8 minute read • published in partnership with Make UK
Houghton International – the SME engineering company that has put itself in pole position
After a long and at times tough journey, revived interest in sustainability and repair-not-replace, reshoring to shorten supply chains and a total focus on people development, Houghton International has put itself in pole position, verified by winning SME of the Year at the Make UK annual awards.
What do you do if people no longer want the thing you are really good at doing? In the early 2000s there was a shift in the way that UK and European markets acquired and managed electrical machinery assets – generators, motors and gearboxes. Companies started to buy low-cost replacement motors, often manufactured in China and Eastern Europe. In a short time these machines became commoditised, as attitudes shifted from maintain and repair to dispose and buy new.
Ever since it was founded by Ron and Christine Mitten in Houghton-le-Spring in 1984, Houghton International has specialised in repairing and improving electro-mechanical assets and manufacturing high voltage coils for motors. “Many companies thought that repair had no future, so they gave up. We always thought it had a future and that a high quality service had value,” says the founders’ son, CEO Michael Mitten. He talks with the calm assuredness of someone who placed early bets that, initially, paid few dividends but who held on for a long-term return.
Houghton International endured the uncertainties of Brexit and Covid, like many others, and is now on an upward curve. Global events have driven up demand for repair and life extension of electro-mechanical assets, as shaky international supply chains showed UK heavy industry it needs reliable suppliers close to home. Customers returned and new ones were secured. Houghton International’s strong performance was endorsed in fine style when, in January 2022, the company won Make UK’s prestigious SME of the Year 2022 award and was Commended in Developing Future Talent.
As well as repairing and refurbishing broken and underperforming electrical machines, from small motors to large, 40 tonne machines from power generation and chemical processing, Houghton International manufactures high voltage preformed coils for motors in industrial, power generation and specialist applications. It was initially founded to supply these preform coils to Portland Electrical Repairs in Nigeria, subsequently developing motor repair skills. The high voltage coils have a global market; the company has customers in Canada, US, Scandinavia, South-East Asia and other regions. Repair is mainly for UK and European customers, linked to their sustainability ethos of reducing the transportation miles of these heavy machines.
Houghton International is an active participant in industrial decarbonisation and it is investing in reducing carbon emissions at all levels. “Faulty offshore wind farm turbine generators are routinely sent to Denmark or Spain for overhaul, then returned,” Michael says. “Shipping hundreds of miles by sea and road is expensive, and it makes no sense when we have the capacity and certification to repair any turbine generator. It’s creating a larger carbon footprint and unnecessary environmental impact, in a green industry.”
Houghton International once operated six sites across Newcastle – “with six different cultures and six approaches to people management,” says Michael. In 2020 it relocated to the historic CA Parsons Works in Heaton, consolidating the 130-strong workforce and operations in one, purpose-built facility, as part of a much bigger strategy to improve the business, through its people.
Running and growing a manufacturing business in Newcastle over nearly 40 years, serving global customers that run critical high value operations, requires effective people engagement.
“To be the best in the world at what we do”, a simple and honest ambition, is displayed on the Company Values board as Our Mission. Many manufacturing companies have similar boards but here it is a totem not a bolt-on. All the company’s decisions are based on the usual business fundamentals but are also guided by these company values and principles. “If we’re faced with a difficult decision, we must ensure it’s in line with our values. We ask our people to hold us to account in that regard,” says Michael.
At the foot of the values board is written: “everyone matters”. Another company philosophy often seen is “We employ for attitude and train for skill”; this company grows its own, gives its people the best training possible and promotes from within.
Its core values are:
• Working as a team to deliver an exceptional customer experience
• Being open, honest, and acting with integrity
• Letting innovation drive our business
• Protecting and developing our employees
Uncomplicated but important to codify. These reflect the belief that, if you train people and treat them well, they add value to the organisation, willingly, every day.
Houghton International’s employees are consulted first-hand about a range of company operations. They know their views count and help shape the business’s direction. It has elevated feedback processes to an Employee Opinion Survey: – 36 questions about the company’s performance and the employee’s role, published annually. Last year’s survey reported:
• 97% of employees agreed Houghton is a great place to work
• 99.1% employees agreed they have a clear understanding of the company’s values
It had an 80% response rate; most companies get 25% to 30%. Houghton International’s most important people factor may be its apprenticeships. Founder Ron Mitten was an apprentice, as was Michael, before attending university, and Chris Lisle and Craig Byers, Head and Assistant Manager of Houghton’s Rail division, were apprentices, as were many others in leadership roles throughout the business
The firm’s award-winning apprenticeship programme has been integral to Houghton International’s growth from its inception, 38 years ago. In addition to on-the-job training and college time, over 2,400 hours of classroom training were delivered in the last financial year, despite the effects of the covid pandemic. Apprentices are the company’s bedrock; they live and breathe the culture from Day One and they create value, says Michael.
