Episode Transcript
[00:00:03] Speaker A: Welcome to INA Insights, where prominent leaders and influencers shaping the industrial and industrial technology sector discuss topics that are critical for executives, boards and investors. INA Insights is brought to you by Ina AI, a firm focused on working with industrial companies to make them unrivaled. Segment of one leaders to learn more about Ina Aihdev, please visit our website at www. Dot ina dot AI.
[00:00:40] Speaker B: Good morning and happy New Year. Welcome to another episode of the Titanium Economy podcast series where we explore a wide variety of topics including the macroeconomy business strategy, technological and operational transformation, and the outlooks for the future with leading executives in the industrial technology sector. Our guest today is Mister Paul Reeds, president and CEO of Titan International.
Titan has a heritage of over 100 years in the off highway wheel manufacturing business. Since Titan's entrance into the tire market in 1993, the company has evolved into a leading global supplier of complete wheel and tire assemblies for off highway vehicles. Titanium's primary markets include agriculture, earth moving, construction and consumer applications. Today, Titan has market cap of a billion dollars and nearly $2 billion in annual revenue. They are based in Illinois as their headquarters employ nearly 7500 folks across the world, out of which about 3000 are here based in the United States. Mister Reitz joined the company in 2010 as the chief financial officer, went on to become the president in February 2014 and then was named CEO in January 2017. Prior to joining Titan, he was the chief accounting officer at Carmike Cinemas, based in Columbus, Georgia. He's also held leadership positions in McLeod USA Publishing, Yellow Book USA and Deloitte and Touche. He has an MBA from the University of Iowa and a Bachelor in Business Administration from Northwood University. Paul, welcome to our podcast. We are super excited to have you and are looking forward to our discussion on Titan and your particular journey today. Thank you.
[00:02:15] Speaker A: Thank you for having me today and looking forward to it as well.
[00:02:18] Speaker B: Well, let's start off by talking about Titan. Could you talk to us about the company's overall mission, its strategy and what are your priorities when you wake up in the morning?
[00:02:25] Speaker A: Sure. Titan is a unique company and I know a lot of people like to use the word unique, so I'm not going to throw around too loosely here, but as you said, what we do is the wheels, tires and undercarriage for off road equipment. So we make big equipment and agriculture, earth moving move. What's unique about our business though is we're really a carve out from other other companies where we've created this niche industry. So there's really nobody like Titan around the world that's making those particular products just for off road. Obviously, wheels, tires and steel track exist in many different facets by other companies that are producing it, but they're either vertically aligned or they're more horizontally aligned across other segments, which primarily go then on road with passengers and consumers light truck. And so Titan is unique in that aspect that we only do. We only make the products that go off road. They get dirty and they, generally speaking, go on pretty large equipment. And so with that being in kind of a niche industry, what we wake up in the morning and every day and really get focused on, and what I got to make sure our team is getting focused on is how do we connect to that end user with the products that we make. We need to make sure that that large equipment, if you think about a typical agriculture piece of equipment, whether it's a sprayer, whether it's a 600 hp tractor that has to go through tremendously difficult terrains and weather conditions, or it's an excavator that has to deal with, obviously, a tremendous amount of weight, we need to do things that connect us with that end user of the equipment. So our customers are the dealers and they're the oems. But really, what we wake up every day trying to do is how do we get to that end user and make that equipment that they're investing a lot of their money in perform better?
[00:04:06] Speaker B: That's very intriguing, Paul, and I think you, I think, as you rightly said, uniquely serve a set of end markets which are very critical to the economy and how it functions. So, speaking a little bit about the end customers use, weve obviously seen a lot of discussion about where the new macroeconomic regime is going, whether its inflation, money supply, interest rates, and how its impacting end customer demand. So just from your perspective, whats your outlook on the broader industry and whats titans playbook in dealing with that? Is it more offensive? Is it more defensive? Would it be great to get your perspective, given the end markets youre serving as a good barometer?
