January, 2012

A publication brought to you by the Manufacturers Alliance

Subscribe | Join MA
MA Announcements

Manufacturer of the Year
Today is the last day nominations will be accepted for Minnesota manufacturers that you feel qualify for the sixteenth annual Manufacturer of the Year award. Learn More

Leaders Alliance Groups
Whether you have worked at the same company for 15+ years or just want to look beyond your four walls for manufacturing best practices, consider joining a peer group to tour, critique and discuss critical issues in confidence. Learn More

Manufacturing Wage & Benefits Survey
Plan to participate in the 2012 Manufacturing Compensation & Benefits Survey sponsored by the Manufacturers Alliance and Minnesota Precision Manufacturing Association (MPMA). This survey was designed with input from local manufacturing companies to provide comprehensive total cash compensation data for making important pay decisions in this ever changing economy. Learn More

LinkedIn Group
If you are currently working at or previously held a position with a member company consider joining the Manufacturers Alliance LinkedIn Group to query over 900 local manufacturing practitioners with your general questions, concerns or simply to share a great article.

Member Recognition
Thank you to our new and renewing members over the last 10 years!

7-Sigma Inc
AbelConn LLC
Ablenet Inc
American Converters
Andersen Corporation
Anderson Automatics
Andrew Tool & Machining
APG Cash Drawer
Artistic Finishes Inc
ASI DataMyte Inc.
Atlas Manufacturing Co
ATMI Packaging Inc
Banner Engineering
Bauer Welding & Metal
Beckman Coulter Inc
Bell Manufacturing
Bondhus Corporation
Boston Scientific
Braemar Inc
Bro-Tex Inc
BTD Manufacturing Inc
Caterpillar Paving Products
Ceramic Industrial Coatings
Chart Industries Inc
Cherne Industries Inc
Clean Air Products Inc
Colder Products Company Inc
Cummins Power Generation
Data Sciences Inc Detector Electronics Company
Determan Brownie Inc
Diversified Plastics Inc
Donaldson Company
Douglas Metal Specialties
DRI-STEEM Corporation
E & O Tool & Plastics Inc
E J Ajax & Sons
Emerson Process Management
Exlar Corporation
Flexmation Inc
FSI International Inc
General Label Inc
GN ReSound
Goodrich Corporation
Gopher Machine & Eng
Graco Inc
Gyrus ACMI
Hartfiel Automation
Hearth & Home Technologies
Heraeus Medical Components
Honeywell
ICA Corporation
INCERTEC
Ironwood Electronics
Johnson Screens Inc
Juno Inc
KEB America Inc
La Machine Shop Inc
Lake Region Mfg
Landscape Structures Inc
Laser Peripherals LLC
Lexington Manufacturing Inc
Liberty Paper
Lifecore Biomedical Inc
Lifeworks Services
LORAM Maintenance of Way
Malco Products Inc
Mate Precision Tooling
Medical Concepts Development
Medtronic Cardiac
Meier Tool & Engineering Inc
Menasha Packaging
Mereen-Johnson Mach Co
MGS Machine Corporation
Milestone AV Technologies
Miller Manufacturing
Minco
Minntech Corporation
MISCO/MPLS Speaker Co
Nonin Medical Inc
North Anoka Control Systems
Nystrom Inc
Possis Medical Inc
Precision Gasket Company
Precision Inc
Red Devil Equipment Co
Reell Precision Manufacturing
Remmele Engineering Inc
Renewal by Andersen
Rimage Corporation
Ritrama Inc
Secoa Inc
Sico America Inc
Smiths Medical ASD Inc
Solar Plastics Inc
SPX Corporation
Standard Iron & Wire Works Inc
Starkey Laboratories Inc
Stratasys Inc
Surgical Technologies Inc.
Synovis Surgical Innovations
Taylor Machine, Inc.
Technical Serv for Elect
Tennant Company
The Toro Company
Thiele Technologies Inc
Thomas Engineering Co
Top Tool Company
Transition Networks Inc
Turck Inc
UMC Inc
Upsher-Smith Labs Inc
Uroplasty Inc
Viking Drill & Tool Inc
Vision-Ease Lens Inc
Wanner Engineering Inc
Waterous Company
Waymar Industries Inc
Whirltronics Inc
Williams Sound Corporation
Wilson Tool International
Windings Inc


Upcoming Events

September 3rd 2014 08:00 am
- Office Process Mapping

September 4th 2014 08:00 am
- The Role of the Leader

September 9th 2014 08:00 am
- Maximizing Throughput with TOC

September 10th 2014 08:00 am
- Mistake Proofing

September 11th 2014 07:30 am
- Lean as a Growth Strategy

September 11th 2014 08:00 am
- Project Management for Manufacturers

September 16th 2014 08:00 am
- Lean Manufacturing Simulation

September 18th 2014 08:00 am
- Leadership Style and Versatility

September 23rd 2014 08:00 am
- Strategic Planning

September 30th 2014 08:00 am
- Visual Management & 5S Improvements

Article Index

Kim_larish_small Striangle HR Insights Interview - Kim Larish
Article by: Kim Larish

Since 1955, E.A. Sween Company has been manufacturing and distributing sandwiches for people on the go.  Today they sell sandwiches and other food products under the Deli Express name as well as co-pack or provide private label product to meet customers’ needs. 


