May/June 1994
“As the world changes around us, we need to change."
That quote, delivered by outgoing ReMA President Arnold Gachman of Gachman Metals & Recycling Co. (Fort Worth, Texas) at the association's seventh annual convention, in many ways captured the character of the event, held March 16-19 in Las Vegas.
The convention indeed seemed an event defined by changes and new beginnings, most notably the election of new national ReMA officers. On March 19, Cap Grossman of Grossman Iron & Steel Co. (St. Louis) became the fourth ReMA president. Also installed in new officer roles were James A. Fisher of Fisher Steel and Supply Co. (Muskegon, Mich.), who became first vice president; Shelley E. Padnos of Louis Padnos Iron & Metal Co. (Holland, Mich.), second vice president; and Richard T. Jaffre of Chaparral Steel Co. (Midlothian, Texas), secretary/treasurer. All were elected to two-year terms.
The promise of change was certainly evident in Grossman's acceptance speech, in which he sketched out the directions his administration might take in keeping up with the times. Top on his list was to revisit the strategic planning process because, as he put it, "We must always know where we're heading."
Grossman also noted plans to augment ReMA's efforts in the critical areas of safety, education, and leadership development, and said his administration will continue to address the ongoing challenges to the industry in the legislative and regulatory arenas. "We will fight and fight, and we will win," he stated, adding that he fully intends to reach his goal of making ReMA "the most productive and responsible association possible."
In tune with Grossman's goal, ReMA's convention offered a spate of workshops and spotlights designed to help attendees be equally productive and responsible--not to mention more profitable. Here's a look at some of the points covered.
Addressing Regulatory Challenges
Among the myriad business issues scrap recyclers face, meeting regulations in the areas of worker safety and environmental compliance is one of the most-challenging tasks, but several convention sessions offered ideas on meeting these challenges.
Confined Spaces--A New OSHA Priority. In the past year, four workers died and six were hospitalized in two incidents involving confined spaces at scrap recycling operations, reported Michael Mattia, ReMA director of risk management, at a session on the Occupational Safety and Health Administration's (OSHA) confined spaces standard. Like OSHA's lockout/tagout regulations, the new standard targets hazards that "can kill instantly," said Mattia, calling the rule "very relevant" to the scrap industry and noting that it appears to be an OSHA enforcement priority.
Compliance with the new standard requires employers to first identify confined spaces that are large enough for an employee to enter to perform work, have limited means for entry, and are not intended for continuous occupancy, Mattia said. Scale pits, tanks, and certain automobile shredder areas are among the potential confined spaces that could be identified in scrap plants, he noted.
If a confined space contains or has the potential to contain a hazardous atmosphere or material that could engulf an entrant, is configured so it could trap a worker, or raises other recognized safety threats, the employer must take certain steps, according to the OSHA rule. These include preventing entry, removing hazards, or establishing procedures to protect workers (and contractors) who may enter the space, Mattia explained.
In addition, he said, the employer must set up an internal permit process to regulate controlled entry of the space and establish detailed documentation and rescue procedures.
Mattia also offered the following tips related to confined spaces.
Ensuring compliance with OSHA's lockout/tagout standard may render some potential permit-required confined spaces as nonpermit spaces.
Gases may leach from the walls of empty tanks previously "sniffed" and determined to be clean, fouling the internal atmosphere and posing a safety hazard.
Equipment to monitor atmospheric conditions should be capable of measuring for oxygen, flammable gases, and toxics, preferably simultaneously and without requiring regular calibration with gas cylinders.
Despite these factors, Mattia concluded, given appropriate precautions, there "should be few spaces in a scrap yard that actually require permits for entry." Furthermore, he added, "if you follow OSHA's decision tree and understand the definitions, this complex standard can be easy to understand and implement."
Storm Water Permit Advancing. Scrap recyclers are likely to face some tough-and potentially expensive-obligations under the Environmental Protection Agency's (EPA) storm water runoff program, said David Kendziorski of Woodward-Clyde Consultants (Milwaukee) and Robin K. Wiener, ReMA director of environmental compliance, at a convention workshop on the topic.
The EPA has proposed model permit conditions for ReMA's group, but the final conditions may not be published until 1995, the speakers noted. The key requirements of the proposed multisector permit include: preparation of a storm water pollution prevention plan; monthly visual inspections; storm water sampling in the second and, possibly, fourth years of the program; and data reporting. The conditions also include requirements covering inbound material control, outdoor and indoor scrap storage, processing equipment, erosion, and spill control.
