Paul Deehan, CEO and owner of AWS Electronics Group, talks with Steve Rogerson in our series of interviews for CIEonline. The AWS Electronics Group is a specialist electronics manufacturing provider offering services for the whole electronic product life cycle from design through manufacture, to whole life service and repair. It has facilities in the UK and Slovakia offering full product assembly, PCBs, cable and harnesses.
After trying to break into the world of professional football with Birmingham City (Paul’s brother John had a successful career with Aston Villa, WBA, Norwich, Ipswich and Manchester City before going into management), Deehan joined the automotive industry with Jaguar and then Land Rover. He studied at night school for his honours degree in business studies and completed his thesis for his honours on the Toyota production system with its emphasis on lean manufacturing.
At Land Rover he rose up the ranks to become a general manager, before moving to Lear, a tier-one supplier to the automotive industry where he was general operations director for the UK and northern Europe.
At the turn of the millennium, Deehan decided to pursue his own thing as he had always wanted to own his own business. He invested to obtain an equity stake joining the main board of Aktrion Manufacturing Support Services, a private equity backed business that specialised in outsourced support services for the newsprint, automotive and white goods industries. When that was sold in 2004, Deehan decided to invest the money he made from that transaction in the EMS industry and acquired AWS Electronics with a plan to create a larger company with a buy-and-build acquisition strategy.
AWS became successful under his leadership and acquired several other EMS providers to offer a full range of EMS services. The company consolidated its operations onto two sites – Newcastle under Lyme in the UK and Namestovo in Slovakia.
Aside from his work with AWS, Deehan is also chair of a specialist motor rewinds business and an equity investor in various technology companies, several of which specialise in products and services for the mobile and digital world showing his love of technology and new inventions. He is also involved with the charity, Children Today, which funds life-saving and life-enhancing equipment for disabled children in the UK. He is a keen sports fan, especially golf and football.
1. What are the best ways to encourage young people to choose a career in engineering?
The best way is to look at the bigger global picture and hone that back to the UK. In concept and design work, we are one of the leading countries in the world. Yet there is a shortage of graduates and apprentices coming into the industry.
If you look at trends, people tend to go into the saturated professions and engineering gets left to the side. But since 2000, we have been in a technological revolution that is changing the world drastically. So the opportunities for engineering and the advancement of technology are there. It is a great space to be in, but I don’t think that message is getting through.
The government has to use the mass media to get the message out and link that with the colleges and universities. That is the only way it can work. There is no magic wand. You have to excite youngsters. Most know more about modern technology than we do. They have it in their hands and use it every day.
2. Acquiring AWS was a big step. What were your hopes and fears at the time?
My hopes were pretty clear. I had a very detailed strategy plan that helped me raise the funds. I wanted to create a larger UK entity. I saw a big opportunity for a medium-sized business as the existing ones had gone out of the UK. The hope was to grow a larger company and then give it a global base. In four years, we acquired four businesses in the UK, we consolidated them and bought a small business in Slovakia.
I didn’t really have many fears because I believed the trend for outsourcing was going to continue and that has been the case. I didn’t foresee the big global recession in 2008 and 2009, but we realigned our strategy and consolidated our UK operation to make it easier for management and customers. And we invested in Slovakia to provide the same facilities out there.
3. What are the difficulties and advantages of running a business in two separate countries?
There is not a significant difficulty. Slovakia is only a one-hour time difference. The senior managers out there are fluent in English. English is on the national curriculum over there and people from 40-years-old and younger tend to have good English. It is all about getting the right management and staff. There has to be standardisation between the two so there is a mirror between the UK and Slovakia of what you have.
There is a bed of people who look for low-cost manufacturing, so there is pressure to be competitive and reduce price. There are only a few areas where you can do that. The cost of management and staff in Slovakia is about a third of what it is in the UK.
4. What triggered your interest in Children Today and what is your involvement?
I have been very lucky with a close-knit family and always have from a young age. I come from a sporting background. All my children are very healthy. A few years ago when I saw I had achieved my business ambitions I looked at what else I could do. I realised how lucky I’d been and looked to help other people.
With modern technology, some of the equipment that can give disabled children a better way of life is there, but the money isn’t and Children Today helps them with that. I know nobody with disabled children, so that wasn’t a driver.
I do lots of charity work and try to raise funds. I do the odd extreme sports activity to help them. I went to South Africa to do some stuff five years ago. And three years ago we did a trek into the rain forest in Malaysia. We actually got lost and did an unplanned overnight camp when we were running out of food and water. Then last year I went to the Grand Canyon.
We raise funds doing these for charity. I pay my own costs and fees and get people to sponsor me. A large number of our suppliers have been very generous.
5. How can European companies guard against manufacturing being outsourced to the Far East?
There is no great answer to that. If companies need lower costs and they believe the way to do that is going offshore, they will. It is very difficult to convince a company that sees the money they will save not to do it. These are companies looking for a low-cost strategy in labour-intensive industries.
But there is still a lot of work for the UK in product development and design, and prototype work. You can also get closer support between supplier and customer and a lot want that closeness of relationships you get by being in the UK.