Carl_moe_small Striangle Lean for Sales - Maybe it’s time?
Article by: Carl Moe

The Problem Manufacturing vs. Sales is the longest running BCS game in the history of American business.   The “emotional capital” invested in arguments over missed shipments, inaccurate forecasts, quality problems, discounting, etc. only amplifies the disparaging attitudes and comments emanating from each camp. 


Tom_fafinski_small Striangle Four Generations of Succession
Article by: Thomas Fafinski

Ostbye has experienced four generations of business succession.  A jewelry designer, manufacturer and distributor based in Plymouth, Ostbye began as a small, family run jewelry shop in 1920.  Today, almost 100 years later, Ostbye stands as a model for successful family business ownership transition.  


Drernestgoss_small Striangle MN Manufacturing Economic Report
Article by: Dr. Ernest Goss

The Minnesota Business Conditions Index, a leading economic indicator, was above growth neutral for the 29th straight month at 56.9 and up from 54.7 in November. 


ADVERTISEMENT
Striangle HR Insights Interview - Kim Larish

Since 1955, E.A. Sween Company has been manufacturing and distributing sandwiches for people on the go.  Today they sell sandwiches and other food products under the Deli Express name as well as co-pack or provide private label product to meet customers’ needs. 

Their products are sold in all 50 states through both Direct Store Distribution system (in 25 states) and over 200 Wholesale Distributors nationally.  Currently they produce around 140 different SKU’s. Their state of the art Ready-to-Eat (RTE) facility in Eden Prairie, Minnesota embraces Lean Production and is SQF (Safe Quality Foods) Level 2 Certified.  Ultimately thier purpose is to provide Food for People on the Go!

 

Where did you receive your HR training/experience

I graduated from college studying Social Work and Business Administration, obtained a Mini MBA from the University of St. Thomas, earned the Human Resources Manager Certificate from the University of MN Carlson School of Management and hold the SPHR designation.  My first three years in Human Resources was spent as part of a 50 person HR team at Northwestern National Life, now known as ING.  From there I started my career at E.A. Sween Company as a Benefits Administrator moving to Human Resources Representative, Manager, Director and my current position as Vice President.

 

How and when were you introduced to HR and what fuels your passion for the profession?
People have always been a focus point for me driving my interest in pursuing a degree in Social Work.  Having worked in the Banking Industry during college I was also drawn to the business world.  I have found the world of Human Resources to be a blend of both interests.  The success of an organization is driven from the effectiveness of its people.  We talk about our HR vision as being “High performing individuals in an organization which delivers results” It is truly all about the people!

 

What are your company’s current HR-oriented activities?

 This past year has been a busy one for our HR team.  As a company we revisited our Purpose, Spirit and Vision, created a pictorial vision and communicated to employees. The HR team introduced on-line benefit enrollment for our new employees and just completed our first on-line open enrollment process.  Connections to our benefit carriers and COBRA carrier are now automated between our carriers and HR system.  In support of our Employee Engagement efforts we conducted an Employee Survey, met with employee focus groups and are working on finalizing action plans between our managers and their employees.   These action plans will become part of the area business plans for 2012 and will be monitored by Human Resources to insure there is action taking place.

 

What was one major lesson learned in 2011 that you feel others could benefit from reading?

 Planning is critical. The importance of having well thought out plans for key projects is extremely vital.  We accomplished a lot this year, however we could have been more efficient with thought-out plans, including a detailed step list of activities and timelines.  There is always room to improve!

 

What are the next steps planned for improving your company HR processes?

Provided we can justify the cost, we will be working on electronic files and workflow.  We have been working hard at minimizing paper flow within our processes.  In the past year and a half we have eliminated many file cabinets of paper, finding ways to save documents electronically and reduce the amount of paper flow between our employees and HR. 

 We will continue to work with our managers and employees to insure that action plans resulting from our Employee Survey process are being addressed.  We want to keep this in front of our supervisors and managers, holding them accountable.  The Wellbeing team will be working on getting Wellbeing message and efforts to all divisions.  Ultimately all these efforts will be in place to support our Employee Engagement efforts.

We will continue to address opportunities identified in our Lean process review.