According to an ReMA study, the annual costs of these proposed controls for scrap recycling facilities could exceed $100,000, Wiener reported. To address this and other concerns, ReMA submitted comments to the EPA, noting which requirements it deemed unfeasible for the industry.
Facilities that haven't joined ReMA's storm water permit group may find their best option is to pursue a baseline general permit, the speakers suggested, because it's too late to join the group and the remaining option-an individual permit-is likely "too burdensome." Even ReMA group participants may want to also apply for a baseline general permit and wait to see which option is better when more information becomes available, they added. In general, the baseline general permit appears to be the "least burdensome" option, although specific requirements will vary in some states, the speakers said.
The Ongoing Quest for Quality
The issue of quality assurance continues to pervade the scrap recycling industry, prompting many firms to apply new or more-stringent quality standards to not only their materials, but also their processes, according to some convention programs.
An ISO Primer. While ISO 9000 certification is only one facet of total quality management, it could become critical for recyclers if their consumers are looking to achieve the standards and expect the same of their suppliers, said Robert J. Janeczko of John Deere Davenport Works (Davenport, Iowa).
The ISO 9000 standards, developed in 1987 by the International Organization for Standardization (ISO) (Geneva), are system-focused, which means they certify the quality of a company's processes, not its products, Janeczko explained. The system is also site-specific, he noted, so each operating unit of a company must be certified individually.
Of ISO's 8,651 published standards, only five relate to quality--the ISO 9000-9004 standards, each of which serves a different function, according to the speaker. ISO 9000, he said, helps a firm decide which standards match its operations, while ISO 9004 guides the firm in developing and implementing a quality system. The remaining standards include the actual requirements, Janeczko said, noting that ISO 9003 is the least-comprehensive set, covering final inspection and testing; ISO 9002 is a step above that, addressing all aspects of production and installation; and ISO 900t is the most-comprehensive, covering all the requirements of the first two, plus two more on design control and servicing.
But the question remains: Do recyclers need ISO certification now? "Listen to your consumers," Janeczko recommended. "Are they certified? And is there any chance they could require you to become certified as well?" While that situation is possible, he said, "so far, there aren't many consumers driving the process."
Committing to UBC Quality. Improvement in the quality of all-aluminum used beverage can (UBC) scrap is the key to future growth in UBC recycling, said a panel of aluminum experts at the convention.
Session moderator Tom Stengel of Anheuser-Busch Recycling Corp. (St. Louis) described the historic success of UBC recycling, which has grown steadily to make UBCs the most-recycled consumer packaging product. He noted that quantity rather than quality of can scrap has been the main issue for UBC recyclers in recent years and predicted that the UBC recycling rate will grow to reach 75 percent in the 1990s.
But today, Stengel said, quality is a vital issue and UBC recyclers must continuously improve their processing methods to reduce contamination levels in UBCs shipped to consumers while maximizing their overall processing rate.
At the retail buyback level, contaminants include moisture, dirt, rocks, plastics, copper and brass, heavy steel, noncan aluminum, and organic materials, noted Dennis Crooker of Alcoa Recycling Corp. (Knoxville, Tenn.). Moisture typically accounts for more than half the impurities in UBCs, said Bob Hubbard of IMCO Recycling Inc. (Rockwood, Tenn.), with dirt and other debris making up more than a third, followed by metal fragments, though the levels of these contaminants can vary widely from load to load. Early removal of contaminants can mean substantial savings for processors, who are literally buying these contaminants by the pound, Crooker said.
UBC quality is increasingly important in the production of new cans, said Linda Peotter of Golden Aluminum Co. (Golden, Colo.). Legislators around the country are pushing laws to increase the recycled content of packaging material, she noted, explaining that increasing the quantity of scrap in the mix raises the importance of the scrap's quality. The continuous down-gauging of can stock, workplace safety issues at aluminum plants, and product liability issues also underscore the need for higher UBC quality, she added. But the ultimate goal of the UBC quality drive, Peotter said, is to “increase demand for the recycled can, thereby increasing its value.”
For firms seeking to improve their UBC quality, Raymond Sloan of Sloan Metal Co. Inc. (Chicago) described an inexpensive homemade system his firm developed to cut contaminants in the UBCs it ships. Cans are poured from a tipped trailer onto a screen that slants toward a conveyor. Relatively small, heavy contaminants such as pieces of rock, dirt, and glass fall through the screen and slide down a steel plate to angle-iron troughs, from which they are swept away, Cans that flow onto the conveyor are leveled using old trailer mud flaps to ensure the scrap is only one-can deep for efficient magnetic separation.
