RPN Executive of the Year: Hawk has Toyo soaring

WHITE, Ga.—In the beginning, there was nothing. Now, Toyo Tire & Rubber Co. Ltd.'s only manufacturing facility in the U.S. can't seem to stop growing.

The White plant just broke ground in December on its fourth expansion since it began production in 2005. The firm will increase the size of the plant to nearly 3 million square feet, add 450 employees by the end of 2015 and boost its capacity to an estimated 8 million passenger, light truck and sport-utility vehicle tires by 2018. If it reaches full capacity, Toyo will have invested nearly $1 billion in the plant since it opened.

Not coincidentally, the facility's president and general manager, James Hawk, also has climbed Toyo's ranks as the plant grew, even in times of economic downturn.

For helping to successfully guide Toyo Tire North America Manufacturing Inc. to its current heights, Hawk has been named Rubber & Plastics News 2013 Rubber Industry Executive of the Year.

“I don't know if leaders can be born, but if they can be, he must be an example of that,” said Allan Huggins, chief financial officer of Toyo Tires North America Manufacturing. “He has the traits that you'd expect in a great leader. He has the ability to set a strategic plan and sets people on the right path to achieving it.”

A career in the rubber industry seemed to be Hawk's destiny. He grew up in Akron's Firestone Park neighborhood, and his father was a truck tire builder for Firestone for nearly 40 years.

“He always encouraged me,” Hawk said. “He said, "You don't want to do what I'm doing. You want to try to do better.' He wanted better for his children.”

Hawk began his career right after he graduated from the University of Akron with a degree in mechanical engineering in 1973. He went to work for Continental Tire as a project engineer. And if he wound up retiring an engineer, that would have been fine.

“I was very, very happy being an engineer,” Hawk said. “I always liked science and math so they had any number of assignments. I had the drafting background behind me, worked for a short time as a tire engineer, did some machine design work and the majority of my work was project engineering for a corporate engineer group.”

But Hawk never has been one to shy away from new horizons—in fact just the opposite. He is always asking questions, always says yes to a new opportunity. If engineering got him into the industry, it was his curiosity that sparked his ascent through the ranks. It is the main reason he got involved with several major plant expansions with General Tire, either expanding existing facilities or building new ones. Through those experiences, his fingerprints were on many different areas of the industry, and he became well-versed in how a plant operates from start to finish.

“It was fortunate that I got directly involved and actually got to build some new tire plants from scratch,” Hawk said. “That's kind of a unique opportunity that only comes around once in a lifetime for some people. By virtue of being involved with that, I got exposed not only to the facility itself, but the process equipment and process engineering. I always pushed myself to learn many, many different things.”

Just when Continental was taking over General Tire in the late 1980s, he developed relationships with European managers. They encouraged Hawk to enter production and production management. He decided to try something different and went to Mount Vernon, Ill., to help start the GTY Tire Co. facility there as project manager. Eventually, he transitioned to become the first production manager for that joint venture facility.

His nearly 23-year tenure with General Tire ended in 1995 when he accepted a position to become vice president, manufacturing, and plant manager of Yokohama's Salem, Va., facility. He stayed there for nine years and oversaw expansions to the facility.

“The only reason for the career move was it was a much higher level position,” Hawk said. “It wasn't that I was dissatisfied with Continental or General Tire. I just couldn't see myself getting to a much higher level.”

Nine years after he joined Yokohama, Toyo recruited him to oversee its first manufacturing facility in North America. He accepted the position of vice president of operations and plant general manager for its White facility.

He has been promoted twice with Toyo: First in 2008 when he became the first—and only—American to serve on Toyo Tire & Rubber Co.'s board of directors as senior corporate officer. At that time, he was also appointed president of Toyo Tire North America Manufacturing. And in 2012, he was named chairman of Toyo Tire Holdings of Americas, its North American business unit.

Hawk and his executive team built the White operation from scratch. It manufactures a wide-range of tires for cars, light trucks and SUVs in speed ratings ranging from S to Y and two different brands—Toyo and Nitto. Light truck comprises about 45 percent of the plant's total output. Passenger tires account for 33 percent and SUVs the rest.

But the facility just doesn't mass produce as many tires as possible. Hawk said one of his main responsibilities is managing inventory and catering lot sizes to specific needs of the dealer. It was a Japanese philosophy and one that took him time to adapt to, after spending most of his life dealing with production efficiency.

“The problem with mass production is you build inventory,” Hawk said. “In a lot size mentality, you're managing your inventories very, very closely to what your sales are. The trade-off is you may have less efficiency in your manufacturing operation, but you're managing your inventory, which is where your cash is.”