[00:04:40] Speaker A: Yeah, it's a good question that I think for many folks, it's hard to turn your head off at the end of the night and not keep thinking about everything you just mentioned. There's so much going on in the world today, so many different variables. And I think we got to be careful to characterize these variables as not necessarily negative. I think we have a lot of times, and I think the media helps portray this situation differently than what it is in reality for a business. But, for example, the word recession, you cannot go anywhere without everybody talking about the recession. Lets look at the delta of where were at today compared to what a soft landing recession would be and realize that that impact is probably not that significant. For example, in the UK, I think we reported what is a 0.1% growth. Well, if you go into a soft landing recession, that differential again is not going to be that big of an impact from where we are today. Youve got to be careful at the variables youre looking at. And obviously from a macro perspective, you could sit here and drive yourself nuts trying to think about all of it. So what we're really focused on is really in the landscape of everything that's going on from a macro perspective. Politically, those challenges are different than what we're talking about with inflation, labor, supply chains. Politically, we do have a plant in operations and we have a large couple of large operations in Brazil. So when you start talking about what's going on in those locations, that's highly sensitive and very specific to what's going on in that locale, what we spent a lot of time, and we get together every week and talk about it as a team, we spent quite a bit of time understanding, okay, what's going on from a macro perspective, what's going on from a local perspective. But then we really tie it down to more specifically what is going on in our industries. And so I think for us, we're fortunate that the industries we serve, as we mentioned earlier, agriculture, construction, earth moving, are in a fairly good position, especially agriculture, which is one of our primary segments. If you look at the agriculture economy, one thing weve seen through the pandemic, your food supply is critically important to your population, your political stability. So weve seen governments step in, provide very good support programs. So some of that volatility that existed, for example, in the eighties with commodity prices, I think if we look at the near term and the midterm, theres a higher floor for where commodity prices are going to be. Then you look at the overall supply demand. Economics for agriculture are really strong right now. And so you take that farmer income is good, inventory levels are still very low, especially in large ag, which makes up the larger part of the overall agricultural economy. And you sit here and go, okay, there's a lot of variables, there's a lot of noise going on, but we're in a good place. And I think with construction, again, you got to step back and look at it and go, if you're trying to drive your economy, you're trying from a political standpoint, trying to make decisions that are going to be win favors within your local population, you got to protect your infrastructure. And I think there's, every developed economy around the world is going to say, look, we need to invest more in infrastructure. So as we see residential slowing down, I wouldn't be surprised if you see some of that infrastructure spending start to kick into gear that's been delayed, especially as the labor becomes available to do so. And so I think the sectors we serve, again, when you look at it from more of a micro perspective, we feel very good about where we're at, but we do spend a lot of time, again as a team. And I know we all spend a tremendous time individually as well, trying to understand that macro where those risks are. How could that impact our specific sectors? What's going on locally, which is always fascinating to sit around and listen to everybody talk about what's going on in their, their local areas, it's, there's a lot of commonality. You know, we all have this kind of the same issues battling the impact of inflation, political problems, et cetera. But then you got to, you got to figure out, what does that mean? What am I going to, what, how's that going to drive our decisions? And so that's the critical aspect of it. You can try, you can talk yourself into circles, but at the end of the day, you got to make the right decisions. And so I think for us as a company, just like everybody else, we spend a lot of time just trying to keep running as fast as we can to keep up on all that. But at the end of the night, you got to put your head on the pillow and fall asleep. So you got to turn it off at some point.
[00:08:43] Speaker B: That's awesome, Paul. I think that theme of people going around in our circles in macro I were able to have heard, and I think it's good to see your playbook to translate them to micro or more local elements of your business and then figuring out what to do with decision making. That was very, very helpful. Paul, just to follow on to that question, I think as you mentioned, Titan has a fairly global footprint and obviously a fairly complicated product portfolio and services portfolio to offer. How have you dealt with the so called supply chain disruptions which plagued us over at least the last couple of years? And what's your outlook on that over the next 1224 months?
[00:09:15] Speaker A: It's a critically important topic. And in fact, our board meeting in December, I spent a lot of time just talking about that. How have we adapted to this new world? And I think for us, this is what I said to the board. So I want to repeat kind of that. So I don't talk a lot about this externally, but for us, we were in a very good position that we went through some bad, tough times before the pandemic.