This portable cleaning system can be used anywhere and with any feeding method, Sloan said. His company still employs three "pickers" who work in conjunction with the cleaning apparatus, he noted, but the cost of these employees is a bargain in the long run because they remove plastic contaminants, which helps prevent load rejections.
Neil Hoffman of American National Can Co. (Chicago) offered other UBC quality suggestions for processors, advising recyclers to review individual operations for possible improvement, discuss quality concerns with customers, consider low-cost methods for improving quality, and use industry forums and contacts to pick up solutions developed by other UBC recyclers.
Despite improvements in UBC processing, such as new air knife systems, UBC processors have to accept that they are in a labor-intensive business and are likely to remain dependent on well-trained employees to ensure scrap quality for the "foreseeable future," said Donald A. Lewon of Utah Metal Works Inc. (Salt Lake City).
"Because UBCs are bought from a very wide spectrum," he explained, processors must "know their customers and check what they are buying and processing." In addition, employees must be able to visually check incoming material and ensure that contaminants are removed under the watchful eye of management, he said. "That's quality control for our industry," Lewon said. "It's really simple, but very demanding."
According to Bill Stratton of Newell Recycling Co. Inc. of Atlanta (Atlanta), the best way to ensure LJBC quality is to know what you ship and educate your suppliers. More-expensive equipment is generally not the answer to quality calls--more-careful handling and visual inspection are, he said, stating that processors must demonstrate these skills to their suppliers.
Such efforts can pay off in terms of having consistent markets, receiving maximum value for material, building a competitive advantage, and minimizing the risks of rejected loads and associated costs, Stratton said.
Toward Better Business Management
Today, perhaps more than ever, running a successful recycling business depends on controlling costs, achieving maximum productivity, and establishing positive relationships with groups outside the industry. A number of convention sessions examined strategies for achieving these.
Cutting Workers' Comp Costs. Workers' compensation insurance has long been a cost drain for scrap recyclers. In fact, workers' comp represents the largest portion of insurance losses for ReMA members participating in the ISRI/CNA insurance program, totaling almost $22 million in 1992-1993, reported Dan Cacchione of CNA Insurance Cos. (Chicago) at a workshop aimed at reducing those costs.
Recyclers can get a grip on the rising costs of workers' comp by establishing an occupational injury management (OIM) program based on management commitment and a good safety program, Cacchione said. One key of an OIM program is timely notification of loss, beginning with workers immediately reporting an injury or illness to supervisors and the word being relayed quickly to the insurance carrier. "The longer the delay, the worse the payout tends to be," he noted.
To properly manage a case, the employer should be in regular contact with the injured worker and help manage the medical aspects of the case along with the medical provider and insurer, according to the insurance expert. Furthermore, he said, good case management demands that all efforts be directed at getting the employee back to work as quickly as possible, even if in limited, alternative duties.
Soaring medical and litigation costs are the main factors boosting workers' comp rates, Cacchione noted. Unlike most insurance, he explained, workers' comp pays 100 percent of medical costs, so doctors have a strong incentive to treat injured workers and, in some cases, providers charge excessively for these services. To help reduce medical costs, he recommended, employers can use a preferred provider program or directed physician services-which are allowed in about half of the states-as well as written fee schedules, which set maximum fees for medical services.
Even though workers' comp was intended to be a "no-fault" system in which any workplace injury is covered regardless of fault, legal fees are the second largest portion of workers' comp costs, Cacchione noted. To minimize the legal risks, he counseled, employers should avoid an adversarial relationship with the injured employee by communicating with the worker and demonstrating concern, streamlining the administration of claims, and getting the employee back on the job as soon as possible.
Investing in Employees. Training can be a valuable business tool, but 85 percent of all employees receive no formal on-the-job training and most companies invest nothing in training programs, said consultant Shirley Hastings, who is also a professor at Mississippi State University (Starkville, Miss.).
According to the program Hastings presented, the benefits of employee training go beyond improved efficiency and productivity to include increased safety, reduced staff turnover, increased loyalty, greater job satisfaction, higher employee motivation, and--ultimately--an improved bottom line. "Training should be considered an investment, not a cost," she asserted.
Training is only effective when done properly, however, she said. Thus, Hastings advised attendees to ask the following questions when organizing a training program: What does the employee need to know? What does the employee already know? What materials or tools will help the employee learn? What teaching methods would be best for the employee?
