Cordell Haymon on his toughest challenge

    Insider

    POSITION: Senior Vice President

    COMPANY: SGS Petroleum Service Corp.

    WHAT THEY DO: Baton Rouge-based SGS Petroleum Service Corp. is in the business of providing Coast Guard-licensed tankermen to load and unload barges, and also operates dock facilities and does in-plant product handling.

    CAREER: For over 20 years Haymon was principal owner and CEO of Petroleum Services Corp. In 2004 the company was acquired by SGS, a global firm based in Geneva. Haymon continues to serve as SVP of SGS Petroleum Service Corp. He has long been active in the Baton Rouge community, serving on the boards of the Baton Rouge Area Foundation, Teach For America South Louisiana and the Center for Planning Excellence.


    THE CHALLENGE

    What do you do when your biggest customer decides to become your biggest competitor? That’s exactly what happened to SGS Petroleum Service Corp. “It’s a hazardous industry,” Haymon explains. “We work in all kinds of weather, loading and unloading hazardous, flammable, environmentally sensitive material.” A little more than 20 years ago, their biggest customer, the largest tank barge company in the U.S., decided to go into the tankerman service business, including building their own cadre of tankermen and bidding against SGS for dock and in-plant contracts. To initiate this effort, the competitor hired a former employee of SGS as the leader and quickly recruited about a dozen of SGS’ tankermen to come to work for them.

    THE RESOLUTION

    Haymon met with the competitor and tried to understand the reasons for their decision. “They explained that they appreciated and valued our company and our service and would like to continue utilizing us as needed, but they saw this direction as an opportunity for growth for their own company,” he said. Since they were unable to dissuade the competitor, SGS had to decide whether they would continue working for them, or stop and view them strictly as a formidable rival.  Despite the considerable ambiguity involved, the decision was made to continue working for them while still competing vigorously to keep them from getting work from other companies. This dance went on for years, until quite recently, and Haymon and the team at SGS all the while worked hard to maintain a friendly relationship with the competitor’s management and provide them great service, while defending their share of the market.

    THE TAKEAWAY

    Despite its best efforts, the competitor’s decades-long attempt to successfully break into the tankermen and dock operating business never gained real traction. “Eventually, in the last couple of years, they came to us and asked if we would be willing to take over a group of their tankermen and also the operation of several dock facilities where they had been able to get contracts. They asked that we consider employing their workers who were assigned to these jobs. These transitions have now taken place, and this major customer is no longer our competitor,” Haymon said. He feels that sustaining this tricky relationship over many years and seeing it to such a successful conclusion is a tribute to the excellent performance of his employees, but also credits the integrity and maturity of the leadership of the customer in sustaining this unusual working relationship.

    Originally published in the first quarter 2016 edition of 10/12 Industry Report. Read more from this issue at 1012industryreport.com.