KEY POINTS:
McKay Electrical & Instrumentation (MEI) must be one of the jewels of Northland industry. Among other achievements, the Whangarei-based company last year won a multi-million-dollar deal to fit the electrical system for an 85.3m motor yacht being built in the United States.
According to some sources, the 2800
tonne vessel will be the biggest yacht built in the US for 75 years.
A confidentiality agreement means MEI's chief executive Lindsay Faithfull is unable to provide details of the contract. But he did let on that competition was fierce and a bit of Kiwi No. 8 wire thinking helped clinch the deal.
MEI submitted a proposal that included a novel piece of equipment which performed two different functions, rather than the separate pieces of equipment traditionally used. That helped save cost and weight, something of considerable importance to yacht builders.
The yacht is being built by Derecktor Shipyards for a client who has already owned two luxury yachts. Derecktor's website says the yacht is capable of extended voyages while keeping her owners and crew in luxury. She boasts six decks, with the owners' and guests' accommodation representing half that space. With a steel hull and an aluminium superstructure, the Derecktor 85 (the project name) will provide a blend of strength, weight-saving performance and seakeeping. Thousands of subcontractors are working on this project.
Faithfull is down-to-earth, despite winning the impressive contract last November. His focus is now on delivering the job, which involves MEI doing the design, software, and manufacturing of the electrical distribution system and switchboards, and alarm/monitoring system in New Zealand. The systems will then be shipped to the US for installation.
MEI is something of a household name in Whangarei because it has a division that services large and small appliances, covering a long list of brands. The company was founded by Tom Mckay in Dargaville in 1936. In 1944, Lindsay Faithfull's father bought a part of Mckay's Whangarei business and the company has grown from there.
That growth means MEI is now among the largest electrical and instrumentation companies in New Zealand, with divisions covering the aviation, power, dairy, timber and petrochemical industries - and the marine industry as well.
In aviation, it has completed lighting systems for runway extensions in New Zealand, Tonga and Samoa. It has also done work on portable runway lights, taxiway and stop bar lights, runway end identification and sequence approach strobe lights in New Zealand, Papua New Guinea and Vanuatu.
Although Northland is traditionally a stronghold of the marine industry, MEI had not been a serious player in that area. But having watched developments in the market, Faithfull was convinced the company's abilities could make it a serious contender in that industry as well.
When the Tenix Defence project to build ships for the Royal New Zealand Navy came up, MEI threw its hat in the ring. Faithfull says MEI won the job in mid-2005 because it identified a need in the market and there was a serious commitment by Tenix Defence to use local content. The Tenix Defence contract was worth $9 million, to be carried out over three years.
MEI's role is to supply electrical distribution systems for inshore patrol vessels as part of Project Protector. The project involves building seven ships for the Royal New Zealand Navy: a 131m multi-role vessel built in the Netherlands, two 85m offshore patrol vessels built in Melbourne, and four 55m inshore patrol vessels, built in Whangarei.
The company employs 130 people, and Faithfull believes in the value of running a flat organisation. Having spent five months with the Icehouse business incubator on its owner manager programme, Faithfull has been forced to put his strategic vision for the company on paper - something not many owners want to spend time doing.
For a company that has doubled in size in the past four years, managing this growth is important. Faithfull wants to keep MEI as an end-to-end supplier of electrical and instrument systems for the industrial and marine industries.
"We intend to do this by focusing on our strength. We can't be all things to all people - for instance we are not in the commercial building industry."
He is aware of the need to continue to evolve his company to make sure its structure stays relevant as it grows. Over the next four years, MEI is going to be a different company and will need a wider range of deeper skills, he says
One of the major trends in the electrical engineering industry is the convergence of power systems and control systems, where the software side meets the hardware guys. To succeed in the industry, a company has to offer skills that cover what a tradesman and professional engineers can offer.
Although there is more hype and buzz in the software side of engineering, the mechanical and fabrication side are just as important. "What we are seeing is the two disciplines coming together. That is reflected in our business, in the breadth of what we do, where our engineering software skills and strong tradesman skills are in demand," Faithfull says.
One of the company's strengths is the ability to use its resources well. The company also places strong emphasis on planning. Every two months, all senior management leave the site for brainstorming and planning sessions.
The company gets 40-50 per cent of its multi-million-dollar revenue from outside New Zealand and Faithfull says MEI has ambitions to be active in every major region. "We want to go where we have a competitive advantage, where we have something to offer."
To succeed overseas, Faithfull reckons, one has to understand the channels to a market. "Often, you have to filter the information that you hear because the principle that applies to someone else, say in the fast-moving consumer goods industry, may not apply to you."
Things electrical run in the family. His dad was an electrician. Faithfull himself has an electrical engineering degree from the University of Canterbury, and has done postgraduate studies in finance, accounting and management. For now, he is happy to keep MEI shining as a Northland jewel.
Switched on
* McKay Electrical & Instrumentation was founded in Dargaville in 1936.
* Now based in Whangarei.
* Employs 130 staff.
* Makes electrical and instrumentation systems for industries including aviation, timber and petrochemicals.
* Has moved into marine industry, winning contracts for Navy patrol craft and an 85m luxury yacht.