To answer the last question, employers need to understand how people learn, she said. People tend to remember only about 20 percent of what they read and hear, 30 percent of what they see, 50 percent of what they hear and see, and 90 percent of what they do, Hastings noted, pointing out that this indicates that employees will learn better in a hands-on training environment.
Effective training also emphasizes relevant and concrete skills, allows time for the learner to practice, avoids "high risk" instructional strategies, and uses a variety of instructional tools that fit the learner's experience and needs. "Effective learning requires more than telling," she said, noting that employees can also learn more if the training is fun and if they have a hand in planning the training approach.
The last step of any successful training program is evaluating it, Hastings said. "For every dollar you invest in training," she concluded, "there should be some return."
Public Relations for the Long Haul. Recyclers must look beyond the transaction-focused nature of their day-to-day business and realize the benefits of a long-term public relations program, said Jerry Thompson of the Steel Recycling Institute (Pittsburgh), one of three speakers at a workshop focusing on effective public relations programs in the scrap industry.
Among its business benefits, public relations can provide accurate information to a company's various "publics," address issues important to a firm or the industry, generate goodwill, give the industry a unified voice, establish better government understanding of the industry, and even improve a company's bottom line, he noted. "We're not talking PR for PR's sake," said Thompson. "It's PR for profit."
To make a public relations program work, however, he asserted, a firm must be committed to it, understand why it's being undertaken, and allocate resources to do it. First, however, advised Gary L. Slack of Slack Myers & Barshinger Inc. (Chicago), it's crucial to conduct research to identify the firm's publics and know what they think about the business. "Don't fly blind," he said. "You need to know where you stand with the groups you want to influence. Don't spend a dime until you know what your publics think."
All along the way, it's a good idea to get good professional public relations advice-internally, externally, or both, suggested Marc S. Czachorski of Reynolds Metals Co. (Richmond, Va.). And finally, he said, you need to frequently evaluate your progress.
Public relations must be for the long haul, Slack said, noting that "most short-term campaigns don't work." In his view, most minds are like rubber bands. A public relations campaign stretches the mind, but if you let up on the pressure, the mind usually snaps back to its original position. As a result, "you have to keep the pressure on," Slack advised.
Examining Market Trends
In the past year, prices of copper, aluminum, nickel, and cobalt-metals examined at convention spotlights-have all shown remarkable resiliency and price uptrends, despite persistently high inventories. The principal reason for this strength, said spotlight speakers, is that current markets have been responding more to extramarket forces-such as fund buying, interest rates, and currency devaluations-than to supply and demand.
Copper Fundamentals Superseded. This has certainly been the case with copper. "Longer-term, we can no longer simply look at supply and demand," said Peter J. Thomas of Kennecott Copper Corp. (Salt Lake City) at the copper spotlight. Options and derivatives must also be evaluated, he stated.
Aside from these extramarket factors, improvement in the U.S. economy helped stimulate the market, Thomas said, and the severe winter depleted scrap resources, thus tightening scrap supplies in nearly all metal categories. Add to this the trading problems of Codelco (Santiago, Chile) and the financial troubles of Metallgesellschaft AG (Frankfurt, Germany), and it's easy to see why copper prices have risen this year, Thomas observed.
In reviewing current market dynamics, David N. Waite of Rudolf Wolff & Co. Inc. ( London ) looked back to the 1987-1992 period, when copper's base price was $1 a pound and backwardation was a steady market feature. Then the bottom fell out, and copper values dropped 36 percent between July 1992 and December 1993. "Will the market collapse again?" Waite asked. "Or have we turned the corner toward the next long bull market?"
According to Waite, copper's recent rally will eventually weaken under pressure of hedge selling and "will test the 1993 lows, probably during the summer quarter." Still, 1994 will see a strong U.S. economic recovery, a European turnaround, and uncertainty in Japan , though decreased demand there is expected to be more than offset by increasing demand from the other Far Eastern countries. In fact, he said, these "Asian tigers" are likely to be able to absorb the anticipated 200,000 metric tons (mt) of new world production. Looking specifically at Chinese buying. Waite said he expects a "fundamental shift," with a big increase in Chinese forward hedge activity, proliferation of local commodity exchanges, and growth in speculation.
Summing up all these factors, Waite asserted that 1994 will be "a typical precursor to a bull market with activity, volatility, and false starts." As for 1995, he added, "it will be the real thing."
