Thursday, April 17, 2014
Michael Dubyak has been with WEX for 27 years, working in a range of positions in marketing, sales, business development and customer service. From August 1998 to April 2013, Dubyak, 62, served as president and chief executive, and he added the title of chairman of the board of directors in 2008.
WEX executive Michael Dubyak, shown at the company’s headquarters in South Portland, says his biggest decision in 27 years was having the company take the risk of expanding internationally.
Gabe Souza/Staff Photographer
In May 2013, Melissa Smith was named president and will become both CEO and president on Jan. 1, when Dubyak will become executive chairman of the board, moving on to a new phase in his life that includes a little down time.
WEX celebrates its 30th anniversary today. The company's fleet fuel-card program has grown since 1983 and the cards are now accepted at more than 90 percent of U.S. retail fuel locations and more than 45,000 vehicle maintenance locations. Corporate and government vehicle fleets with more than 7.6 million vehicles use WEX's charge cards to purchase fuel and maintenance services.
WEX announced Tuesday that it was suspending a planned expansion or relocation of its corporate headquarters in South Portland. Dubyak, who was interviewed for this Q&A before the announcement, and a company spokesperson declined to elaborate Wednesday on why the expansion had been put on hold.
WEX employs about 1,400 people, including more than 600 in Maine. The company's stock price has risen more than 40 percent over the past year. In the second quarter, WEX posted adjusted earnings of $41.1 million on revenues of $178.3 million, topping Wall Street expectations.
In 2012, Dubyak earned $2.48 million in total compensation, including salary, stock awards, incentive plans and all other compensation, according to a filing with the Securities and Exchange Commission.
Q: What's the most dramatic change you've seen at WEX in your 27 years there?
A: Completing the initial public offering in 2005. That secured our independence. We had six owners prior to that, and there was always a question of "Are they going to move us, change us?" We had two companies trying to buy us at the same time. With the IPO, we got to define how the business would operate on its own. Since the IPO, we have acquired eight companies and we now operate in five countries. The IPO defined the degrees of freedom to be an industry leader. We had a board of directors solely devoted to us. The IPO was crucial.
Q: What's the most controversial or biggest decision you've made as a boss at WEX?
A: The biggest decision was the move to expand internationally. We were a leader in North America, but were we going to be willing to expand and take the risk? With our fleet cards, we had oil companies working on an international basis. We thought we could really leverage our brand and our connections.
Q: International expansion has been a big part of the company's growth in recent years. Can you talk about what you've learned about navigating different cultures and ways of doing business?
A: We learned that you have to put some of your key people in place to try to explain and insert aspects of our culture into the partners. It's tough because all cultures are different and all company cultures are different. You have to get some of your key people on the ground to help smooth the transition.
Q.: You've mentioned in the past that WEX wants to expand in Asia and the Pacific -- what's the appeal and risk of that type of expansion?
A: Our largest international deal was in Australia. That deal gave us connections to 90 percent of the gas stations in Australia. Managing that deal gave us credibility with the street (Wall Street) and gave us a jumping-off point in the Asia-Pacific market. For Singapore and Hong Kong, we see opportunities in those markets for the fleet product and the virtual product.
Q: The company has grown through several acquisitions in recent years. What's the hardest part about integrating a new business into the WEX culture?
A: All acquisitions are different. The Australian acquisition did not have a lot of synergies. We can still be there on the ground, but it operates more as a standalone operation. When we did acquisitions in the U.S., such as Fleet One, we knew there would be some synergies. With every acquisition, we've learned more and more. From the management team's perspective, we need to be ready to put people in place. Both sides of the acquisition are crucial to the integration plan. We need both sides to buy into the integration for it to work. You also identify "centers of excellence," no matter which company they come from, and put them in place systemwide. We also need to bring our culture to bear. There's three C's to focus on in an acquisition: There's the cost to buy the acquisition, there's the control side, and the cultural side.
Q: What's the biggest challenge you've faced in managing the fast growth of the company?
A: There's execution risk. You have to keep up with the acquisitions while keeping your eye on the ball of organic growth. That goes to the issue of our bench strength. Our management team is deep. We're constantly developing people and looking for the best and brightest to bring on and develop. It's important to prioritize and delegate. You can't do everything yourself.
Q: What do you want to be remembered for as you prepare to change roles at the company?
A: On the business side, I feel comfortable we've established ourselves as the leader. We have a strong brand. And we've diversified -- 25 percent of our business is outside the fleet business. We've also expanded internationally. On the culture side, I feel very good about the culture we've created. We consistently get high 80s or better on employee satisfaction ratings. I feel good about that.
Q: Did coming up through the ranks of WEX make you a better manager? If so, how?
A: Yes, I've been through the trenches. We cracked the chicken-and-egg problem. In the early days, oil companies would say, "We understand what you're trying to do, but you have no customers." And customers would say that we had no oil companies signed up. So I had to hit the road and sell this concept. And we eventually cracked that problem. After eight years of losing money, we turned things around. It gave me a lot of perspective and respect about how the company got on its feet. We have good loyal customers -- they trust us and believe in us. We lost money through 1993. Once that changed, we had to look at how we could give back to the community. All of those early years in the trenches drove me to make sure we were good partners with our customers and good partners with the community.
Q: What's next for you as you as you transition to executive chairman? Will you take on more community projects such as Project Login? (Project Login, led by Educate Maine and the University of Maine System, aims to double the number of computer science and information technology graduates from the University of Maine System.)
A: I'm there to help in certain aspects on very high-level issues, such as acquisitions. I'm there to give high-level input as needed. I'm also interested in helping with issues such as Project Login and issues on the education side. I'm passionate about Maine and helping any way I can make this be a better place to live and do business. I have some ideas about other things I want to do, but really, I want to get to the other side and decompress a bit. But hopefully I can keep helping Maine.
Q: Do you use WEX's fleet cards yourself?
A: Yes. I have WEX cards in my wallet right now. I have a WEX Mastercard as a company card and a WEX fleet card. I also have the Octane app. It's great. You download the (proprietary) app to a smart phone and it identifies where you are and tells you the gas stations within that area and what they are charging. Fleets use it to find the most economical gas in their area. We also had first responders use it during Hurricane Sandy to find out what gas stations had gas available.
Jessica Hall can be contacted at 791-6316 or at: