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Wates chief places right before might

Paul Drechsler’s condition of giving Construction News an interview is that we agree not to use any images of him pictured on his own.

From the outset, Wates’ chief executive insists the company is not about him, it’s about its family owners (and their children who will inherit it), its staff and its clients. He is “just here to conduct an orchestra”, he says.

This focus on people extends to the way he talks about the business too. It is much more about the company’s moral values than it is about the values on their balance sheet. Mr Drechsler’s emphasis is on winning work by “delighting” people.

“The key to success is two things: working with your customers and then working with suppliers who are going to all subscribe to the same values, which are successful project delivery, safely, on time, on budget, to a quality that will delight everyone. That’s a common mission.”

He talks with passion about the way the work Wates does changes people’s lives. The “fabulous regeneration” of the Cruddas Park estate in Newcastle, now renamed Riverside Dene, for example, where, he says, “you now walk into this sea of tower blocks and it’s dramatically different.

We’ve done some serious building, some serious modification, it’s all beautiful architecturally. But actually what we’ve done is change the whole sense of community.

You walk into the reception and these people, many of whom are long-term unemployed, or children who are one of the one million kids not in employment, education or training, and now they go into the reception and it looks more like the reception of a Marriott hotel”.

Likewise on education. “I will do anything to change the environment in which children learn,” he says. And he’s not just talking about building or refurbishing schools. Wates also has plans to work in business partnerships with 500 schools within two years (see box).

A lot of Mr Drechsler’s emphasis on values comes as a result of Wates being a family business, which has always set great store by its social impact, he says. “What they have is an undeniable commitment to the long term and an unquestionable commitment to community and society.”

It is this focus, the commitment to treating people well, that Mr Drechsler says will win the company repeat work in difficult times (see box). His priority, he says, is “don’t hurt anybody” – the public, sub-contractors, customers, employees.  But isn’t all this niceness going to be at the expense of Wates’ competitive advantage? Mr Drechsler says not.

“Success breeds success,” he says. “We are not the only company serving Land Securities. I wish we were, but we’re not. We’re not the only company working with Marks & Spencer. I think we should be, but we’re not. We believe the more our customers see and push this way of working, the more people are going to do it.”

Winning work

Paul Drechsler says he’s more concerned with longevity than growth. There’s a “good chance” Wates will grow 5 – 10 per cent next year, but he’s only interested in doing it at the “right margin”.

Where will this work come from?

  • Retail

“I fully expect we will continue to delight John Lewis, Waitrose, M&S, Morrisons and others.”

  • Interior fit-out

“Will continue to do great work in the commercial market, and in legal and financial services. The London market is set to be quite interesting next year, a lot of leases come up so it should be a good place.”

  • Social housing

“Living Space is a great business. What’s absolutely clear is the UK is going to need homes and roofs for people. We will find different ways of doing things [but] it’s not going to be fast. What we need at the moment are pilots.”

  • Education

“No matter what you say, this needs a lot more expenditure over the next few years and it will happen. There is a political imperative.”

  • Commercial

“The commercial market in London will have a bumpy road because of the world economy but I think we have a great reputation in that area and we do very well and we will win our fair share of business.”

  • Heritage buildings

“Wates people are passionate about difficult construction jobs, particularly heritage buildings. We’ve always got a few things like that on.”

In any case, growth is not his priority, it’s longevity he’s preoccupied with. “If the market falls dramatically it’s going to have an impact on us. What we’ve got to do is make sure it impacts us in a way where we come out better, stronger, long-term.

“That’s the deal. My deal is with several [Wates] kids under one year old up to one who’s now 18. My deal is to deliver something that goes to them in 20 years that they say this team did a fantastic job.”

This long-term view might explain why Mr Drechsler is prepared to be pretty outspoken about the industry’s attitude to pricing work. He doesn’t mince his words.

“We need to behave like professionals. Not just in the way we tender, not just in the way we plan, not just in the way we deliver, but in the way that we price. No other professional service on planet earth behaves on pricing the way this industry does. It’s absolutely ridiculous.

“We are employing very talented people, these are the people that matter in this industry. We are letting them down as an industry if we don’t price to deliver safety, to deliver quality, to deliver satisfaction.”

But however strong his commitment, isn’t it necessary to stop other people behaving like this too if it’s going to make a difference?

“Well, it is. I can’t stop other people. All I can do is say: how about sitting down, looking in your mirror and asking are you a total idiot or not?

“What I can say is: we are going to do our business this way. Does that mean the next two to three years we are going to grow? I don’t think so. I think we will be very happy to nurture this company, get better and better at what we do, get better at safety, get better at operations, get better at our commercial practices, get better at our risk management, get better at our relationship management. If I can grow that’s a bonus.”

Mr Drechsler’s forthright views may be as a result of his outsider status. Most family businesses are pretty private, he says, and “it’s only because I’m not family that we are even talking here in a way”.

His background was in the chemical industry, working all over the world. He says he still feels like a “fly-in”.

In the seven years he’s been at Wates, Mr Drechsler thinks the industry has got better at communicating its strengths, its importance to the economy, its impact on society. But there’s still a long way to go.

Again, it comes down to people. “This industry is about fantastic individuals, immensely capable, hugely proud, very able, who do great stuff. And all this management system around them in a way lets them down.

“We need to perform better, shout louder, be more articulate about what we are doing.”

Wates is a member of Business in the Community, which awarded it company of the year last year.

Through BITC, Wates is part of a national programme, ‘Business Class’ which forms long-term partnerships with secondary schools to help them raise their aspirations and the students’ attainment. Overall the programme is working with 175 schools, of which Wates is involved with seven, including Ernesford Grange School, Coventry (pictured).

BITC is aiming to have formed 500 of these partnerships within two years. Mr Drechsler says: “As Wates I cannot do 500 schools but I go out finding companies. I haven’t met a chief executive in the past six months where I haven’t said: have I got an opportunity for you.”

Readers' comments (2)

  • This article is simialar to the ass kissing ones you used to write about the sage of construction Garvis Snook. These people are only bothered about nailing down margins so sub-contractors are constantly under pressure. You never learn.

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  • Interesting article with a lot of positive comments.
    Getter better, sharing values, behaving professionlly are all very worthy company goals.
    With respect to the earlier commentary about Garvis Snook and ROK I don't think that comparing Wates to ROK is quite fair, they are completely different organistions in every sense.

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