Russian Aluminum Still a Worry. Russia 's exports of aluminum to the West plus the continued production of Western smelters have unbalanced the world aluminum market, said Thomas R. Akers of Consolidated Aluminum Corp. (St. Louis) at the convention's aluminum spotlight.
To address this problem, world prime producers have reportedly agreed to cut 1.5 million mt of Western smelter production and 500,000 mt of Russian output, Akers reported. According to Ralph Kestenbaum of the London Metal Exchange (LME) (London), "The general view was that if 1.5 million to 2 million mt were cut back, the oversupply problem would be solved within 24 months."
But does anyone in Russia have the authority to make a Siberian smelter toe the line? Kestenbaum asked, also wondering aloud whether licensed exports will be replaced by conversions. Akers noted that while Russia 's aluminum production has fallen, its internal consumption is also dropping. This situation prompted Kestenbaum to ask: "Will the paralysis in Russian domestic consumption mean that even with production cutbacks, the tonnage available for export will not diminish?"
So far, announced cuts have reached 855,000 mt in the West and 158,000 mt in Russia , the speakers reported.
Aluminum Scrap Faces Tightness. The U.S. aluminum scrap market has been experiencing strong demand, but certain grades of scrap are particularly tight, squeezing margins for processors, said Barry Dorman of OmniSource Corp. (Fort Wayne, Ind.), who spoke at the aluminum committee meeting held in conjunction with the convention. Harsh weather plus increased use of tolling and other forms of internal control of scrap have limited the amount of material available, he noted. "Today, scrap is king--if you control it," said Dorman. "Six months ago, this wasn't the case."
With the LME firm, demand strong, and some limits instituted on the flow of scrap from the former Soviet countries, supplies are likely to remain tight through the first half of 1994, Dorman predicted. The second half should be as strong or stronger than the first half if automobile production continues apace, he added.
LME Aluminum Contract Still Controversial. According to the LME's Kestenbaum, automakers--the largest generators of secondary alloy scrap--will protect themselves by using the LME secondary aluminum alloy ingot contract, and he urged the scrap industry to do likewise. "This baby has finished crawling, is now walking, and will soon be running," he said.
Offering a differing view, Robert David of Wise Metals Co. Inc. (Linthicum, Md.) said at the aluminum committee meeting that the secondary contract needs to be changed before it can work effectively, noting that although the contract "started out with a bang, it's now completely, completely stagnant."
A key problem, he pointed out, is the contract's use of three different specs--Japanese, German, and U.S. "The wrong metal is always at the wrong location," he stated, plus there is no direct relationship between these specs and aluminum products or the primary aluminum price. The contract must have a more-direct relationship to the physical market to be useful, David said. "Until the LME changes the specs so it works for consumers, the contract won't really get off the ground."
Nickel in Balance. As with aluminum, the world nickel market continues to be adversely affected by Russian exports, said James Moore of Falconbridge U.S.A. (Pittsburgh) at the convention spotlight on nickel, stainless steel, and specialty metals. While Russian nickel output is expected to decline to 170,000 mt in 1994, he said, the country's consumption will also fall, to about 35,000 mt, meaning that 135,000 mt should still be available for export.
Turning to nickel stocks, Moore noted that Western producer inventories total about 90,000 mt, while LME warehouses contain about 130,000 mt--almost 10 weeks of supply. "It's believed that a large quantity is tightly held by investors who have higher selling prices in mind," he stated.
Regarding demand, Moore reported that nickel consumption in the West grew 57,000 mt from 1992 to 1993 and should show strong growth again in 1994. The East's consumption, meanwhile, decreased 12,000 mt in 1993, he said, pointing out that these factors combined have "resulted in an apparent balance of nickel supply and demand."
Small Deficit in Cobalt’s Future? Looking at the cobalt market, Moore said there would probably be a "small deficit" in the cobalt supply this year, primarily due to political and economic upheaval in Zaire, the world's largest cobalt producer. Output has reportedly decreased sharply from Zaire 's Gecamines, with newspapers indicating that no metal has been mined there since December.
At the time of the convention, the cobalt market was also facing problems related to the "reference" price of $18 a pound set by Zaire and Zambia, which traders considered unrealistic. A new reference price was expected to be announced soon.
Meanwhile, in the United States, the Defense Logistics Agency has said it plans to sell 12 million pounds of cobalt this year, and thus far it has sold about 2 million pounds, according to Moore.
