Innovation in the Desert

The Story of Diab Engineering

for

"Innovations in the Desert: Telling the Stories" project

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Introduction

Diab Engineering is a unique industrial services business serving the mining industry in some of the most remote areas of Australia. From its humble beginnings in 1970, it has grown to a business now turning over in excess of $11 million annually. More importantly, some of Diab's customers are the backbone of Australia's resource industry and depend on the company's support for survival. It is a truly remarkable business that has a reputation for excellence, reliability and success 'no matter what'. Built around its people, its customers and its local communities, this is the Diab Engineering story…

From Rural Sandpit to Regional Superstar
Diab Engineering was first conceived in Capel (near Bunbury in the south west of Western Australia) in 1970 as a joint partnership between David and Anne Payne and Ian and Betty Shields. With just a few employees and a background in mineral sands, their aim was to provide quality contract labour services to cover peaks and troughs in engineering maintenance activities at remote mine sites. In 1976, David and Anne Payne took over Diab Engineering as sole partners and relocated to Geraldton (in the mid west region of Western Australia) with a contract staff of around 15 boilermakers and fitters.

With its main office and workshop now located at Narngulu (just outside of Geraldton), Diab Engineering offers full support in the provision of: mechanical and electrical labour, fabrication, scaffolding/rigging, high voltage electrical, cranage, piping, laser aligning, rubber lining, belt splicing, industrial painting and machining services. The company employs 80 permanent staff, spread among its main office and permanent mine maintenance operations in Muchea, Cataby, Eneabba, Mt Keith, Leinster and Agnew. It also has a new 2,500m2 workshop complex, the best equipped and largest in the region that covers 475,000 km2 or one fifth of the state.

Much of the company's amazing success can be attributed to Diab Engineering's Managing Director David Payne, who has had the vision and courage to craft a business that is now one of Western Australia's regional superstars.

A Truly Special Attitude for Business Success
Diab's business success stems from David's philosophy that is based entirely around the two essential elements of any business, its people and its customers. His attitude is that if you truly understand your customer's business needs and commit to doing whatever it takes to services those needs, then continued custom and growth will be the reward. This premise is based around the foundation that all business transactions should be based on the values of honesty, commitment, self-belief, integrity and loyalty, to customers, suppliers and employees. This attitude, captured in the following key success factors, has resulted in a belief that 'almost anything is possible', and has meant that Diab has retained some customers for 30 years.

Key Success Factors
Factor 1: Investing in people to maintain an experienced workforce.
People are the backbone of Diab's business and the company ensures that its people are well looked after. But it is more than just monetary rewards - involvement in decision-making, contributions to business improvements, and the enjoyment of an enjoyable, challenging and rewarding working environment are equally as important. As a result, more than 90% of Diab's staff has been with the company longer than 5 years. For some, Diab is the only employer they have known. The loyalty of its people ensures important skills and knowledge are retained - this in turn ensures that Diab knows its clients' businesses well, which brings integrity and success to the business.

Factor 2: Planning and building an infrastructure based on the needs of clients.
Diab's growth has come largely through the needs of its clients. If a particular service or skill was required that it did not have (but fitted with its core business) then the company reinvested profits back into the business to ensure it developed the capability. This strategy allowed it to grow as its clients grew, enabled it to employ the large range of skills and trades it currently has, and ultimately resulted in the state-of-the-art workshop it presently enjoys.

Factor 3: Maintaining loyal customers by responding quickly to their needs.
In the resources industry, downtime of critical equipment can cost mining companies millions of dollars per day. The ability to be able to respond quickly can make a huge difference to a company's bottom line. Diab has developed an enviable reputation to being able to service these unforeseen needs through its ability to work 24 hours a day and 7 days a week and having its own fleet of maintenance vehicles.

Overcoming the Difficulties & Challenges in Remote Areas
Diab's success is made even more remarkable given that many of its customers are mining companies in remote country locations. Many of these companies depend on Diab's support for survival and to remain competitive.

The electronic media such as information technology and telephony communication has provided a huge boost to Diab's business in recent years. Avenues such as e-mail, the World Wide Web and video conferencing now mean that Diab has real time access to information. Benefits include:

Improved communication effectiveness by essentially closing the distance gap between Diab's own business and remote customers.
Lower cost of doing business through a reduced need for couriers, general transport and airfares.
Being able to compete on a more equal basis for tenders and work with capital city businesses, as information is now available to Diab as quick as it is to competitors that are local to that information.
Better opportunity to gain work outside its local region into other parts of Western Australia and other Australian states.

Rather than being seen as a threat to regionally based industry, this kind of communication and integration technology has strengthened business ties with Diab's clients that have been built on a culture of service and personal commitment.