Kim_larish_small Kim Larish is the VP of Human Resources at E.A. Sween Company in Eden Prairie MN. She may be reached at klarish@easween.com

Back to Top

ADVERTISEMENT
Striangle Lean for Sales - Maybe it’s time?

The Problem Manufacturing vs. Sales is the longest running BCS game in the history of American business.   The “emotional capital” invested in arguments over missed shipments, inaccurate forecasts, quality problems, discounting, etc. only amplifies the disparaging attitudes and comments emanating from each camp. 

In some organizations, it has advanced to a form of corporate cannibalism where each silo is operating at Defcon 5 and ready to launch missiles as soon as they suspect the other team member has failed to perform…again.  If only the customers knew what was behind the external veneer these organizations portray to their market place. 

The Opportunity The Recession has helped companies to better understand the challenges of increasing revenues.   The model has not changed - sales has to bring in orders at acceptable margins and manufacturing has to meet customer delivery schedules.  Failure on either side puts everything at risk, so continuing the manufacturing vs. sales game is dysfunctional for long term success.  How can Lean methods help?

First, sales and manufacturing both benefit from shorter cycles – as in sales cycles and manufacturing cycles.  Getting more done with the same resources in less time is beneficial to both groups.

Second, if both groups integrate their models to focus on the market rather than each other, the upside potential for the business has dramatically improved.

The Lean journey has proven successful for countless manufacturing operations, with positive results in performance, teamwork and systems creativity.  Lean manufacturing occurs inside the four walls of a business where there is better control of variables in defining, testing and selecting solutions.  A Lean Sales implementation must address variables outside the four walls - namely prospects and customers, so the Lean model can be similar but not identical.   Senior management understands these differences conceptually, but the question always arises:  How do we start?

If both groups are to align their energies on the market (and not on each other), the first concept they need to understand is Differentiating Value (DV).   Differentiating Value is not the feature/benefit statements on your data sheets or the value platform defined on your web site.  Differentiating Value is what you do that is unique or better than the competition and is what prospects give up (lose) in their world if they decide not to do business with your company.

This may appear to be a simple concept, but we are continually amazed by the answers whenever we ask teams to define their Differentiating Value from the customers’ view.  The most common variants are a combination of service and support statements, along with a manufacturing overview of how we make all this greatness happen…with nothing specific to the customers’ world. If you and the market are not clear about what makes you worth more, you will always compete on price!

The Solution First, define your Differentiating Value.  Involve manufacturing and sales.  The desired outcome is to have both understand the differentiation between how you get paid (your world) vs. what you deliver (customer’s world).

Next, identify the 9 forms of waste that are alive and well in your current sales process.  “Waste” that we typically see is described below. 

 

  1. Rework  Re-quoting the same deal only at discounted prices. This typically occurs as a result of having no traction established in the prospect’s world regarding your Differentiating Value.  This is a sales communication/skill issue.

  2. Over-Processing  Too much time spent with non-qualified contacts.  The heavy lifting in sales is qualifying.  If your Differentiating Value is not a fit for the prospect, move on.  Continuing to pursue them as viable prospects is a waste of resources.

  3. Waiting  A result of not knowing where you stand in the decision process.  Efforts to get the deals moving may then involve offering discounts or other special incentives, which are a waste of time if you are not the selected vendor.

  4. Testing/Inspection  Inaccurate sales forecast data requires ongoing sales pipeline reviews.  One solution is to build a forecast process that includes an audit trail.

  5. Information Flow  Too many non-qualified presentations / proposals to suspects – not qualified prospects.  This ends up as free consulting for most recipients.

  6. Inventory  Having too many wrong prospects in the forecast pipeline; ones having no traction with your Differentiating Value so they are “discount only” shoppers.

  7. Motion  Sales is always busy, but numbers are flat or declining.  Sales is not a one-size-fits-all process.  You need an effective qualifying process to identify and work on the real deals.

  8. Talent No structured staffing process results in poor selection techniques - like only hiring from the competition.

  9. Energy  A negative sales culture impacts the entire organization.  Integrating the sales function with the company’s value chain and involving other departments with market -based challenges can only build organizational savvy.

Summary The benefit in a Lean for Sales program is organizational alignment where sales and manufacturing are using similar approaches with a common glossary of terms, concepts and objectives.  That can only strengthen the performance platform of the entire organization and may encourage other departments to take on a similar challenge.