Stainless Scrap's Bright Future. Examining stainless scrap usage from 1993 to 2000, Rover V. Mellon of Mellon Associates (London) stated: "We're looking at a market worth $3.5 billion a year."
By 2000, obsolete scrap will represent a larger portion of the market, rising from 54 to 74 percent, while new scrap's share will decline. "Our summary indicates that some 935,000 mt of additional good-quality stainless steel scrap will be needed annually to service the producing mills," Mellon said. Despite anticipated increases in nickel output by some nations-such as South Africa, South Korea, and Taiwan-more scrap will be needed, he said. In fact, he added, "Whatever process technology is chosen [by the mills], the preferred raw material is stainless steel scrap."
Reviewing the future of stainless steel, Mellon noted that "world demand is increasing at about 3 to 4 percent annually," with Chinese demand expected to rise 10 percent; Asian consumption, 6 percent; and Japanese usage, 3 percent. Even so, there will be few new giants or greenfield hot rolling mills dedicated to stainless, with expansion instead coming in incremental steps using new thin-slab or continuous-strip casters added to existing mills, Mellon predicted.
Plastic's Recycling Potential. Does postconsumer plastic recycling have a future? Absolutely, said Tom Rattray of Procter & Gamble Co. (Cincinnati) and Dennis M. Sabourin of Wellman Inc. (Shrewsbury, N.J.), examining the directions this market is likely to take.
For plastic recycling to succeed, Rattray noted, recycled resin must become competitive with virgin resin, which means that plastic recyclers must cut cost out of the recycling system. This can be done in a number of ways, he suggested, such as making product improvements based on Design for Recycling, installing autosorting technology, and streamlining the collection and preparation stages. "To get cost out of the system, you must use new technology," Sabourin added. "Technology is the wave of the future."
Plastic recyclers can also cut costs by shipping flake instead of pellets, establishing long-term sales contracts, achieving economies of scale, and integrating into other parts of the plastic recycling chain, such as product manufacturing. "Integration will be key to survival in the plastic recycling business," Sabourin said. Such changes can cut up to 7 cents a pound out of the plastic recycling process and, thus, make reclaimed resin more competitive, Rattray observed.
Beyond economics, plastic recycling's success will be aided by a long-term landfill crisis and a shortage of some natural resources, Sabourin suggested. Furthermore, state and federal legislation and procurement practices will continue to encourage-and even demand-recycling, and public sentiment will keep recycling a top priority, the speakers noted. As Rattray pointed out, "People are worried about the future, and environmental quality is a new consumer need. People want to do something to help."
- Jeff Borsecnik , Kent Kiser, and Si Wakesberg
What’s Important in Life
Terry Bradshaw may have achieved his fame on the football field as a quarterback for the Pittsburgh Steelers, but at ISRI’s convention he played the role of cheerleader, reminding people from the sidelines what’s important in life.
“All we want out of life is to be happy,” said the football Hall-of-Famer, but to be happy, you have to ask yourself the quintessential question: Do you truly love what you’re doing? The biggest problem today, he said, is that “people can’t find happiness because they aren’t happy with what they’re doing. Happiness comes down to love and passion for what you do.”
Even so, he stressed, “you can’t do anything in life without quality people who are committed to what they’re doing,” adding that “it’s other people we need to depend on. People are the most important thing.”
Throughout his comedic speech, which was chock full of football anecdotes and slapstick routines, Bradshaw offered a stream of life rules, such as: Learn how to smile. Appreciate what you have. Be happy to be alive. Tell people you love them. And bring strength and energy from home and apply it to your business. “All we’re entitled to is to have a goal and work hard,” Bradshaw concluded.
Women in Recycling
In a special convention panel workshop, four female recycling executives described what it’s like to work in the overwhelmingly male scrap industry.
Vonna Fisher Cloninger of Biltmore Iron & Metal Co. Inc. (Asheville, N.C.), who is being groomed to take over the family company from her father, said the toughest challenges she has faced have been winning the respect of the men working in the plant, being taken seriously when bidding on industrial accounts, and working alongside the “good ol’ mountain boys”--peddlers who bring material to Biltmore.
Marsha Serlin of United Scrap Metal Inc. (Cicero, Ill.) spoke of her experience starting up a scrap recycling company from scratch with a few hundred dollars in 1978. She succeeded even though no one would give her credit, and today the company has 60 employees and is growing rapidly. Serlin observed that many women already have the experience that would help them succeed in business, stating, “If you’re a PTA president, why not run General Motors?”
