March/April 1995
More and more scrap companies are hiring executives new to the scrap business, presenting a training challenge. Here’s a look at the trend and how some firms are bringing scrap rookies up to speed.
By Eileen Zagone
Eileen Zagone is editorial associate of Scrap Processing and Recycling.
It used to be that most recycling professionals were born into the business, working for their family's scrap company from the time they could push a wheelbarrow or alphabetize some files. It's a different story today. As the scrap recycling industry has grown and the family nature of the business has diminished, many industry firms must look to outsiders to fill management and trading positions.
While some target experienced scrap professionals for these jobs, many see advantages to hiring those new to the industry, especially recent college graduates. For one thing, says Bob Toth, human resources manager for Annaco Inc. (Akron, Ohio), such newcomers "have not learned any bad habits yet, allowing us to mold and train them the way we want to." In addition, recent graduates tend to grasp the business quickly since they are accustomed to a learning environment. "An education-oriented person is still in the learning mode and is generally able to make a smooth transition to learning about the industry and the company," explains Toth. Add to this the fact that the starting salary for a trainee is likely to be lower than that for a seasoned scrap veteran, and it's even more clear why so many companies are increasingly appointing new executives with a veritable "clean slate."
The catch, of course, is that such trainees need to be educated about the intricacies of their new industry. "I wish there were a canned training program we could send new employees to," muses Ronald Messner, vice president of human resources for Luria Brothers (Cleveland). But, alas, there is no such panacea for the training quandary, leaving many firms to devise their own methods and programs for preparing new employees for the unique challenges of the scrap industry.
While these strategies can differ from company to company, most firms with experience in training industry newcomers seem to follow the same basic steps and have been generally pleased with the outcome.
The Application Process
The first and most critical step, say many top scrap managers, is to hire the right sort of person for the job in the first place.
In terms of educational background, most companies require managerial and trading candidates to have earned an undergraduate degree, with many recruiting those with business administration or marketing degrees since graduates in those fields generally offer solid skills in financial management, accounting, and sales. Graduates of trade schools can also make good candidates and may offer more expertise in the technical side of the business.
Still, scrap executives emphasize that the type of formal education a prospective candidate has earned takes a back seat in personnel importance to the personal characteristics a person brings to the job. In fact, most say that if a job candidate possesses the proper qualities, the type of degree he or she has earned may be inconsequential. For instance, someone who is eager to learn and demonstrates initiative is likely to be readily trainable, and those with good people skills--the ability to communicate effectively and develop and maintain good relationships with customers--can fill a critical role in the customer service-oriented recycling industry. Other desirable characteristics include a strong sense of responsibility, accountability, integrity, inquisitiveness, and problem-solving and decision-making skills.
These traits can be difficult to determine from an interview and copy of a college transcript, so some companies use pre-employment tests to help figure what kinds of skills and psyche a potential employee would bring to the job. M. Lipsitz & Co. Inc. (Waco, Texas), for instance, has developed a personality profile of what it considers to be the ideal scrap plant management candidate, based on characteristics of the company's successful managers. Prospective trainees are given a test to measure, among other things, their mental alertness, character strength, emotional maturity, competitiveness, and work motivation.
The Outdoor Classroom
Once a good candidate is selected, the process of educating can begin. For most scrap companies, this means some form of on-the-job training. Indeed, scrap executives from companies large and small emphasize that hands-on learning is a critical key to new employee success, and also allows a company to begin seeing some return on its investment fairly early in the process since the employee is working while learning.
This experiential learning may take several different forms depending on a company's particular focus and its trainee's specific needs, but most trainees begin their on-the-job education working out in the plant learning operations basics--even if they will not have much contact with the plant once they begin their regular job duties. Brokerage operations without physical plants have been known to send their trainees to work at customers' facilities as a way to get this training stage in.
This outdoor training typically takes anywhere from one to three months, depending on the size of the operation, with a week or so generally allocated to each segment of the plant. Those training to become traders, for instance, are likely to spend time sorting scrap in order to get a better grasp of the different grades they may be responsible for trading in the future, and then might move on to working at the scale, where they have the opportunity to interact with customers and evaluate incoming loads of material. Many companies also require trainees to learn how to operate cranes, balers, furnaces, and other processing equipment.
