Nik Endrud, 48, always knew he wanted to be in manufacturing but did not predict that the CoverGirl cosmetics company would be the way he would crack into the sector. It turns out that makeup provided the perfect foundation for a career that would lead Endrud from internet marketing to the automotive industry, where he's risen to be executive vice president, North America at Forvia — the result of seating interiors and exhaust supplier Faurecia's recent takeover of lights supplier Hella.
Endrud is responsible for merging the operations of the two supply giants, both of which have a big presence in metro Detroit and combined revenue in North America of around $6 billion. He's also overseeing a combined 27,000 team members in North America — 4,000 of whom are in Southeast Michigan. The following conversation has been condensed and lightly edited for clarity.
Q: Faurecia just completed its acquisition of Hella. Should we expect to see a consolidation of operations?
Endrud: Only since the last day of January when the deal closed were we able to actually officially begin to collaborate business topics, so now that is starting in earnest. We've identified the workstreams and have an expectation for, at a global level but also at a regional level, the synergies that we expect to gain from the transaction. Those synergies are not only performance improvement and profitability improvement synergies ... but also, there are top line synergies. We expect to grow faster. There's a natural, I would say, complementary aspect of who we sell to and what vehicle platforms we're on, so we're able to begin to kind of look across a broader cross-section of the industry, and it just creates more opportunities.
Q: So is there overlap in terms of operations and in terms of employees?
Endrud: From the product lines and actual business execution, there's very little overlap. I would say that 90 percent of our business is seating interiors, exhaust systems, and then there is 10 percent roughly (that is) electronics, say, in the legacy Faurecia business. So there's a natural complementary aspect ... and there's actually only a couple product lines that have any direct overlap in the electronics space. So, in a lot of ways, this is a bolt on of a great company with a strong market position, as opposed to a merger where we're going to rip out a bunch of synergies through a duplicated overhead ... Over time we're going to obviously look to optimize synergies. What we're really looking to do is capitalize on the net growth to create more opportunities for people, as opposed to having this be a situation where we're displacing people.
Q: How did you get your start in manufacturing?
Endrud: I grew up in northern Illinois, went to school down in North Carolina to Duke, and I knew I always wanted to be in manufacturing. And so coming out of school with an engineering degree, I went to work for Procter & Gamble making makeup of all things. But I had a great experience ... and I learned a lot in those two years. I was there just under five years, worked as a manufacturing engineer and then as a production supervisor, literally on the CoverGirl liquid makeup line because that was my line ... But I learned a lot about manufacturing, system-based organizations, matrix organizations, how you join people up to an organization — training, development, a lot of discipline. The one thing that I did learn through that process was that the manufacturing process, and the fundamental technical aspect of that — I enjoy that being a big part of what you sell and the value proposition you offer to your customer. And so I left that because I went and joined an internet marketing firm, because it was 2002. Why not join an internet company? It was a cool business. It was more of a technology platform that was a direct marketing model, and it worked well. The business sold to AOL. Remember them?'
Q: How did you end up in the automotive industry?
Endrud: So, I joined the automotive industry in 2002. I was 29 years old. So I got into the auto industry, at its simplest level, because I married a woman from Southeast Michigan. So, we came (to metro Detroit) and I needed, obviously, to support my new family. And so I was given the opportunity to join Johnson Controls, and I did that in 2002. At the time, it was pre-Adient, so I worked through different parts of the organization but really found myself seeding business. I kind of got into it. It's a really dynamic business. You know, I come out of a startup where I looked at raising capital and looking at burn rate and funds, and I thought going into this big, monolithic company and industry would be so different, but because we run on program cycles, every program is the opportunity to look at it like a business on its own. And so what I found was that it was actually a really entrepreneurial approach to a big business because you're constantly challenging competitiveness and your market position and strategic drivers ...
Q: When did you join Faurecia the first time, and why did you leave?
Endrud: I joined Faurecia in 2006 at an interesting time in the company's evolution. So it was a lot of fun, and it was constant growing. We were opening plants and thinking about where to be, so it was really a dynamic ride that we were on. As with many rides, they can end, because there were no executive committee level positions. The position I'm in today didn't exist when I left. I went to Tenneco, and Tenneco was a great company, and they gave me an opportunity to lead a global business, and I'm super appreciative. Two and a half years I spent there, and when I got called back to do this role, you know, I have a long history here and kind of grew up in this business and with a lot of people in this business. There's an element of pride, and the opportunity to lead this organization at this time was something that was too good to pass up.
Q: Suppliers have obviously been hit hard by the chip shortage. Do you expect that to ease up?
Endrud: Yeah, so us, like the rest of the industry, expects it to ease up successively throughout this year. So, it's already better, but it's based on customer and platform. So it affects us in two different ways. So it affects us as a manufacturer of electronic components, meaning that securing our own stocks to produce sometimes comes at, I'd say, a higher degree of challenge, which oftentimes translates into cost, but a higher degree of challenge and complexity. So its costs in terms of availability and transportation, but also resource burden to secure them and make sure that they're coming in reliably. Sometimes there's an engineering burden because you're having to substitute, etc. The idea that an industry with probably the most sophisticated supply chain network in the world, honestly, can take down an entire assembly plant for the next week on a Friday afternoon is something none of us ever thought we would see. Certainly, if there was a fire or a strike, but because of supply chain disruption, repeatedly? That is a phenomenon that many of us ... it's just something that we're not used to having to deal with.
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