Mary Lynn Thompson of Keystone Iron & Metal Co. Inc. (Pittsburgh) offered a similar message, asserting, “Whatever you want to do, you can do it. It doesn’t matter if you’re a woman or a man.” Thompson learned the scrap business from her grandmother and has worked in her family’s recycling business at least part-time since she was about 12. She now manages the company’s finances.
Shelley E. Padnos of Louis Padnos Iron & Metal Co. (Holland, Mich.) focused on volunteer work, noting that “ISRI loves volunteers and rewards them generously” and that it doesn’t matter if you’re a man or a woman. She described other experiences she’s had as a volunteer and encouraged audience members to be willing to take chances. “Don’t let your fears hold you back,” she said. “Stretch yourself.”
The panelists also discussed their relationships with other family company managers, with Cloninger noting that she hasn’t found it difficult working for her father. “At work, he’s my boss, not my father,” she said. “But she has found it somewhat tougher working with her husband, though the two have managed to basically stay out of each other’s jobs.
The group also considered whether being a woman can be an asset in the industry, with Serlin noting that it can be an advantage in the “men love women and they love to talk to them.” Men also believe women are honest, she said. Padnos added, “Overall, being a woman is an advantage because we’re still unique and being unique is an advantage,” but she voiced frustration with the “old boys’ club” atmosphere in the industry.
Finally, the panelists touched on their preferences in managing male and female employees, with Serlin admitting that, although she likes to “mentor” women, she has trouble managing them and, therefore, seeks to add men to her women-dominated office. Thompson agreed that women are harder to manage, while Padnos suggested that men who deal with customers can be more difficult to manage than women. “Guys have a problem with their egos getting in the way,” she said, which can make it tough for them to accept that “the customer is always right.”
Managing Stress to Your Advantage
“Nobody ever set a world record running around a track with a dog on a Sunday morning,” said Peter Hanson, illustrating his point that “you can’t have excellence without stress.” In fact, according to Hanson--a family doctor, cardiac specialist, author of The Joy of Stress, and special convention session speaker--“Stress is not Public Enemy No. 1 Stress is a neutral.”
We can learn to manage stress to succeed rather than suffer its disasters, in part, by using the body’s “switches and dials,” as he put it. For example, he noted that pressure points on the hand and wrist can ease pain and stress, respectively. Other personal-management techniques include learning to monitor and control the body without the use of drugs, such as pressing the earlobe to gently awaken ourselves or learning the proper way to take our pulse or breather deeply to expel carbon dioxide.
The problems of stress today are a result of rapid change in our lifestyles and sources of stress, Hanson explained. Today’s stress isn’t more severe than that faced by our ancestors, he said, comparing being stuck “on hold” to facing mortal combat with a wild animal. While today’s stress affects our bodies as it did aeons ago--such as by producing cholesterol as emergency fuel--the pressures causing it may be continuous rather than occasional, he noted.
But the way to deal with stress can be changed, Hanson said. We can switch the pictures, or “paradigms,” that our brains use to filter data absorbed by the senses before the information is acted on, altering the way we respond to stress. For example, he suggested trying to see a new computer as a chance to free time for playing more golf rather than a way to embarrass ourselves in front of our children or employees.
In sum, Hanson encouraged people not to avoid stress--because stress is necessary to excel--but, he said, “I hope it lands on the right manager.”
Avoiding Business Failure
The A&P supermarket chain didn’t slip from 15,000 stores to a few hundred because of ignorance about groceries. Nor did IBM’s near-collapse have anything to do with computer hardware, according to Don Beveridge, the convention’s keynote speaker, who examined why successful businesses don’t stay successful.
These businesses stumbled, he said, because of a deficiency in execution, not a deficiency in knowledge--the first of four major reasons businesses fail. “Nobody goes out of business because they don’t know their business,” said Beveridge. And how can you avoid this execution pitfall? “It ain’t got nothing to do with scrap,” he noted. “It has everything to do with becoming a value-added, customer-focused business.”
The second major reason successful businesses fail is because they lose the desire to compete, said Beveridge, observing, “You can tell when you’re losing the desire to compete: You start making decisions for you, not the business.”
The third reason for failure he cited is a lack of appropriate standards. To succeed, businesses must have standards for customer satisfaction, Beveridge said, but 80 percent don’t. What they need are “excellence standards,” he stated, which means giving people more than they expect, such as a cheaper price or quicker delivery.
