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Tuesday, October 7, 2014

Path's to Success (of an Industry Corp) Part 1: Have a Plan

In the past I have chronicled my experiences as a CEO of an industrial corp.  I decided to step away from being a CEO, but joined up with my former directors in our current corp and I have taken on the mantle "Director of Industry".  We have been growing steadily and we keep people activly involved in the corp's success.

How do you run a successful industrial wing and keep people involved?  Well, there are many cogs to the machine.  I will make this a multiple-post series, so check back often.

Here are some general guidelines to get the ball rolling.  Note, this is mainly from a high sec perspective.  Unsecured space brings on an additional slew of questions.

[Step 1] Have a plan.  
I can't stress this enough.  Out of all the things you do, this is probably the most critical.  You need to have a framework you can hang all the pieces on.  Think of it as a foundation.  A fundamental piece of the whole operation.  Do you want to make ISK by corporation mining ops or do you want those to fund your manufacturing?  Do you want your manufacturing to be the main source of revenue?  Do you want to put all your eggs in one basket and focus on T2 or T3 manufacturing?  Hulls or Modules?  Do you want to buy your manufacturing materials from the market or set up a moon?  What do you do in times of war?  These are just some of the questions.  You might not think of things until you are forced to make a choice.  War Dec's can have a huge impact on your activities, but so can supply and demand and market warfare.  Here are a few bullet points you should ask yourself when developing a strategy.
  • What should your main source of income be?
  • What can your supplementary income sources be? [ore/mineral/ice/composite/etc] sales?
  • How are you going to supply your demands of?  [minerals/ice/pi/composites/etc] 
  • By what means will you acquire your list of demands? [mining/moon harvesting/revenues on market sales/wholesalers]?
  • How will you involve your corporation members?
  • What steps need to be taken in the event of a war dec?  
  • How do you want to model your divisions of labor?
  • What are your priorities? 
  • Do you want to rely on repeat business?
  • Do you want to undertake marketing your manufactured goods to specific entities or just dump them on the market
  • Where should you focus your attention (go from broad scope to a specific area or specialty)?
  • Do you want to set up a POS or use NPC stations?
  • Do you want to have access to Low/Null/WH locations or just strictly high sec?
  • Security at the pos?
This is by no means an all-inclusive list, but these are some of the fundamental questions that should be answered before you decide to take the plunge. 

For an example, here is what we do:
  • Main Source of Income: Manufacturing > Sales
  • Supplementary income: Ore/Mineral surplus sales and PVE taxes (missioning mainly)
  • Supplies (highest utilization to least): market buy orders, market sell orders, internal corp member buyback, donation mining ops, wholesale trade mailing list, other industrial contacts)3
  • Corp Member Involvement: I have started what I call "Builder's Packs".  I make a blueprint copy for the required number of runs I want built, set the blueprint copy and any associated material requirements in a specific corp hanger floor in the array required at the POS.  I then send out an email to our manufacturing mail list with what is there and on a first come, first served basis, the prints are used by the corp member and the goods pop out when they are done.  You can also use the activity level of those who help for a rewards program.  Win-Win.  Also, corp-run mining ops, mission running, incursions, etc.
  • War Decs: THEY WILL HAPPEN.  You need to be prepared.  Hauling and mining are soft targets.  Those will be a primary target for the aggressor corp.  Put out an email with all the things that you don't want to see and the things that individual members can/need to do.  Keep that email handy.  You will use it a lot, unfortunately.  If you have a POS, get those defensive modules turned on.  You should get a list of those who can man POS guns.  Make sure your tower is set to "attack if at war".  Take out anything that you can't afford to lose (capital BPO's, spendy ships in the maintenance bay, minerals, modules, etc).  If you are in low/null/wh space, this is critical as "capital support" may be called in.  Make sure POS fuel and Strontium bays are full.
  • Divisions of Labor:  The larger the corp, the more there is for one person to handle.  That's where directors and managers come in.  You don't need to make everyone a director and that is the surest way to corp theft.  However, you can assign people who are interested to a "junior management" position.  We have someone running mining ops and overseeing the corp ore bank.  Members are always looking for more to do, so if someone is interested, why not give them a little rope?   Roles, that needs to be a carefully thought out consideration however.
  • Priorities:  Keeping members engaged, active and happy.  They are a meaningful part of your corp and they are always eager to help and do more.  Use that.  Make enough ISK to cover expenses and provide profit.  Reroll the revenues into more of what you do (reinvest capital).  Support the alliance with ships, modules, ammo, etc.
  • Repeat Business: When using the market or wholesale mailing lists, the journal tells you who is buying.  If you see someone buying a lot of your goods, send them a message.  They may be interested in buying direct from you.  This has a bunch of advantages.  Higher (more specific demand), cut out sales and market fee taxes (for both parties), cut down on the time it takes to extract the capital from your manufacturing (quicker returns), networking (providing lasting partnerships with people who are good at what they do).  You kind of need to be a salesman.  It's different when you deal with a specific person than it is selling to the market with no face/name.
  • Focus:  When manufacturing, we focus on high volume/moderate margin T2 items.  T1 items have an intrinsic low ISK/moderate to high volume, but the item list that is most profitable (and I'm still talking low 10-20% margin markups are very slim.  I don't like to keep all my eggs in one basket.  The market is fickle and it ebbs & flows.  It's like a 401k mutual fund.  Diversify where possible.  That's how I roll.  Others may argue otherwise.
  • POS: We have POS/Lab/Assembly Arrays .  The change in Kronos made it a viable venture to move as much industry to the POS as possible.  There are benefits, like reduced times, lower costs, etc.  
  • Unsecured space Access: We have access to low sec.  This works out well because we can mine low sec ore, have a good market for marked-up goods and other possibilities.  It is not necessary and you might not use it all the time, but it's certainly a bonus if you wish to exploit it.
  • Security: Minimum time in corp to use POS.  Strict access to POS hanger divisions.  Minimal roles.  This can be very cumbersome, but you have to deal with it head on.  There isn't a sure way to eliminate risk but if you compartmentalize it, you can limit your exposure to loss.  CCP really needs to fix pos/corp management roles.  They suck.  I know; dead horse.
That is kind of my overview.  It's a list based on my experiences and others might do it differently and be as successful if not more.  It's a balancing act.