And it's one of those life lessons where you learn from the tough times. And we, as a company had to learn a lot in 2018, especially in 2019, we were going through some industry downturns. And so the mechanisms that we put in place, which were protect the balance sheet, get the right people in the right position and give them the room to go do their job, we couldn't afford to make bad decisions, so we had to make sure, again, that team was very aligned and going in the direction of do what's best for Titan International. Our margin for error had been greatly shrunk because of, again, the pressure from the, at that point, the industry, along with, we were facing some balance sheet, balance sheet stretches. And so when the pandemic hit, to be honest with you, we're already kind of in a mode that fit very well for what happened. So March 2020 rolls along. We have four plants in central Italy. We have a plant outside Madrid, Spain, right where the, the epicenter where the activities started coming at us. And our team was very poised, and we knew we had to operate effectively to take care of our customers because at that point, the government said, you can't shut down ag construction. Those mandates came in pretty quickly in Europe, uS, South America. So we had to figure it out. But at the same time, we had to continue to do what we needed to do for the company, which, again, was really driven by some situations that were specific to, again, us, our industry. And again, it fit very well for what was going on in the pandemic. And we adjusted quickly. I think we did an exceptional job. We took care of our customers well in 2020, not necessarily all reflected in the financial results, but then you kind of take that as a springboard, as the pandemic challenges turned into labor challenges turned into supply chain challenges, that culture, that environment with our people that we had built really set us up well for 21, and then what we were able to accomplish in 22. And it starts with taking care of your customer. There's no doubt about that. And I think that, again, that pandemic put that focus, that spotlight on, you got to do what your customer needs, and they're really counting on you. And so how that parlays into your question is our supply chain was really built upon people. We had really done a lot of things that were needed to deal with, you know, to be able to handle all the challenges and all the issues that were coming at you every day. Because again, quite frankly, it stems from we had to do that, we had to make the hard decisions in 2019. So again, not making light of what went on with the pandemic because it was very difficult, but we were almost in a position where the pandemic was less of an issue as far as the challenges it was creating compared to what we were dealing with in 2019. And so our muscles were very well trained is basically what I'm saying. And so we've been able to do quite well the last few years. And again, I think the team is in an excellent position and our customers have reflected that as well. We've done a good job taking care of customers.
[00:12:26] Speaker B: That's a great example. I think in the book we talk about using adversity as an opportunity and seems like Titan did that in 2019. The pressures kind of made you become more resilient, which hopefully helped during the pandemics. Thank you so much for sharing that, Paul. One place I wanted to get your opinions on was m and A is a topic which we talk about in the book as companies whove done well use it very effectively, but its also a tool which many times is not used very effectively. I think Titan is one of the companies which has deployed m and A as a core part of its strategy to build up your business so far. So what is your advice on m and A? What has been, like, the two things you feel you've done better than potentially others to be able to get value from that as a lever?
[00:13:05] Speaker A: Yeah, like you said, we've done some things very well. It's inherent in how our company was created and we've also made some mistakes and I'll certainly spend a little bit of time talking about both. You know, our company started from nothing. You know, 1983, we started from a closed down plant that was vertically integrated with a large company. So our grassroots are really stemmed from the fact we're going to take somewhat discarded assets again that either didn't fit horizontally within the industry landscape or didn't fit vertically within a particular operation of an OEM. We've been able to put that together as the basis for who we are, and it's a pretty awesome thing to be part of. I take zero credit for that. We had a visionary founder, as a lot of companies do, that was able to take the risk and see this vision. And I've had the honor and privilege of working with him. He's still the chairman of our board. You know, again, for me, I'm a trained finance guy. Wintle, delight to. I did get an MBA in marketing, so I wanted to learn both perspectives, but again, traditional, more textbook type environment early in my career, whereas early in his career, he was creating a damn company, so out of nothing. And so it's been great to just to learn that perspective. And so what he taught me and what I've seen at Titan is you have to be very patient with acquisitions. You know, you have to invest the time to understand what your target is. You have to invest the time to understand who you are, and you have to be patient for those opportunities to come along. And then when they do, you have to be bold. You have to be willing to take that risk. You don't hesitate. You jump in. I will say that's worked very well for Titan. But we did make some mistakes in the mid 2010 that, quite frankly, had reached a point where I went to the board, spent some time talking to the board and said, look, we. We don't see this as necessarily fitting culturally, product or even more specifically with our customers. So in our industry, because each one of our plants builds a product that's fairly different than the other plant, there's a little bit of overlap, but each one of our plants does need to be able to operate autonomously. So synergies are hard to come from. Your synergies have to come from the marketplace to the larger degree. And so we had an acquisition we did in the mid 2010s. It just wasn't fit in that mold. It was losing money. I went to the board and said, look, here's what we need to do. We're going to get this to, relatively speaking, break even. And then I think at that point, we need to, you know, we need to unwind it and, you know, we unwound it for about 45% of what we had paid for it. But at that point, we went from losing money with a property, with an acquisition didn't fit to something that in somebody else's hands will fit with them. And again, we were able to extract some value from it. And so, you know, for me, the reason why I bring that up is in my prior life before Titan, I worked with a company that did couple of companies that did a lot of acquisitions, and I always found them a tremendous learning experience. You learn from the successes. They're always a ton of work. Let's, let's. Let's start there. You know, getting. Getting the deal accomplished takes a lot of. Lot of patience, a lot of effort. Like I said, integration is a tremendous amount of work on the organization.