Carl_moe_small Carl Moe is the author of “Sales Revenue System 2.0”, a popular book that details the revenue system processes he implemented in his corporate executive roles. He is also founder of CRO Success LLC – specializing in restructuring B2B revenue systems for sustainable growth and optimized performance. He can be reached at 952.232.6720 or cmoe@crosuccess.com

Back to Top

ADVERTISEMENT
Striangle Four Generations of Succession

Ostbye has experienced four generations of business succession.  A jewelry designer, manufacturer and distributor based in Plymouth, Ostbye began as a small, family run jewelry shop in 1920.  Today, almost 100 years later, Ostbye stands as a model for successful family business ownership transition.  

Walter Ostbye and his son Roy spent their entire lives working on the quality, value and service tradition that became synonymous with Ostbye in the jewelry industry. Roy then transitioned the business to his son-in-law, Jack MacBean. Jack calls himself the “illegitimate third generation”.

Jack was an industry outsider, yet under his leadership and due to his entrepreneurial passion, the company blossomed and expanded nationally. Jack transitioned leadership to his son, Craig MacBean roughly five years ago, after decades of running the business. 

To facilitate the transition from Jack to Craig, they employed an outside consulting firm, the Platinum Group. Platinum studied the obstacles associated with transitioning the business and over a two-year period, developed a transition plan. While the actual planning was done behind the scene, the majority of employees were unaware that a transition was even in the works.  Ultimately, the formal transition took place over 24 hours.  A company meeting was held on a Thursday, Craig was named president, moved into Jack’s office and Jack left the following day.  This resulted in a very smooth, conflict-free transfer of leadership with no question as to “who was in charge”. The company operations never missed a beat.

Today, Jack serves as Chairman of the Board.  He functions in an advisory capacity and attends bi-annual review meetings with key company executives.  Jack strongly believes that the departing generation has to turn over the power to the next, understand and accept that there is more than one right way to run a company, and stay in the background except as needed. 

With the exception of a minority share of company stock owned by Craig, the majority of company stock and the company building are held in a family trust for Craig and his brother David, who has a successful career outside the industry.  To allow Craig to benefit from his positive impact on the business, a comprehensive program has been developed to reward Craig for sales growth and profitability.  This takes the form of various bonuses and phantom stock that can be converted to common stock as Craig desires.

Craig had not worked for Ostbye prior to joining in 2002 to lead sales and marketing.  Jack believes that, as with him, it is imperative that family members get experiences in other businesses prior to joining a family business, and are then expected to bring additional skills and knowledge to the business. The experience Craig gained from 10 years with several multinational large corporations gave Craig the vision, commitment and drive to build Ostbye to the next level, face the challenges of a privately held company in the 21st century, and address the difficult issues of current economic times.  As a result, the company continues to grow, maintain solid profitability and perform well above industry standards.

There is one employee at Ostbye who has worked for all four generations, Linda Broadhead.  Craig refers to her as a “change champion who has worn every hat in the company.”  Linda explained that Walter, Roy, Jack and Craig have all been very different in terms of their style and management techniques - ranging from cautious, deliberate and formal to sociable, patient and relaxed to determined, competitive and purposeful.  Craig tells us that while there were different styles of management through all of the transitions, Ostbye’s motto and spirit has remained “building customers and jewelry for life.” 

Craig is the only family member currently directly involved in the business.  He has not ruled out including other family members, including his brother, with whom he has maintained a close relationship.  Craig is not sure if the business will transition to his children, but is staying open to all options.   He does say that “the most important thing is that our family is healthy. We get together regularly and there is no mud-slinging at all.  We are all quite happy with each other.”

Tom_fafinski_small Thomas Fafinski, co-founder of Virtus Law PLLC, which serves privately-held businesses [business law, succession, estate & income tax planning, real estate and litigation]. Thomas maybe reached at 612-865-1700 or tfafinski@virtuslaw.com

Back to Top

ADVERTISEMENT
Striangle MN Manufacturing Economic Report

The Minnesota Business Conditions Index, a leading economic indicator, was above growth neutral for the 29th straight month at 56.9 and up from 54.7 in November. 

Components of the index for December were new orders at 57.7, production or sales at 64.1, delivery lead time at 63.0, inventories at 52.7, and employment at 46.9. “Durable goods manufacturers, especially those dependent on exports and agriculture, continue to experience healthy growth as non-durable goods producers detailed pullbacks in recent months,” said Goss. Estimated 2011 growth: Jobs 0.4 percent, inflation adjusted GDP 1.9 percent.  Projected 2012 growth: Jobs 1.2 percent, inflation adjusted GDP 2.8 percent.

Drernestgoss_small Dr. Ernest Goss of Creighton University, used the same methodology as The National Association of Purchasing Management to compile this information. An index number greater than 50 percent indicates an expansionary economy, and an index under 50 percent forecast a sluggish economy, for the next three to six months.

Back to Top


Copyright © 2011 Manufacturers Alliance. All rights reserved.
Thank you for reading the Manufacturers Alliance E-Newsletter.