The Elgin Group’s recent strategy is set to reap huge benefits over the next year as the turnkey engineering solutions provider looks to the rail and port sectors to continue its exciting journey.
Since 1949, the company has been an ever-present fixture of the engineering industry in South Africa and the surrounding region, but since a takeover in 2004 by brothers, Ian and Lee Donjeany, the business’s new flexible approach has culminated in dramatic growth.
“Our strategic objective is to utilise our core capabilities around engineering and fabrication and provide a broader product range and geographic spread through acquisitions and joint ventures,” Chief Executive Officer (CEO), Ian Donjeany said. “When we took over the business in 2004 there were 120 people employed. A decade later, we employ over 1,500 across The Group.
“The infusion of an entrepreneurial culture into the organisation has been key over the past 10 years. For example about three years ago an opportunity presented itself, for which we positioned ourselves and are now a potentially meaningful player in the rail space.”
Reacting quickly to a government initiative in South Africa brought about this move into the rail sector and Donjeany soon realised there was more to capitalise on through the opportunity too.
“About three years ago, the South African government embarked upon a number of initiatives in this space so there was no doubt that there was going to be significant expenditure, both in terms of passenger rail and in terms of freight,” Donjeany explained.
“We knew the two opportunities to come out of it would firstly be the major rail infrastructure, but also, if you’re going to move products or commodities - then the port infrastructure had to be improved as well. The Group is positioned for both rail and port related opportunities.
Quickly hatching a plan to this end, The Elgin Group has already begun to make its mark on rail and port projects in South Africa.
On the port-side, the company has once again formed a powerful partnership with Chinese organisation, Shanghai Zhenhua Heavy Industry Co. Ltdto be the local partner in the engineering of large container handling trains for The Port of Durban, the largest of its kind in the southern hemisphere.
Following this promising start, Donjeany is now determined to ensure that by late 2014, The Elgin Group is “meaningfully entrenched in the rail industry in South Africa”.
Partnering with large, multinational organisations is another strategy which Elgin Group has spent a lot of time and effort focusing on.
As well as acquiring an array of local businesses to aid its own operations, including Trotech Engineering, Petrel Engineering, Spare Parts, Solar Leasing Systems and Intershore, Elgin’s recent growth has largely been achieved through its more all-encompassing approach.
“One of the things we thought the company was, historically, was that the entity was a bit insular focused and people didn’t get out into the world enough to see what was going on,” Donjeany said. “We’ve now realised we need to give our people the best exposure to the global business environment.”
A recent example of Elgin’s new inquisitive strategy saw a team travel to the Chinese Welding Institute in a move that resulted in a substantial overhaul of its own welding technologies and processes.
Proactivity is certainly the order of the day in modern-day Elgin, which has also been represented through its recent expansion efforts.
“We currently have a link to both Mozambique and Tanzania,” the CEO continued. “We saw the trend developing and thought we had to be there, so had people on the ground for eight months in Mozambique developing our service for the gas companies.
“We’re in the process of pricing and tendering work for that and I’m looking at setting up the infrastructure in order to play a meaningful role in Mozambique. By this time next year I’d like to say I have in-country resources and facilities and employ 100-plus people in the country.”
Murray & Roberts took care of the Elgin foundations for nigh-on 20 years, and while the company remains a loyal local partner to The Elgin Group , the corporate legacy they left is hardly recognisable to the flexible, entrepreneurial, family-run business it is proud to be at present.
There is a very clear and consistent culture within the business now, which has similarly been transferred to employees, both at Artisan and Senior Management level.
Despite the obvious challenges arising from increasing a work force so dramatically in a relatively short space of time, the inclusion of both in-house and external training opportunities, staff-retention schemes and a new Elgin Training Academy has ensured that The Group is quickly becoming an employer of choice within the region.
“Getting rid of the bureaucracy that was here previously was a key focus when we created the business, and we feel it is in much better shape than it was 10 years ago,” Donjeany concluded. “Being a family company allows us to have a long-term view on the business, which initially people were doubtful of.
“Over time though, we’ve created stability and convinced people that they should join us in this long-term plan, knowing that we will still be just as committed in 20 years’ time. In the short-term, I have my own five-year wish list which will keep the team dreaming and looking to the horizon.”