On March 1, 2020, Jeffrey Cote took over as CEO and President of Sensata Technologies after 13 years as a veteran leader at the company. We had the opportunity to sit down with Jeff (virtually) and learn about what excites and worries him as he takes the reins of the company.
Read our interview with Jeffrey Cote below.
First, give me the Sensata elevator pitch. Who is Sensata?
We have a long legacy of designing and manufacturing sensors and sensor-rich solutions which help our customers solve their most difficult challenges related to enabling their products to meet regulation and consumer demands in areas such as the environment and safety. We are a company with a rich history – over 100 years in existence and 10 years as a public company. We serve a number of end markets and benefit from mega-trends such as electrification, autonomy and IOT, or smart & connected, which allow us to grow faster than the end markets we serve. We also focus on mission-critical, hard to do applications that are differentiated and drive high margins and great cash flow conversion. None of this would be possible if not for the talented employees at Sensata.
When a new CEO comes in, there is often change throughout the organization. What changes do you foresee?
I’ve been with the company for 13 years and I’ve been involved in all aspects of the company strategy, how we engage with customers and how we operate during that time. As we started planning this important succession process I became more involved in the development of the strategy over the past few years. So, in short, no major changes other than perhaps the pace of execution against our stated strategy and doubling down on our talent and how we serve our customers.
What are you most excited about?
The future and our purpose. With regards to our future, the markets we serve are going through unprecedented change given the megatrends related to electrification, autonomy and IOT, or smart and connected. Sensata does well in situation where market discontinuity occurs. With regards to purpose, our purpose is compelling, we are deeply embedded in so many applications that make the world safer, smarter, more connected and more electrified. It’s what excites me to come to work and what excites Team Sensata as well.
What are you most worried about?
Mostly about short term events, the economy, impact of events such as COVID-19 and ensuring we make the right short-term decisions to benefit our employees and our company over the long term.
Your thoughts on the Economy?
Sensata serves global markets in a variety of end markets which have seen decline for the past year and we are forecasting these markets to decline again in 2020. The good news is that we benefit from secular growth which allows us to grow faster than end markets in good times and offsets the market decline in tough times.
What are your company expectations this year?
Our financial position is strong, but given the increasing level of economic uncertainty, we withdrew our guidance for the year recently. OEM orders and global economic conditions have deteriorated over the last few weeks, and in response we are taking necessary measures to ensure that we have the financial strength to weather this period of uncertainty. During this period we are prioritizing essential production for our critical customer needs who in many cases are performing work essential in this environment. We have managed through tough times in the past; we are confident and focused on coming out of this stronger.
What have you done in response to coronavirus?
As a global company with more than 22K employees, our priorities remain to ensure the safety and well-being of our team, while continuing to serve the mission-critical and essential needs of many of our customers. Since early March, employees that are able to work remotely have been working from home, thereby making it safer for our employees that must work on site. Our Health & Safety teams are working around the clock to ensure a safe working environment at our global production sites and we are following all government guidelines on social distancing and more.
As a Company that has navigated many challenges throughout our 100+ year history, we remain committed to our people, communities, customers and investors and will continue to stay true to what has always made Sensata great – designing and manufacturing sensor and sensor-rich solutions to help our customers solve their most difficult challenges.
I heard you took your salary down to $1 for Q2 as part of the COVID-19 cost containment measures you recently announced. Can you comment?
I’ve been with Sensata for 13 years and in the business world for more than double that. What we are seeing is truly unprecedented and it warrants an equivalent response. We are a strong company, with a sound balance sheet. But we have asked our people globally, our leaders and our Board to take a salary reduction or unpaid time off, and it’s only fitting that I do everything I can to help our team weather this financial challenge.
What has changed in the past 10 years since your IPO?
A lot has changed. First, we are more than 3 times the size from a revenue, profit and cash flow standpoint. Second, we are more diversified from an end market and offering standpoint. Third, we are a stronger more resilient company.
What would you have done again, done different?
Many of the actions we have taken I would do again. One thing I would have done differently is the acceleration of our end market diversification efforts.
Why is Sensata in Massachusetts? Are there advantages to being here?
My wife and I raised our boys in Massachusetts – well truth be told, she did most of the work though I did do my fair share of coaching for their sports. The Commonwealth is a great place to raise a family and build a career. The state is known for intellectual curiosity, freedom of thought, and commitment to the common good. It’s also a great place to do business. We are able to attract great talent to Sensata from Boston and beyond.
Are you hiring? For what types of roles?
Yes, we continue to seek out the best and the brightest talent for Team Sensata. Despite the near-term challenges that we are all experiencing, we are confident that once the economy and the markets we serve rebound, we will be ready to serve our customers with the mission-critical sensor-rich solutions they need to keep the world moving. We are always looking for electrical, mechanical, and systems engineers and have a number of roles open across many professional functions as well.