And then when it succeeds, it's a home run and everybody feels great. You see the value of your organization, your company go up, but there's, you know, you would know better than me what the exact figure is. But what is it? Like, 71% of all acquisitions don't add value? I think we all like to think we can do better than that, but let's, let's go with that number. And, you know, I've seen in prior lives as well where those acquisitions don't work out. And you need to, you learn a ton from that. It's like accelerated learning when you're an m and a type environment. And, you know, I think, for me, what I learned before Titan and then some of these experiences I've had at Titan, again, it's the, it's the wins are great, but the losses, you're going to have to learn from those. You're going to have to take quick, decisive actions and, you know, you move forward from there. So, yeah, so at Titan, we have done a number of acquisitions that have been right in our core to kind of build this niche industry. We are continuing to look for those opportunities. That's something that I would be excited if those opportunities come along. I think our organization is ready to do that. You got to have the resources, the ability to integrate successfully, and I think we're at that point. So we are continuing to look for those opportunities. Nothing imminent. But again, part of our culture is, as you mentioned with the question, terrific.
[00:17:15] Speaker B: That's very helpful advice, I think, for our listeners. Paul, you mentioned a couple of times in that answer that you worked well with the board in terms of making those decisions and getting alignment around them. I think that's one of the areas we've seen in particular, industrial, industrial technology sector can do as better as a whole. So just from your experience of obviously being in a board yourself and then working with your own board, what distinguishes an effective CEO board relationship versus the not so effective ones? What has been the learning scanner, which you take along with yourself?
[00:17:44] Speaker A: You know, again, that's one of those things. You see the good, you see the wins and you see the losses. And I think when you talk about industrial companies, you do probably see more losses than others because I think we, you know, industrial companies are different. And what I have seen be very effective is, one, you need a diverse board, differences in backgrounds, experiences, that those diverse opinions are good because industrial companies can get caught in their own little world. And you need somebody that pulls you out of it and again, gives you all those variety of perspectives. And so I think that is number one. And I think we've really done a good job at Titan here with our current board getting those different perspectives. We have money managers with hedge funds, private equity. We have a good background from manufacturing. We have a diverse, from, you know, diverse group of board members, their own personal experiences. And that's been great. But, you know, I've also seen, you know, kind of going back to learning from, from the past. We've seen that when you bring into a board somebody who's not willing to see, see the world from an industrial perspective, and they try to apply a different type of perspective into the industrial world, it can, it can have, you know, some, some issues that really become difficult to overcome. And so what I think a board member needs to do, and this is probably true for any company, but again, you guys wrote a great book that really talks about the perspective of industrial company. I think any board members are willing to invest the time to understand your company from an industrial perspective. And if you have not worked from an industrial company and you've spent 45 years in another environment, it can just, like anything, part of your leadership team. If it's not a good cultural fit, you're going to have problems. And we've seen, a number of years ago, we had some issues where board members just didn't fit. They wanted to do things their way. They were more interested in kind of the soup du jour of what the world was saying effective board members should do. Instead of understanding. What does Titan International and shareholders need from you as a board member? And so I think what you need from a good board member is pretty similar to what you need from a good leader on your management team. Good, diverse perspectives. They have to invest the time in people, the company, the products and the customers. And if they do that, you know, differences in opinions, differences of thoughts is wonderful. That's what we all wanted. You know, we'll spend time debating that. But if you're not willing to put in that time, you're not going to be effective as a board member or a leader, in my opinion.
