As he prepares to step aside May 1, Phil Dyskow reflects on 30 years of regulation and reinvention
It was more than a quarter-century ago that Phil Dyskow joined Yamaha Motor Corp. U.S.A. as the first employee of the Yamaha Marine Group, serving as head of marine research, and planning and developing the group's first business plan.
That was 1981, and Dyskow, president of the Marine Group for the last 13 years, says he's seen a lot of changes in his company and the industry as a whole. The biggest changes, he says, came in the late 1990s with the first of the new Environmental Protection Agency standards. Outboards got more expensive and more complicated, Dyskow says, but they also got cleaner and more fuel efficient.
"I think the change in technology has been huge and very beneficial to the consumer when you look at fuel economy improvements, emissions reduction, all of the feature content of outboard motors, all of the things that have happened," he says. "We build, as an industry, a far better product today than we did in the early 1980s, and competition drove that. We all got better because of competition."
Distribution also has changed, Dyskow says. "We went from an industry that sold 100 percent of its product direct to the dealer in a box to an industry that has packaging with boatbuilders as well as still a sizeable direct box-engine business with dealers," he says.
The industry is more complicated now as well, with a much more technologically advanced product and a more challenging regulatory climate, an issue Dyskow says he never used to worry about. "Today, it's a major part of what I do," he says.
Despite the challenges facing the industry, Dyskow, who announced his retirement at the Miami International Boat Show, says he's leaving Yamaha Marine Group in a good position for the future and in good hands. Dyskow will step down May 1, but he will remain a senior adviser until Sept. 30 and will become an independent consultant to Yamaha Oct. 1.
Ben Speciale, who currently serves as vice president of planning and operations, will succeed Dyskow as president. Speciale has been with Yamaha since 1987, holding positions in marketing, promotions, strategic planning and financial operations over the years.
"I turn 62 this year," says Dyskow, "so the planning process for my retirement has been ongoing for some time, and we've been working with a transition strategy for a number of years. As far as picking this specific time, we just had the largest new-product launch in our history. And we appear to have hit the bottom of this economic recession, and we're starting to see a modest recovery, so it's the right time."
Dyskow says if he waits another year, he'll be in the middle of the next product and business cycles. "It's sort of the end of a business cycle, so it makes sense to pick this time," he says. "Last year would have been inappropriate. Next year, the timing wouldn't have been right, so it was the right time to do this."
Dyskow says the lengthy transition period was designed to make the change as smooth as possible. "After October, I will remain available as a consultant to Yamaha as needed on a non-
exclusive basis, meaning I would have the opportunity to do other work if I choose to," says Dyskow, adding he currently has no plans to look for additional work.
As for how he will spend his retirement, Dyskow says he and his wife plan to pursue other interests they haven't had time for, having been immersed in the business for nearly 30 years.
Future of the industry
The last year was tough, Dyskow says, but he thinks things are starting to turn around. "I think the year Neanderthals died out was a worse year," he quips. "We always underestimate the resiliency of the economy and the marine industry. This may be the most severe downturn we've seen in recent history, but we've seen others. And in each of those cases the gloom-and-doom naysayers were at their peak in the middle of that recession, but the recovery in each of those cases was quicker than anybody expected when they were in the depths of that issue. I think this time we're going to see a slower recovery, but I have no doubt that we're going to recover."
Boaters, he says, have not given up on boating; they've merely changed their spending habits for the time being. "We're selling lubricants and maintenance items at a record level - it means people are out there boating and having fun," Dyskow says. "Sports die out because people stop participating or participate less. That's not what we're seeing."
Manufacturer and dealer failures are slowing, he says, and other companies are anxious to get involved in the industry. "Large, presumably smart investment companies like Platinum [Equity] are bullish on this industry to the point that they're getting into it now. And there'll be other people getting into the sport now," Dyskow says. "We're past the bottom, and we are forecasting, as a company, a modest improvement in our business in 2010. We're not saying we're going to be back to the levels of 2004-2005."
From a unit perspective the industry may never get back to mid-2000 levels, he notes, but from a dollar perspective it will. The average boat has gotten bigger and more expensive, Dyskow says. The biggest mistake people make when they look at the data is thinking the industry isn't nearly as big as it was compared to the 1970s.
"Well it's much larger," he says. "You just have to look at dollar value as opposed to unit quantity. We used to sell a lot of boats that were less costly; now we sell fewer boats that have tremendously more feature content and sell at a higher price. On a dollar-value perspective, the market didn't shrink."
As for Yamaha's future, he's certain the engine manufacturer will continue to gain market share as it develops products that comply with tighter environmental regulations while delivering options consumers want. "Our business and our market share grew throughout those regulatory changes because we looked at it as an opportunity to improve our products and improve our competitive position, and we'll continue with that strategy," he says.
"As an industry, as the government regulations tighten, we have to remember that a more expensive engine with no consumer benefit is not such a good deal," Dyskow says. "If we can provide an engine that meets those federal requirements and returns some additional benefit to the consumer, it's a much better solution."
In Florida, for example, theft of large outboards is a problem, so for 2010, Yamaha offers an outboard security system. "I think what customers want today is everything," Dyskow says. "Do they want speed at the exclusion of economy and clean emissions and feature content? No. Do they want those other things at the sacrifice of speed? No. The customer today wants everything, so I think the product of the future will perform better and perhaps be faster. It will certainly have to be more fuel efficient and quieter running, it will have to be more reliable and it will have to have more of the feature content that people want."
This article originally appeared in the April 2010 issue.