diversify. “It was a difficult strategic decision,” says Webber. “Why diversify when you can actually make more money doing what you were doing? But we knew that—the industry being cyclical—the cycle would come again.” By the third quarter of 2009, NMC had pulled back more than 75 per cent of its lost business. “We had weathered the storm.”
Yet the catastrophe called for something more. For NMC this was partly in its alliance programme, the decision to expand its geographic footprint into other parts of Africa and the establishment of the NMC Business School. The board of directors also decided to implement a series of feedback sessions five times per year that involved the entire company.
Marketing Co-ordinator Stephanie King says this was a direct result of NMC’s policy to invest in its people and positioning itself within the industry as the employer of choice; no easy task in an industry with severe skills shortages at every level.
Significantly, this new business has not relied on the 2010 FIFA World Cup bandwagon (although NMC on its civil side has tendered for two Bus Rapid Transport (BRT) projects). NMC sees the bigger picture. “Strategically, we are not limiting ourselves to the RSA, but are looking at specific opportunities in other parts of Africa. We don’t want to tie ourselves into one country because we need to procure lucrative work—projects worth R500-million plus—in other destinations outside of South Africa. And we do this through our network.”
As Webber, says bluntly, the real strength of NMC is in its people, its clients and the solid, open relationships between them that the company culture endorses. King says that the reputation of NMC reflects its original values of uncompromising quality and commitment to safety. “NMC has grown over the last five years—even through the recession—and remains focused on constantly re-energising its quality controls and safety practices.”
Webber agrees. “We are—in the original sense of the word—good, honest brokers. People know that if you want to put your money in good hands, then leave it with NMC. We have a lot of repeat clients.” This reputation for delivery goes back Neil Muller’s days—the founder—and the company is grounded in these principles. “The client always knows we stand by our commitments,” says Webber.
He emphasises this point because a lot of what NMC is doing outside of the straightforward business of construction focuses on creating a sustainable environment for the industry. That’s why NMC created the NMC Business School in partnership with the Cape Peninsula University of Technology and endorsed by the Construction Industry Development Board.
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