[00:20:06] Speaker B: Thank you, Paul. That's incredibly insightful. Paul, just one more topic, which is a. And if it's a buzzword, if it's reality, I think that's a bridge everybody's trying to cross around environmental, social and governance dimensions. The ESD dimension would love your thought. As the CEO of Titan, what role does ESG play in your decision making today? And do you see the gap between how it's talked about versus how much does it really impact ground reality?
[00:20:31] Speaker A: Yeah, yeah, that's a good question, that gap between what you read and what you see. I will admit I kind of got a cheat sheet because we have a lot of european operations.
Even before ESG from a publicly listed us company was really being talked about, I was getting more of the answers and really some internal pressure from our. Italy is a good example. Italy has very, very strong commitments from a social responsibility perspective.
I'm on the board of our italian companies, which in Italy, that's a lot of responsibility as well. I learned quickly from that. And quite frankly, it was probably eye opening and I probably went into it a little bit blunt headed, not necessarily open minded, necessarily at the beginning, looked at it more of a regulatory perspective. Then we had customers like Volvo, for example, who are leading the way with their ESG efforts and the commitment they expect from their suppliers. And then really, obviously, you've seen around the world, especially as a listed company, the ESG requirements take off from there.
Our italian operations served as kind of that cheat sheet for me to understand the importance of it. I think the key thing is we need to see customers really support that as well, and we all move in the same direction. It becomes difficult if you start going in a multitude of different directions. I think the difference that you see in business versus what you read about when you read about it, you read it's all harmonious and this is what you should do. But in reality, you have a lot of conflicting pressures. And so as a leader, we need to do what's right. And that's a balance between our shareholders and our customer. I do think our customers are becoming more and more together and united along that path. That ESG is important not just from an individual's mindset, but really from the broader perspective. And we all need to take a leadership role in that. And so I think it's going to continue to really, really move in a positive direction. I think the things we're reading about recently, over the last couple of months, to understand it's not free, there is a cost, there's a burden associated with this. So there's a balance between how quickly you can go from what you want and what you can do.
And I think we're seeing a better perspective with that. But at Titan, we do use it as a basis for all our product innovation. I mentioned before, the importance of us being connected to our customers, as part of being connected to our customers is that we need to do everything we can to be environmentally sound, socially responsible, and we do that. We're constantly using as many renewable materials as we can. We're taking materials out of our products. We design products that minimize the impact on the environment, on the soil compaction for farmers. And so that's definitely built in inherently now into our culture of really how we do our product innovation.
[00:23:16] Speaker B: Thank you, Paul, for that. I think that tip on working with the customers, not just in product innovation, but also the ESG dimension of it, is actually incredibly helpful. Thank you. So, Paul, moving a little bit now a little bit to broader industry outlook. I think one of the reasons, for example, why we wrote the book was, at least from our experience in the industry, we definitely felt a big gap between perception and reality. I think the perception of the industrial sector was not the sexiest sector around. Everything was about tech and all the good things happening in Silicon Valley. And when we looked at the reality of the sector, we did feel that was a little unfair, both in terms of the type of economic value and the type of social value the sector generates. So we kind of coined it as the sectors underappreciated, misunderstood, undervalued. How do you evaluate that thesis from your perspective? Do you think that's true or not true? Like, where do you come out on that?
[00:24:01] Speaker A: Look, I'm going to go on a 62nd plug for your book. You guys did an excellent job of that. So it's definitely true. But if you think about a book needs to capture the reader's interest level quickly and it needs to resonate with them. And again, your book, the titanium economy is excellent at that. And I'm not just saying it because we're here doing this together.
I actually brought your book. It was around the holidays when I started reading your book. And I was with my family and I looked at my wife and said, this is an excellent book. So I'm not saying I can get her to read it, but I did recommend it to her as well. But now you guys hit on something I think that's really, really, really critical from an industrial perspective, is that one, industrial companies are important. What we do may not be known, but it's important to so many aspects of our life. And you guys illustrate that perfectly right out of the gate. But also what you do is do it in a way where you're connecting technology with industrials and you're able to go, you know what, industrial companies are cool. And I think that's really important for leader because we try to sell that a lot and it's not always the easiest thing to do because there's not a lot of material out there.
