Careers at Parker Hannifin
Parker Hannifin’s mission is to partner with its customers to increase their productivity and profitability.
Parker Hannifin is a provider of motion and control technologies and systems. The firm operates two reportable business segments:
- Diversified Industrial Segment – Includes products in the following groups: Automation, Engineered Materials, Filtration, Fluid Connectors, Hydraulics, and Instrumentation. Accounts for 80% of sales.
- Aerospace Systems Segment – Includes the following products: control actuation systems and components, engine systems and components, fluid conveyance systems and components, fluid metering, delivery and atomization devices, fuel systems and components, fuel tank inerting systems, hydraulic systems and components, lubrication components, power conditioning and management systems, thermal management, and wheels and brakes. Accounts for 20% of sales.
In the early 20th century, automobiles became a mass market industry thanks to Henry Ford’s introduction of the Model T. By the late 1910s, more than one million vehicles were being produced annually in factories. Engineer and inventor Art Parker decided to take advantage of this opportunity. In 1917 he founded Parker Appliance Company, a manufacturer of pneumatic brake boosters.
The purpose of the product was to make it easier for buses and trucks to stop while in transit. However, while on a promotional tour, Parker’s only truck hit an ice patch on a hill and went flying over a cliff. The accident and ensuing negative publicity caused him to go bankrupt and fold the company. Parker returned to an engineering job at a plant, but did not give up on his dream.
In 1924 he relaunched the firm with a new product – flared-tube fitting components. They were useful for many purposes, and thus drew attention from many types of industrial manufacturers. One customer group was the aviation industry. Parker took on Douglas Aircraft Company and Lockheed as clients, producing a wide variety of pneumatic and hydraulic components.
The new direction was a major success, and the business thrived in the next few decades. During World War II it stayed afloat by producing parts for military aircraft. By 1934 it was generating $2 million in annual sales. In 1957 it acquired Hannifin Corporation, changing its name to Parker-Hannifin Corporation. In 1964 the firm began trading on the New York Stock Exchange.
Benefits at Parker Hannifin
Business model of Parker Hannifin
Parker has a niche market business model, with a specialized customer segment. The company targets its offerings at firms in the mobile, industrial, and aerospace markets.
Parker offers two primary value propositions: innovation and brand/status.
The company has a history of innovation. Its breakthroughs include the following:
- Air Saver – A switching valve technology that, when supplied a continuous stream of compressed air, generates pulsed air blow that is only “on” when air is required by the operator. By holding back the supply in between periods of active use, it reduces air consumption by 50%.
- Parker CNG Dispenser – A dispenser that uses a set of protective sensors, hose disconnects, and breakway couplings to prevent the risk of mechanical or user malfunctions. The system is held to a high standard of quality to stop leakage, reduce downtime and provide consistent service.
- Modulated Turbine Clearance Control Valve – The MTCCV controls the tip clearance – the distance between an engine’s rotating blades and the casing. This increases the engine’s efficiency, resulting in extended service life and a reduction in emissions and fuel consumption.
The company has established a powerful brand due to its success. It bills itself as the world’s top diversified manufacturer of motion and control technologies and systems. It is a Fortune 250 firm with $11 billion in sales in its 2016 fiscal year. It has increased its annual dividends paid to shareholders for 60 consecutive fiscal years, among the top five longest-running dividend-increase records in the S&P 500 index. It operates in 55 countries on six continents and serves 444,000 clients.
Parker’s main channels are its direct sales team; its network of over 13,000 authorized distributors worldwide; and ParkerStore Network, a group of independently-owned industrial retail operations with over 3,000 service points globally. The company promotes its offering through its website, social media pages, and participation in expos, symposiums, trade shows, and conferences.
Parker’s customer relationship is primarily of a self-service nature. Customers utilize its products while having limited interaction with employees. The company’s website features a “Support” section that includes literature and reference materials, selector guides, product demos and tutorials, software downloads, a CAD center, and a configuration center.
The site also provides a gallery of instructional videos and answers to frequently asked questions. That said, there is a community element in the form of a peer forum and a personal assistance component in the form of phone and e-mail support.
Parker’s business model entails designing, developing, manufacturing, and distributing its products for customers.
Parker’s key partners are the suppliers that provide the raw materials and components it uses to manufacture its products for customers. It also depends on its networks of independent distributors and retailers who sell its products at thousands of locations worldwide.
Parker’s main resources are its human resources. It relies heavily on its research and product development team, which consists of physicists, chemists, and mechanical, electrical, and chemical engineers.
The company also depends significantly on physical resources in the form of 309 manufacturing facilities (most of which it owns) and 88 distribution centers located in 39 U.S. states and 49 other countries. Lastly, it places a great priority on its intellectual property, its patents.
Parker has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions. Its biggest cost driver is cost of sales, a variable expense. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.
Parker has one revenue stream: revenues it generates from sales of its products to customers. Most of these sales occur through the signing of long-term contracts.
info: Thomas L. Williams earned a Bachelor’s degree in Mechanical Engineering at Bucknell University and an MBA at Xavier University. He previously held various senior roles at Parker, including Executive Vice President and Operating Officer.
info: Lee C. Banks earned a Bachelor of Arts in Economics at DePauw University and an MBA at The Keller Graduate School of Management in Chicago. He previously served as Operating Officer of Parker’s Middle East, Africa, and Latin America Groups.
info: Jon P. Marten earned an undergraduate degree at the Virginia Polytechnic Institute and State University and an MBA at Baldwin-Wallace College. He previously served as Vice President, Corporate Controller.
info: William Eline earned a Bachelor of Science in Accounting at John Carroll University and an MBA at Kent State University. He previously held various senior leadership roles in materials control, accounting, and information system management at Parker.
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