Promotion is from within; apprentices know that they can go all the way. Retention rates at Houghton International are high, apart from a blip during the covid pandemic.
And Houghton International supports people externally too. A Working Matters Committee supports a range of charities, including Macmillan Cancer Support and Tiny Lives, and arranges various food bank collections throughout the year. In 2020, the company’s commitment to employees’ mental and physical wellbeing was recognised with the Bronze Better Health at Work Award, followed by the Silver standard in 2022.
Houghton International’s rigorous methods for training people, measuring job satisfaction and looping their views into company policy, helped them secure second place in Make UK’s Developing Future Talent award last year.
Repair Don’t Replace
The image of “repair shop” as an old school factory, bashing machines and bits to “make good” obsolete motors or gearboxes has no place at Houghton International.
The business combines 38 years of technical expertise and modern equipment to work with customers to solve their problems, where imagination and reverse engineering is key. “Customers send us the manufacturing information and we build a 3D model; we don’t need to see the physical machine,” says Michael. “This is very efficient for UK customers, and eliminates the cost of sea freight to send them abroad.”
In the early 2000s, when these machines became commoditised, many were poor quality, inefficient and didn’t last long. Big machinery weighing 15 tonnes, with years of life left, were scrapped for new. The environmental impact was ignored; this mindset stuck for the next 15 or so years.
The Covid and Ukraine crises produced geopolitical turmoil and have created an appetite to reshore, or “nearshore” and bring some manufacturing back. They and Brexit’s tariffs and border delays revealed inherent weaknesses of international supply chains. Customers want the assurance of parts and competent service closer to home.
Now Covid is waning, the world’s focus is turning again to climate change and net zero. Suddenly, every company is examining its sustainable practices and ESG policies; sweet music to Houghton International, who played the long game of repair not replace. “We can demonstrate the value of repairing. If you follow best practices, you can actually improve asset performance,” says Michael, adding that some electrical machines actually run better than ever after rewinding.
Clean Tech is the Future
Houghton today serves every sector where an electrical rotating machine is used, from mining and oil, to rail, water and industrial manufacturing. It wasn’t always so; Michael says it learned, the hard way, to widen its portfolio and reach new markets.
The business is increasingly servicing the power and renewables sectors – wind, solar and hydro – and the strategy is to increase this segment as the world decarbonises. It recently refurbished a 26-tonne Enercon E48 wind turbine generator for Grannell Community Energy in Ceredigion, Wales, and completed a prestigious overhaul of a generator for EDF’s Sizewell B nuclear power station. The war in Ukraine may prompt the return and expansion of nuclear power, to help reduce dependence on Russian gas.
But going green brings its frustrations, also. “Electrifying cars and setting net zero targets is great; I am not anti-oil or anti-wind or anti-any energy system,” Michael says. “We are going to stop burning hydrocarbons as the primary source propulsion for domestic transport and mass transport – but where will we get the power this needs?” He says that government, energy companies and industry must be far more joined-up on this agenda, more strategic, make less fanfare targets and analyse the practical physics.
It comes back to applying core engineering, the essence of a company that really understands power and can provide real solutions.
“Very smart people can design machines to produce more power from a smaller footprint but they don’t necessarily know how they will work in practice,” Michael says. “How do we turn the concept into a practical asset? We understand the manufacturability of the design. This, and underestimating the delivery of electricity needed to power these devices, is misunderstood.”
This experience and clarity of thought was assisted by Michael’s late mentor Steve Black, sports therapist and former personal coach of England rugby legend Jonny Wilkinson, who Michael retained to supervise the company’s employee engagement work. Sadly, Steve died suddenly in February, but the results speak for themselves. Through Michael, he left his mark at Houghton International, as he did with Newcastle Football Club, Newcastle Falcons Rugby Club and soccer great Kevin Keegan.
Boosted by reshoring, the climate agenda and the rediscovered desire to repair, Houghton International will diversify further, focus on clean energy and clean technology markets, invest more in training its people, and continue seeking “to be the best in the world at what we do”.