A giant in the industry, Houghton International is evolving all the time – and as Director of Marketing Mervyn Chung-Fat explains, its impact is stron...
Houghton International, the global metalworking fluid solutions provider, continues to go above and beyond to ensure top-rate relationships and collaborations with customers. With multiple Customer Solutions Centres being set up at an incredible rate across Europe, changing regulations across the continent, and a huge upcoming combination with Quaker, Houghton stands strong in the eye of the storm.
Mervyn Chung-Fat is the Director of Marketing for Houghton in the EMEA region, and the Automotive and Aerospace sectors globally. Chung-Fat spoke with us last year about the work Houghton was doing, and to say the business has evolved since then would be a gross understatement. However, the focus remains the same.
“We want to be working much more closely with our customers, and are trying to develop solutions that are much closer to their needs,” he explains.
Hence the development of the Customer Solutions Centres. Four new locations have recently been opened in Italy, Germany, Spain, and the UK, designed to bring Houghton and its customers into a more collaborative partnership.
“We’re trying to resolve problems ahead of time,” says Chung-Fat. “As we work more closely with customers, we can better understand what their main overall objective is, so it’s easier for us, together with tool and equipment manufacturers, to make sure all variables are balanced and working in a synchronised way.”
The Customer Solutions Centres were a natural evolution for a company that already concentrates heavily on customer relationships and satisfaction. “Our approach here is to try and get everybody to start talking together more and planning further ahead, and create a forum where we give our customers access to all our engineers globally through these centres,” Chung-Fat continues. “If we have more open discussions with customers, we’re able to bring the solutions to them much faster.”
Customer feedback has been positive, with the general consensus that the concept is long overdue. Partners too are excited by the merging of minds, and the opportunity to influence both Houghton’s products and the consumers that buy them. If Houghton’s processes are in alignment with what its customers are doing, those sought after productive and successful relationships are formed.
The impact of REACH
These strong connections will prove vital in the wake of regulatory changes. REACH – Registration, Evaluation, Authorisation, and Restriction of Chemicals – is a set of regulations in the EU which are set to have a heavy impact on Houghton’s services.
“REACH has somehow gone under the radar for some companies,” Chung-Fat explains. “It’s been out there for 10 years in the industry, and the major players have all been ready for it for many years, but a lot of small-to-medium chemicals companies have completely underestimated the impact on the market. Some major automotive manufacturers have even told us that they are afraid some of their components may disappear in the next year, because a smaller supplier may not have considered that a chemical that goes into a critical car part is going to disappear.”
Houghton successfully anticipated the gravity of this issue, and already has a team dedicated purely to working with suppliers to understand the situation with every single one of its raw materials, how their status will evolve over time, and to ensure that Houghton’s own supply chain is guaranteed.
The business is looking closely at all 4,000 product formulations it provides to the market today, and in doing so, Houghton knows that it will soon lose around 10% of raw materials it buys as they are discontinued by suppliers. Registration costs are high, and labs are significantly overworked – however, thanks to Houghton’s dedication to preparedness, the company is placed in a more comfortable position than most as REACH takes effect.
“We feel very confident today on the availability of our products during 2018,” Chung-Fat says. “We’re a global leader in metalworking fluid solutions and we cannot afford to leave our customers in the trenches all alone, so we’ve tried to anticipate this because while REACH is only occurring across Europe, it has global ramifications across industries. We don’t want to put our customers into a position where there’s a necessity to make a change last-minute which could then have other impacts on approval process flow. We are working closely with many of them through the transition and making sure they are ready for next year.”
Unmoved by any problems that REACH may cause, Houghton is driving forward with new strategies. The business is concentrating on the accelerating march of Industry 4.0, having worked on it for over a decade, and is applying solutions all the time to enrich the customer experience.
“Our Houghto-Trend solution is an information database that help our customers monitor how they are consuming their fluids and all maintenance related information,” says Chung-Fat. “With this data, which is available to them over the internet, they are able to see how efficient their operations are and can choose where they need to act. With the new EHS regulation in the UK, Houghto-Trend allows to keep the required testing and monitoring history to be fully compliant.”
Houghton is also introducing a device called Greenlight to Europe. Already available in the US, Greenlight is a simple bolt-on product with a green/amber/red lighting system that shows the user whether the fluids being monitored are within the correct concentration levels. This level of effort to improve and simplify life for their customers is another feather in Houghton’s cap.
“We’re moving our focus away from just product competitiveness and more towards customer solutions,” explains Chung-Fat. “We’re a speciality process chemicals company, but we understand that our customers are looking for more than just the chemistry part. We’ve got experience and expertise on their production and processes, and we’re really focused on trying to go much further into offering these broader solutions.”
Creating a powerhouse
Houghton’s desire to forge strong relationships doesn’t stop at customers, but also to long-term rival like Quaker Chemicals, with which Houghton is combining. There are many similarities between the two leaders of the industry, from technical solutions to their focus on customer intimacy. By combining Houghton’s and Quaker’s diverse technical expertise, the combined business will cover bases that neither has done on its own.
“For our customers needing fire resistant hydraulic fluids, independent of what type of equipment they have, once we combine with Quaker they will have access to the best of both worlds with a single supplier,” says Chung-Fat.
Investing in real talent is what has enabled Houghton to not only be successful as a business, but has ensured that people remain the focus. The company’s team members bring the best solutions to customers because they care, and in a dynamic and ever-changing industry, caring is vital. This is what Houghton’s attitude going forward revolves around.
“To last another 150 years, Houghton needs to be operating more of a start-up than a well-established business,” Chung-Fat concludes. “We carry our heritage very closely, which has made us the global leader, but we have to keep thinking like an entrepreneur to thrive in this fragmented market.”