And reason four: losing sight of the mission. “Ask everyone in your company, ‘What is your No. 1 job priority?’ A business survives when everyone wants to identify, then satisfy, the customers’ needs profitably,” said Beveridge. If recyclers remain commodity-focused, they’ll fail, he said, adding that they need to “mentally and physically leave the commodity in the car” when visiting consumers. Instead, they must identify needs from the customer’s point of view.
“There’s one microsecond that will determine whether you’re successful for the rest of your business life,” said Beveridge, and that’s the moment you go from being product-oriented to expertise-oriented. “You can’t sustain a competitive advantage as a commodity. A business only survives when its identity evolves from product to expertise.”
Concluding his presentation, Beveridge showed a slide of a dinosaur and the caption, “History is full of giants who couldn’t adapt.”
The Keys to Effective Negotiating
“Negotiating is the game of life,” said Herb Cohen, author of the best-seller You Can Negotiate Anything, and the goal of negotiating is to solve problems or “move people from ‘no’ to ‘yes.’” This is easier said than done, but negotiations can be more successful using the following advice Cohen offered in a general convention session.
Drain emotion from negotiations. “The proper attitude to have when negotiating is to care … but not that much,” Cohen advised.
Try to understand how the opposing party sees the situation--a difficult task for many people, especially when negotiations are cross-cultural. “We see things not as they are, but as we are,” he suggested. “Remember that other people don’t see things the way we do, and people in different cultures view things differently, which means the obvious won’t be obvious.”
Convey respect by listening to and writing down what the opposing party says. Ask questions even when you know the answers, withhold bias, and learn how to say things diplomatically, Cohen said, asserting that style tends to supersede substance in negotiations. Being sensitive to these issues will enable you to establish trust and get the other party to invest in the negotiation.
Teach yourself to “live with silence and dwell amidst ambiguity,” Cohen said. That is, though all negotiating involves action/reaction, don’t respond or make decisions out of habit. Instead, he offered, “let’s examine what we’re doing and reassesses if our actions are getting the desired results.”
Offer creative, innovative solutions. This can be especially difficult for Americans, who like situations to be cut-and-dried, with clear winners and losers, which isn’t the case in negotiations. “It’s not just A or B,” Cohen pointed out, “there’s always a C.”
As a final point, Cohen told his audience to keep in mind that a “no” response is often nothing more than a reaction to the unexpected and is only relevant at the moment. With the proper approach, anyone’s response can change. “The key to negotiating,” he concluded, “is persistence and perseverance.”
The U.S. Economy in Painful Transition
“We know something very big is wrong with the U.S. economy, not in the short term, but in the longer term,” said social forecaster David Pearce Snyder, who serves as lifestyle editor of The Futurist.
Though delivering a special convention presentation titled “Survive and Prosper,” Snyder focused his discussion on the painful changes being forced on the U.S. economy by a revolution in information technology. In the 1980s, the barons of industry sought to stimulate the economy using new technology to boost worker productivity and have since spent a trillion dollars on modern information-age technology, he said. Productivity hasn’t increased, however, Snyder noted. Why? Because the United States--followed by Europe and Japan--is being forced to retool its economy to a fundamental new technology, which only began to develop in the 1950s, and shifts of such magnitude can take 40 to 50 years to work out, he explained.
Meanwhile, the U.S.work force has experienced painful changes because many middle class jobs are disappearing faster than new skilled jobs are being created as companies fight to survive, Snyder said. Today, however, he continued, the U.S. economy appears to be nearing the midpoint in the transition, after which more jobs will be created than lost. But turning the corner will depend on whether employers are willing to create jobs the new economy demands, he added.
In the future, all employees will need to use more information to function, acting as intermediaries between computers and their work. This means the United States will need better-trained workers such as high school graduates capable of understanding statistics, said Snyder. Apprenticeships should also be mixed into school curricula, as is done inEurope and Japan , since “few people learn well in passive classroom mode,” he stated. Managers may also have to go back to school for continuing education, he said, but employers may not be willing to pay for such training.
“Training by itself is not enough,” however, Snyder asserted. Work must be changed to allow workers to act on the data they are given, with decision-making transferred from the traditional rigid authoritarian bureaucracy to decentralized teams.
“Why is this important to you?” he asked. Because the recycling industry will change to use more high technology, more information, and more-expensive labor. “The dip is forcing us to reinvent ourselves,” Snyder concluded. “We will reinvent America and you have a great and exciting role to play in that revolution.” •