It may seem to make more sense to start new recruits in the actual jobs they will be doing, rather than spending time and money teaching them things they may never do again in the plant. However, scrap executives and recent trainees say that time spent in the plant is an essential part of a complete scrap education, and it gives newcomers a better idea of what the industry and the company are all about than any book, video, or magazine. Brian Halloran, a relatively new nonferrous trader for David J. Joseph Co. (Richmond, Va.), who sorted metal as part of his job training, explains, "About 90 percent of my time is spent brokering metal, and even though I may never actually see the material, it is important that I understand each metal--what each looks like, its properties, and what can be done to it to add value."
Graduating Into the Office
With some in-plant experience under their belts, the next step for most scrap students is more hands-on learning, this time with an emphasis on the skills and responsibilities specific to the trainee's job. In this phase of the training program, companies often opt to pair the scrap trainee with an older, established employee who serves as a guide and mentor, tutoring the newcomer on the business side of things, such as following the commodity markets and establishing contact with customers. In addition to shadowing this person, the trainee may need to supplement this on-the-job learning with industry-relevant books, videos, and periodicals as well as any company specific training materials. Such material can help the trainee keep abreast of various issues pertaining to the scrap processing industry, including environmental regulations, safety standards, and market influences.
If the new recruit's responsibilities involve dealing with the outside world, as most every scrap professional's job does, this training phase is likely to also include a few months spent visiting consumers, suppliers, and other recycling facilities. Such field trips, say those companies that include them in their training programs, provide new employees with a broader understanding of how scrap is generated and consumed and what this means for processors and traders. Such travel also affords them the opportunity to network with customers and others in the business.
Because of the importance of networking--particularly for traders—some firms encourage or even require employees to participate in industry and local business associations as an additional training step. As those that advocate it point out, this approach not only allows trainees to make business contacts, but also provides them a chance to gain valuable perspectives from industry and business veterans.
Furthermore, some of these organizations, such as the Institute of Scrap Recycling Industries (ISRI) (Washington, D.C.) offer educational programs appropriate for people new to the industry. In 1995, for instance, the association will offer a seminar specifically for new executives June 11-13 in Chicago--which will cover a broad range of industry basics--as well as metals identification and environmental management programs scheduled throughout the year in various parts of the country. (For details, contact Jennifer Adams at ISRI, 20216624533.)
ISRI also features a Young Leadership Council, which generally meets quarterly as a forum for young managers to learn from each other. As a more-formal educational effort, the council is preparing a scrap dictionary of sorts, which will define industry terms and acronyms.
Higher Learning
Newcomers at scrap firms with some kind of training program generally spend anywhere between one and two years in a training capacity, gradually taking on more responsibilities throughout that period. The learning process, however, is ongoing, so some companies offer their newly initiated employees, as well as established staff, the opportunity to continue to pursue job knowledge through formal and/or informal education programs. This can consist of anything from tuition reimbursement for classes taken at a local university to payment for local seminars on time management topics to company-sponsored on-site workshops.
Annaco, for example, worked with a former steel industry CEO to help the company's executives put together a comprehensive continuing-education program for its managers that covers, among other things, improving communication skills, giving instructions and delegating effectively, motivating others, and resolving time management conflicts. Participants spent two hours every other week for several months in this structured program. Other companies meanwhile, offer periodic seminars on specific industry or business topics.
Then there are those scrap recycling companies that encourage employees to continue their academic studies by offering tuition reimbursement or other financial aid. Employees at these firms have achieved everything from taking a few classes to brush up on metallurgy or accounting to earning graduate degrees. Matt Heitmeier, a trader at Padnos Iron & Metal Co. (Grand Rapids, Mich.), for instance, recently earned his MBA while working full-time and attending classes at night, courtesy of the company’s tuition reimbursement program. “I was able to use what I learned in school on the job and what I learned on the job at school," he notes, adding that blending the two together has made him more effective at his job.
Whatever form continuing education takes, scrap executives that offer it tend to agree that it can be a worthwhile investment that pays off by keeping staff up to date and motivated, both of which can result in substantial returns. The thing to remember, however, says Annaco's Toth, is that "training has to be connected to the strategic direction of the company and should produce measurable results."
Following the Rules
That point is appropriate advice to heed throughout the process of hiring and training new managers. In other words, there can be no hard and fast formula for educating new employees since each company and each individual are unique. Indeed, the only rule that seems to apply universally is that the growing number of professionals entering the scrap industry with little or no recycling business experience need some kind of training--no matter how informal--to perform their jobs as well as possible. As Toth puts it, "Service is the life blood of this industry, so to keep customers you have to provide excellent service. You can't do this without knowledgeable people--therefore you must train your staff well."
More and more scrap companies are hiring executives new to the scrap business, presenting a training challenge. Here’s a look at the trend and how some firms are bringing scrap rookies up to speed.