Shiloh's plants and facilities were operating at low utilization levels after years of heavy capital spending. And debt levels had reached record heights, maximizing the company's borrowing capacity.
Zampetis, who speaks with passion and energy when discussing his subsequent turnaround of Shiloh, came out of retirement to run the business. He was a board member who knew Shiloh's business well, and it didn't take long for him to make his presence felt.
He established a new "Sustainable Business Model" that called for the company to focus on two key premises -- generate and deliver a continuously competitive advantage to Shiloh's customers and create profitable growth for Shiloh.
To accomplish this, Zampetis developed a Low Cost Commitment Strategy focused on reducing scrap rates and headcount, operational improvements and increasing throughput for all of Shiloh's plants and locations. He set an aggressive goal to generate significant cost reductions at each of Shiloh's 11 manufacturing facilities.
"We knew that in order to grow this company, we had to shrink it first," Zampetis says. "And, we had to create a culture where we were able to constantly innovate."
That involved getting employees to take control of their jobs and feel accountable that their work was directly contributing to the success of this business.
Within his first eight months as president and CEO, Zampetis successfully stabilized the business. By the end of fiscal year 2002, the company's debt levels dropped by nearly 22 percent and Shiloh produced significantly improved gross and operating margins, leading to an overall lower bottom-line net loss.
The following year, Shiloh generated its first annual profit in three years and shrunk its debt levels by an additional 34 percent, creating a total debt level reduction of nearly 49 percent in 24 months. Zampetis' aggressive moves also led to Shiloh exceeding its LCCS goal, generating cost reductions of 109 percent of the originally identified budget.
Today, under Zampetis, Shiloh continues to grow. The company reported record revenue and earnings for the second quarter of 2004 and is on pace to far exceed its full-year budget. How to reach: Shiloh Industries, (216) 267-2600 or www.shiloh.com.