Where else, besides your book, can you read something that says industrial companies are important and they're also cool? But that's a message. We've been walking around a titan saying for years, what we do is important. When you drive by an agricultural field and you see those big yellow wheels or you see the tires out there in the field, doing something important to the food supply of the US, to that farmer, his family, that feels good. When you see you go by a construction site and you see your product in action, that feels really good to the people, our folks, that work hard building and constructing those products. Again, I loved what you guys did with you connected the importance of the industrial companies, the economy and our products. You can see, you can see big yellow wheels, giant tires, but there's a lot of products and components that you can see that the end result is something critically important to not just businesses, but to people. And again, I really, really think you guys did an excellent job with that, but also the way you connect it with technology.
Industrial companies are not old, stodgy places that are run down. They are continuing to innovate. They're continuing to get better at what they do, and they're utilizing technology, doing so. So while we're not a technology company, there is a hell of a lot of technology that's going on within our company, within every industrial company. And so for me, I think you guys really hit something that's important. And now you throw the pandemic on top of it. As we are all adapting to a new world of supply chains and labor. I think the message that you guys are delivering is really going to resonate more in reality than it probably did when you were writing the book, is what I would predict. Not sure you would agree. I'd like to hear your thoughts on that as well.
[00:26:58] Speaker B: No, I think we completely do. I think in many ways, we were fortituous. The timing went with that because the narrative, particularly with respect to talented, was changing. I think as we looked at people's opinions about the industrial sector start before the pandemic and post pandemic, I think we are seeing, hopefully, a right, the curve in the right direction. Paul, at that point, this is where I'd love to get your thoughts as well. As we worked in the industrial sector, I think invariably the topic of talent and availability of talent, whether it's at the trades level, whether it's digital expertise, which industrial companies need to continue this wave of innovation and, and impact in the society. Talent comes out as a big bottleneck. What is Titan's philosophy in attracting the right set of talent and then nurturing and incubating it over time within the company?
[00:27:43] Speaker A: We look for people that want to be in an environment that is somewhat industrial. And I say somewhat because there are a lot of different things you can do. An industrial company. And so it starts there. I go back to, we all remember what Jeff amount said. GE is not going to make anything. They're just going to do services. We know how that worked out. You want somebody that understands inherently that making something does feel good. And so what we do then is we get them in there and we show them. Look, with that, you have a giant playground. You're not going to be sitting at a desk designing something that you have no idea what it does. We really encourage our people to get out there, get involved with the business, and again, use that plant as a giant playground, connect to that end user. And so we like to look for people that enjoy working in that environment.
We're a very decentralized company, as a lot of industrials are. That's certainly the case that I've seen in meeting with Industrial CEO's through the years, is that being decentralized is very common and you really need to have excellent people at your locations that love being in that environment. And so for us, we've been using a lot of what you say in your book is, again, come to the Titan, you're going to get to see your product operating in the field. We encourage you to be connected to the end user. Bring your ideas of what, what you think the marketplace needs back to our plants, back to our business. Use the plant as a playground to have fun, do something different. We're constantly trying to redesign. We're constantly trying to bring new applications, new technology into our plants and our operations. And with that, what you do is going to be kind of cool, but it's hard to sell. You know, like most industrial companies, our plants are, are operated in locations that you don't drive by and see a shiny new sparkling glass tower. You know, you're going to be, you know, you're going to be in an environmental part of the city that usually is more industrial. And once we found, once we get them in there, though, the success rate's very high. The challenge is at times, again, kind of what we said with the previous question, because there's not a lot written about industrial companies. If you're a 25 year old, you haven't really seen or heard much about them. If you're more of our generation, you grew up in a different era. So we're realizing we have to be different, how we go after those younger folks. But we found that once we spent a lot of time going to college fairs, at first we thought we'd be sitting there talking to ourself, and probably at times we were just talking to ourselves. But we have found the success rate to be really good. Once we get them into Titan, our retention is strong again. We recruit for people that they have that little bit of. That gleam in their eye, like, hey, I want to be here. It's similar to probably what I said about our board members, to be honest with you. If you have a board member that's doing it for themselves and they're doing it because they. They don't, and they don't want to invest the time and the energy, and they really don't like industrials, it doesn't work. Same is true for bringing people into our company. They got to really want to be there. And we're. We're finding that those people are out there. They're out there. And so it's. It's fun. I got to be honest. It's fun. I know I'm biased, but I think you guys are on a good path with what you're doing. And I know you just got done doing this one, but hopefully you'll write another one in another year or so.