Using Innovation and Dedication to Succeed
Despite these advances in information technology, Diab has still had to use innovation to overcome the many difficulties and challenges in servicing the needs of its remote customers.

The company has a pool of trusted, casual staff to supplement its permanent workforce. This initiative has ensured Diab Engineering's ability to quickly mobilise experienced and skilled workers and has been a major factor in the company's continued growth.

The company has also fabricated an enclosed semi-trailer mobile tool store that carries approximately $100,000 worth of specialised equipment and tooling for major maintenance campaigns. This ensures Diab's employees have access at remote locations anywhere in Australia to a full range of tools that have been safely maintained. Diab has also invested in two coaches so it can transport large numbers of people to reduce cost.

Building a large-scale workshop in Narngulu in 1998, Diab Engineering has been able to further complement its services to remote clients. The workshop gave the company the capability to provide tailor-made solutions from start to finish, from initial drawings and designs, to fabrication and on-site installation. With over 160,000 m3 of space, the workshop houses two 5 tonne overhead cranes and a 10 tonne mobile crane, as well as offering many specialised welding techniques and plasma cutting.

With many short-term shutdown contracts, predominantly in the mining industry, these innovations mean that Diab Engineering is ready to respond to a huge range of needs around the clock, including abrasive blasting, painting, manufacturing, rubberising and more.

Even with these innovations, the extraordinary lengths that Diab often takes to support remote companies are still quite amazing. In essence, dedication has supported innovation, demonstrated through the following examples.

A call late one night by a client resulted in the urgent delivery of a critical part - personally by a senior Diab supervisor. He drove a few hundred kilometres in the early hours of the morning so that the client's operations would not have a significant drop in production (and many lost dollars) the following day.
30 personnel, equipment and tools were mobilized within 3 hours to a remote site to undertake emergency preventative work after the potential failure of a critical item (a mill motor) was identified by the client.
After an urgent request at 4pm on a Saturday after a fatality at a client's remote site operation, two hours later six personnel and the required equipment were mobilized to assist in the dewatering and recovery operation.

To its knowledge Diab Engineering is the only company in Western Australia that offers these services to remote mining companies.

Creating Harmony with the Local Communities
A fundamental part of Diab's existence is its integration into, and support of, the local communities in which it operates. This has resulted in the development and sponsorship of many local sporting organisations, clubs and activities, especially in and around the Geraldton area.

This development extends to the training of young people through alliances with industry groups to ensure people potentially entering the industry or the company for the first time are exposed to training in all aspects of the industry. This is done in three ways.

Work experience program
This program was introduced to allow high school aged students the opportunity of experiencing the range of jobs available at a facility such as Diab Engineering. The company has places for up to 6 students per annum and has a high conversion rate of students to employee applicants.
Apprenticeship program
Diab Engineering generally employs two apprentices per year and has a number of apprentices at various stages of their training. Diab strongly believes in the value of a solid trade qualification and makes a commitment to provide opportunities for young people wherever possible.
Alliance with technical college
In addition to the work experience program run through the local high schools, Diab also runs a work experience program in conjunction with the local technical college. The program involves experience at its premises in either two week or four week blocks. The students are assigned a mentor and go through appropriate inductions and safety awareness and also take part in specific projects.

The Vision for The Future
Diab's vision for the future is to develop a truly unique industrial services business that prospers because it gives just as much back to the youth and community of the regions and remote areas in which it operates as it does to the businesses that it transacts with. David Payne drives this vision forward by continuing to:

Further develop its apprenticeship training program and youth employment opportunities.
Create a fairer and more efficient environment for all employees.
Maintain a focus on customer service and performance delivery excellence.
Work more closely with all clients to identify and effectively manage risks both for Diab's business and it clients' businesses, so that all business transactions are 'win/win'.
Be an 'employer of choice' in the region and to enhance this reputation even further through the development of the existing client base and current employees.
Develop business relationships that are based on openness and trust with the aim of achieving a level of service that, in the opinion of its clients, represents the highest standard of satisfaction that adds true value to their businesses.
Grow its business beyond the boundaries of the local region by capitalising on major business relationships, growing with these businesses and, through a proactive approach, taking advantage of any opportunities that may arise.

When you combine Diab Engineering's experience in mining maintenance, mobility throughout the regions and workshop construction capabilities, its soon becomes apparent why the company has achieved such unparalleled success. For this reason, many say David's vision for Diab has already been achieved…

For more information about DIAB Engineering visit www.diabeng.com.au

August, 2003.

Diab Engineering
Lot 109 Foskew Way Geraldton WA 6530
P.O. Box 2197 Geraldton WA 6531
Telephone +61 8 9923 3720
Facsimile +61 8 9923 3746
E-mail: diabeng@bigpond.com.au