Modine’s Burke: ‘Strategic Thinking vs. Planning’

The management team at Racine’s Modine Manufacturing Co. has had to relearn most of what it thought it knew about competing in the global marketplace, says its President and CEO Tom Burke.

A basic difference was coming to grip with the concept of strategic thinking versus planning.

“Every plan you make is wrong. Instead, you want to get a cycle going to where you adapt to obstacles,” Burke told an audience of about 70 people attending the bi-monthly Business Networking event at the CATI auditorium, 2320 Renaissance Blvd. in Sturtevant.

Modine, which turns 95 years old in June, produces heat transfer products such as radiators, condensers and HVAC equipment. The company has operations in the U.S. and 16 other countries.

The change in thinking was a survival response when the company’s vehicle and building construction markets collapsed in 2008-09. Changing the company's approach was also an important tool in competing in a fast-paced global environment, he says.

"Obstacle” is now in the Modine vocabulary and response is a constant, not just a once-a year planning exercise. Burke says that new, highly sophisticated competitors from places like China mean that new products and innovation most now be available “in months, not years.” Meanwhile customers everywhere continue to expect the best products at the best price.

“We’re constantly learning that a customer in China or Russia is demanding far different things than what we’re delivering for U.S. customers,” he says.

Among the things that Modine’s management has done to stay competitive:

• Learned—the cost of the production and profit margins of all competitors among all products.
• Mapped—the entire Modine product portfolio to identify which are core products, what are the most profitable and what are supplemental. “That was the hardest part for us. It took months. And, it has to be dynamic,” Burke says.
• Detected—potential obstacles to achieving targets. “Early obstacle detection is the responsibility of leadership,” he says. “We had to change our mindset. Rather than ignore or fail to accept obstacles, we have to point out obstacles and talk about what we’re going to do about them.”

Although Modine’s leadership team has changed the way it thinks and acts, it’s not about to stop adapting.

“We’re just getting started on this,” Burke says. “Just as soon as you think you you’ve got it figured out, something changes.”

Burke’s talk was part of an ongoing business networking and educational session co-sponsored by the Racine County Economic Development Corp., Racine Area Manufacturers and Commerce, Young Professionals of Racine and the Racine Founders Rotary Club.