Hawk said the Japanese call it sleeping money: Tires just waiting in a warehouse for someone to buy them. Toyo analyzes its sales and tries to the best of its ability to produce what it needs without stockpiling the warehouse full of tires.

“Inventory is directly related to cash,” Hawk said. “It's managing customer requirements and the cash flow of the business. It's a major focus of mine. Before I came to Toyo, I never had to be concerned with that.”

The facility also uses Toyo's Advanced Tire Operation Module process, which is a totally hands-free, highly repeatable tire manufacturing process. Hawk said the technology has evolved over an 8-10 year period. The process constructs a tire on a single module that can build up to seven tires at one time. The plant has 32 ATOM machines, with the fourth expansion adding nine more.

The other advantage to the ATOM process is it allows the facility to grow in a modular fashion. Hawk said Toyo doesn't need to have a huge manufacturing facility and then go look for business; rather the company can grow its facility with its current and incremental business.

“The main focus of our automated process is repeatability,” Hawk said. “It's very expensive. We're not in this game to crank out a lot of volume at low cost. The vision of the ATOM machines is high quality and very, very high repeatability.”

Toyo approved the expansion despite the economic downturn in 2008. Hawk said senior leadership didn't blink when the issue of putting the third phase on hold was discussed. The expansion went ahead; when the economy improved, Toyo had a new addition ready.

“When the economy bottomed and came back up, we were perfectly poised to come out of it and hit the ground running,” said Steve Wesner, senior director of quality at Toyo Tire North America Manufacturing. “While other people were backing out and hunkering down, we were moving forward.”

Hawk said the payoff has been fantastic. The most rapid growth has been on the Nitto side. It was created as a stand-alone business with separate products and dealers, but it grew through the edginess of the high-performance market. He estimates the Nitto brand has gone from a $100 million business to about a $500 million business in the last seven years.

“It's been incredible, way ahead of schedule,” Hawk said. “It's the match of the technology we have and how efficient it is and the focus that we have on small lot production. The reliability and the high quality of our products, the style of the products and the way we sell and market those products.”

What Hawk loves most about his job is creating jobs and developing people into managers, but even he needs a reminder every now and then. He carries with him a paper that lists a variety of habits that critical thinkers need to be successful. He said he constantly refers to it in order to remain on track. The first one is “be more concerned with getting it right than being right.”

“I have to remind myself all the time that if you're not careful, you want to make all the decisions and do all the talking,” Hawk said. “At my point in my career, it's not about me. It's about making this a better organization and a better life and career for the people here.”

Other habits on his sheet include avoid jumping to conclusions, not accepting information at face value and—perhaps most importantly—show flexibility and willingness to consider alternate ideas and opinions.

“You've got to stay calm under pressure or when things are going in the wrong direction and get it back in the right direction,” said Don Waterhouse, director of human resources and general affairs at Toyo Tires North America Manufacturing. “He's that kind of guy.”

Hawk tries to put himself in his employees' shoes. If someone was micromanaging him every day, he would get the impression that he is not capable of doing the job he is assigned. Instead, he sets the course, establishes the goals and trusts his employees' way of getting there.

Hawk will challenge his employees, especially new ones, to see what kind of character they reveal. He will give them control of their own program, making them responsible and holding them accountable for its success. It also means there will be mistakes that come with inexperience, but Hawk won't ever set his employees up for failure.

He's not afraid to let them make mistakes and learn from the experience.

“It's very difficult for someone like me to let people make mistakes,” Hawk said. “Unfortunately that's part of the learning process. You've got to overwhelm these younger folks with responsibility, but not sink or swim. Somebody needs to be observing what's going on and don't let them fail. In some cases, you have to push their back to the wall to see what kind of character they have and whether or not they're going to take ownership.”

He also is obsessed with promoting from within. Hawk said nearly all of Toyo's supervisors came out of production. He is not opposed to hiring from the outside, but he would much rather grow his work force organically.

“You have to know when it is the appropriate time to hire someone from the outside to give yourself a different look and perspective on how other businesses work,” Hawk said.

Huggins is a perfect example. At Continental, he began as a controller, but then he switched to purchasing, holding that position for several years. He joined Toyo as a purchasing engineer, but a year later the CFO position opened up on the finance side. Hawk asked him to fill it because of his prior experience as a controller.

Since he left that area, Huggins said another organization likely would not have given him the opportunity to return, perhaps filling the position from outside.

Hawk's philosophy when it comes to hiring gives his employees more of an incentive to be a contributor, Huggins said. They feel they can contribute and work their way up the company.

“I tell everybody, "If you want my job, come and get it. I'll help you,' “ Hawk said, “as long as you care about these people, and as long as you're as good as I am. One of the most satisfying things I do nowadays is being able to be part of creating jobs and being able to help promote people's careers and future.”