[00:30:43] Speaker B: Yeah, no, fingers crossed. But I think I do share your enthusiasm, and it's good to see, I think, at least you share your side of the story with. You are finding folks who have that kind of optimism and gleam in their eyes for industrials. That's incredible. So, Paul, just in conclusion, this is more, I guess, at a personal level, you've been a leading executive and leader in the space. Obviously, your work with Titan is well known. What are the lessons you would want to share with our audience around value creation in an industrial space today? Whether we think about investors or think about internal employees or think about customers, what are the three or four things which kind of come to your top of mind as you think about advising other folks who might be your peers in the sector?
[00:31:19] Speaker A: For us, and I think it's true with the industrial companies, it's getting connected to the end users where your products are being used. Now, some products, I realize, go into other components. They're just a component into a larger product. But innovation doesn't come easy. And innovation, I think, for industrial companies, sometimes it's harder to find. You really got to go search for. And so we've put a tremendous amount of effort and it's driven value certainly to our shareholders, but it's taken a lot of patience, a lot of investment in human resources and financial resources to get there. But it's developing that connection to the end user, and with that, you get an understanding of what their needs are. If you're just dealing with your customer, which is going to be primarily an OEM or another manufacturer, and it's going to be a dealer network, it's hard to drive innovation. And so again, our culture is now built around connecting to the end user. It's not easy. Again, you have the constraints that are inherently in front of you that everybody expects, but you also have these hidden constraints where, quite frankly, your dealers and your oems don't want you talking to end users.
And so you have to have this patience and you have to go about doing it in a way that in the long run, you believe it'll work. And for us, it has. We've now reached the point where all our customers, all our customers see the value in that innovation we're driving. We have the testimonials, the support from the end user marketplace that says, yes, Titan is a good company. We trust the innovation they're driving. But it took a long time. Like anything, it takes a while to build that trust. And so I think for industrial companies, I would highly encourage them. You got to understand what your products are doing. You got to understand it from the perspective of the end user. And then from there, you got to figure out how you drive the value stream into your organization and then ultimately through your customers. That's a little bit backward thinking. At times, it's a little easier to go more direct to your customers and work innovation together. But we have found that, again, this is a way for an industrial company to drive a lot of value, and then you got to stay connected. That's the other thing is once you get there, it's great to be there, but at times, it can be even harder to stay there. And so we've had to continue to not just, I don't want to make it seem like it's just you go spend the money, you got to create the culture, you got to create the right environment where that's fully supported, and you got to take risks. Some things you're going to be wrong, some things you're going to hit home runs. It's the nature of product innovation. And so I think we've done a good job. If you look at all our locations, the amount of new products we're kicking out every year, it's a pretty healthy one. But really, how we look at it, it's got to come from that end user. And so again, I think it's a good way to drive value for an industrial company that I think many companies could follow that same model. But again, I don't have a shortcut. I don't have a secret sauce. I could tell you other than, you know, just, just really, you know, build your culture, invest the time, be patient, and you can get there terrific.
[00:34:11] Speaker B: I'm definitely taking my patient and customer connectedness as my is my motor from this discussion. So I do appreciate you taking this time, Paul. I found it incredibly enlightening and I'm sure our audience will as well. So thank you so much for taking the time and sharing your perspective. Thanks a lot.
[00:34:26] Speaker A: Appreciate it. Thank you very much. Enjoyed it. And again, really enjoyed reading the book as well.
[00:34:30] Speaker B: So thank you. Thank you.
[00:34:38] Speaker A: Thanks for listening to Ina Insights. Please visit Ina AI for more podcasts, publications and events on developments shaping the industrial and industrial technology sector.
