Navistar deal shows UAW president's pragmatism

Williams: Problem-solver on Navistar board Photo credit: BLOOMBERG

When Troy Clarke, a former General Motors executive, was hired by Navistar in Chicago five years ago, the UAW's Dennis Williams offered to help him find his way around the city.

It's that personal touch that helps set Williams apart, said Clarke, CEO of Navistar. Williams, now UAW president, is a born networker, politically savvy and well aware of the pressures that companies face from global competitors.

He also is known as a hard-nosed negotiator who is no stranger to strikes.

All of those qualities will be on display during this year's UAW contract negotiations with the Detroit 3. The negotiations kick off in earnest after next week's UAW bargaining convention in Detroit.

Williams has been on Navistar's board of directors since 2006. And last month, the company, which produces commercial trucks and engines, completed a difficult four-year contract with the UAW under circumstances that might have caused a strike a few years ago.

The UAW, Clarke said, agreed to keep bargaining for a deal even though the previous contract expired in September.

Clarke credits Williams' pragmatism and the patience of the union's bargaining team for a contract that included a raise for workers and lean-manufacturing rule changes to aid Navistar's turnaround.

"We benefited from the fact that Dennis Williams is on our board of directors," Clarke said. "He was very supportive of us taking the time needed to negotiate the right agreement, not the agreement we could have gotten -- either us or them -- by the end of September."

Williams declined to be interviewed for this report.

Everyman governance

Clarke, who had a long history of bargaining with the UAW at GM before joining Navistar in 2010, said with Williams, what you see is what you get.

The ex-Marine ascended the UAW hierarchy representing workers in the farm and heavy-equipment industries out of the UAW's Region 4 office in Chicago.

As such, he participated in some bargaining brawls. He was involved in bitter strikes at heavy-equipment maker Caterpillar in the 1990s. From 1995 to 2010, he held assistant director and director positions in Region 4.

Clarke said he has seen a much different side of Williams, though, at Navistar and also as they came to know each other before Clarke left GM in 2009.

As a Navistar board member, Williams has been a problem-solver with a common-sense approach that has, at times, taken management and other trustees aback, Clarke said.

For instance, last fall, when management proposed an incentive program for salaried workers, Williams, in his role as a trustee, found it too hard to understand, Clarke said.

Williams, Clarke said, suggested that the program be simplified so workers could readily see whether their performance put them in the money each month based on goals that were neither too hard nor too easy to reach.

Clarke, whose father was an auto worker in Detroit, said that same workingman's perception is how Williams pursues his fiduciary responsibility to Navistar shareholders.

Williams tends to ask how the decisions he makes will affect the "90-year-old guy" who bought Navistar common stock in its heyday and now holds it at half the value it once had, Clarke said.

"Dennis feels very comfortable, given his union background, challenging me and management very directly," said Clarke, who became Navistar's CEO in 2013.

Williams also has worked to troubleshoot regulatory problems that Navistar encountered during several years of pushing an innovative diesel engine design that ultimately failed to meet federal emissions guidelines.

The failed project was a major financial setback for the company. Navistar eventually joined the industry in using urea to cut emissions.

Politically connected

Clarke said he appreciated that Williams offered to point him to the right people in the EPA to mend fences over the engine dispute, though Clarke already had contacts at the agency. Williams, who lived in Chicago, was an early supporter of President Barack Obama's first presidential run.

"He's just a good sounding board," Clarke said.

Clarke said he and Williams met several years ago at a restaurant. Dick Shoemaker, then UAW GM department chief, had brought Williams along to dinner because he was targeted as an up-and-comer in the union.

Though Williams was on the agriculture side of the union and not involved in auto talks, he has made it a point to get together for dinner with Clarke occasionally ever since.

And when Clarke moved to Chicago, he said, Williams "took it upon himself to make sure I felt comfortable in a new environment."

Clarke said: "Dennis invests heavily in developing relationships."

You can reach David Barkholz at dbarkholz@crain.com -- Follow David on Twitter: @barkholzatan

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